Document ofThe World Bank

FOR OFFICIAL USE ONLY

Report No: 20070

IMPLEMENTATION COMPLETION REPORT(CREDIT 24800)

ON A

CREDIT

IN THE AMOUNT OF SDRs 8.65 MILLION (US$12.0 MILLION EQUIVALENT)

TO THE

COOPERATIVE REPUBLIC OF GUYANA

FOR A PUBLIC ADMINISTRATION PROJECT

January 31, 2000

This document has a restricted distribution and may be used by recipients only in theperformance of their official duties. Its contents may not otherwise be disclosed withoutWorld Bank authorization.

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CURRENCY EQUIVALENTS

(Exchange Rate Effective as of January 28, 2000)

Currency Unit = Guyana Dollar (G$)G$180.5= US$ 1

US$ I = G$.0055

FISCAL YEARJanuary 1 to December 31

ABBREVIATIONS AND ACRONYMS

ASYCUDA UNCTAD's Automated System of Customs MOF Ministry of FinanceData

CARICAD Caribbean Centre for Development MPT Managerial, Professional and TechnicalAdministration positions

CAS Country Assistance Strategy NDC Neighborhood Democratic CouncilsCDB Caribean Development Bank NDMA National Data Management AgencyCED Customs and Excise Departments NGOs Non-Government OrganizationsCG Central Government ODA UK Official Development AssistanceCIDA Canadian International Development Agency PAP Public Administration ProjectCPPR Country Portfolio Performance Review PCU Project Coordinating UnitDCA Development Credit Agreement PMT Professional, Managerial, Technical PersonnelERP Economic Recovery Program PRKS Personnel Record Keeping SystemESAF Enhanced Structural Adjustment Facility PSM Public Service Management MinistryFPID Financial and Private Sector Institutional PSMTC IDB's Public Sector Management Technical

Development Project Cooperation GrantFISBEC Financial Sector/Business Environment PSR Project Status Review

(2746-GUA)GIS Geographic Information System PSRSAC Public Service Reform Adjustment CreditGOG Government of Guyana RA Revenue AuthorityHIPC Heavily Indebted Poor Countries Initiative RDC Regional Democratic CouncilsHRMIS Human Resource Management Information REOs Regional Executive Officers

SystemICB International Competitive Bidding SAR Staff Appraisal ReportICR Implementation Completion Report SDR Special Drawing RightsIDA International Development Association TA Technical AssistanceIDB Inter-American Development Bank TAC Technical Assistance CreditIFM Integrated Financial Management TC Technical CooperationIMF International Monetary Fund TIN Taxpayer Identification NurnberIRD Inland Revenue TOR Terms of ReferenceLIB Limited International Bidding UNDP United Nations Development ProgramMLG Ministry of Local Government

Vice President: David De FerrantiCountry Manager/Director: Orsalia Kalantzopoulos

Sector Manager/Director: Guillermo PerryTask Team Leader/Task Manager: Jit Gill

FOR OFFICIAL USE ONLY

Cooperative Repubic of GuyanaPublic Administration Project

CONTENTS

Page Noi. Project Data 1

2. Principal Performance Ratings 1

3. Assessment of Development Objective and Design, and of Quality at Entry 2

4. Achievement of Objective and Outputs 3

5. Major Factors Affecting Implementation and Outcome 7

6. Sustainability 97. Bank and Borrower Performance 10

8. Lessons Learned 12

9. Partner Comments 1310. Additional Information 18Annex 1. Key Performance Indicators/Log Frame Matrix 28

Annex 2. Project Costs and Financing 30Annex 3. Economic Costs and Benefits 32

Annex 4. Bank Inputs 33Annex 5. Ratings for Achievement of Objectives/Outputs of Components 35

Annex 6. Ratings of Bank and Borrower Performance 36Annex 7. List of Supporting Documents 37

This document has a restricted distribution and may be used by recipients only in theperformance of their official duties. Its contents may not otherwise be disclosed withoutWorld Bank authorization.

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Project ID: P007266 Project Name: Public AdministrationTeam Leader: Jit Bahadur S. Gill TL Unit: LCSPSICR Type: Core ICR Report Date: January 31, 2000

1. Project Data

Name: Public Administration L/C Number: 24800Country/Department: GUYANA Region: Latin America and

Caribbean RegionSector/subsector: BA - Civil Service Reform; BY - Other Public Sector

Management

KEY DATESOriginal Revised/Actual

PCD: 05/08/92 Effective: 07/17/93 07/13/93Appraisal: 06/22/92 AMTR: 06/30/95 08/12/96Approval: 03/30/93 Closing: 12/31/97 07/31/99

Borrower/lImplementing Agencv: GOVERNMENT OF GUYANA/OFFICE OF PRES./PUBLIC.SERVICEMINISTRY (PSM)

Other Partners:

STAFF Current At AppraisalVice President: David De Ferranti S. Shahid HusainCountry Manager: Orsalia Kalantzopoulos Yoshiaki AbeSector Manager: Guillermo Perry Shahid ChaudhryTeam Leader at ICR: Jit Gill Antonio Martin del CampoICR Primary Author: Rita Parrilli

2. Principal Performance Ratings

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, HUN=HighlyUnlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible)

Outcome: S

Sustainability: L

Institutional Development MImpact:

Bank Performance: S

Borrower Performance: S

QAG (if available) ICRQuality at Entry:

Project at Risk at Any Time: No

3. Assessment of Development Objective and Design, and of Quality at Entry

3. 1 Original Objective:The main objectives of the project were to provide urgently needed assistance to maintain and improve thecapacity of the public sector to perform its core functions. The thrust of the project was twofold: (a) tofacilitate adequate staffing of key public service positions and eliminate staffing redundancies; and (b) tocreate conditions for accountability in financial and personnel management; as well as in fundamentaloperational programs. The project supported the first phase of the Government's longer-term strategy forpublic sector reform, and sought to assist in preparing the next phase of the program.

These objectives were clear and essential to the Bank's Country Assistance Strategy (CAS) and thecountry's development priorities (see also section 7.1). The objectives were straightforward and took intoaccount the limited implementation capacity of the concerned agencies. The extent of salary enhancementtook into account GOG's fiscal and other constraints. The complexity of the project was kept in check byaddressing only the most pressing issues, limiting the number of project components, and keeping the linesof responsibility with other donors clear and simple. The main risks were recognized from the outset: thatmany incumbents would not qualify for significantly higher salaries; that increases available only formanagerial, professional, technical (MPT) positions might engender resentment among public servants atlower pay grades; and that there may be political and union opposition to increasing MPT salaries. Theproject attempted to minimize these risks through neutral application of a sound salary structure.

The project responded directly to borrower circumstances and development priorities. One of the directconsequences of continuous negative real GDP growth of the 1970s and 1980s was the sharp decline inliving standards. This led to a large-scale emigration of qualified personnel from the public and privatesectors. The loss of skilled and experienced personnel was particularly acute in the Central Government.Senior positions had to be filled by junior personnel or left vacant, affecting the national capacity to carryout economic reform and even deliver basic public services. In 1988, the Government announced itsEconomic Recovery Program (ERP) which reversed the movement toward Cooperative Socialism. As partof the ERP the public sector was reduced through a program of privatization. GOG, however, lacked thefiscal resources to invest in skilled public employees and management systems. For Guyana to achievesustainable economic growth it was essential that it develop an efficient public service that could effectivelycollect revenue and deliver basic services. The project, therefore, supported GOG's major macroeconomicand sector policies by attempting to strengthen the public service and arrest its depletion. At the same timeit sought to build capacity in personnel management, financial management, revenue administration,regional administration and general administration.

3.2 Revised Objective:N.A.

3.3 Original Components:Cost

(US$ millions)Component 1 Upgrading of Salary Structure 10.0 (Gov't)Component 2 Personnel Management 0.5Component 3 Recruitment Program 1.8Component 4 Regional Administrations System 1.0Component 5 Integrated Financial Mgt./Revenue Adm. 4.0Component 6 General Administration 4.0Coordinating Unit 0.7

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Assessment of the Design. Project components were well suited to the limited capacity of theimplementing agencies. The project design took into account relevant lessons from previous operations inGuyana and the PSM sector, such as the need to: (i) keep the project simple; (ii) hold a mid-term review totake stock and reassess the continued relevance of the projecfs objectives and activities; and (iii) include awell-equipped Project Coordination Unit (PCU), to avoid overloading already stretched implementingagencies and ensure effect project management. However, while the salary structure introduced during theproject was a significant improvement over the previous regime, salaries had fallen so low that the payincreases were insufficient to retain staff in certain critical positions. Moreover, morale was adverselyaffected by unfulfilled expectations and poor communications. This was due in part to GOG's continuedlack of fiscal resources and in part to difficulties in reaching agreement with the Public Service Unions onthe higher salaries needed for managerial, professional and technical staff (MPT). Similarly, the incentivesinitially put in place to attract skilled expatriates under the Recruitment Program proved inadequate. Thiscomponent had a positive impact after considerable additional flexibility was added to the recruitmentprocess. In addition, while the expenditure management sub-component of the Integrated FinancialManagement component received considerable attention at the design stage, the Revenue Administrationsub-component was not adequately developed since it was introduced into the project at GOG's requestafter project appraisal. This sub-component was developed, therefore, during project implementation,contributing to delays in its execution.

3.4 Revised Components:The basic project design remained unchanged over the life of the project. Preparation of a Long-TermPublic Sector Reform Program, was to have been financed from the Credit, but was later financed throughthe IDB at the Government's request. Similarly, GOG requested that the expenditure managementsub-component of the Integrated Financial Management (IFM) Component be delegated to other donors,who provided grant funding. CIDA is introducing program budgeting as a first step and the IDB'sproposed $20.0 - 30.0 million Public Sector Reform Operation includes a major IFM reform component.IDA retained the strengthening of revenue administration (US$2.0 million of the original US$4.0 millionallocation for the IFM component). The balance of US$2.0 million was reallocated to the GeneralAdministration Component. These amendments were not of a substantial nature and, therefore, the Board'sapproval was not required.

3.5 Quality at Entry:

N.A.

4. Achievement of Objective and Outputs

4.1 Outcome/achievement of objective:

Most objectives were either achieved or important progress was made toward achieving them. The project's overall outcome was, therefore, satisfactory. The project helped GOG to streamline the public servicesalary structure and raise salaries in real terms. Major salary improvements granted in August 1999 arelikely to have a further positive impact in attracting and retaining managerial, professional and technicalstaff. It improved the availability of information relating to the staff establishment and, to that extent, itstrengthened the Government's personnel management capacity. The project helped GOG recruit 44 seniorand mid-level professionals to key and critical positions in the public service, most of whom remain in thepublic service. It also procured a wide range of capital equipment for different government entities at thecentral and regional levels, thus helping improve their operational efficiency. Groundwork has been laidfor strengthening the Regional and the Revenue Administrations, although considerable follow-up isneeded. The lack of operationalization of the Revenue Authority to date has had a negative impact on the

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effectiveness of the Revenue Administration sub-component [Note: the RA was brought into effect onJanuary 26, 2000].

4.2 Outputts by components:1. Upgrading of Salary Structure (original US$10.0 million/US$1 1.0 million -- G$38.0 billion). Thegoal was to improve GOG's capacity to attract and retain skilled staff and eliminate staffing redundanciesby reforming the public service salary and employment structure. Considering the conditions prevailing atthe inception of the project and the difficulty of the working environment in Guvana, advances made aresubstantial and the outputs were satisfactory. These include:0 A new uniform 14-band salary structure covering all public service positions was introduced in1994 replacing the 16 band structure which included a multiplicity of existing salary regimes;* The salary scale was decompressed raising the compression ratio from 6:1 to 9:1 for grades 1through 16 and 16:1 for grades 1 through special. However, salaries of technical and professional stafffrom grades 10-13 remain substantially compressed (3.5:1 and 6.6: 1 respectively);

The range width increased progressively from 25% for grades 1-3 to 60% for grade 14;* All existing posts were mapped to the new structure based on a iob evaluation exercise carried outwith assistance of ODA consultants;* Key and critical positions were identified for salary supplements based on criteria such as scarcityof skills and difficulty in recruiting. GOG provided a total of G$60.0 million per year for 1996, 1997, and1998 to supplement the pay of about 1,800 key and critical positions 15% and 20%;

Salaries increased 82%, while inflation totaled 53% over the period 1993 through 1998, resultingin a real increase of about 29%. In August 1999, following a two-month strike by civil service employees,an independent Arbitration Panel decided on an across-the-board wage award of 31.6% for 1999 andalmost 26.6% for 2000, with a possible effects on the economy as noted below. The original goal was toincrease salaries by 25% for grades 1-9 and 90% for the higher grades;

0 Eliminating Staffing Redundancies. It was originally intended that all vacancies in grades 1-5 becanceled and recruitment be frozen. While vacancies in levels 1 to 5 were not canceled due to unionpressure, line ministries were required to obtain clearance of the Ministry of Public Service Management(PSM) before recruiting at these levels. Between 1993 and 1999 there was a net reduction of about 2,850employees (about 20%) in these grades.

2. Personnel Management (original US$0.5 and actual). The objective was to develop a modernpersonnel management system for the public service, create conditions of accountability, and improvepersonnel management. Most major outputs were satisfactorily achieved.* A Personnel Records Keeping System (PRKS) was designed, hardware was procured, and thePRKS is being utilized in the PSM and in 24 Departments and Regions. The system provides amuch-needed database on individual staff and their posts, salaries, and allowances. This information isaccessible to each agency with aggregate information being accessible to the PSM. This is an advancefrom the situation existing before the project, when reliable establishment and wages information was notavailable to Government.* The National Data Management Agency (NDMA) carried out a successful training for about 150staff of user agencies who are now using the PRKS.* The Rules of Procedure of the Public Service Commission have been streamlined. The effect hasbeen to give managers more authority to hire and terminate employees and shorten disciplinaryproceedings. Implementation has not begun although the rules have been gazetted.

An annual performance appraisal system was introduced.* New rules regarding leave, pension, retirement age, and travel allowances were developed. Thesehave, however, not been brought into force pending agreement with the Public Service Unions.

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3. Recruitment Program (original US$1.8/actual US$665,000). The output was satisfactory in termsof the component objective of facilitating adequate staffing of key and critical positions. Over 143applications were received from overseas and locally. Seventy-eight persons were interviewed andforty-four senior and mid-level professionals were recruited and paid incentives with IDA funds, thusmaking scarce expertise available. Recruitment included areas such as an Assistant Commissioner of theInland Revenue Department; Vocational Training Specialist and Deputy Director of the National Center ofEducation, in the Ministry of Education; Senior Physician and two anesthetists in the Ministry of Health;and a Senior Agricultural Officer in the Ministry of Agriculture. Further recruitment was stopped in 1998since the recruited persons were expected to serve for a period of three years, which would have broughttheir service beyond the project's closing.

GOG indicated that many of the persons recruited made a singular contribution in their respective fields.The Industrial Relations and Occupational Health and Safety Units of the Ministry of Health reported thatthey were seriously depleted of qualified and experienced staff prior to the special recruitment under thePAP. The seven specialists hired directly impacted on the work of the Unit and led to significant increasesin inspections by the Industrial Relations Officers, better health and safety practices, more speedysettlement of disputes and an increase in the number of site visits. Similarly, the National EducationResearch Council (NCRD) reported that two of six specialists hired had a strong impact on developingprograms for reading and science and technology, which resulted in tangible improvements in literacy andcurriculum. Various innovations were introduced, such as Reading Tests, Workshops with NGOs, and theGet Reading Right Program.

4. Regional Administrations System (original US$1.0/revised US$618,000/actual $480,000).The outputs of this component were satisfactory in meeting the component's objective of initiatingimprovements in the effectiveness of service delivery in Guyana's ten Regional Administrations (RAs).Outputs include:(a) Improved Communications. The understanding of the role of the Chairman of the RegionalDemocratic Councils (RDC) vis a vis the Ministry of Local Government (MLG) has been improved, as hasthe linkage between the Chairman (who is elected) and the Regional Executive Officer (REO -- who isappointed). In the past there had been tensions, particularly when the two did not come from the samepolitical party. There is now more and better inter-ministerial collaboration, which has been essential to theachievement of the outputs listed below.(b) Improvements in service delivery. Following a review of the organizational and administrativeaspects of the service delivery functions of the RAs, a Local Government Operational Manual wasprepared and adopted. It clarifies roles, responsibilities and relationships between the Central Government(CG), RDCs, Municipalities and Neighborhood Democratic Councils (NDCs). Impact includes: (i) workprograms by REOs are reviewed on a quarterly basis and reporting procedures have been streamlined; (ii)payment time for contractors has been shortened; verification of relevant compliance certificates andprocessing of documentation through line Ministries, such as Finance and Public Works, is more efficientlyattended to by a better division of labor among senior officers; (iii) about 200 functioning CommunityDevelopment Councils (CDCs) as well as revitalized programs of 65 NDCs and Amerindian VillageCouncils, have enabled strong partnerships in small-scale community projects, such as public sanitation,family life education, in conjunction with Regional Health Workers.(c) Increased tariffs for services. Payments for land rents at the level of the NDC have increasedsomewhat. However, constraints on the part of the RDCs to levy taxes and the difficulties of the NDCs,caused by delays by the CG authorities in fixing contemporary and equitable tax rates and effectivecollection processes, continue to limit their possibilities for increased revenue collection, thus continuingtheir dependency on CG budgetary allocations. Areas where tariffs can be charged (e.g. land and

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buildings; drainage and irrigation, electricity and water) and measures to improve equity in collection wereidentified.(d) Improved Information Systems. The MLG implemented a Human Resource Management/Payrollsoftware "Smartstream", which is PRKS compatible, and which has made it possible to monitor PersonnelAdministration records and budget allocations in the Regions.(e) Geographic Information System (GIS). The feasibility of a GIS was assessed and its usefulnessdemonstrated to the MLG, the Forestry Department and the National Data Management. While interestwas stimulated, it has not yet been implemented due to the uncertainty of the power supply in remote partsof the country.(f) Training. NDCs and Amerindian Village Councils have been trained in the use of LocalGovernment Operational Manual and the Manual on Improved Financial Management. The effect hasbeen better bookeeping/compliance with the requirements of the Auditor General. A series of workshops,seminars and orientation programs for REOs and their staff and Amerindian Village Captains in all 10Regions were organized. They are now more capable of operationalizing their plans and justifyingexpenditures. The training has also given them a clearer understanding of the process of obtainingtransfers from the CG. General management training on the role and responsibilities of the Councilors andhow their committees should function has led to better prioritization of needs and strategic planning.5. Integrated Financial Mgt./Revenue Administration (original US$4.0/revised US$2.070/actualUS$1,962,000). This sub-component financed consultants and equipment to strengthen the Inland Revenue(IRD) and the Customs and Excise (CED) Departments and carry out the detailed organizational design ofthe proposed, autonomous, Revenue Authority that would supervise both the departments. The MissionStatement, Vision and Values of the RA; strategic plan for the RA; strategic, tactical and operationalplanning framework and performance monitoring guidelines; organizational structure of the RA anddetailed design and profile of its various functional divisions such as Internal Revenue, Customs, InternalAudit, Legal Services, Management Services, Human Resource Management, Finance and Administration,Information Technology, Collections, and Revenue Protection were prepared. Detailed policies, proceduresand guidelines were developed for human resource management, including an employee code of conduct,conflict of interest and post-employment code, discipline of employees, job evaluation manual, pay scalesfor RA staff, performance appraisal system, grievance procedures and HR (Staffing) Manual. For InternalAudit, investigation procedures, internal audit policy and internal audit charter were developed, besidesinternal audit manuals. Computer hardware and generator were acquired for the IRD and CED. In theCED the consultants developed a Container Tracking System for tracking containers received and releasedat different transit sheds, and an Importer Profiling System to assist in targeting enforcement actions. Aconsumption tax computerized system was also developed. In the CED, workshops were held forDepartmental Management Committees to define operational reporting requirements and reporting forms.In the IRD, a new Taxpayer Identification number (TIN) was designed and a Trade Licensing andMiscellaneous Licensing System was developed. New income tax forms were designed. A Training NeedsAssessment for the RA was carried out, skill gaps were identified, and training programs were conductedfor managers of the IRD, CED, and Internal Audit. In addition, GOG prepared a draft of the proposedsalary structure and a list of current staff of the CED and IRD to be transferred to the new RA.

Finally, an action plan for full implementation of the RA was developed. Thus, preparatory work for thecreation of the RA was completed and critical inputs were provided to the CED and the IRD. While theoutput of the sub-component is satisfactory, the outcome is unsatisfactory since the RA is yet to beoperationalized and the bulk of consultant recommendations and products are yet to be implemented.

6. General Administration (original US$4.0/revised US$7.5/actual US$4.9). Since 1993 the CAShas, inter alia, focused on developing basic infrastructure while strengthening institutional capacity andregulatory frameworks for effective delivery of essential services. The provision of badly needed

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equipment under this component is consistent with those objectives. The output was satisfactory in meetingimportant physical resource needs of various government agencies and Regional Administrations. A widerange of capital equipment was acquired for different Government entities at the central and regional levels.This included an X-ray machine, Apron Security Lighting and Precision Approach Path Indicator for theGeorgetown airport; earth moving equipment, transport equipment and communications equipment. Theseitems contributed to significantly improving the operational efficiency and effectiveness of recipient publicentities.

The project's Performance Indicators (see also Annex I) were appropriate for achieving the project'sobjectives, although many by their nature could not be quantified. The majority were fully or mostlyachieved, although only half of those targeted were hired under the Recruitment Program; tariffs under theRegional Administration may be increased to reach the projected targets once further decentralization oftaxing power in achieved; and revenue collections may reach levels targeted in the SAR if the RevenueAuthority is operationalized [Note: the RA was brought into operation on January 26, 2000].

4.3 Net Present Value/Economic rate of return:The net present value/economic rate of return were not calculated in the SAR. The possibility of hiring andretaining qualified/skilled staff when improvements are made in the salary structure was demonstrated byGOG's current ability to hire accounting and certain other professions which were previously difficult toattract. Similarly, the incentives provided under the Recruitment Program demonstrated that certain scarceskills can be obtained in the fields mentioned in Section 4.2 (3). In addition the potential remains strong forsignificant increases in revenue collections pending operationalization of the Revenue Authority [Note: theRA was brought into operation on January 26, 2000].

4.4 Financial rate of return:A financial rate of return was not calculated in the SAR.

4.5 Institutional development impact:Each component contributed to the country's ability to make effective use of its human or financialresources as indicated in Section 4.2. The ID impact of this project was substantial in some areas(Regional Administration, Personnel Management) and modest in others (Revenue Administration, SalaryStructure) for reasons set forth in sections 5 and 6 below. In either case, the project laid a solid foundationfor institutional strengthening efforts in future projects. The proposed IDA Public Service ReformAdjustment Credit (PSRSAC), and the proposed IDB Public Sector Modernization Technical AssistanceGrant which will help prepare IDB's long-term Public Sector Operation, will build on the institutionalstrengthening begun under this project. See also sections 6.2 and 6.3.

5. Major Factors Affecting Implementation and Outcome

5.1 Factors outside the control of government or implementing agency:Salary Structure: A special remuneration structure for MPT remains to be developed with IDB assistance.However, given the 31% across the board public service salary increase for 1999 and the nearly 27%increase for 2000 (see transition arrangements below), GOG may now find it difficult to give higher wagesto MPT in the short term, both on fiscal grounds and due to lack of agreement from the public serviceunions, whose emphasis has been on salary increases for the bottom and middle grades, which are alreadycompetitive with the private sector. This has had a partial impact on the outcome of the component.

Personnel Management. The PRKS had been used less than expected, in part due to the departure of sometrained personnel and the need for additional training, and in part due to the lack of management initiativeat the agency level. This has had a partial impact on the outcome to date. However, the proposed IDA

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Public Service Reform Structural Adjustment Credit (PSRSAC) and complementary long-term IDB publicsector operation are expected to develop the next version of the PRKS, combine it with other databases,and transform it over time into a full-fledged Human Resource Management Information System (HRMIS).

Recruitment Program: Since GOG salaries remained significantly lower than international comparators,even after improvements under the project, the additional incentives expected by skilled expatriateGuyanese were found to be generally higher than those offered by the Recruitment Program. Therefore,considerable difficulty was experienced early in the project in attracting expatriates under the program.Recruitment picked up after the Program was broadened to include qualified resident Guyanese, coveragewas extended to mid-level critical positions, and GOG was given additional flexibility in negotiating theincentive package. The effect, therefore, was partial.

Regional Administration. The full benefits of the work of the consultants were inhibited by poor staffing inthe Regional Administrations, which is largely the result of poor pay and harsh living conditions. Theconsultants worked well with the staff available and the recent salary increases for the public service mayameliorate this problem. Also, in view of the impending Constitutional Reform, expected to be enacted in2000, GOG decided not to pursue structural reforms in Regional Administration through the project. Theeffect was partial.

Revenue Administration: Industrial relations problems in Guyana and bomb scares, particularly over thelast months of the project, limited the amount of coaching and mentoring the technical specialists couldprovide to the staff. The effect was partial, since many qualified counterparts were not on board anyway,due to lack of activation of the Revenue Authority.

5.2 Factors generallv subject to government control:Salary Structure: In December 1995, GOG announced a policy that would aim to bring public service paylevels to within 10% of the lower market quartile in the medium term (also a Heavily Indebted PoorCountries Initiatiye - HPIC - requirement). While this remains the GOG's intention, actualization wascomplicated by negotiations with the public service unions and macro-economic constraints. The policy,nevertheless, is likely to have a substantial positive impact in setting the direction for the future.

Regional Administration. The establishment of the Ministry of Local Government (MLG) in the mid-1990swas a significant initiative and a clear indication of the intention of GOG to strengthen RegionalAdministration. In addition, GOG support for local government and decentralization has beendemonstrated by the policy statement from the GOG that local elections will be held in 2000, after morethan two decades. Implementation, however, was partially affected due to significant delays in GOG'sdecision-making, first relating to the engagement of the Consultants, and then on actions to be taken ontheir recommendations. The delay was partly due to the need to build consensus within Government on thepolitically sensitive issue of regional administration. Since the loan was extended for other reasons theconsultants were able to complete much of their work. However, only about half the amount allocated forthis activity was spent.

Revenue Administration (RA). The passing of the Revenue Authority Act in July 1996 was a significantstep forward, but the fact that it was not effective during the life of the project had an substantial negativeimpact on the outcome of this sub-component. This has limited the benefits derived by the RA from theinputs provided by the project.

IDA agreed to the third extension of the PAP's closing date from June 30, 1999 to July 31, 1999 in order to

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complete procurement of the computer equipment for the IRD and CED. There had been delays inevaluation of bids, approval by the Central Tenders Board and the Cabinet. This delay had a partial effect,since the expertise of the consultants could not be used in operationalizing the equipment.

General Administration. GOG requested a third extension of the IDA Credit through December 31, 1999[the first extension was from December 31, 1997 to December 31, 1998 and the second was fromDecember 31, 1998 to June 30, 1999] to use most of the undisbursed $3.1 million in IDA funds forpurchase of new Y2K compliant systems for: (a) payroll; (b) Air Traffic Services Instrument Landing(ILS/VDR); (c) Billing for GUYWA; and (d) hardware and software for various departments to replacenon-Y2K compliant systems. The extension was made contingent upon bringing the Revenue Authorityinto operation by June 15, 1999. As this was not done, the request could not be granted. GOG has madealternative financing arrangements for these items. The effect was negligible since this component hadalready used more than its original allocation.

5.3 Factors generally sul?Ject to implemienting agency control:Recruitment Program. Delays were experienced initially in obtaining responses from line ministries onCVs of candidates sent to them for final selection. Some managers were disinclined to pay incentives tofuture subordinates when they themselves would continue to receive their low Government salary. Theremay also have been professional insecurity created by the prospect of recruiting persons who were betterqualified than the managers. Once this reluctance was overcome, the skills of those recruited were used inmost cases to good effect. The effect, therefore, was negligible. Also, the Head of the PresidentialSecretariat quickened the pace of recruitment by recruiting some persons directly at the Office of Presidentand assigning them to the concerned ministry.

5.4 Costs and financing:N.A.

6. Sustainability

6.1 Rationale for sustainability rating:Salary and Employment Structure: Reforms have been formally enacted and, therefore, are likely to besustained including through continued support from IDA's PSRSAC and the IDB's Public SectorModernization Program. The actions taken thus far have been important first steps in the establishment ofan adequate and transparent salary structure. Moreover, GOG's policy of bringing public service paylevels to within 10% of the market lower quartile further enhances the likelihood of sustainability over thelong-term.

Personnel Management: GOG is considering upgrading the PRKS to a Human Resource ManagementInformation System (HRMNIS) with help from the IDB. Sustainability is, therefore, likely. See alsoTransition Arrangements below.

Recruitment Program: Of the 44 professionals recruited 35 have remained in Government service to dateand budgetary provisions are being made for their continued employment. Sustainability is, therefore,likely.

Regional Administration. Sustainability is likely since periodic monitoring and follow-up on CARICAD'swork will be undertaken through assistance from the following sources: (a) the CDB in their support forstrengthening local governments (already approved); (b) the IDB in their work on infrastructure formunicipalities; (c) UNDP's Development Cooperation Framework, which provides for strengtheningregional administrations, including local communities.

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Revenue Administration. Sustainability is unlikely until and unless the Revenue Authority is brought intoeffect quickly and funding is obtained to institutionalize the work done under the project . The longer thetime passes between the departure of the consultants, the more the momentum generated by their work willbe lost [Note: the RA was brought into effect on January 26, 2000].

General Administration. Sustainability is likely since GOG has included maintenance of the equipmentprocured in its capital budget and ongoing and proposed Bank operations will continue to providesupplementary equipment.

6.2 Transition arrangement to regutlar operations:Salary Structure: The two month strike in mid- 1999 by public service employees led to an across the boardwage award in August 1999 of 31% for 1999 (retroactive to January 1999) and almost 27% for the year2000. The increases did not occur in the context of an overall pay and employment policy. It is estimatedthat they will increase the budget deficit to an estimated 5% of GDP by the end of 1999. GOG iscommitted to turn this into an opportunity for public sector reforms through measures to be undertaken inconnection with the proposed IDA PSRSAC and IDB Public Sector Modernization operation. ThePSRSAC will provide short term support for the Government's adjustment program to reinstate fiscalstability with public service downsizing, to begin to pave the way for longer term public sector reforminitiatives. Measures relevant to the PAP include: (i) a hiring freeze (staffing of the Revenue Authority willnot be constrained by the freeze), (ii) retirement of unqualified temporary and other redundant publicservants in levels 1-5, (iii) cancellation of vacancies, and (iv) down-sizing of the civil service, whileattracting skilled personnel.

Also, HPIC measures included: (i) the carrying out a survey of private sector remuneration andestablishment of mechanisms to carry out such surveys regularly; and (ii) developing and implementing aremuneration structure for MPT positions in the civil service. The survey was completed in November1999 with IDB assistance and work is in progress to develop mechanisms for regular surveys. In addition,a portion of IDB's $1.5 million TC Grant will be used to review the entire public sector salary and jobclassification structure, including for the MPT. Implementation is likely only in the longer term, given therecent across-the-board wage increases mentioned above.

Personnel Administration. To assure that the process of selecting redundancies is technically sound andtransparent, the GOG has made a commitment to make full use of information already available in thePRKS and the MOF's payroll system. Under the IDB operations, GOG is considering developing andoperationalizing an integrated HRMIS.

Revenue Administration. Transition arrangements are not currently in place. Previous experience indicatesthat Customs and Excise and Inland Revenue reform is a long-term endeavor. If the Revenue Authority isbrought into effect, the IDB's proposed $50.0 million Public Sector Reform Operation may continue thework begun under this project [Note: the RA was brought into effect on January 26, 2000].

The main future performance indicators for PAP components include: (i) operationalization of the RevenueAuthority; (ii) further elimination of redundancies at the still-bloated lower grades of the public service(PSRSAC); (iii) development and implementation of a MPT salary structure sufficient to attract and retainskilled staff (IDB); (iv) further development of the PRKS and other personnel initiatives (IDB's long-termPSR), and (v) update of property tax rolls and enhanced tariff collections in the Regional Administrations(CARICAD/CDB).

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Bank follow-up. The Bank will follow-up on several PAP components through the PSRSAC, which willlikely be reviewed by OED, and through continued monitoring of HPIC initiatives.

7. Bank and Borrower Performance

Bank7. 1 Lending:The Bank's performance in the identification, preparation and appraisal of the project was satisfactory,with the caveats on design mentioned in Section 3.2. The PAP objectives and activities were consistent withthe CAS and the Government's development strategies. They continue to be consistent with the CAS asIDA moves toward consolidating and enhancing advances to date through the proposed FPID and PSRSACoperations and the proposed enhanced HIPC Debt Relief Initiative.

As indicated in Section 3.1, the skill mix of Bank staff (Annex 4(a) (b)) was appropriate to address GOG'smajor public sector problems of the 1 990s. The design took into account the findings of a comprehensiveBank Public Sector Review for Guyana completed in 1992. The Bank adequately appraised thecommitment of the Government, as reflected in GOG's public sector development policy letter of February10, 1993. The risks and complexity of the project are covered in section 3.1 and strong coordination withdevelopment partners can be seen throughout preceding sections. See Section 4.2 and Annex 1 foradequacy of performance indicators. With the exception of the Revenue Administration component,implementation plans were clear and well thought through.

7.2 Supervision:Bank supervision was satisfactory. Supervision missions were effective and well documented.Comprehensive 590s/PSRs and aide memoire were prepared, reviewed and agreed in detail with beneficiaryagencies, the Head of the Presidential Secretariat and Minister of Finance. Ratings were realistic.Implementation problems, including recruitment and procurement delays and the development impact of notoperationalizing the RA, were identified early and called to the attention of the national authorities. Thequality of the advice given was appropriate and clearly set forth in aide memoirs. For example, themid-term review report outlined various options for funding MPT salary enhancements and, earlier, goodadvice was given on steps toward moving to an integrated financial management system. As discussedearlier, the Bank showed considerable flexibility in agreeing to: (i) the modification of the DCA to activatethe Recruitment Program; (ii) reallocation of project funds and project extensions; and (iii) implementationof parts of the project through partner agencies as the situation changed. The quality, number, skill mix,and continuity of staff supervising the project were appropriate for the nature of the project.

IDA has recently carried out a Country Procurement Assessment Review which took into account theexperience of all projects in the Bank's portfolio, including the PAP. Bank missions were often timed sothat supervising staff could participate in related Bank and donor missions. For example, members of themid-term review team of May/June 1996 also participated in the Country Portfolio Performance Review(CPPR), and several PAP missions worked closely with the multi-donor HPIC missions. Bank managerschanged several times over the life of the project, but task managers changed only once in the eight yearselapsing from design to close. This provided continuity and consistency of approach.

7.3 Overall Bank performance:The Bank's overall performance was satisfactory for the reasons stated above.

Borrower7.4 Preparation:Given the context of scarce administrative resources and shortage of skilled personnel, the GOG's

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performance in design and preparation was satisfactory. Borrower commitment was evident from theirPublic Sector Development Policy Letter of February 10, 1993, policy initiatives, and new legislation.

7.5 Government implemnentation peiformance:The Government's performance in implementation was mostly satisfactory. The Borrower expressed strongcommitment to the project in several ways mentioned earlier, including setting the policies and passing thelaws needed to reform the public sector. GOG was effective and timely in meeting the loan covenants,although the pace of implementation was sometimes slowed due to circumstances beyond GOG's control:industrial actions, civil disturbances following elections, and, in the case of the Revenue Authority, a courtorder enjoining Government from establishing the Authority, as well as by systemic issues affecting mostprojects in Guyana: slowness of evaluation of bids and low procurement thresholds requiring frequentministerial decisions.

The Project Coordinating Unit (PCU) was adequately staffed and functioning throughout the life of theproject and carried out its responsibilities in accordance with the requirements of the DCA. These includedarranging for project audits, maintaining accounts of expenditures, facilitating hiring under the RecruitmentProgram, and ensuring that TOR and procurement met IDA requirements.

7.6 Implementing Agency:Implementation Agencies used the project funding to the best of their capabilities and adequately managedthe work of consultants and procurement, within the context of limitations of staffing and resources andsystemic constraints on timely procurement. Implementation follow-up has been adequate in most cases.Their performance is, therefore, satisfactory.

7.7 Overall Borrower performance:The Borrower's overall performance was satisfactory especially in light of the difficult conditions in whichthe project operated.

8. Lessons Learned

a. General Lessons:(i) Important changes to the salary and employment structure require agreement from all stakeholders.When there is solid justification for targeting MPT salaries rather than the lower grades, it is important toseek the early support of staff unions and opposition political parties in an attempt to prevent theundermining needed reforms.

(ii) Accurate and transparent information needs to be provided on a regular basis to public servantswhen salary reforms are being undertaken to avoid creating false expectations that may later lead tofrustrations and industrial actions.

(iii) When designing new salary regimes, it is important to obtain the most reliable information beforeembarking on the reform, even if this results in implementation delays, to ensure that the new structure willbe adequate to meet stated goals. Similarly, it is essential to carefully examine the effect of removingmarket supplements, in order to protect key and critical posts.

(iv) In exceptional circumstances, such as in Guyana, when Recruitment Programs are appropriate, itis important to ensure that the receiving departments are consulted as well as the concerned ministry, inorder to maximize effectiveness and receptivity. Tapping the experience of skilled retired persons may alsobe a relatively low cost way to obtain critical expertise.

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(v) When dealing with sensitive issues, such as decentralization, setting of tariffs, and the sorting outof the respective roles of various levels of (sub-national) government, it is important to hire consultantswho are familiar with and sensitive to the issues. This is essential if they are to be successful in gaining theconfidence of all concerned parties and playing a catalytic role. In such cases, sub-regional groups andNGOs may be more effective than international consultants.

b. Country-Specific Lessons:(i) The procurement system is cumbersome and was responsible for delays in projectimplementation. For future projects it would be useful to agree on a special "fast-track" system. FutureCPPRs and Procurement Assessments should focus on the bottlenecks and agree with the borrower on howto eliminate them.

(ii) A fully functioning and well-equipped PCU with decision making authority and access to all levelsin the project's beneficiary agencies is essential in countries where implementation capacity is weak andstaffing is thin. Without such support, decisions are slow or not forthcoming and there is considerabledifficulty in complying with IDA's basic requirements for accounting, audit, and procurement.

9. Partner Comments

(a) Borrower/implementing agency:

PUBLIC ADMINISTRATION PROJECT

PROJECT REVIEW FROM BORROWER'S PERSPECTIVE

A. Introduction/Baclkiround

1. This Implementation Completion Report (ICR) is an evaluation of the Guyana Development CreditAgreement (DCA) 2480 GUA. The SDR 8.65 million credit which was approved by IDA on April 08,1993, provided from expenditures in respect of the reasonable cost of goods and services required tomaintain and improve the capacity of the public service to perform its core functions.

2. The Government of Guyana (GOG) designed a medium term Economic Recovery Programme(ERP) in June 1998 in order to reverse Guyana's economic decline and create the basis for sustainedeconomic growth and a viable external position. There was a fundamental change of economic policy andshift towards a market-oriented economy. The key elements of the ERP were the unification of theexchange rate system, liberalization of external trade, increase in the primary current account surplus of thepublic sector, tightening of credit policy, pursuit of a flexible interest rate policy and major structuralreforms, including the divestment of a number of public enterprises. Also important in regard to restoringgrowth was the improvement in power supply.

3. Decades of long neglect of the economy and poor public sector wages, however, had resulted inemigration of a large number of technical and professional staff to North America and the Caribbean insearch of better employment opportunities. Technical staff in the public service at the time of the ERP,therefore, lacked experienced and relevant training to undertake analytical work; where technical skills wereavailable, staff was stretched very thinly. In addition, information and capacity for policy formulation andanalysis were almost non-existent, there was little capacity for development and implementation of thepublic section investment program, and, by end 1990, the Statistic Bureau had stopped the publication of

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statistical reports and computer equipment and software were largely not available for key ministries andagencies.

B. Proiect Obiective

4. The main objective of the project was to provide urgently needed assistance to maintain andimprove the capacity of the public service to perform its core functions.

The focus of the project was two fold -

(i) to facilitate adequate staffing of key public service positions and to eliminate staffingredundancies; and

(ii) to create conditions for accountability in financial and personnel management, as well as infundamental operational programmes.

C. Implementation

5. The main parts of the project were:

a) Reforming the public service salary and employment structure;

b) public sector management strengthening which included the following components (i)Integrated Financial Management; (ii) Regional Administrations Systems; (iii) PersonnelManagement; (iv) General Administration and (v) a recruitment programme with definedcoverage and selection criteria, advertising campaign, an incentive package and a system formanagement and monitoring of the programme.

D. Assessment of Credit

6. (i) Reforming the Public Service Salary and Employment Structure

The key elements of this component were to:

a) improve capacity to attract and retain skilled staff

b) implement a new personnel grading system and salary structure for the public service.

Public Service salaries were found to be comparable with salaries in the private sector only forunskilled jobs at the lower end of the salary scale.

Prior to 1998, although salaries increased significantly in real terms, the increases could beconsidered as insufficient to attract and retain staff on a sustainable basis.

However, with a substantial increase of salaries in 1999 by 31.06%, although not yetverifiable, it is anticipated that the attractiveness of the public service will improve.

The work to be financed by IDB on compensation and the proposed Public SectorModernization Project will address further issues of public service salaries which will go a

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long way to increase the "pull" of persons to the public service.

The introduction of a new salary structure, graded positions in different ministries based on auniformed criteria, resulting in employees in "closed" ministries whose pay was higher thantheir counterparts in "open" ministries to loose their privileged positions. While theseemployees become "red circled" they were not penalized when salary increases were grantedsince they received the same percentage increases as other employees.

The goal of upgrading of the salary structure was not totally achieved. The fourteen (14) BandSalary Structure comprised only minimum, mid point and maximum salary at each band, butthis was not a design problem, but rather due to the fact that no merit pay scheme was in placecoupled with "ability to pay".

While vacancies in the grading levels 1 through 5 were not cancelled, the ManagementServices Division of Public Service Management continued to assess needs on a case by casebasis.

Government has proposed a voluntary departure scheme which it is hoped will be effective inthe year 2000.

There is still need to obtain total agreement with the social partners.

An annual performance appraisal system was introduced but implementation problems arose.This aspect will be revised in the IDB project.

(ii) Upgrading of the PRKS

The employment of a local information Systems specialist within the Data Processing Unit(DPU) in 1998 brought great improvements to the Personnel Record Keeping System. ThePRKS database has gone through several iterations of re-modeling and is now referred to asHRNIS database. The new database has already been created using the available informationfrom PRKS. The new structure includes as many aspects of public service data as necessaryfor immediate improved information management. It accommodates position which includesjob descriptions, training information, employee training, as well as security features to allowfor controlled access to site information. All aspects of information are structured according tomodern relational database techniques, therefore the transition to an upgraded HumanResources and Payroll package will be easily facilitated.

The facilities required at a site to provide access to the data base are standard for all officesexternal to PSM. These include Widow 9X, a modem, the HR S1 application and a telephoneline that will be used to make a dial-up connection to the database at PSM. The statistics showthat 30 out of 53 offices require access to the database based on their employee volume. Ofthose, 22 already have computers and 19 will have access as 15 modems were purchased byPSM and 4 have purchased their now new PCS with modems. Of the 15 modems purchasedby PSM, 9 have been installed. The process of installation has been slow as the PCS are 486sand several problems had to be resolved by PSM or in the case of replaced parts by theagency. A DPU staff has been trained and monitored during the upgrade process. Internal toPSM a local area Network of about 12 computers has been installed and configured with aWindows NT server acting as a file server and the HRM ISI database server.

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With respect to the installation of the application itself at the sites no site has been able toconnect remotely as the acquisition of a latest version of the development tool has broughtbetter techniques to solve certain remote access programming problems which had sloweddown development of application. Security features are also still in development. As a resultan even more scaled down application was developed to update Government Orders internal toDPU. A new completion date of January 31 has been set to roll out the position managementand employee management module of the application internal to PSM and to external offices.

Other updates currently done centrally, relate to the provision of a link between HRM IS 1 andthe MOF payroll. Initial activity have commenced, but there is need for a structured approachto this collaboration and further inputs in terms of agreed policy roles for major actors. ThePSC is still to be brought on board. It is envisaged that full harmonization will be achievedunder the IDB Public Sector Modernization Programme which is scheduled to commenced inearly 2000.

(iii) Public Sector Management Strengthening

(iii) a) Revenue Administration

Adequate preparatory work has been done to facilitate the creation of a Revenue Authority.

However recommendations in this area remained unimplemented for various reasons.

Central Government is none-the-less committed to the establishment of a Revenue Authoritywhen institutional strengthening issues contemplated can be adequately completed andimplemented.

It is anticipated with the establishment of the Authority, institutional strengthening initiativeswhich could not have been addressed on account of the acute staff shortage at the InlandRevenue Department will be treated with by the Revenue Authority.

(iii) b) Regional Administrations

No additional comments are proposed at this time. Suffice it to say that the views on theBank's section of the ICR are acceptable.

(iii) c) General Administration

Procurement under this component is considered satisfactory. However aspirations towardssecuring a fisheries patrol vessel were not fulfilled on account of the value of the bidssubmitted and the need for Central Government to find additional funds to progress thisprocurement.

Even the alternative proposed utilisation of the non-committed funds to procure additionalequipment for the Ministry of Home Affairs including fire tenders and fire vehicles; a billingsystem for GUYWA, equipment for the Ministry of Health and Regions as well as the CivilAviation Department could not be progressed in view of the fact delivery dates would havebeen beyond the closing date of the project.

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(iii) d) Recruitment Component

The recruitment component of the Project had envisaged the recruitment of fifty (50) personsto various skill areas in the Public Service and while there was a great effort to recruit personsfrom overseas, only 10 persons took up appointments.

As a result, it was agreed with the Bank that the component be opened to include localprofessionals.

This action brought more success as thirty-four (34) persons took up offers of employment.

Of the total number of persons recruited; four terminated their contract prematurely, one (1)contract was terminated by Central Government, and one (1) recruit died in service.

Three persons who tours of duty were completed did not opt to continue in the Public Service.

While the flexibility of the Recruitment Component in the later stages allowed for localrecruitment which provided much needed capacity in the Ministries concerned, in places wherethere were staff at the same levels who were equally qualified a "morale" problem emergedsince the incentives of the programme created inequities among staff remuneration.

In any future programmes where this impact may be identified consideration may be given toputting in place appropriate mitigating mechanisms.

(b) Cofinanciers.N.A.

(c) Other partners (eNGOs/private sector):N.A.

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10: Additional Infornation

GUYANA PUBLIC ADMINISTRATION PROJECT: IDA CREDIT 2480-GUAProject Review/June 1999

This matrix was attached to the final mission aide memoire. It, therefore, does not take intoaccount the significant salary increases of August 1999, discussions related to the proposed IDA

PSRSAC, or the operationalization of the Revenue Authority on January 26, 2000.

Component 1. Reforming the Public Service Salary and Employment Structure

COMPONENT ACTtVIntES EXPECTED RESULTS CURRENT SITUATION/ PROBLEMS AND NEXT STEPSOBJECTIVES ACHItEVEMENTS CONSTRAINTS FUTURE OPERATIONS

ENCOUNTEREDImprove Govt's capacity to 1. Implement structural Salary structure streamlined New Salary Structure: A new While public service salaries Initiatives taken so far areattract and retain skilled staff changes in salary scale so that all public servants 14-band salary structure was have been found to be important first steps in publicand eliminate staffing through: ean be adequately, equitably introduced in May 1994 w.e.f comparable with those in the service reform, a process that,redundancies by reforming the and transparendy 117/93. This replaced all existing private sector for unskilled jobs given the extremely poor initialpublic service salary asd (a) Incorporation within the compensated within a salary regimes, including special at the lower end of the salary conditon in the public service,employment structure salary scale of all positions formal grading structure. arrangements that existed in the " scale, the difference at the has to be viewed as a multi-step

presently filled through Closed" Ministries. middle and senior levels remains process, linked to the overallPerformance Indicators From special contracts, allowances Slowing down of attrition substantial. macro-economic performance ofthe Staff Appraisal Report of and salary enhancements rate in key and critical A number of allowances were the country.March 9, 1993 positions and increased grossed up into the regular salary. Although salaries increasedImplementation of new (b) Decompression of the recruitment to these The new structure had a mid-point significantly in real terms, the However, given the centralpersonnel grading system and salary scale: raising positions compression ratio of 12:1. increasesto dateare insufficient importance ofhavingaagreed salary structure for the comoression ratio from 6:1 to attract and retain staff on a well-staffed and skilled publicpublic service, including the to 9:1 for grades I through The range width increased sustainable basis. Resources service to all other initiatives ofelimination of all employment 16 and 16:1 for grades I to progressively from 25% for grades available for salary enhancement GOi, the need to take additionaland salary regimes outside the Spedal 1-3 to 60 for grade 14. Based on a are constrained by overall fiscal measures to improve theformal grading system job evaluation exercise carried out capacity ofthe govemment, the attractiveness ofthe public

(c) Designing an increasing with assistance of ODA consultants, amount of funds available from service is evident.Achievement of target range-width across grades: all existing posts were mapped to donors - ODA and WB - as wellcompression rations, and grading 40% for grades 1-9; 60% for the new structure. as IMP conditionalities. Also, It is expected that work financedsystem composition of the grades 10-14; 80% for due to pressure from the unions, by the IDB on compensation andpublic service [the compression grades 15-Special Salarv increases: in May 1994, a GOG had to allocate a larger the proposed DDB P2ublic Sectorratio should be at least 9:1 for 20% increase in salary and wages share of available resources to Modemization operation willlevels I through 16, and 16:1 for prevailing at 12131/92 was granted the lower grades 1-5, reducing, address further the issue oflevels I through Special]. with effect from 711193. Following therefore the increases that could public service salaries.

(d) Increasing salaries by a strike by Public Sector Unions, be granted to key and criticalCancellation of all existing 25% for grades 1-9 to 90% who demanded increasing the positions.vacancies in grading system for grade 16. minimum wage to G$6,600, fromlevels I through 5 at the time of G05,040 proposed under the new Transitional anomalies: In someimplementation of the new (e) Shifting key and critical salary structure, GOG agreed to cases salary differentials basedsalary scale; and freezing, or nositions to grades such that increase salaries and wages by 5% on seniority were not maintained.cancellation, of all sew the corresponding salary is for Grades 1-5 w.e.f 1/1/94. Also A Committee, including Unionvacancies in the same levels sufficient to attract and from 7/1/94, the minimum wage was representatives, was constitutedthroughout the life of the Project retain qualified people increased to G5,500. Since this to review and address such

implied disturbing the agreed anomalies. However, not muchcompression ratio, the whole salary progress was made and GOG isstructure was revised upwards to dealing administratively withmaintain the mid-point compression anomalies on a case by caseratio. Salary scales were increased basis.byanotherl6%w.e.f 1/1/95, 16%w.e.f 1/1/96, 15%w.e.f 1/1/96;20% w.e.f 1/1/97; and 30% w.e.f

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On thewhole, the minimum wage Effect ofNew Salary Structurehas increased from G$ 3,451 on on Morale: The introduction of1/1/93 to G$11,445 on 1/7/98. The the new salary structure raisedtop band salary scale has increased expectations of substantialfrom G$19,344-G$28,255 (old increases in saaries. TheseGS 16) in January 1993 to G$91,753 expectations were not fulfilled.- G$170,346 (new GS 14) in July Further, since the new salary1998. structure graded positions in

different ministries based onPublic Service Wage Policv: In uniform criteria, employees in"December 1995, GOG announced a Closed ministries, who werepolicy to bring public service pay paid higher than theirlevels to 10% of the market lower counterparts in "Open"quartile, in the medium-term and to ministries lost their privilegedwithin the market median quartile in position. These employeesthe long-term. The Gov't became "red-circled", meaningcornmitted to provide GS60.0 that while the pay of themillion per year for 1996,1997 and incumbernts would be protected,1998 as counterpart fimds to they would not be entitled to paysupplement the pay of about 1,800 increases until the correspondingkey and critical positions ranging grade salary caught up with themfrom 15% to 20%, and an additional through periodic increases.G$10.0 million in 1998 for These factors caused somesupplements payable in 1999. demoralization. However, the

red circled employees did notPosts eligible for supplements were actually suffer, because GOGidentified inl 996 based on agreed granted the same salary increasescriteria such as scarcity of skills and to them as to other employees.difficulty in recruiting.Supplements continue to be tax-freeand based on the minimum gradebase pay at 12/95.

Policy changes include theintroduction of an annualperformance evaluation system,regular salary reviews, and animproved job evaluation procedures.

IL. Fill Key and Critical 231 persons were recruited forpositions on priority positions between grades 6 to 14,

from 1993 to 1995, and 165 personswere recruited from 1995 to 1998.However, from 1993 to 1995 747persons in these grades left thepublic service between 1003 and1995 and from 1995 to 1998 141persons left. GOG has beensuccessful in recruiting 42 mid-leveland senior persons to key andcritical positions using theincentives of the RecruitmentProgram.

Eliminate staffing redundancies IIl. Cancel all existing Vacancies in levels 1-5 were notvacancies and freeze canceled. However, Line Ministriesrecruitment to grades 1-5 are required to obtain clearance of

the Ministry of Public ServiceManagement (PSM) beforerecruiting at these levels. This isgiven only in deserving cases.Between 1993 and 1996, there was anet reduction of about 2,200positions (17%) in these grades.Betwecn 1996 and 1998 there was afurther reduction of about 639positions.

IV. Assess employment The Management Services Division A comprehensive assessmentneeds of each Executing of PSM assesses employment needs of agency employment needsAgency on a case to case basis and provides is likely to be included in the

assistance in reorganization, such as Public Sector Modernizationin the case of the Office of the operation under preparationAuditor General for IDB financing.

V. Implement transfers both Transfers have been implemented aswithin and across Executing neededAgencies

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VI. Design mechanismns to No Voluntary Departure scheme Attrition: Continued low salaryreduce the size of the public prepared. Concern expressed by levels and dissatisfaction causedsector work force, including PSM over loosing most able public by unfulfilled expectationsinter alia, incentive packages servants. However, attrition has appear to have aggravated thefor voluntary departure helped reduce size of the public problem of attrition in the Public

sector. The total number of filled Service. The attrition level (netpositions decreased by 15% from number of staff in a grade/filled1993 to 1996 from 16,159 to 13,658 positions in the grade) in theand to 9,339 in 1998 lower grades 1-5, increased from

1.15% in 1993 to 12% in 1995.In 1994 there were 16,945authorized positions in grades1-5 ofwthich 12,575 were filled;in 1998/9 12,575 positions atgrades 1-5 were authorized and9,176 were filled.

In 1994, 4,266 positions at themiddle grade 6-10 wereauthorized and 2,523 wee filled;in 1998/9 3,599 positions wereauthorized and 1,972 were filled.

In 1994 535 positions at hightrgrades 11-14 were authorizedand 319 were filled; in 1998/9544 were authorized and 311filled.

Complete private sector Surveys completed in Nov. 1998 bysalary surveys Commonwealth Secretariat and

KPMG (T&T)l Resultsconsolidated by IDB consultants.

Design a new salary Authorities are developing a . Feedback is awaited on thestructure for Managerial, remuneration structure for MPT that Bannock work from GOG.Professional, and Technical is expected to be implemented when Before implementing the new(MPT) positions the 1999 wage negotiations are salary structure, a consensus will

completed. most likely need to be reachedwith the "social partners' -

Norms and mechanisns for periodic opposition political parties andadjustment of this remuneration public sector unions.structure vis-a-vis the private sectorremains to be done. The iDB alsorecently completed a computerizedcompensation model (Bannock,UK) which will provide the basis fora remuneration structure; it draws onthe work completed by theCommonwealth Secretariat and

__________ _ =_____ iC______ _______ ______ KPMG

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Component 2: Personnel ManagementCOMPONENT ACTIVITIES EXPECTED RESULTS CURRENT SlTUATIONI PROBLEMS AND NEXT STEPS AND FUTUREOBJECTIVES ACEIEVEMENTS CONSTRAINTS OPERATIONS

ENCOUNTEREDDevelop a modem personnel Design and establish a Information on individual The PRKS has been designed, The PRKS is essentially a data The IDB has committed to GOGmanagement system for the Personnel Records Keeping staff accessible to each hardware has been procured, and the base rather than a Human in principle to work on a Publicpublic service and create System (PRKS) agency and aggregate PRKS is being implemented in Resource Management Sector Modermization Projectconditions of accountability and information accessible to PSM and 27 ministries and Information System (HRMS). (PSMP), originally requested forimprove Personnel Management ministries, PSM and the departments. The system provides The system is being used less FY00 but delayed due to

PSC. basic information about posts, than expected. A system is technical and politicalemployees and their salaries and needed that will allow all considerations, including relatedallowances. personnel actions to be to MIPT compensation. In the

conducted on the system. In that interim, an IDB Technicalway the database would be Cooperation grant ts proposed to

The availability of information automatcally updated ssth each lay the groundwork for therelating to the staff establishment personnel action. There is a PSMP. The IDB operaton mayhas improved and, to that extent, need to improve the functionality address this issue.Gov't personnel management of the PRKS to enhance thecapacity has been strengthened. system's usefulness as a tool for In the meanwhile, the updating

personnel management of the PRKS is being consideredin conjunction with the MOF's

Training: the National Data proposal to use project funds toManagement Agency (NDMA) has finance a new payroll system tocarried out a successful training avoid Y2K problems (See theprogram for the staff ofuser project extension discussionagencies. under the Revenue

Admninistration Component 5)The project provided the MOFwith consulting support toevaluate the current payrollsystem and develop a strategy forits upgrade. The Bank's May1999 mimsion recommended thatthe new package include

persornnel managementfunctions.

Revise and Streamline Rules Managers given more Work completed by a committee ofof Procedure of the Public authority to hire employees, private sector, gov't, and publicService Commission termination of service made sector union officials. Revised rules

easier, disciplinary have been signed by the Presidentproceedings shortened, and and are tn effect.annual performanceappraisals reinstated

Develop new rules regarding Report of a committee (Gov't, Public Service Unions have notleave, pension, retirement private sector, Public Service been in agreement with Reportage and travel allowances, Union) was submitted to Cabinet in or the composition of theetc. December 1998 remains under Committee, which included

constderation representatives of the privatesector. While salarims may bemore generous in the pnvatesector, other conditions ofservice such as those underconsideration, are typically lessgenerous

Fstablish a newjob Transparent procedures for Newjob classification system Work on the job classification Additional work may beclassification system for the recruitment, evaluation, and implemented. Needs to be refined. system was funded by ODA completed under the proposedpublic sector monitoring of personnel between 1994 and 1996, IDB Public Sector

including the introduction of the Modemization Operation and itsnew 14 band structure parallel Technical Cooperation

Grant

Consolidation of modert To be done as part of the Public -do-personnel management Service Reform Strategysystem in the executiveagencies, includingemployment and salaryadministration, performanceevaluation, and incentivessystem, and comprehensive

_ public sctor policy

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Support effbrts to prepare a Develop a Long Term This was initially delegated by GOG Once approved by Cabinet, thislong-term strategy and Public Sector Reform to the IDB pending outcome of policy statement will provideprogram for public sector Program Carter Center work on the National guidance on how the publicreform Development Strategy which they service will conduct business in

helped prepare. The Carter Center the future.work is completed. The IDB, withassistance from an ODA consultant,has prepared a preliminarydocument on a broad public sectorstrategy based on consultations withpublic sector officials, including

_____________________ ___________________ Permanent Secretaries.

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Component 3: Recruitment Program

COMPONENT ACTIVITIES EXPECTED CURRENT SITUATION/ PROBLEMS AND NEXT STEPS ANDOBJECTIVES RESULTS ACHIEVEMENTS CONSTRAINTS FUTURE OPERATIONS

ENCOUNTEREDFacilitate adequate staffing Recruit qualified Adequate staffing ofkey 42 senior and medium level Initially GOG tried to recruit Prepare an impact analysisof Key and Critical Guyanese senior and and critical positions to professionals have been for specific positions to determine the effect ofPositions mid-level professionals strengthen managerial recruited, thus making scarce overseas. This did not recruitment under the project

for about 50 positions and technical capacity technical expertise available. produce encouraging results. on the overall effectivenessPerformance Indicators from GS levels 15, 16 Areas in which recruitment has The Credit Agreement was of departments for whichFrom the StaffAppraisal and the "special" been made include: amended to allow greater staff were hiredReport of march 9, 1993 category - Technical Officer, Office of flexibility. Recruitment ofNumber of applications the President local skilled persons wasreceived in response to - Asst. Commissioner Inland allowed as also of personspromotion activity, number Revenue Dept. above the retirement age.of candidates screened and - Subject Specialist, Ministry GOG was given greatershortlisted of Education leeway in negotiating the

- Deputy Director National quantum of incentives to beNumber of positions staffed; Center of Education, Research paid, keeping in view theretention rate of the and Development, MOE skills of the candidate andprogram; attrition - Senior Physician, Ministry of the relative scarcity of

Health his/her skills. This strategy- Two Anesthetists, Ministry helped activate the program.of Health However, the program might- Senior Foreign Service have been even moreOfficer, Ministry of Foreign successful if criticalAffairs mid-level positions had been- Senior Agricultural officer, targeted from the beginning.Ministry of Agriculture

GOG has indicated that thepersons recruited through theproject are making a singularcontribution in their respectiveareas of work.

-23 -

Component 4: Regional Administration

COMPONENT ACTIVITIES EXPECTED RESULTS CURRENT SITUATION/ PROBLEMS AND NEXT STEPS ANDOBJECTIVES ACHIEVEMENTS CONSTRAINTS FUTURE OPERATIONS

ENCOUNTEREDImprove the effectiveness of Review of Improved institutional CARICAD draft final report Significant delays were The final report ofservice delivery ofthe 10 - the present functions capacity of the RAs to and additional work has been encountered in GOG CARICAD will include anRegional Administrations of RAs; deliver services completed as follows: decision-making, first impact analysis.(RAs) - operational systems relating to the engagement of

for the planning, -- Local Government the Consultants, and then on Periodic monitoring andPerformance Indicator From execution and Operational Manual covering actions to be taken on their follow-up on the use ofthethe StaffAppraisal Report monitoring of RA roles, responsibilities and recommendations. It is manuals is needed. Thisdated March 9, 1993: programs and their relationships between the understood that the delay in support is likely to comeTimely and periodical integration into the Central Gov't, Regional the Cabinet decision on next from one or more of thereports, with accuracy, of central system; Democratic Councils, steps was partly due to the following sources:qualitative and quantitative - powers delegated to Municipalities, and need to build consensusmeasures of service delivery the RAs; Neighborhood Democratic within govemment on the 1. The CDB in their supportby each RA - adequacy of Councils politically sensitive issue of for strengthening local

resources and lines of Regional Administration governmentsIncreased collection of accountability for -- Operational Manual fortariffs for services provided efficient and effective Amerindian Local Gov't 2. The IDB in their work onby the RA's [collections service delivery by the infrastructure forshould represent at least RAs -- Financial Management municipalities50% ofthe costs of services Manual(samples) by the mid-term 3. UNDP's Developmentevaluation, and at least 80 - Procedures for Cooperation Framework,% by completion of the Neighborhood (District) which provides forproject Councils strengthening RAs, including

local communities, mostThe CARICAD Report has likely through NGOs andbeen used by the Constitutional sharing experiences withReform Commission which is other countries. Thislooking into issues of assistance is pendingdecentralization resolution of constitutional

issues regardingdecentralization ofdecision-making, which iscurrently highly centralized.

Design and implement Extensive training andrequired institutional institution building activitiesreforms and new have been carried out relatingsystems to support a to personnel management,new role for RAs in financial management strategicrelation to ministries planning accountability, and

transparency in resourceallocation and roles andresponsibilities of differentRegional Administrationofficials.

Develop a modern Feasibility analysis forinformation system for developing a GeographicalRAs Information System (GIS)

completed.

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Component 5: Revenue Administration/Integrated Financial Management

COMPONENT ACTIVITIES EXPECTED RESULTS CURRENT SITUATION/ PROBLEMS AND NEXT STEPS ANDOBJECTIVES ACHIEVEMENTS CONSTARAINTS FUTURE OPERATIONS

ENCOUNTEREDImprove effectiveness of 1. Set up the Revenue Establishment of a fully Preparatory actions to RA Act passed in July 1996 The requested extension ofTax and Customs Authority (RA) functioning Revenue operationalize the RA have but is not yet effective; this project from June 30,Administration and improve Authority with improved been completed: the CIAT Board of Governors has not 1999 to December 30. 1999mobilization of resources 2. Appoint the institutional capacity for contract commenced with the been created as the law is not is contingent upon the RA's

Commissioner Gencral the Inland Revenue and purpose of defining and in force and the CG has not becoming operational.Performance Indicators: (CG) of the RA Customs and Excise planning for the been appointed, specialIncreased tax and customs Departments implementation of the RA salaries not implemented, The CIAT team will preparecollections [100% by the 3. Give adequate (organization, design, vacancy rate is high (50% in an action plan to give themid-term evaluation; and decision making mandates, roles, customs), many staff are in RA's management a bird's200 percent by completion powers to the RA responsibilities, Job acting positions, morale is eye view of the concreteofthe Project] Steering Committee classification and pay low. RA was to have been steps needed for full

structure), the CG and Board created by 3/31/99. implementation from the4. Develop a strategtc of Governors have been time the RA is enabled.plan for the RA identified, the draft ofthe A court decision enjoined the

proposed salary structure has Government from5. Develop a Code of been completed; a list of establishing the RA. TheConduct and Conflict current staffof the CED and Gov't has filed a motion toof Interest and IRD to be transferred to the have the injunction lifted.Post-Employment Code new RA has been sent to thefor RA Staff Public Service Commission; If the RA is not

the Code of Conduct has been operationalized quickly anddralted, and a complete training the CIAT contract extended,needs analysis has been many staff yet to beprepared recruited, who would occupy

responsible positions withinthe RA, would not be trainedand many who are trainedmay not be suitable for thosepositions.

6 Strengthen the CIAT Consultants haveIn-land Revenue Dept., developed the organizationalincluding and legal structure, job

descriptions and computerPreparation of the systems.organtzation structure Job evaluation surveyfor the new IRD completed

Complete a preliminaryjob evaluation survey Taxpayer Survey nearing

completionDesign and implementfield surveys I In addition:throughout the country New Taxpayer Identificationto register potential No. (TIN) has been designedunregistered taxpayers

Trade Licensing andMiscellaneous LicensingSystem designed

New income tax return formhas been designed

Preliminary review completedfor re-engineering businessprocesses. _

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7. Strengthen the Training: A training needsCustoms and Excise assessment was completed forDept. (CED): the full implementation phase

and training began in selectedPrepare organizational areas: a 7 day Managementstructure for the new Orientation Program, 2 dayCED managing change course and 2Complete a preliminary day communication workshopjob evaluation survey was held for CED and IRD

staffDevelop an ImporterProfiling System toassist in targetingenforcement actions

Develop a ContainerTracking System totrack movement ofcontainers received andreleased at differenttransit sheds

Advance onintroduction ofASYCUDA

Complete study on theGuyanese TariffandHarmonized System

Complete Study onCustoms ValuationIntegrated Financial The core of the new CIDA agreed to finance these Under CIDA's GEM IManagement System: arrangement was to have activities originally envisaged Program, the budgetingDesign and implement been an integrated, under the PAP through a grant system has been put in placenorms, procedures, and decentralized budgeting financed under the GEM and the concept of Programsystems for effective and accounting system program Budgeting has beenand efficient budgeting, coordinated by the MOF. introduced. Under theaccounting, cash Consultant services, currently proposed GEM 2management, debt software, computer and 3 programs additionalmanagement, intemal equipment and training work will be completed incontrol by the Treasury were to have been the other functional areas,Secretary, Office of the provided to the key including multi-yearBudget, Account financial entities, as well planning.General Department as accounting centers inand the Auditor the 11 ministries, 10 RAs, GOG has recentdy requestedGeneral Department. the Guyana Defense that the implementation of a

Force and the Guyana Y2K compliant payrollNational Service system be financed through

the project. This is beingconsidered subject toextension of the project

- 26 -

Component 6: General Administration

COMPONENT ACTMTIES EXPECTED CURRENT SITUATION/ PROBLEMS AND NEXT STEPS ANDOBJECTIVES RESULTS ACHIEVEMENTS CONSTRAINTS FUTURE OPERATIONS

ENCOUNTEREDImprove public sector Provision of Meet important physical A wide range of capitaloperations administrative, resource needs of various equipment has been acquired

computing, central gov't agencies and for different govemmentPerformance Indicator: communications, and RAs and, by taking on the entities at the central andIncreased provision of transportation financing of part of the regional levels, thus helpingservices in selected equipment for capital budget of the Gov' improve their operationaloperational programs managing operations t, indirectly enable GOG efficiency. This equipmentcovering the principal of Executive Agencies to finance increases in includes: (examples to bebeneficiaries of the salaries of public servants added)component (e.g.maintenance services indrainage and irrigation,availability of educationalmaterials, and textbooks)

- 27 -

Annex 1. Key Performance Indicators/Log Frame Matrix

Outcome I Impact Indicators:

indc0trIMtri Projecte In last P$R ActtaaIILNg est st matNOT INCLUDED IN SAPSee Sections 4 and 10

Output Indicators:

PERFORMANCE INDICATORS FROMSAR -SEE ALSO SECTION 10

Integrated Financial Management:- Timely provision of accurate accounting In progress with assistance from CIDA andinformation to assure compliance with USAIDpreparation of official accountstReduction innon-budgeted and unaccounted forexpenditures within the Ministries,Departments, and Regional Administrations[50% reduction by mid-term evaluation; and100% by project completion]- Increased tax and customs collections 2-4 years from time of operationalization of Same[100% by mid-term evaluation; 200% by Revenue Authortycompletion of project]

Regional Administrations' System- Timely and penodical reports, with Done Doneaccuracy, of qualitative and quantitativemeasures of service delivery by each R.A.- Increased collection of tariffs for services Amounts of tariff increases unavailable fromprovided by RAs [collections should GOG Samerepresent at least 50% of the costs ofservices by mid-term evaluation, and at least80% by completion of the Project].

Personnel Management- Implementation of new personnel grading Done Donesystem and agreed salary structure for thepublic service, induding the elimination of allemployment and salary regimes outside theformal grading system- Achievement of target compression ratios,and grading system composition of the public Partially done Partially doneservice [the compression ratio should be atleast 9:1 for levels 1 through 16, and 16:1 forlevels 1 through Special)- Cancellation of all existing vacances ingrading system levels 1 -5 at the time of To be done Doneimplementation of the new salary scale; andfreezing, or cancellation, of all new vacanciesin the same levels throughout the life of theproject.

General Administration- Increased provision of services in Done Doneselected operational programs covering theprincipal beneficiaries of the component

- 28 -

Recruitment Program- Number of applications received in Targets almost met Targets almost metresponse to promotion activity; number ofcandidates screened and shortlisted- Number of positions staffed 44 of the revised target of 50 staffed Same- Retention/attrition rate of the program 35 retained Same

End of project

- 29 -

Annex 2. Project Costs and Financing

Project Cost by Component (in US$ millioln equivalent)Appraisal 1 Actual/Latest PercentageEstimate Estimate of Appraisal

Project Cost By Component US$ million US$ millionUpgrading Staff Salaries 10.00 11.00 110Personnel Management 0.50 0.54 108Recruitment Program 1.80 0.65 36Regional Administration Systems 1.00 0.48 48Integrated Financial Management/Revenue Admin. 4.00 1.96 49General Administration 4.00 4.89 122Project Coordinating Unit 0.70 0.30 43

Total Baseline Cost 22.00 19.82

Total Project Costs 22.00 19.82Total Financing Required 22.00 19.82

Project Costs by Procureme nt Arrangements (Appraisal Estimate) (US$ million equivalent)

Procurement MethodExpenditure Category ICB NC8 Other N.B.F. Total Cost

1. Works 0.00 0.00 0.00 0.00 0.00(0.00) (0.00) (0.00) (0.00) (0.00)

2. Goods 3.60 0.00 2.50 0.00 6.10(0.00) (0.00) (0.00) (0.00) (0.00)

3. Services 0.00 0.00 4.20 0.00 4.20(0.00) (0.00) (0.00) (0.00) (0.00)

4. Miscellaneous 0.00 0.00 0.00 0.00 0.00(0.00) (0.00) (0.00) (0.00) (0.00)

5. Recruitment(travel and 0.00 0.00 1.70 0.00 1.70shipping expenses and (0.00) (0.00) (0.00) (0.00) (0.00)salary allowances)6. Incremental Costs of 0.00 0.00 10.00 1 0.00 10.00the Salary Structure (0.00) (0.00) (0.00) (0.00) (0.00)

Total 3.60 0.00 18.40 0.00 22.00(0.00) (0.00) (0.00) (0.00) (0.00)

- 30 -

Project Costs by Procurement Arrangements (Actual/Latest Estimate) (US$ million equivalent)

Procurement MethodExpenditure Category [CCBr thod N.B.F. Total CostCategory ~~~~~NCB Other2

1. Works 0.00 0.00 0.00 0.00 0.00

(0.00) (0.00) (0.00) (0.00) (0.00)2. Goods 3.80 0.00 1.60 0.00 5.40

(0.00) (0.00) (0.00) (0.00) (0.00)3. Services 2.10 0.00 0.70 0.00 2.80

(0.00) (0.00) (0.00) (0.00) (0.00)4. Miscellaneous 0.00 0.00 0.00 0.00 0.00

(0.00) (0.00) (0.00) (0.00) (0.00)

5. Recruitment(travel and 0.00 0.00 0.70 0.00 0.70shipping expenses and (0.00) (0.00) (0.00) (0.00) (0.00)salary allowances)6. Incremental Costs of 0.00 0.00 0.00 0.00 0.00the Salary Structure (0.00) (0.00) (0.00) (0.00) (0.00)

Total 5.90 0.00 3.00 0.00 8.90

(0.00) (0.00) (0.00) (0.00) (0.00)

Figures in parenthesis are the amounts to be financed by the Bank Loan. All costs include contingenciesI Includes civil works and goods to be procured through national shopping, consulting services, services of contracted

staff of the project management office, training, technical assistance services, and incremental operating costs related to(i) managing the project, and (ii) re-lending project funds to local government units.

Project Financing by Component (in US$ million equiv alent)Percentage of Appraisal

Component Ap raisal Estimate Actual/Latest Estimate Pcaop iBank Govt. CoF. Bank Govt. CoF. Bank Govt. CoF.

Upgrading Salary 0.00 10.00 0.00 0.00 0.00 0.00 0.0 0.0 0.0StructurePersonnel Management 0.50 0.00 0.00 0.54 0.00 0.00 108.0 0.0 0.0Recruitment Program 1.80 0.00 0.00 0.65 0.00 0.00 36.1 0.0 0.0Regional Administration 1.00 0.00 0.00 0.48 0.00 0.00 48.0 0.0 0.0Int. Fin.Mgt./Revenue 4.00 0.00 0.00 1.96 0.00 0.00 49.0 0.0 0.0AdministrationGeneral Administration 4.00 0.00 0.00 4.89 0.00 0.00 122.2 0.0 0.0Project Coordinating Unit 0.70 0.00 0.00 0.30 0.00 0.00 42.9 0.0 0.0

- 31 -

Annex 3: Economic Costs and Benefits

N.A.

- 32 -

Annex 4. Bank Inputs

(a) Missions:

Stage of Project Cycle No. of Persons and Specialty Performance Rating(e.g. 2 Economists. I FMS, etc.) Implementation Development

Month/Year Count Specialty Progress Objective

Identification/Preparation 6 1 Task Manager (Public5/92 Administration Specialist), 1

Financial ManagementSpecialist, 3 Consultants

Appraisal/Negotiation6/92 7 1 Task Manager (Public

Administration Specialist), 1lawyer, I OperationsAnalyst, 1 FinancialManagement Specialist, 3Consultants

SupervisionI - 10/93 4 1 Task Manager (Public HS HS

Administration - PSM-Specialist), I Sr. PublicAdministration Specialist, ITax AdministrationSpecialist, I OperationsAnalyst

II - 7/94 3 1 Task Manager (PSM S HSSpecialist), I OperationsAnalyst, I Consultant

111-1 1/94 1 1 Task Manager (PSM S SSpecialist)

IV-6/95 I I Task Manager (PSM S SSpecialist)

V - 2/96 2 1 Task Manager (PSM S SSpecialist), I Sr. PublicAdministration Specialist

VI-8/96 3 1 Task Manager (PSM S SSpecialist) , 1 Sr. PublicAdministration

VII - 6197 1 1 Task Manager (PSM S SSpecialist)

VIII - 10/97 1 1 Task Manager (PSM S SSpecialist), I Consultant

IX - 6/98 2 1 Task Manager (PSM S SSpecialist), I Sr. PublicAdministration Specialist

X - 1/99 1 1 Task Manager (PSM S SSpecialist)

- 33 -

ICR5/99 2 1 Task Manager, I Sr. S S

Public AdministrationSpecialist

(b) Staff:

| Stage of Project Cycle Actual/Latest Estimate: ::

.______:______ ____________ No. Staff weeks US$ (,000)Identification/Preparation 13.1 32.2Appraisal/Negotiation 48.4 87.1

Supervision 111.5 242.1

ICR _ 4 12.3

Total 173.0 373.7

- 34 -

Annex 5. Ratings for Achievement of Objectives/Outputs of Components(H=High, SU=Substantial, M=Modest, N=Negligible, NA=Not Applicable)

RatingMacro policies O H *SUOM O N O NA

I Sector Policies O H *SUOM O N O NAZ Physical OH OSUOM ON *NA* Financial O H OSUOM O N * NA* Institutional Development 0 H O SU 0 M 0 N 0 NAN Environmental O H OSUOM O N * NA

SocialZ Poverty Reduction O H OSUOM O N * NA* Gender O H OSUOM O N * NA[B Other (Please specify) O H OSUOM O N * NA

• Private sector development 0 H O SU O M 0 N 0 NA• Public sector management 0 H O SU 0 M 0 N 0 NA• Other (Please specify) O H OSUOM O N * NA

- 35 -

Annex 6. Ratings of Bank and Borrower Performance

(HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HU=Highly Unsatisfactory)

6.1 Bank performance Rating

Z Lending C HS @ S C U C HUZ Supervision O HS *S C U OHU[ Overall O.HS OS C U 3 HU

6.2 Borrower performance Rating

I Preparation O HS S C U CHUi Government implementation performance 0 HS 0 S 0 U C HU

2 Implementation agency performance C HS 0 S 0 U HU

N Overall OHS OS U CHU

- 36 -

Annex 7. List of Supporting Documents

1. Staff Appraisal Report for the Public Administration Project (PAP) to Guyana, Report No. 11258-GUAof March 9, 19932. Memorandum of the President for the Public Administration Project to Guyana, Report No.P5901 -GUA of March 9, 19933. Development Credit Agreement for the Public Administration Project between the Republic of Guyanaand Guyana, Credit No. 2480-GUA of April 8, 19934. Guyana PAP Supervision and Back-to-Office Reports, 590/PSRs, Aide Memoire, 1993-19995. Guyana PAP Credit Amendments/Extensions, 1994-19996. CARICAD's Final Report on Regional Administrations, 19997. CIAT's Final Report on the Revenue Authority, 19998. PAD for the El Nino Emergency Assistance Project to Guyana, Report No. 18018-GUA, September29, 19989. Draft President's Report for the proposed IDA Financial and Private Sector Institutional DevelopmentCredit (FPID) to Guyana, October 199910. Draft President's Report for the Proposed IDA Public Service Reform Adjustment Credit (PSRSAC)to Guyana, November 199911. Memorandum of the President on Assistance to Guyana under the HIPC Initiative, May 3, 199912. Implementation Completion Report for the Guyana Technical Assistance Credit, Report No.16199-GUA of December 30, 199613. Implementation Completion Report for the Guyana Private Sector Development Adjustment Credit,Report No. 17999 of June 11, 199914. Final HIPC Document, Report No. P7206 GUA, December 6, 199715. IDA's Country Procurement Assessment Review for Guyana, 199916. Caribbean Countries Public Sector Modernization in the Caribbean, Report No. 15185-CRG, April199617. Guyana: Public Sector Review, A World Bank Country Study, 199318. IDB's Draft Design of the Public Sector Modernization Program, TC#99-0400-2, October 199919. ODA's Mid-Term Output to Purpose Review of the Guyana Public Service Reform Programme, May1996

- 37 -

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