en - european commission · en this action is ... the insurgency spill-over, initially contained to...

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EN This action is funded by the European Union

ANNEX 2 of the Commission Implementing Decision on the Annual Action Programme 2016 and 2017 part 1 in

favour of Pakistan, to be financed from the general budget of the European Union

Action Document for Second EU contribution to the Khyber Pakhtunkhwa, FATA and Balochistan Multi-Donor Trust Fund

1. Title/basic act/ CRIS number

Second EU contribution to the Khyber Pakhtunkhwa, FATA and Balochistan Multi-Donor Trust Fund, CRIS number: ACA/2016/39283, financed under Development Cooperation Instrument

2. Zone benefiting from the action/location

Asia, Pakistan The action shall be carried out at the following location: the provinces of Khyber Pakhtunkhwa, FATA and Balochistan

3. Programming document

EU-Pakistan Multi-Annual Indicative Programme (2014-2020)

4. Sector of concentration/ thematic area

Sectors: 1. Rural development and 3. Governance, human rights and rule of law

DEV. Aid: YES

5. Amounts concerned

Total estimated cost: EUR 347,159,603 1 Total amount of EU budget contribution: EUR 10,000,000 The contribution is for an amount of EUR 10,000,000 from the general budget of the European Union for 2016. This action is co-financed in parallel or joint co-financing by other donors of the Multi-Donor Trust fund for an amount of indicatively USD 373,661,000.

6. Aid modality(ies) and implementation modality(ies)

Project Modality Indirect management with the International Bank for Reconstruction and Development, and the International Development Association, and the International Finance Corporation, collectively "World Bank Group" Direct management – procurement of services (for communication and visibility)

7 a) DAC code(s) 43040-Rural development; 73010-Reconstruction relief & rehabilitation

b) Main Delivery Channel

44000 - World Bank; 44001 - International Bank for Reconstruction and Development General policy objective Not

targeted Significant objective

Main objective

Participation development/good governance

☐ ☐ x

Aid to environment x ☐ ☐ Gender equality (including Women In Development)

x ☐ ☐

8. Markers (from CRIS DAC form)

Trade Development x ☐ ☐

1 USD 385,000,000 correspond to approximately EUR 347,159,603 (Infor€ur rate of August 2016).

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Reproductive, Maternal, New born and child health

x ☐ ☐

RIO Convention markers Not targeted

Significant objective

Main objective

Biological diversity x ☐ ☐ Combat desertification x ☐ ☐ Climate change mitigation x ☐ ☐ Climate change adaptation x ☐ ☐

9. Global Public Goods and Challenges (GPGC) thematic flagships

Human Development

10. SDGs Main SDG is goal 8 Secondary SDG are goals 1 and 6

SUMMARY This Action will provide a second EU contribution to the Khyber Pakhtunkhwa (KP), the Federally Administered Tribal Areas (FATA) and Balochistan Multi-Donor Trust Fund (MDTF), administered by the World Bank Group. This MDTF has been created to support the provincial/regional governments of KP, FATA and Balochistan in response to the 2010 crisis. The purpose of the MDTF is to support the implementation of a reconstruction and development program aimed at facilitating the recovery of the affected regions in the KP, FATA and Balochistan from the impact of (i) the armed conflicts and reducing the potential for escalation or resumption, and (ii) the floods of 2010. The Round I of the MDTF has been completed by the end of 2015 and the Fund's implementation period has been extended with the Round II designed for an additional 5 years (2016-2020). While the Post Crisis needs Assessment (PCNA) objectives remain as a main overarching reference, the MDTF Round II will be primarily a tool for implementation of the different development policies existing at provincial level, ultimately the SDGs. The round II of the MDTF includes programmes supporting peace building and development of the target regions. The Result Framework defines 9 outcome indicators, which are common for the 3 provinces. The initially planned activities cover 3 thematic areas: 1. improved local service delivery (education, agriculture, livelihoods, infrastructure); 2. growth and job creation (economic revitalisation focused on SMEs, skills development and youth employment); and 3. governance and policies. The indicative total budget of the MDTF over 5 years is estimated to become approximately USD 460 Million, while the current indicative donor commitments stand at around USD 385 Million. This programme should benefit significant numbers of temporarily displaced families in the targeted regions and also indirectly contribute to prevention of irregular migration.

1 CONTEXT

1.1 Sector/Country/Regional context/Thematic area Pakistan’s GDP growth has been lower and more volatile when compared to other regional economies. Structural problems, including shortage of energy, decline in investments and persistent high inflation and security issues, have been exacerbated by the global financial and food commodity crises in 2008 and the impact of unprecedented monsoon floods in 2010 and 2011. Poverty levels reported in 2008 having previously declined to 17.2 per cent, are widely perceived as to be on the increase. Food insecurity and malnutrition are high in rural areas and progress in key sectors, such as education and health, has slowed down in recent years. Pakistan ranked in 2014 146th out of 187 countries on the United Nations (UN) Human Development Index and has gradually fallen behind its neighbours. Pakistan reported limited progress of the Millennium Development Goals (MDG), particularly in the western border regions of Balochistan, Khyber Pakhtunkhwa, Federally Administered Tribal Areas (FATA) and interior Sindh. These areas have disproportionally suffered from successive calamities, militancy, and policy neglects and therefore still need to better benefit from a renewed effort focused on implementation of Sustainable Development Goals (SDGs). The current macro-economic

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performance and economic governance are severely constraining the economic and social development process in the provinces. Successive attempts to reform the economic management have rarely been accomplished because of a highly complex political economy. Repeated changes in leadership between democratically elected and military governments have resulted in a continuously weakening of public administration both in the provinces as well federal level. Development policies have been overly biased towards public sector projects and arbitrary incentives impeding competiveness and sustainable economic growth. However, since 2013 elections serious efforts were extended to fight corruption leading to some improvements. Within the national context, the economic situation and prospects in Khyber Pakhtunkhwa province have been chronically constrained by difficult geography, years of regional instability, natural disasters, poor governance, limited investment in human capital and a policy environment that has not been conducive to private sector growth. With its economic potential largely unexploited, especially in mining and hydro-power, the province has consistently underperformed compared to the rest of Pakistan. The insurgency spill-over, initially contained to the Federal Administered Tribal Areas (FATA) along the Afghan border, expanded into Khyber Pakhtunkhwa province by the end of 2007, severely affecting the northern mountainous and predominantly rural Malakand division. The military offensive in spring 2009 to re-establish the State's writ displaced some 2,300,000 people and resulted in severe losses of infrastructure. Large parts of the Malakand division were further devastated by flash floods in August 2010, virtually wiping out the entire local economy. Additional destruction in KP brought earthquakes in 2015 and 2016. Whilst the provincial government re-established administrative control over all seven districts of the Division, socio-economic situation of the approximately 6,300,000 inhabitants remained precarious and fragile. Cognisant of the root causes that triggered the extremist forces to build a foothold in the area, the Government of Khyber Pakhtunkhwa sought to consolidate and stabilize the transition process of post-crises measures and to overcome the trust deficit with its citizens. Economically, Federally Administered Tribal Areas (FATA) is one of the poorest and most underdeveloped regions of Pakistan: almost 60% of the population lives below the poverty line. Literacy rates reach 21%, with male literacy at 34% and female literacy at only 7%. Approximately 34% of under-5 children are severely stunted (low height for age) and 6% suffer from severe wasting (low weight for height), whereas the national averages are respectively 22% and 6%. The population lives principally from subsistence farming and livestock (mostly goats), with very little industrial, mining or service employment. Due to these economic factors, there has always been some economic migration towards urban centres. Over the past 15 years, with peaks since 2009, the impact of local conflicts and reiterated military operations has displaced relevant segments of the local population and destroyed social structures. Internally Displaced Persons (IDP) have found refuge mostly in the neighbouring KP in camps or principally in hosting families. As of the end of October 2014, official statistics account for approximately 225,000 displaced families registered by the authorities, of which 31% come from the North Waziristan Agency (NWA), following the June 2014 offensive. The 2013-14 FATA Annual Development Plan (ADP) accounted for 15 billion PKR. The main benefitting sectors were education (3.7 billions) and communications (3.3 billions), followed by health and irrigation each being allocated approximately 1.5 billion. Local administration suffers from weak capacity and resources and still need to improve policies and sector strategies, in order to better deliver services to the population. Limited number of donors currently supports FATA development, principally due to the security context. In some parts of FATA, such as the South Waziristan Agency (SWA), some development projects, mostly related to infrastructure rehabilitation, have been implemented by the army. In May 2014 a FATA Reforms Commission was established with the aim of proposing reforms of the FATA status by April 2015. The official endorsement of the reform agenda is still in process. In November 2015 a High Level Committee was created by the Prime Minister to address political reforms and clarify administrative status of FATA. Balochistan is the first province having constituted local governments in January 2015 after successful elections, followed by Khyber Pakhtunkhwa. The province of Baluchistan is in a state of crisis posing serious threats to the federation of Pakistan amid rising nationalist and religious insurgencies resulting from a sense of neglect and isolation, and poor socio-economic development. Its unique features, i.e., its diverse geographic, ethnic, political and social mosaic that constitutes 44% of the country’s land

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area with only 5% share of the population open up a vista of possibilities as well as challenges for social transformation. It is the least developed province but rich in energy and mineral resources meeting more than 40% of Pakistan’s energy needs while half of its own inhabitants do not have electricity. Of the estimated 13 million inhabitants, over 70% live in rural areas and depend on agriculture for their livelihood, suffering however from increasing of water shortages, frequent drought, and poor agricultural practices, which increase the vulnerability of the rural communities, especially women and children. Consistent depletion of water resources and absence of storage systems turned it into an arid wasteland, and half of the population lives below the poverty line. The fishery sector has huge potential, but suffers from constraints caused by poor treatment and conservation, and poor infrastructure. Average household incomes are low as alternate livelihoods means are limited. Security aspects - In recent years, different regions of Pakistan have emerged as key conflict areas, while the overall security situation of the country remains fragile in for multiple reasons: the persistence of conflict in the border regions with Afghanistan; communalism and separatism in Balochistan; growing instability in key urban contexts. In addition, growing emphasis on dogmatic orthodoxy and rigid conception of religious identity has been fuelling tensions between different cultural traditions and religious practices, resulting in a variety of sectarian conflicts across the country, with a potential to escalate into violence. The Multi-Donor Trust Fund (MDTF) was established in August 2010 as one of the instruments to support the reconstruction, rehabilitation, reforms and other interventions needed to build peace and create the conditions for sustainable development in the aftermath of the 2009 crisis – together with reducing the potential for the escalation or resumption of conflict in these regions. The MDTF is administered by the World Bank and has been supported so far by eleven donors - Australia, Denmark, European Union, Finland, Germany, Italy, Netherlands, Sweden, Turkey, UK, and the US (US, Denmark and Netherlands discontinued their contributions recently). Primarily, MDTF has been financing projects intended to (i) promote enhanced, sustainable and accountable delivery of basic services (ii) support livelihoods and community-based development of basic infrastructure and services (iii) help communities to access assets and market opportunities and create the basis for viable income generating activities and (iv) support peacebuilding activities and promote rapid crisis recovery in KP, FATA and conflict-affected districts of Balochistan (v) strengthen, re-building and/ or maintaining government institutions in order to improve governance, overall institutional performance and state effectiveness. The overall portfolio of MDTF stood at around $201m by the end of 2015 and the programme has been extended in 2015 for another period of 5 years up to the end of December 2020.

1.1.1 Public Policy Assessment and EU Policy Framework

In line with EU’s Agenda for Change 2011 underlining the requirement to focus the EU aid on actions related to key elements of good governance, as well as on inclusive and sustainable growth for human development, this action is focused on these priority areas. Governance is also highlighted as a specific area of the EU – Pakistan 5-Year Engagement Plan of 2012. The action is also designed keeping in view the strategic objectives outlined in the EU MIP 2014-2020 aimed at fostering rural development and good governance and in particular supporting federalisation and decentralisation of public administration to provinces and districts through strengthening of accountability in delivery of public services. The operating environment for the MDTF, political and institutional context, has evolved since its inception in 2010. After the general elections held in May 2013, new governments were appointed in the provinces, with an ambitious agendas for change. This momentum has been illustrated in the discussions and adoptions of updated development strategies, namely: the KP Strategic Development Partnership Framework, the FATA Sustainable Development Plan, and the Balochistan Comprehensive Development Framework. These strategies consolidate in some ways the existing plans and provide a set of priorities without undermining what has been already achieved, especially under the Post Crisis Needs Assessment (PCNA). The focus on Governance and Local Government reform in KP, on community participation in FATA and water resources management in Balochistan provide a road map to donors which are willing to partner with Provincial Governments in their transformational efforts. MDTF and donors have been invited to align with these strategies, coordinate

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with the ongoing efforts of Provincial Governments and fill the investments gaps, which were analysed in the stocktaking exercise completed by KP and FATA. Moving forward MDTF must contribute to this momentum for change. However, PCNA and the Balochistan Development Needs Assessment (BDNA) remain the guiding document with regard to peace building and development in KP, FATA and Balochistan respectively, and it is therefore essential for the MDTF to align its activities to these documents. Provincial priorities have evolved since 2010, when the MDTF was established and Government capacity has been enhanced and all provincial/regional governments are now in a better position to articulate their needs. Two activities have contributed to this. First, under the MDTF-supported Governance Support Project (GSP), the Governments of KP and FATA have completed an extensive mapping exercise, which maps investments (government and donor) against the PCNA. The Government of Balochistan has initiated this activity against the Balochistan Development Needs Assessment (BDNA). The MDTF Round I has been designed as a response to the Government request for assistance in meeting needs related to management of post-crisis situation in the affected provinces. The Government of Pakistan launched a peace building assessment for strategic medium- to long-term support for the addressing the needs of the Federally Administered Tribal Areas and Khyber Pakhtunkhwa in 2009. A Post-Crisis Needs Assessment (PCNA), supported by Asian Development Bank (ADB), the European Commission (EC), United Nations (UN) and WB, was formally issued in October 2010 which provides a very comprehensive peace building strategy for addressing the regional issues with a holistic approach. Recognizing the dynamic nature of the crisis, the focus of PCNA recommendations is on creating the enabling conditions – peace, trust, responsiveness, access - that make further long term development and sustained peace possible. It does this by proposing recommendations for fundamental reform that protect basic rights and address the key governance, security and development shortfalls and inequities that caused the crisis.

1.1.2 Stakeholder analysis

Provincial Authorities, their line departments and the Planning and Development Departments need to have a stronger ownership and role in design and implementation of MDTF, and in donor coordination. They continue benefiting from capacity development through the MDTF Governance Support Programme. The authorities in the three areas request simplified modalities to give implementing departments more control over their respective activities, as well as flexibility to adjust activities during implementation to achieve the targeted results. Business partners involved in implementation of MDTF, including delivery of services which are subject to the sales tax, raise concerns related to the compliance costs and corruption in tax administration. The Government of KP province in the north-west Pakistan has been responding to unprecedented levels of destruction and disruption caused by militancy and civil unrest resulting from the Afghan war, the 2010 floods and recent earthquakes (2015 and 2016). Whilst the provincial government re-established administrative control over all seven districts, socio-economic situation of the approximately 6,300,000 inhabitants remained precarious and fragile. Cognisant of the root causes that triggered the extremist forces to build a foothold in the area, the Government of KP sought to consolidate and stabilize the transition process of post-crises measures and to overcome the trust deficit with its citizens. Public sector in Balochistan lacks capacity to formulate and execute effective development policies for public services, which is compounded by a weak public finance system. Members of the Provincial Assembly have a strong say in decisions on allocation of development budget, where they tend to promote schemes on behalf of their respective constituencies. Following the constitution of the local governments in January 2015, Baluchistan's public administration is in need of a concerted approach to budgeting for local development based on local participative development planning. Although political choices and key decisions come from the President, FATA Secretariat has overtime gained increasing levels of ascendancy in terms of local planning. The Secretariat in fact sets policy

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for the social sectors, and implementation takes place through the line departments and the offices of the Political Agents. However, their levels of efficiency and effectiveness still need to be improved. On the other hand, donors are often sceptical about investing in FATA, in view of the volatile security situation and difficulties in accessing the projects sites. Development projects launched both by the Government and donors have been confronted with major problems due to the widespread presence of militancy and prevailing insecurity. Since project-monitoring in many areas is particularly difficult, there is a concrete risk of misappropriation of development resources by militiamen and local powerbrokers, while only a limited share of benefits is effectively delivered to the local population. Army is in control of FATA and in charge of civilian tasks as well. In KP army maintains a strong presence despite handover of powers to the civilian administration and in Balochistan even more with some regular military operations still on-going. However, while the army remains heavily involved in Balochistan, it recognises the need to restore a responsive and accountable civilian administration. Different political parties dominate provincial governments. In KP it is the strongest opposition party of Pakistani Tahreek-e-Insaf (PTI), and in Balochistan, the Pakistan's ruling party of Pakistani Muslim Leagues-Nawaz (PML-N). Federal Government is interested in co-chairing the MDTF Steering Committee despite the full devolution and division of powers between the federal and provincial levels, as it remains in charge of the flow of development aid. Civil society and local communities need capacity development assistance to enable them to monitor service delivery and to raise awareness of citizens’ rights, with particular focus on expanding outreach in rural areas. This is particularly important in FATA, where only around 3% of the population resides in established townships. Temporarily displaced families from FATA have found refuge mostly in the neighbouring KP in camps or principally in hosting families. As of the end of October 2014, official statistics account for approximately 225,000 displaced families registered by the authorities, of which 31% come from the North Waziristan Agency (NWA), following the June 2014 offensive. In KP the military offensive in spring 2009 to re-establish the State's writ displaced some 2,300,000 people. Women, members of religious minorities (Shia Hazaras) and those in the majority Muslim community whose views are not aligned with a rigid interpretation of Islamic tradition and practice are increasingly under assault and suffer from violation of human rights and individual freedom. In particular, youth remain vulnerable to the radical Islamist influence and to reflexive acceptance of radical religious thinking and violent behaviour. Vulnerable groups experience even more difficulties in accessing quality social services, job opportunities and micro-credit and loans.

1.1.3 Priority areas for support/problem analysis

The MDTF Secretariat carried out three analytical exercises with the objective of supporting the development of MDTF strategy for Round II. These included i) MDTF Round I Operations: lessons learned and recommendations for moving forward ii) Post-Crisis Needs Assessment Stock Taking Round I, and iii) The economic impact of Afghanistan’s transition on Pakistan’s economy and its border areas. Aiming to identify how the MDTF could ensure the shift from an array of projects towards more coordinated and structured programs, the first study outlined mechanisms through which the MDTF could consolidate its activities for more efficient implementation. The analytical exercise synthesized the central lessons learned from the implementation of Round 1 and how the MDTF should be re-positioned in the new political context of KP, FATA and Balochistan. It also described how MDTF delivery could be improved to strengthen the case to internal and external stakeholders for the continued relevance of the MDTF as an aid instrument. The PCNA stock-taking report aimed to provide a summary of PCNA’s state of affairs. The report also served to inform donors and government of the extent to which PCNA recommendations are being addressed by i) the activities of provincial government, ii) bilateral activities supported by donors, and iii) through the performance of MDTF Round – I projects. The third analytical exercise relating to the economic impact of

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Afghanistan’s transition on Pakistan’s economy and its border areas provided background information relevant to the development of the MTDF Round-II strategy. As a result of the analysis outlined above the MDTF Round II shall become more strategic in meeting development needs and will have one portfolio per province which includes three programs, each reflecting the themes identified in the MDTF engagement strategy. These include 1) improved service delivery, 2) growth and job creation and 3) policy reform and governance. The higher level result for each portfolio is to enhance state-citizen trust in that province/region. At the project level, results will be pre-determined, in consultation with provincial governments and endorsed by the MDTF Steering Committee. In addition, the MDTF will manage a fourth program that provides a mechanism to allow for quick response in areas experiencing rapid deterioration of the economic and social environment. This will be managed independently from the three provincially-based programs. This approach has a number of advantages: • It allows for consolidation within a governing programmatic entity so that funds can be easily

reallocated from one theme/component to the other where necessary. • One governing entity is not punished for the poor performance of another. This implies that if the

program in one region would be under-performing in comparison to the other regions, it can be restructured, or even cancelled, in the under-performing region, without affecting the Bank’s engagement in the better preforming regions.

• It allows for a greater and more focused impact that reinforces the over-arching objectives of the three themes.

• Provinces can design interventions that are more suited to the local context, which better identify cross-program linkage and will support the identification of results that are more reflective of their particular context.

• The size of each program can be pre-determined allowing for more transparent and systematic forward programming. This could lead to revisiting the MDTF Financing Strategy, which allocates a share of MDTF funds according to provincial population.

• It provides flexibility to shift resources between components as well as allowing greater capacity to adapt operations in response to changing security situations. Under this approach; the ISUs could become the nucleus of coordination and support within the Government for all development programming and donor coordination beyond that financed by the MDTF.

Each program within the portfolio will be designed with its own results framework, implementation status reporting, ratings and operational risk assessment framework. Regarding preparation of the specific activities to be implemented through each program, a long, medium and short list of activities will be prepared. A program might undertake 3 activities but, at the outset, it would prepare for perhaps four from the long list so that if one is under-performing, this can be cancelled and the other can kick in with no loss of time. Such restructuring can be easily undertaken at the country office level. It must be recognized that in terms of funding, the MDTF represented just over 6 percent of the needs identified in the PCNA and its impact towards enhancing state-citizen trust is yet to be demonstrated. The lack of flexibility that has been characteristic of MDTF activities in Round I has resulted in slow pace of implementation and disbursements. In accordance with Aid effectiveness principles, the MDTF has used government systems to implement. While this is essential for capacity building, it does come at a price in terms of speed of implementation. Initial concerns over slow implementation have been addressed through consultations such as the MDTF Advisory Group used to inform decision making and to raise and discuss impediments to implementation. In deciding the choice of investment and level of financing for activities/projects under each component of the three geographic programs, decision makers will need to consider that the balance of funding, 40, 35 and 25 percent for KP, FATA and Balochistan respectively, can be changed. Most importantly, the idea of having in Round II portfolios for each province/region makes it easier for the governments to solicit other sources of funding including through blended operations. Within a portfolio, allocations across programs may vary depending on provincial/regional priorities where a particular component may receive smaller or no funding and/ or where well performing activities under one result can be scaled up and allocated greater resources.

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In addition to the three provincial portfolios a “quick disbursing window”, the MDTF will be designed to address emergent needs that may arise as a result of the economic contraction that could occur as a consequence of the withdrawal of ISAF troops and the potential flow-on effects from an anticipated economic contraction in Afghanistan. Whilst it will be important to maintain the window as a highly adaptive and quick response mechanism, it is anticipated that three types of needs are most likely to emerge as a result of this contraction: i) support for emerging trade opportunities and reforms that might facilitate greater regional economic integration; ii) a cash transfer program to provide a safety net for families made more vulnerable as a consequence of a deteriorating economy and accompanying social instability; and, iii) job creation and support to SMEs to help communities make the transition to new economic conditions. While the first is beyond its scope (although it can be done under the policy reform and Governance stream or even through the growth and job creation stream) the second and third can be implemented through the MDTF. Some of the safety net-focussed activities could be implemented in partnership with the UN, which has extensive experience as well as presence in the border areas of Pakistan. It is also possible to consider disaster response interventions through the MDTF quick disbursing window particularly with regard to managing the emerging IDP crisis, which is the mandate of Provincial Disaster Management Authorities.

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2 RISKS AND ASSUMPTIONS

Risks Risk

level

(H/M/L)

Mitigating measures

Limited commitment of the provincial authorities to undertake governance and other reforms

L Donors, the Bank and the provincial authorities are systematically engaged in a policy dialogue

Slow start-up of projects L On-going strategic dialogue with donors and government will be used to prioritize the project pipeline. Continued support to the governance shall also facilitate the process.

Insufficient capacities of provincial authorities to implement projects, within the implementing agencies and PMUs. Lack of experienced and qualified staff for financial management and procurement.

M FATA, KP, and Balochistan – hiring consultants/staff with the requisite skills, if required, combined with capacity building by MDTF on a continuous basis. New modalities of ensuring sustainable capacity building are being explored by the Governance projects for possible replication province-wide. These could include provision of in-house expatriate support and on-line courses in the areas of procurement, financial management, and M&E. Adequate documentation of basic internal controls and payment processes is a pre-condition for disbursement. Close supervision will be done by Bank teams. Also Balochistan, KP and FATA will upload procurement disclosures on Project website. An independent complaint redressal mechanism will also be established.

The centralized government structure in KP and the current institutional arrangements in FATA could limit the involvement of stakeholders in the decision making process.

L Project activities will be initiated by the sector agencies/line departments / directorates and the technical assistance will be providing support for its implementation. Citizen engagement will be built into the design of projects to the extent possible.

Reputational risks L These could arise from unmet government and public expectations about the pace and reach of MDTF. Inevitably, progress in reaching less secure areas will be

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tied to progress in the military campaign and is not subject to mitigation.

Key stakeholder groups lack understanding and commitment to reforms, and resistance at various levels to change is observed

M Political economy analysis to be used to explore the stakeholder relations and incentive for change as well as decision making structures to better understand the complex interrelations among key reform drivers and influential agency decision makers. Attempt at identifying what the public is receiving and what should be delivered to them by the government will be made. Additionally, projects will support preparation of a communication strategy for systematic consultations with various stakeholders

Inadequate donor relations and communication may result in a duplication of effort.

L Regular interactions with the development partners. The MDTF Secretariat will also work with the KP /FATA/Balochistan counterparts to support a mapping of assistance received and encourage the most strategic use of it.

Insufficient supervision and difficulty in reaching out to remote areas to ensure adequate beneficiary participation due to post-crisis context and security issues.

H A communication strategy and community outreach plan will be implemented as tools for promoting greater public participation. MDTF has an experience in working in

higher‐risk areas which includes working through local

partners and use of supervision consultants, monitoring agents, and security consultants to mitigate supervision and security risk. Task teams also make use of technology to facilitate supervision through local partners.

Fraud and corruption risks affecting the attainment of project results and undermining fiduciary management. The risk of fraud in selecting the consultants and in contracts management is a possibility.

M a)There will be direct transfer of funds to projects with timely reporting of expenses along with independent verification of payments for technical assistance, capacity building and training, with third party monitoring arrangements. (b) FATA’s, KP’s and Baluchistan's mechanism for internal reviews will be extended to the project level. Post audits of projects will be done by the Auditor General (AG). All Audit Reports will be discussed at the Departmental Accounts Committee (DAC) meeting. In FATA, the corruption cases are reviewed by the Governor’s Inspection Team which also reviews public complaints. (c) The respective Steering Committees will provide overall guidance, oversee implementation of project and make decisions to address delays. (d) Internal Audits of the project will be carried out periodically. Annually AG will carry out external audit of the project. Transparency of the procurement process and effective controls will be monitored closely and should be in line with Bank requirements.

Assumptions

Security risks are beyond WB influence and the team plans to respond to such situations through a flexible implementation schedule that would allow rescheduling or suspension of some activities if the situation on ground deteriorates. It is assumed that the financing gap between current f MDTF funds and the financing needed to undertake the proposed activities, according to Government request and detailed costing will be gradually filled by donor contributions. The Bank team with the help of Government will prioritise the activities, with an open ended scope so that they could be scaled up or down depending on the availability of MDTF funds.

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3 LESSONS LEARNT, COMPLEMENTARITY AND CROSS-CUTTING ISSUES

3.1 Lessons learnt

An in-depth analysis of lessons learned from MDTF activities to date has led to the following findings: 1. Use of government systems presents a trade-off between capacity building and speed of implementation. 2. Continued support for capacity building of line departments is necessary to enhance implementation through partnership with communities, CSOs, NGOs and private sector. 3. Stability in tenure of project management team and delegation of decision-making are critical for smooth implementation. 4. Security risk, including access to certain areas and travel restriction is critical in selected areas of intervention. 5. There is a need to better align interventions with updated priorities of provincial governments. 6. It was found that the MDTF should move from fragmented projects to programmatic interventions along government priorities (e.g. Governance, Job creation and Service Delivery) with a strong results framework.

Going forward in the context of the replenishment of the MDTF, it is essential that MDTF activities be less fragmented and be implemented as scaled up and flexible programs to ensure that the development impact of MDTF interventions is transformational, increases exponentially and that the benefits are sustained. Having in view the purpose of the Fund the future programming should build on those activities that have a demonstrated impact on enhancing state-citizen trust.

3.2 Complementarity, synergy and donor coordination

The MDTF has been supported so far by eleven donors - Australia, Denmark, European Union, Finland, Germany, Italy, Netherlands, Sweden, Turkey, UK, and the US (US, Denmark and Netherlands discontinued their contributions recently). Main donors supporting KP include UK, Germany, and US, while UNDP implements programmes using the government funding. In Balochistan the assistance is provided primarily by US and EU while different UN Agencies are also active there. FATA is supported mainly by US (infrastructure investments in collaboration with the military), EU, UK, Germany and Japan. Germany is supporting FATA since 2009 by capacitating the FATA Secretariat and working on local development. UK and the WB are mostly intervening through the MDTF. MDTF Round I had a minor share of the total donor assistance portfolio in Khyber Pakhtunkhwa (KP), FATA and Baluchistan, and small share of the total Annual Development Programs (ADPs) (2%, 2% and 4% respectively) of the three provinces/areas. Since early 2013 the provincial Governments of KP and FATA have been taking stock of what has been funded both through the provincial budgets and through bilateral programs of development partners in addition to what is being financed under the MDTF. Currently in KP the donor coordination is well organised with 8 thematic sub-groups. FATA Secretariat established a donor coordination Steering Committee, which primary responsibility is coordination, resource mobilization and management for development framework. In FATA donor coordination is assisted by UNDP, while in Balochistan there are no formal coordination mechanisms in place. The MDTF Steering Committee co-chaired by WB and the Economic Affairs Division of the Federal Ministry of Finance provides a valuable additional coordination and dialogue platform bringing together representatives of the provincial authorities and donors. Moreover since January 2015 EU has co-chaired with the representatives of the provincial authorities the MDTF Advisory Group meetings. This role has been assumed upon request from the EU Member States contributing to the fund.

3.3 Cross-cutting issues

MTDF will continue to be focused on representation and engagement of women in the development interventions. For women, limitations on access to basic services are common amongst the three regions. Sectors like infrastructure and energy have major bottlenecks in terms of mainstreaming gender into operations due to the weak institutional and monitoring mechanisms. Crises can break down social barriers and traditional patriarchal patterns, thus providing windows of opportunity for the reconstruction of a more just and equitable society where women’s human rights can be protected and gender equality becomes the norm in institutional and social frameworks. Engagement of the community ensures greater participation, representation of women and sustainability of interventions

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and ensures a multiplier effect with respect to state-citizen trust. The MDTF delivers projects in some of the most insecure and socially conservative contexts, where women’s rights are severely limited. Consideration of gender and inclusion of youth and marginalised groups was variable across the MDTF Round I portfolio as so far there has been no strategic framework for addressing gender equality and engagement of vulnerable groups, and the absence of a gender expert in the MDTF management team. However in the Round II WB is planning to appoint a focal person dedicated to gender and issues related to operating in fragile areas. For MTDF Round 2, gender mainstreaming will be done at two main levels: the portfolio as a cross-cutting theme and program level with specific interventions. At the portfolio level, gender mainstreaming will be achieved through institutional strengthening. The aim is to build the capacity of existing government institutions and foster involvement of CSOs to create awareness about the issues as well as the capacity to address these. At the program level, interventions related to gender mainstreaming will reflect the overall aim and goal of women empowerment, trust building and inclusion. Programs will therefore require detailed gender analysis as part of the gender action plans/gender mainstreaming notes with quantifiable results, key performance indicators that are measurable and time bound to monitor inputs and outputs for women and girls. The MDTF results framework will be designed to establish targets and collect data disaggregated by gender and other relevant demographic categories. To assess the nature and significance of the potentially negative environmental impact, and to determine appropriate mitigation measures environmental screening would be carried out during the proposal/design phase. The implementing agency will also ensure compliance with the WB and national environmental requirements. MDTF will appoint a focal point person for environment issues as well as a focal point to address the risks associated with work in fragile insecure areas.

4 DESCRIPTION OF THE ACTION

4.1 Objectives/results

The overall objective of MDTF is to support the implementation of a programme reconstruction and development aimed at facilitating the recovery of the affected regions in the Khyber Pakhtunkhwa Province ("KP"), the Federally Administered Tribal Areas ("FATA") and the Province of Baluchistan ("Baluchistan") from the impact of: (i)the armed conflict and reducing the potential for escalation or resumption, and (ii) the floods of 2010.

The specific purposes are to: (a) promote enhanced, sustainable and accountable delivery of basic services: (b) support livelihoods and community-based development of basic services; (c) help communities to access assets and market opportunities and create the basis for viable income generating activities; (d) support peace building, recovery, rehabilitation and reconstruction activities and promote rapid crisis recovery in KP, FATA and conflict-affected districts of Balochistan; and (e) strengthening, rebuilding and/or maintaining government institutions in order to improve governance, the overall institutional performance and state effectiveness.

The MDTF Round II Results Framework consists of 9 outcome indicators covering three provinces/regions. The output indicators in the framework were identified through the provincial/regional consultation exercises. These vary across the three provinces/regions to reflect the outcomes prioritised by the government to support its own initiatives.

Result 1. Increased productivity in employment generating in priority sectors

Result 2. Enhanced job creation through entrepreneurship development and better skilled labour force

Result 3. Strengthened systems to prepare for and to respond to disasters and emergencies

Result 4. Improved transparency and accountability of the service delivery

Result 5. Improved environment for public private partnership and private sector growth

Result 6. Capacity building of public administration through improved management and strengthening of systems used by the Government

Result 7. Improved water resource management in an environmentally and socially sustainable manner

Result 8. Improved access to basic services in selected less developed areas identified by the government

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Result 9. Access to social safety net programmes (aimed at provisional temporary relief)

This programme is relevant for the Agenda 2030. It contributes primarily to the progressive achievement of SDG target(s) and in particular Goal 8 "Promote sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all" but also promotes progress towards Goal 1 "End poverty in all its forms everywhere", and Goal 6 "Ensure availability and sustainable management of water and sanitation for all". This does not imply a commitment by the country benefiting from this programme.

4.2 Main activities

Initial set of programmes has been identified for each of the targeted provinces and their formulation is on-going in consultation with stakeholders.

Khyber Pakhtunkhwa - 3 programmes:

a. Service Delivery Program: Scale up of KP Southern Area Development Project into a Local Service Delivery Program to provide integrated services in education, agriculture and livelihoods support;

b. Skills and Competitiveness Program: Discussion is ongoing to prioritize activities; c. Governance and Policy Program (GPP);

FATA – 3 programmes

d. Integrated Community Livelihoods and Infrastructure Project (ICLIP) Program: Scale up Rural Livelihoods and Community Infrastructure Project and Urban Centers Project into a new program combining both urban and rural areas;

e. Growth and Job Creation Program: Scale up of Economic Revitalization of Khyber Pakhtunkhwa and FATA Project into a program focusing on small and medium enterprises, skills development and youth employment;

f. Governance and Policy Program (GPP);

Balochistan – 1 programme

g. A single integrated Local Service Delivery and Job Creation Program: combining the pillars of service delivery and job creation. This program would be based on demand driven interventions at the community level, with a focus on value chains and skills;

4.3 Intervention logic

Since 2011, MDTF has moved from a funding mechanism for KP, FATA and Balochistan to a strategic instrument aimed at contributing to objectives of the provincial development plans and ultimately the SDGs, while helping provincial governments to build their own capacity. Based on the experiences from the implementation of MTDF I, the fund has made a strategic shift from a project-based funding mechanism to a more programmatic approach aimed at making the MDTF more strategic, responsive to evolving needs, flexible and less fragmented. It is envisioned that this approach will better contribute towards achieving the aims of the provincial development plans. The MDTF Programmatic Approach focuses on each province/region having one portfolio that consists of a number of programs reflecting the themes identified in the MDTF engagement strategy. The approach proposes that at the program level, results for each theme will be pre-determined, in consultation with provincial governments and endorsed by the MDTF Steering Committee. This approach supports provincial/regional governments to develop robust portfolios at the provincial level and leverage additional resources, whether through multilateral and bilateral donors. The success of the approach hinges upon the clear identification and prioritization of results by provincial/regional governments at the outset. MDTF will continue working under the principle that its program is Government owned and executed. This means that Provincial Governments and their line departments are leading the implementation of projects with the support of the Bank. The strategic drive of MDTF shall strengthen further the capacities of provincial authorities while advocate for an increase of on-budget bilateral support and helping donors to harmonize their

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interventions. As an instrument for channelling financial support, the MDTF has also served as a useful forum for a joint dialogue of actors dedicated to the reconstruction and development of KP, FATA and Balochistan. This additional role of the MDTF will be further strengthened in the Round II.

5 IMPLEMENTATION

5.1 Financing agreement

In order to implement this action, it is not foreseen to conclude a financing agreement with the partner country, referred to in Article 184(2)(b) of Regulation (EU, Euratom) No 966/2012.

5.2 Indicative implementation period

The indicative operational implementation period of this action, during which the activities described in section 4.1 will be carried out and the corresponding contracts and agreements implemented, is 50 months from the date of adoption by the Commission of this Action Document. Extensions of the implementation period may be agreed by the Commission’s authorising officer responsible by amending this decision and the relevant contracts and agreements; such amendments to this decision constitute technical amendments in the sense of point (i) of Article 2(3)(c) of Regulation (EU) No 236/2014.

5.3 n/a

5.4 Implementation modalities

5.4.1.1 Indirect management with an international organisation

This action may be implemented in indirect management with an international organisation, the "World Bank Group", consisting of the International Bank for Reconstruction and Development, the International Development Association, and the International Finance Corporation. in accordance with Article 58(1)(c) of Regulation (EU, Euratom) No 966/2012. This implementation entails the whole action described in this Action Document. This implementation is justified because this is a continuation of the EU support (second contribution) to a multi-donor trust fund which was established in 2010 and is planned to be implemented until the end of 2020. This fund has been administered by the World Bank Group.

The entrusted entity would carry out the following budget-implementation tasks: implementation of procurement and calls for proposal (grants), contract conclusion and execution, payments, programme monitoring, evaluation and reporting.

For the budget-implementation tasks not yet assessed, the entrusted international organisation is currently undergoing the ex-ante assessment in accordance with Article 61(1) of Regulation (EU, Euratom) No 966/2012. The Commission’s authorising officer responsible deems that, based on the compliance with the ex-ante assessment based on Regulation (EU, Euratom) No 1605/2002 and long-lasting problem-free cooperation, the international organisation can be entrusted with budget-implementation tasks under indirect management.

5.5 Scope of geographical eligibility for procurement and grants

The geographical eligibility in terms of place of establishment for participating in procurement and grant award procedures and in terms of origin of supplies purchased as established in the basic act and set out in the relevant contractual documents shall apply, subject to the following provisions. The Commission’s authorising officer responsible may extend the geographical eligibility in accordance with Article 9(2)(b) of Regulation (EU) No 236/2014 on the basis of urgency or of unavailability of products and services in the markets of the countries concerned, or in other duly substantiated cases where the eligibility rules would make the realisation of this action impossible or exceedingly difficult.

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5.6 Indicative budget

EU contribution (amount in

EUR)

Indicative third party contribution, in

currency identified

5.4.2.2. – Indirect management with the World Bank

9,800,000 Estimated USD 374,131,800*

Communication and visibility 200,000 nil

Totals ** 10,000,000 USD 374,131,800

* the total scale of MDTF over the coming 5 years is estimated to be at least USD 460 million, while the current indicative donor commitments stand at around USD 385 million. Year 1 expected amount = approximately $100 million ($73m contributed or pledged by donors, $25-32m unspent from Round 1)

** USD 385 million = EU contribution of EUR 9,800,000 (i.e. approximately USD 10,868,200) + USD 374,131,800 (other donors' contributions to the MDTF). USD 385,000,000 correspond to approximately EUR 347,159,603 (Infor€ur rate of August 2016).

Based on agreement with the government the overall budget of MDTF is planned to be divided among the provinces in the following way: KP – 40%, FATA – 35%, Balochistan – 25%. Furthermore a competitive window of a minimum USD 45 Million will be established to be allocated based on performance of the provincial programmes.

5.7 Organisational set-up and responsibilities

The working of MDTF is governed by: (a) Administration Agreements between the Bank and donors; and, (b) Grant Agreements between the Bank and grant recipients. The Bank administers the MDTF in accordance with fiduciary terms agreed with the trust fund donors. Activities financed from the TF are administered under the Operational Policies and Procedures that apply to IBRD and IDA financing, including the Bank’s framework regarding governance and anti-corruption. The governance arrangements of the MDTF consist of three tiers: (i). A Trust Fund Steering Committee (TFSC) consisting of members of a Management

Committee (MC) and contributing donors responsible for strategic direction; (ii). A Management Committee responsible for reviewing progress and approval of projects for

consideration by the Administrator; (iii). An Administrator responsible for the day to day management of the MDTF including

appraisal, implementation review, and monitoring and reporting on all performance aspects of fund-financed activities and supporting the Steering and Management Committees.

The TFSC meets on a semi-annual basis to: 1) provide advisory guidance on program strategic goals, grant criteria and other high-level issues; 2) review and endorse the results matrix for the MDTF and the achievement of results envisaged for the MDTF; 3) provide advocacy support, and, 4) review and make recommendations regarding the overall allocation of fund resources across fund pillars. Each of three provincial portfolios will have one portfolio manager and three program managers. Each program manager will manage a team of focal points who will be drawn from the World Bank resources. Some portfolios may not have all three Programs (for example no activities will be implemented in Balochistan for the Governance and Policy Program). Reallocation of resources from underperforming activities within programmes and across programmes will be subject to the Steering Committee approval. Advantages of the approach: consolidation of activities, focused interventions and flexibility. In keeping with the state-building ethos, it is envisaged that line departments of the provincial and local authorities would consolidate their role in identifying, coordinating and, where relevant, implementing development and service delivery interventions. Accordingly, it is expected that the program for growth and job creation would be implemented through the Department of Industries, the policy reform and governance program will be implemented through the Planning and Development

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Department (P&DD) and the program for service delivery would be implemented through Local Governments Department. After a number of years of capacity development under the Round 1 program, it is anticipated that there will be a greater role for the Implementation Support Units (ISUs) as an institution of upstream governance. The aim of the ISUs in this new approach is twofold: i) to support the line departments and World Bank teams in implementation and operations; and, ii) to support P&DD in coordinating and reporting on investments and results. It is expected that by providing more proactive support to line departments, the ISUs will be able to monitor resource allocation and utilization and propose timely corrective action for efficient implementation. As capacity development continues, it is anticipated that ISUs will direct their support to addressing capacity gaps where these become implementation bottlenecks and will focus their capacity building efforts in those areas so that, over time, line departments will be able to fulfil their mandates with decreasing levels of outside support. It should be noted that the proposed role of the ISUs does not imply that they will become engaged in implementation, which remains the purview of a line department or agency. Rather, ISUs will support the process to ensure bottlenecks are addressed in a timely manner and that achievements against the higher level objectives can be captured.

5.8 Performance monitoring and reporting

Achievement of the objectives of the MDTF would be monitored through a comprehensive results framework aligned with Government’s systems related to the PCNA and provincial development plans. The Secretariat is responsible for consolidating and reporting on the Results Monitoring Indicators at an aggregate level for the program and for updating the results framework to ensure that it reflects the overall objectives of the MDTF. The Bank will provide donors with semi-annual reports on the progress of activities financed by the Contribution. Within six months of the final disbursement date of the MDTF, the Bank will furnish to donors a final report. The day-to-day technical and financial monitoring of the implementation of this action will be a continuous process and part of the implementing partner’s responsibilities. To this aim, the implementing partner shall establish a permanent internal, technical and financial monitoring system for the action and elaborate regular progress reports (not less than annual) and final reports. Every report shall provide an accurate account of implementation of the action, difficulties encountered, changes introduced, as well as the degree of achievement of its results (outputs and direct outcomes) as measured by corresponding indicators, using as reference the logframe matrix (for project modality) or the list of result indicators (for budget support). The report shall be laid out in such a way as to allow monitoring of the means envisaged and employed and of the budget details for the action. The final report, narrative and financial, will cover the entire period of the action implementation. The Commission may undertake additional project monitoring visits both through its own staff and through independent consultants recruited directly by the Commission for independent monitoring reviews (or recruited by the responsible agent contracted by the Commission for implementing such reviews).

5.9 Evaluation

Having regard to the nature of the action, mid-term, final, and ex-post evaluation(s) will be carried out for this action or its components via independent consultants through a joint mission contracted by the Commission and other donors contributing to the MDTF. A mid-term evaluation is foreseen. It will be carried out for problem solving, learning purposes, in particular with respect to considering another time extension of the MDTF and possible additional financial contributions. Final and ex-post evaluations will be carried out for accountability and learning purposes at various levels (including for policy revision), taking into account in particular the fact that MDTF intends to support provincial governance and develop capacities for local service delivery.

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The Commission shall inform the implementing partner at least 14 days in advance of the dates foreseen for the evaluation missions. The implementing partner shall collaborate efficiently and effectively with the evaluation experts, and inter alia provide them with all necessary information and documentation, as well as access to the project premises and activities. The evaluation reports shall be shared with the partner country and other key stakeholders. The implementing partner and the Commission shall analyse the conclusions and recommendations of the evaluations and, where appropriate, in agreement with the partner country, jointly decide on the follow-up actions to be taken and any adjustments necessary, including, if indicated, the reorientation of the project. The financing of the evaluation shall be covered by another measure constituting a financing decision.

5.10 Audit

Without prejudice to the obligations applicable to contracts concluded for the implementation of this action, the Commission may, on the basis of a risk assessment, contract independent audits or expenditure verification assignments for one or several contracts or agreements. The financing of the audit shall be covered by another measure constituting a financing decision.

5.11 Communication and visibility

Communication and visibility of the EU is a legal obligation for all external actions funded by the EU.

This action shall contain communication and visibility measures which shall be based on a specific Communication and Visibility Plan of the Action, to be elaborated at the start of implementation and supported with the budget indicated in section 5.6 above.

In terms of legal obligations on communication and visibility, the measures shall be implemented by the Commission, the partner country, contractors, grant beneficiaries and/or entrusted entities. Appropriate contractual obligations shall be included in, respectively, the financing agreement, procurement and grant contracts, and delegation agreements. The Communication and Visibility Manual for European Union External Action shall be used to establish the Communication and Visibility Plan of the Action and the appropriate contractual obligations.

Communication and visibility of EU and other donors’ assistance in MDTF will be very limited as agreed by the WB and all donors during the phase I of the MDTF. This is to primarily support the trust building between the local communities and the provincial authorities, who should be perceived as those ensuring delivery of aid and local services. This approach has been adopted in consistency with the overall goal of contributing to stability in the targeted provinces.

Indicative table of communication and visibility measures to be concluded:

Subject in generic terms, if possible Type (works, supplies, services)

Indicative number of contracts

Indicative trimester of launch of the procedure

Communication and visibility action Services 1 1st quarter 2017

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APPENDIX - Indicative Logframe matrix (for project modality)

MDTF Consolidated Reporting Format

Results Indicators Base-line Value Target

Frequency

of Data Collection

Source of data

Factors outside the project

management's control

IMPACT

IMPACT Trust between government and citizens is enhanced in MDTF areas

The impact of MDTF activities against this indicator will be measured using a number of indicators including, but not restricted to, (I) community participation in government activities; and, (II) greater responsiveness of the government (%).

Not responsive: 4.39

Partially responsive: 58.54Survey Conducted

July 2012

10% over baseline

End of MDTF

Survey (to be conducted at end of MDTF Round I;

underway)

Security

OUTCOMES

OUTCOME 1 Self-assessment by line agency staff on their individual and organisational capacity to deliver key functions in line with PCNA/BDNA priorities

Improved delivery by government institutions of key functions in line with PCNA/BDNA priorities NA End of

MDTF Rapid evaluation

process

OUTCOME 2 Improved access to basic services (health, education, etc) - particularly for vulnerable groups, including women

Number of citizens, disaggregated by demographic group and sex, benefiting from new or improved basic services

-

4,710,000

Semi-annually

Implementation Support

Missions, Project Quarterly

Progress Reports (QPRs), Third

Party Monitoring Agent Reports

Uncertain security

situation, frequent staff

turnover within the Government

and political instability that

results in frequently changing

priorities of the client.

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Number of citizens, disaggregated by demographic group and sex, benefiting from livelihoods support and employment generation

- 145840 Semi-

annually

Implementation Support

Missions, Project Quarterly

Progress Reports (QPRs), Third

Party Monitoring Agent Reports

OUTCOME 3 Improved livelihoods and economic support to citizens in MDTF areas

% of people who perceive their standard of living has improved as a result of MDTF activities

- End of

MDTF Survey

OUTPUTS

OUTPUT 1

Number of training sessions organised for capacity building of government employees (in the areas of planning, services, coordination, supervision, M&E, communication)

- 7

Semi-annually

Implementation Support Missions

Number of government staff trained in MDTF-supported projects, disaggregated by institution, level of administration, and sex

- 440

Semi-annually


Number of planning documents, programme concepts and reports prepared by government institutions in a timely manner and according to agreed standards, disaggregated by institution and level of administration (Data will be reported for process and results indicators)

- 55

Semi-annually


Enhanced capacities of government institutions to deliver their key functions in line with PCNA/BDNA priorities

Mechanism in place to implement the PCNA/BDNA including i) ISUs established and operationalised; ii) total resources allocated towards the implementation of the PCNA/BDNA; and, iii) Public Administration Reform (PAR) introduced

-

14

Semi-annually


Uncertain security






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OUTPUT 2

% of the population in MDTF-supported areas, disaggregated by sex, respond that there is a formal grievance redressal / complaints handling mechanism (established by the government) to convey their complaints and concerns

9% (m: 9% f: 9%)

Beginning and end of MDTF

Number of citizens, disaggregated by sex, having registered complaints - including those regarding corruption - at any forum (government or community driven. In Round I, the results for this indicator are achieved through support provided to entities through GSPs Rapid Response Facility, including KP Ombudsman's Office, FATA Tribunal and KP Anti-Corruption Establishment. There are no stipulated targets for this intervention).

5% (m: X% f: X%)


Legitimate dispute resolution / grievance redressal mechanisms established

% of registered complaints are resolved in a timely manner 0


Implementing Partners, PMU

OUTPUT 3

Number of services in health, water and sanitation, education, transport, urban centre upgradation services and livelihoods support (please refer to Annex 1 for details)

- Semi-annually

Improved provision of basic services

% of schemes completed with adequate quality as specified in planning documents -

100 Semi-

annually Implementing Partners, PMU

OUTPUT 4 Viable mechanisms established to support private sector development -

858 Semi-


% of schemes and measures (for private sector development) completed with adequate quality as specified in planning documents and expected by target groups

- 60

Semi-annually


Revitalised private sector and generation of employment

Number of youth, disaggregated by sex, who obtain jobs after completing vocational training programmes n.a. Semi-

annually

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Number of people, disaggregated by sex, employed in viable industries (mining, cottage industries, etc.) -

8,100 Semi-


OUTPUT 5 % membership, disaggregated by sex and interest group, in government facilitated community organizations (CBOs)

0 Semi-annually

% of communities/farmer groups mobilised using participatory planning and implementation n.a.

80 Semi-

annually Implementing Partners, PMU Increased social capital

to promote trust between communities and government

% CBOs mobilised are sufficiently mature to carry out (i) budget preparation, (ii) book-keeping; and, (iii) oversight in a transparent manner

68%, 80%, 75% 80



ANNEX 1

Number of drills/simulation exercises completed to assess operational coordination, preparedness and emergency protocols

-

2

Semi-annually


Number of community groups/farmer groups established and/or revitalised

-

282

Semi-annually


Number of farmers who received livelihoods support from agriculture and livestock

-

4,000

Semi-annually


Number of community /farmer organisations trained for technical and managerial skills

-

282

Semi-annually


Number of people benefiting from infrastructure schemes completed: a) within budget b) on time c) with specified quality

-

56,760

Semi-annually


Establish and/or revitalise 1000 Economic Interest Groups (EIGs) and aggregate them into about 200 Clustered EIGs (CEIGs) at Tehsil Level

-

1,000

Semi-annually


% beneficiaries confirm project investments reflected their needs

-

60

End of MDTF


Uncertain security






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% EIG members (disaggregated by gender) benefitting from technical assistance

- 50 Semi-


Number CAPs approved by the District Review Committee

-

30

Semi-annually


% approved CAPs completed in time after receipt of grant and published in the project website

-

60

Semi-annually


Number of SMEs using matching grants for rehabilitation and upgradation (gender disaggregated)

-

850

Semi-annually


Number of jobs created/restored (direct and indirect) classified by gender and age group to determine youth employment

-

8,100

Semi-annually


Number of shelterless primary and middle girls' schools provided with adequate infrastructure

-

130

Semi-annually

Implementing Partners, PMU,

Third Party Validation

Number of primary and middle schools provided with missing facilities

-

200

Semi-annually



Number of children enrolled in new schools -

6,000 Annually



Number of new government primary schools established based on approved policy and protocol for community supported schools

-

150

Semi-annually



Number of staff and PTSMC members trained through on-the-job support

-

2,288

Semi-annually



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Number of candidates for female teacher posts identified and successfully contracted for new established government, community-supported schools

-

300

Semi-annually



Number of districts contracted out for management of health services

-

6

End of Project

Implementing Agency

Number of health facilities reconstructed, renovated and/or equipped

-

10

Semi-annually

Implementing Agency

Number of DHQ hospitals refurbished -

3

Semi-annually

Implementing Agency

Number of people who have access to tubewell or domestic water supply

-

8,100

End of Project

Implementing Agency, PMU

Number of km of roads constructed/rehabilitated -

2

End of Project


Number of street lights installed/restored in Khar -

450

End of Project


Number of km of provincial highway from Sharifabad to Kanju constructed and operational

-

41

End of Project


Number of roads constructed in Bajaur and Orakzai -

50

End of Project


Number of motorised trips taken by beneficiaries living alongside rural roads in Bajaur and FATA

- TBD End of

Project Implementing Agency, PMU

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