world bank document...estimated revenues, as reported in the final budget execution report value 12%...

Document of

The World Bank

Report No: ICR00004498

IMPLEMENTATION COMPLETION AND RESULTS REPORT

(IDA-56190)

ON A

IDA CREDIT

IN THE AMOUNT OF US$ 100 MILLION

(SDR 71.1 MILLION EQUIVALENT)

TO THE

UNITED REPUBLIC OF TANZANIA

FOR A

FIRST OPEN GOVERNMENT AND PUBLIC FINANCIAL MANAGEMENT

DEVELOPMENT POLICY OPERATION

August 28, 2018

Governance Practice, GGODR

Eastern Africa Country Cluster 1, AFCE1

Africa Region

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CURRENCY EQUIVALENTS

(Exchange Rate Effective as of December 31, 2015)

Currency Unit = TSh

US$1 = TZh 1984.13

FISCAL YEAR

July 1 - June 30

Senior Global Practice Director: Deborah L. Wetzel

Sector Manager: Nicola Smithers

Project Team Leader: Gert Van Der Linde/Denis Maro Biseko

ICR Team Leader: K. Migara O. De Silva

ABBREVIATIONS AND ACRONYMS

AfDB African Development Bank

AFRITAC Africa Regional Technical Assistance Center

ATI Access to Information

BoT Bank of Tanzania

BRN Big Results Now initiative

CAG Controller and Auditor General

CAS Country Assistance Strategy

CAS-PR Country Assistance Strategy Progress Report

CBMS Central Budget Management System

CCM Chama Cha Mapinduzi

CPF Country Partnership Framework

CSOs Civil Society Organizations

DFID Department for International Development (United Kingdom)

DPO(s) Development Policy Operation(s)

EAC East African Community

EFT Electronic Fund Transfer

ENCB External Non-Concessionary Borrowing

FDI Foreign Direct Investment

FY Fiscal Year

FYDP Five Year Development Plan

GPSA Government Procurement Services Agency

IFMIS Integrated Financial Management Information System

IMF International Monetary Fund

IPTL Independent Power Tanzania Limited

ISR Implementation Status and Results Report

LGAs Local Government Authorities

MDAs Ministries, Departments, and Agencies

MDGs Millennium Development Goals

MKUKUTA Mkakati wa Kukuza Uchumi na Kupunguza Umaskini Tanzania

MoFP Ministry of Finance and Planning

NBS National Bureau of Statistics

NGOs Non-governmental organizations

OGPFM Open Government and Public Financial Management

PAP Pan Africa Power

PCCB Prevention and Combating of Corruption Bureau

PCN Project Concept Note

PDO Program Development Objective

PEFA Public Expenditure and Financial Accountability

PER Public Expenditure Review

PEs Public Enterprises

PFM Public Financial Management

PFMRP Public Financial Management Reform Program

PIM Public Investment Management

PO-PC President’s Office-Planning Commission

PSI Policy Support Instrument

PPA Public Procurement Act

PPAA Public Procurement Appeal Authority

PPRA Public Procurement Regulatory Authority

PRSC Poverty Reduction Support Credit

SCD Systematic Country Diagnostic

SIDA Swedish International Development Agency

SOGDAT Support to Open Government, Data, and Accountability in Tanzania

SORT Systematic Risk Assessment Tool

TA Technical Assistance

TANESCO Tanzania Electricity Supply Company

TISS Tanzania Inter-Bank Settlement Scheme

TSA Treasury Single Account

TSh Tanzanian Shilling

i

Tanzania

Open Government and Public Financial Management TABLE OF CONTENTS

DATA SHEET

A. Basic Information

B. Key Dates

C. Ratings Summary

D. Sector and Theme Codes

E. Bank Staff

F. Results Framework Analysis

G. Ratings of Project Performance in ISRs

H. Restructuring

1. PROJECT CONTEXT, DEVELOPMENT OBJECTIVES AND DESIGN １

1.2 Original Project Development Objectives (PDO) and Key Indicators ４

1.3 Revised PDOs and Key Indicators, and reasons/justification ４

1.4 Original Policy Areas Supported by the Program ４

1.5 Revised Policy Areas ８

1.6 Other Significant Changes ８

2. KEY FACTORS AFFECTING IMPLEMENTATION AND OUTCOMES ８

2.1 Program Performance ８

2.2 Major Factors Affecting Implementation １５

2.3 Monitoring and Evaluation (M&E) Design, Implementation, and Utilization １８

2.4 Expected Next Phase/Follow-up Operation １９

3. ASSESSMENT OF OUTCOMES ２０

3.1 Relevance of Objectives, Design and Implementation ２０

3.2 Achievement of Program Development Objectives ２１

3.3 Justification of Overall Outcome Rating ２３

3.4 Overarching Themes, Other Outcomes and Impacts ２４

3.5 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops ２４

4. ASSESSMENT OF RISK TO DEVELOPMENT OUTCOME ２５

ii

5. ASSESSMENT OF BANK AND BORROWER PERFORMANCE ２５

5.1 Bank Performance ２５

5.2 Borrower Performance ２６

6. LESSONS LEARNED ２７

iii

A. BASIC INFORMATION

Country: Tanzania Program Name:

Open Government and

Public Financial

Management

Program ID: P133798 L/C/TF Number(s): IDA-56190

ICR Date: 04/09/2018 ICR Type: Core ICR

Financing Instrument: DPL Borrower: TANZANIA

Original Total

Commitment: USD 100.00M Disbursed Amount: USD 99.99M

Revised Amount: USD 100.00M

Implementing Agencies: Ministry of Finance

Co-financiers and Other External Partners: The series was linked to development partner working sub-groups on

governance and public financial management and budget support donor group. AFRITAC (IMF), DFID and SIDA

provided complementary TAs, while EU and JICA provided complementary budget support.

B. KEY DATES

Process Date Process Original Date Revised / Actual

Date(s)

Concept Review: 03/11/2014 Effectiveness: 06/26/2015 06/26/2015

Appraisal: Restructuring(s): NA NA

Approval: 06/23/2015 Mid-term Review: NA NA

Closing: 12/31/2015 12/31/2015

C. RATINGS SUMMARY

C.1 Performance Rating by ICR

Outcomes: Unsatisfactory

Risk to Development Outcome: Substantial

Bank Performance: Unsatisfactory

Borrower Performance: Unsatisfactory

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

Bank Ratings Borrower Ratings

Quality at Entry: Unsatisfactory Government: Unsatisfactory

Quality of Supervision: Unsatisfactory Implementing

Agency/Agencies: Unsatisfactory

Overall Bank

Performance: Unsatisfactory

Overall Borrower

Performance: Unsatisfactory

iv

C.3 Quality at Entry and Implementation Performance Indicators

Implementation

Performance Indicators

QAG Assessments (if

any) Rating

Potential Problem Program

at any time (Yes/No): No Quality at Entry (QEA): None

Problem Program at any

time (Yes/No): No

Quality of Supervision

(QSA): None

DO rating before

Closing/Inactive status: Moderately Unsatisfactory

D. SECTOR AND THEME CODES

Original Actual

Sector Code (as % of total Bank financing)

Public Administration

Other Public Administration 29 29

Central Government (Central Agencies) 71 71

Theme Code (as % of total Bank financing)

Public Sector Management 100 100

Public Administration 75 75

E-Government, incl. e-services 29 29

Transparency, Accountability and Good

Governance 46 46

Public Finance Management 25 25

Public Expenditure Management 25 25

E. BANK STAFF

Positions At ICR At Approval

Vice President: Makhtar Diop

Makhtar Diop

Senior Global Practice Director: Deborah L. Wetzel Mario Marcel

Country Director: Bella Bird

Philippe Dongier

Practice Manager/Manager: Nicola Smithers

Guenter Heidenhof

Task Team Leader: Gert Van Der Linde

Denis Maro Biseko

Chiara Bronchi

Gert Van Der Linde

ICR Team Leader: K. Migara O. De Silva

ICR Primary Author: Natsuko Obayashi

v

F. Results Framework Analysis

Program Development Objectives

The Program Development Objective (PDO) of the series was to support the Government to establish open

data in order to increase access and use of service delivery information as well as to improve budget

credibility and execution.

The PDO was supported by two pillars: (i) Open Government Partnership – Support Tanzania’s

commitment to promote access to information, open budget, and open data in Education, Water, and

Health; and (ii) Public Financial Management - Improve budget credibility and execution through better

cash management, public investment management, and procurement.

Revised Program Development Objectives

The PDOs were not revised.

PDO Indicator(s)

Indicator Baseline Value Original Target Values (from

approval documents)

Formally

Revised

Target

Values

Actual Value Achieved at

Completion or Target Years

Pillar 1 Open Government Partnership – Support Tanzania’s commitment to promote access to

information, open budget, and open data in Education, Water and Health

Policy Area 1 Establishing the Legal Framework for Access to Information

Indicator 1: Percentage of ATI (Access to Information) requests granted as a share of total requests.

Value 0

80 percent of the requests for

information by citizens will have

been granted in line with the ATI

Act.

NA from official sources

Date achieved 2014 2017 2017

Comments

Not achieved: According to a survey conducted by an NGO Twaweza on LGAs in 2017, only 33

percent of requests received responses from the LGAs (43 out of 131 requests for information sent to

26 LGAs were granted while 88 were refused), with Works LGAs 48 percent (10 granted out of 21

requests), Land 43 percent (9/21), Planning 43 percent (9/12), Health 36 percent (8/22), Education 24

percent (5/21), District Councils (DED) 8 percent (2/23).

Policy Area 2 Establishing an Open Data system and practice for Government Budget and Sector

Performance

Indicator 2:

Dashboards with data and performance information for the Education, Water, and Health

sectors, including a citizen feedback mechanism, are fully functional and available on the

Government open data portal.

Value

0 3 3 existing, but abandoned


Comments

Not achieved: Dashboards for the 3 sectors were uploaded to and exist on the open data portal

(opendata.go.tz). However, since the government withdrew from the Open Government Partnership

vi

in mid-2017, all ongoing work was abandoned. National Bureau of Statistics (NBS) is considering

migrating the dashboards to its own platform, but there is so far no specific plan in place.

Indicator 3: Increased downloads of budget and expenditure data

Value

0 2500 0


Comments Not achieved: While data was collected in 2014 to implement BOOST, open budget activities were

not implemented.

Indicator 4: Number of information intermediaries that use open data.

Value

0 5 0


Comments

Not achieved: It is understood that about 6 NGOs (non-governmental organizations) working on

social accountability and 1 Media with data analyst in some way have benefited from the open data,

notably the sector dashboards. However, open data being abandoned, there are no longer

intermediaries that could benefit.

Pillar 2 Public Financial Management - Improve budget credibility and execution, through better cash

management, public investment management, and procurement

Policy Area 3 Cash Management

Indicator 5: Stock of arrears of expenditure payments as % of GDP, at end of fiscal year

Value

1.8%

(1.4% actual) 1% 1.9%

Date achieved 2014 2017 FY 2015-16

Comments

Not achieved: stock of arrears in % of GDP increased, instead of declining, from 1.4% as a % of GDP

in FY2013-14 to 1.9% in FY2015-16 (please see below IMF data).

FY2013-14 FY2014-15 FY2015-16 FY2016-17

Stock of arrears

in % of GDP 1.4% 2.3% 1.9% 3.5%

Source: IMF and Tanzanian authorities

Indicator 6: Average annual under-collection of revenue and grants, as the difference between actual and

estimated revenues, as reported in the final Budget Execution Report

Value

12%

(actual 8.9%) 5% 14.3%

Date achieved 2014 2017 FY2016-17

Comments

Not achieved: Under-collection of revenue and grants steadily increased since 2015 and reached

14.3% in the last FY, well above the targeted 5%.

FY2013-14 FY2014-15 FY2015-16 FY2016-17

8.9% 3.7% 6.2% 14.3%

Source: Tanzanian authorities

Indicator 7: Variance in expenditure composition in the last three years, excluding contingent items.

Value Exceeded 15% in at least two of the last

three years

Exceeded 10% in no more than

one of the last three years.

Exceeded 10% in all the last three years.

vii

Date achieved 2014 2017 FY2015-16

Comments

Not achieved: According to the last PEFA indicators in 2017 (below), variance is higher than the

initial value and exceeded 10% every year.

FY2013-14 FY2014-15 FY2015-16 FY2016-17

19.2% 31.5% 24.2% NA

Source: PEFA 2017

Indicator 8: Percentage of annual expenditure by Regional MDAs paid through TISS and EFT.

Value 0% 100% 100%


Comments Achieved: All MDAs are fully connected to IFMIS which is linked to TISS and EFT. All MDAs on

budget items are therefore paid through TISS and EFT.

Indicator 9: Number of pilot MDAs whose budget is presented, discussed, and appropriated by Parliament

at the program level.

Value 0 6 0


Comments

Not achieved: While programmatic classification and budgeting was initiated for 8 pilot Ministries by

AFRITAC and donors funded PFM TAs, it was not implemented. The 8 pilot Ministries prepared an

ex-post programmatic budget for the FY2016-17.

Policy Area 4 Public Investment Management

Indicator 10: Percentage of the new public investment projects selected for financing based on the PIM

manual as a percentage of total new public investment projects in the same year.

Value

0% 100% 0%


Comments

Not achieved: According to the government, PIM manual was not used.

Policy Area 5 Procurement

Indicator 11: Average percentage of procurement entities that comply with PPA 2011 as per PPRA annual

evaluation report

Value

64.3%

(65% in FY2013-14) 90% 74%

Date achieved FY2012-13 2017 FY2016-17

Comments

Not achieved: Overall compliance rates steadily increased from 64.5% in FY2013-14 to 74% in

FY2016-17 (the baseline value was from FY2012-13), although progress was much slower than

expected. The progress is uneven, with compliance rates dropping in FY2014-15 for MDAs and in

the last FY (2016-17) for LGAs. Compliance rate during this period did not reach the targeted 90%.

LGAs: Local Government Authorities; MDAs: Ministries, Departments, and Agencies; PAs: Public Authorities

Source: PPRA annual evaluation reports

viii

Indicator 12: Percentage of goods procurement contracts undertaken annually using E-procurement in

Medical Store Department and the Government Procurement Services Agency

Value 0% 60% 0%


Comments Not achieved: e-procurement has not yet started.

G. Ratings of Program Performance in ISRs

No. Date ISR

Archived DO IP

Actual Disbursements

(USD millions)

OGPFM 18 Nov. 2015 Satisfactory Satisfactory USD 99.99M

H. Restructuring

Not Applicable

１

1. PROJECT CONTEXT, DEVELOPMENT OBJECTIVES AND DESIGN

1.1 Context at Appraisal

Program Context

1. Tanzania was facing significant external financing shortfall in FY2014-2015. This shortfall

was caused due to the withdrawal of donor support, including the general budget support in October 2014

because of the IPTL scandal1.. It resulted in a significant underfilling of the non-concessional financing

with only $300 million out of $800 million ENCB (external non-concessionary borrowing) space under

the IMF’s Policy Support Instrument (PSI). In addition, there was a sharp depreciation of Tanzanian

shilling and the Bank of Tanzania’s active interventions in the market which led to a reduction in gross

official reserves during Q3 of FY14. As a result, towards the end of the FY (Q4), there was an urgent need

for the economy to secure more external financing for fiscal spending (and some for balance of payment).

Bank Management endorsed the delivery of this Development Policy Operation (DPO) in Q4 in order to

assist the Government of Tanzania to address this shortfall.

2. At the time of appraisal, Tanzania had recorded stable growth, subdued inflation, limited

fiscal deficit but a large current account deficit. Fast GDP growth that reached 7.1 percent in fiscal year

(FY) 2013-14 was projected to remain at the same level. Inflation steadily decelerated during the previous

years, from 12.7 percent in 2011 to 6.1 percent in 2014 (average), due mainly to tighter monetary policy

and lower international energy and food prices. Liquidity tightening was translated by steady decline of

M3 from 22 percent in June 2011 to 13 percent in June 2015. Tanzania had maintained high level of

investment, at 30.5 percent on average during 2011-2014, driven notably by public investment that

accounted for half of the total investment. Trade liberalization opened the economy, with trade-to-GDP

ratio rising from 42 percent in 2008 to 49 percent in 2013, but still well below the Sub-Saharan Africa

average of around 66 percent. Large current account deficit of -10.8 percent of GDP in average during

2011-2014 was mainly dominated by import growth (+10.5 percent in average) faster than that of export

(+6.4 percent). Forex reserve steadily increased from 3.5 months of import in June 2012 to a comfortable

4.4 months in June 2015. Fiscal deficit (with grants) was broadly contained to -4 percent of GDP in average

during the years preceding the DPO (2011-2014).

3. Tanzania’s macroeconomic framework remained robust during the OGPFM series’ period

(2015-17). Its economy grew by 6.8 percent in average, the highest rate among the EAC, but slightly

1 Tanzania Electricity Supply Company (TANESCO, the state-owned electricity company) had a 20-year Power Purchasing Agreement

with Independent Power Tanzania Limited (IPTL), a joint venture between Mechmar Corporation (Malaysian-owned, 70% stake) and

VIP Engineering and Marketing (Tanzanian-owned, 30% stake) since 1995. Various disputes between IPTL and TANESCO led to a

dispute on the power purchase agreement in 2006 and an escrow account was set up at the Bank of Tanzania where the capacity charges

owed by TANESCO were deposited waiting for the resolution of this dispute. In 2013, VIP’s share was taken over by Pan Africa Power

(PAP) under dubious circumstances, while PAP’s owner was recognized as the legitimate representative of Mechmar Corporation

Tanzania by a decision of the Tanzanian High Court, and therefore as the owner of the remaining 70% stake of IPTL. Soon after,

around US$ 122 million from the escrow account was transferred to PAP. The High Court’s controversial decision was challenged. In

early 2014, both the Controller and Auditor General (CAG) and the Prevention and Combating of Corruption Bureau (PCCB)

investigated the case following the request made by the parliament. Their reports in December 2014 concluded that the transfer was

made to a firm without any legal ownership of IPTL. A number of top government officials were removed, including some Cabinet

Ministers, the Attorney General, and a Permanent Secretary.

２

dropped from 7 percent during the two FY2014-16 to 6.4 percent in the last FY2016-17. The growth is

driven by mining, manufacturing and services (communication, financial services, construction and retail

trade). By contrast, agriculture’s contribution to growth has remained limited, while about 80 percent of

households relies on the sector. Inflation was broadly contained during the period, despite a temporary

acceleration to 6 percent (average) in FY2015-16. Inflationary pressures decelerated to 5.3 percent in

FY2016-17, driven by lower food and energy prices coupled with a stable shilling. However, against this

background was a tightening monetary condition, with steady decline of liquidity growth (M3) that reached

6.3 percent in June 2017 against 13.1 percent in June 2015, despite increasingly expansionary monetary

policy. Liquidity tightening was driven by under-execution of budget and lower external financing,

combined with a fragile banking sector with growing NPLs (from 7.9 percent in December 2015 to 12.5

percent in September 2017) and a weak business environment that drastically reduced credit growth to the

economy (from 21 percent in FY2014-15 to 1.2 percent in FY2016-17). Current account deficit was

significantly reduced from 9.8 percent of GDP in FY2014-15 to 2.7 percent in FY2016-17, due to reduced

external trade with import decline (notably capital goods and lower oil prices) greater than that of export.

Tanzania has maintained a comfortable level of forex reserve, at 5.2 months of import in June 2017 against

4.4 months two years earlier, through interventions on the forex market and larger external financing

deposits due to slow execution of projects. Fiscal deficit was also contained, with 3.3 percent of GDP in

FY2014-15, and was significantly reduced in the last FY from 4 percent in FY2015-16 to 2.1 percent in

FY2016-17. However, growing arrears of about an estimated 3.5 percent of GDP in FY2016-17 should be

counted against this apparently low fiscal deficit. While current spending has remained under control,

increasing capital spending (from 4.4 percent in FY2014-15 to 6.7 percent in FY2016-17) with larger

domestic financing (from 2.7 percent to 4.7 percent) contributed to the greater arrears accumulation.

4. Limited progress in poverty reduction and in reaching MDGs pushed the government to

commit to Open Government Partnership (OGP) and “Big Results Now” (BRN) initiative. After a

long period of stagnation, poverty rates had finally started to decline, from 34.3 percent in 2007 to 28.2

percent in 2011-12, while extreme poverty declined to 9.8 percent, two percentage points lower than in

2007. However, almost half of the population is still below the well-accepted international poverty line of

US$1.25 per day. The inequality gap between urban and rural populations was widening. Overall progress

towards Millennium Development Goals (MDGs) were slow. The country fell short of universal

completion of primary school, and maternal mortality and the number of households without access to safe

water were higher than they were in 1990. There was limited voice and participation in the design of public

policies and weak accountability thwarting efficient and effective policy implementation2. To promote

greater accountability and citizen participation, the government joined the OGP which is a multilateral

initiative that aims to secure concrete commitments from governments to promote transparency, empower

citizens, fight corruption, and harness new technologies to strengthen governance. Similarly, the

government launched a new results delivery initiative “Big Results Now!” (BRN) for a greater focus on

results, with accountability and performance management at the core of implementation, and is focused on

eight priority sectors, including Education, Health, and Rural Water. It was to ensure that government’s

policies are implemented on time to respond to the citizens’ needs, and that the latter participate in

monitoring progress and providing feedback on the successes and setbacks. The BRN initiative also re-

affirmed the government’s commitment to improve public financial management. Both BRN and OGP

initiatives were championed by the top leadership of the country before the elections.

2 Hoffman, Barak D. Political Economy of Tanzania. March 2013.

３

5. Tanzania enjoyed a relatively stable political context. Chama Cha Mapinduzi (CCM) has ruled

the country since the establishment of multi-party elections in 1994. The President at the time of the

appraisal was Dr Jakaya Mrisho Kikwete. Following his 2 terms (2005 – 2015), a general election was

organized in October 2015 to elect the president, members of Parliament, and local government councilors.

The incumbent President being ineligible to be reelected because of term limits, the ruling incumbent party

CCM selected Works Minister Mr. John Magufuli as its presidential nominee, although within the CCM,

there was a drama during the process of selecting the party’s candidate for the presidential election. The

former Prime Minister (PM) was perceived as the frontrunner who later joined the opposition and ran his

own campaign. The margin of victory of CCM during the last election was much smaller than it was in

the previous elections. The new government prioritized efforts to clampdown on corruption, improve

public administration, and manage public resources for improved social outcomes. According to the 2017

Afrobarometer, 72 percent of Tanzanians who participated in the survey said that corruption has decreased

“somewhat” or “a lot” over the preceding year, compared to 13 percent in 2014. Similarly, 71 percent

survey participants said that the Government is fighting corruption “fairly well” or “very well”, compared

to 37 percent in 2014.

Rationale for Bank Assistance

6. Tanzania’s Development Vision 2025 (TDV 2025) sets forth Tanzania’s aspiration to become

a middle-income country by 2025. To achieve the goals of the TDV 2025, Tanzania was implementing

a medium-term national growth and poverty reduction strategy, MKUKUTA II covering the period from

2010-11 to 2014-15. MKUKUTA II is organized into three clusters: (i) growth and reduction of income

poverty; (ii) improvement of quality of life and social wellbeing; and (iii) good governance and

accountability. In this context, the First Five Year Development Plan (FYDP I) (from 2011-12 to 2015-16)

complements MKUKUTA II by prioritizing key interventions. The overarching goal of FYDP I was to

unleash the country's growth potential by fast-tracking the provision of the basic conditions for broad-

based and pro-poor growth, and was based on five areas: (i) hard infrastructure (energy, port, railways,

roads, airports, and air-transport) and soft infrastructure (mainly information and communication

technologies, ICT); (ii) agriculture; (iii) industries (manufacturing, mining); (iv) water and sanitation; and

(v) human capital development. The plan emphasizes the need to: (i) sustain macroeconomic stability; (ii)

promote governance and rule of law; and (iii) support the productive use of land to sustain growth. In an

effort to speed up the implementation of FYDP I, the government has launched the Big Results Now (BRN)

initiative which helped the Government to establish a strong and effective system to oversee, monitor, and

evaluate the implementation of its development plans and programs based on the Malaysian Big Fast

Results approach.

7. The Open Government and Public Financial Management (OGPFM) series was developed in

the context of the FY12-FY16 Country Assistance Strategy Progress Report (CAS-PR) which aimed

at supporting Tanzania to sustain high growth and to make growth more inclusive to reduce poverty. The

CAS-PR proposed adjustments around two strategic clusters (a) Productive investments for growth of

labor-intensive industries and job creation; and (b) Programs that target reduction of extreme poverty and

improvements in quality of social services. The OGPFM series was to address the challenges identified in

the CAS and intensify efforts in poverty reduction outlined in the CAS progress report by strengthening

open government and public finance foundations to improve public expenditure transparency and

management, and strengthen the delivery of social services.

４

8. The Bank launched four new sectoral series in 2015 after 11 Poverty Reduction Support

Credits (PRSCs) from 2001 to 2014. However, PRSC outcomes were limited due in part to the agreement

among budget support donor group that all donor budget support financing will be disbursed only when

60 percent of common targets are achieved. For this reason, the Bank decided to launch four thematical or

sector series multi-sector PRSC to promote deeper dialogue with the authorities and to support more

focused reforms by themes and sectors. These included the OGPFM series, and 3 other series on Business

Environment, on Energy sector, and on Pension System reform. This approach was taken to ensure that

each thematical or sector series’ disbursements would be more clearly linked to associated reforms

progress, with outperforming programs are awarded by regular disbursements while non-performing

program would not see funds disbursed.

9. There was a high level of consultation and coordination arrangements in Tanzania under the

Budget Support (BS) group of development partners. The series was linked to development partner

working sub-groups on governance and public financial management. Thus, there was also a strong

coordination with the multi-donor technical assistance program PFMRP IV. The results matrix of the

OGPFM series were prepared in collaboration with the budget support donor group. Therefore, the

Performance Assessment Framework for BS in 2015 included a policy action and an indicator on open

government in order to ensure the harmonization of donor programs towards a coordinated dialogue on

governance.

1.2 Original Project Development Objectives (PDO) and Key Indicators

10. The Program Development Objective (PDO) of the series was to support the Government to

establish open data in order to increase access and use of service delivery information as well as to

improve budget credibility and execution. The PDO was supported by two pillars: (i) Open Government

Partnership – Support Tanzania’s commitment to promote access to information, open budget, and open

data in Education, Water, and Health; and (ii) Public Financial Management - Improve budget credibility

and execution through better cash management, public investment management, and procurement.

1.3 Revised PDOs and Key Indicators, and reasons/justification

11. The PDOs and indicators were not revised.

1.4 Original Policy Areas Supported by the Program

12. The two pillars were supported by 5 policy areas. The first pillar included two policy areas: (i)

Establishing the legal framework for access to information, and (ii) Establishing an open data system and

practice for government budget and sector performance. The second pillar three included three policy

areas: (iii) Cash management, (iv) Public investment management, and (v) Procurement.

Pillar 1: Open government partnership – Support Tanzania’s commitment to promote access to

information, open budget and open data in education, water and health

５

13. Tanzanian government joined the Open government partnership in 2011, and it also

launched “Big results now!” initiative in 2013. Both initiatives aimed at strengthening the accountability

and performance management. The OGPFM was designed to support the government in implementing the

second OGP action plan commitments in the following areas: (i) enacting an Access to information Act,

(ii) enabling open data regime for education, health and water, and (iii) ensuring open budget data, and

publishing this data in machine readable formats to facilitate access and analysis of budget execution.

Policy Area 1: Establishing the legal framework for access to information

14. The Access to Information Act was initially submitted by government for comments in 2006 and

withdrawn following public outcry that it had punitive legal measures. Civil society organizations then

prepared a counter draft which was presented to the government in 2007. In 2014, after having rejected the

controversial amendments to the Newspaper Act of 1976, the parliament demanded the submission of the

ATI bill for enactment, which was reflected in the second OGP action plan (2014-16). The draft bill was

prepared following consultations with major civil society organizations. Following extensive discussions

in the Cabinet in July 2014, the bill was submitted to the Parliament on February 20th, 2015 (OGPFM-

1prior action). In addition, it was initially planned that the OGPFM series support the ATI Act

implementation with a strong regulatory framework (OGPFM-2 trigger) and with a mechanism to monitor

compliance (OGPFM-3 trigger), as part of the two-year OGP action plan.

Policy Area 2: Establishing an open data system and practice for government budget and sector

performance

15. Establishment of open data system was strongly driven by the high-level leadership, as it was

considered as a useful tool to improve functionality and accountability through information sharing within

government, between central and local governments, and between government and citizens to enhance

effective service delivery. Due to increasing demand from the citizens for results and more accountability,

the government committed to make the disaggregated data available online in electronic format in the key

sectors of education, water, and health. An inter-agency taskforce led by National Bureau of Statistics

(NBS) to set policies, to advise on standards, and to coordinate implementation of open data across MDAs

and LGAs, was setup (OGPFM-1, prior action). The task force prepared draft guidelines on open data

which was issued as a temporary measure to ensure data availability in open-data format (OGPFM-1 prior

action), while a comprehensive policy on open data was being prepared (OGPFM-2 trigger). This allowed

the Ministries of education, water, and health to pilot an Open Data dashboard (OGPFM-1 prior action).

The Data dashboard was to include a citizen feedback mechanism (OGPFM-2 trigger) as well as

performance data and to be rolled out in the three ministries (OGPFM-3 trigger). A Technical Assessment

(TA) program SOGDAT, which was financed by DFID and implemented by the Bank, was to support the

government to establish open data dashboards. While the OGPFM supported policy actions, SOGDAT

was to provide outreach, promotion, and training to civil society, think tanks, media, and other

organizations, to help monitor information uptake by citizens. Moreover, the 2014 OGP Action Plan

(mentioned in the previous para) included a commitment to open budgets, with the objective of improving

Tanzania’s rating on Open Budget (from 47 out of 100 by the 2012 Open Budget Index). It was therefore

expected that BOOST - a World Bank portal that promotes fiscal transparency by disseminating the entire

public spending datasets in accessible formats - would be adopted by the government and be implemented

(results indicator 3).

６

Pillar 2 - Public Financial Management - Improve budget credibility and execution through better cash


16. Deterioration of the PFM systems was noted in the 2009 and 2013 PEFA scores. The government,

through the PFM Reform Program (PFMRP IV, which started in 2012) and taking into account the 2013

PEFA findings, was committed to further strengthening the PFM systems notably in the area shortcomings

were highlighted by the 2013 PEFA. These include, the weaknesses in non-salary internal control systems,

fiscal risk to the budget posed by public entities, poor predictability in the availability of funds for

commitment of expenditure, weak prioritization, execution and monitoring of investment projects,

combined with weak procurement planning and processing.

Policy Area 3: Cash Management

17. Accumulation of arrears remains a major recurrent issue in Tanzanian budget execution. A

resource and expenditure “Ceiling Committee”3 determines monthly expenditure ceilings of spending units

based on revenue availability instead of actual expenditure projections. Information on credible

expenditure ceilings are provided monthly, but often during the month of execution and sometimes

retrospectively. The cash flow forecast is then adjusted monthly in light of ceilings but without an update

of the remaining months of the year. A set of clear rules for cash rationing of the appropriated budget when

revenue and grants are under-collected, was to be adopted (OGPFM-2 trigger). Furthermore, a plan which

establishes verifiable level of expenditures arrears; financing the payment of such arrears through the

budget; and preventing the build-up of further arrears was also to be adopted (OGPFM-2 trigger) under

reforms in this policy area.

18. Cash management in Tanzanian public finance did not ensure a predictable flow of funds to

execute approved budgets. This was primarily due to unreliable budgets and cash flow forecasts, under-

collection of revenue and grants, ineffective commitment controls, growing expenditure arrears, an

ineffective Treasury Single Account (TSA) modality, and multiple budget reallocations. With the IFMIS

only allowing commitments up to the level of available funds (as approved by the Ceiling Committee),

MDAs were committing outside the IFMIS, since it is common practice by the MoFP to accept and pay

such arrears. In addition to the clearance of expenditure arrears in the FY 2014-15 budget (OGPFM prior

action), instructions were issued to spending units to commit all expenditures through the IFMIS (OGPFM

prior action), thus allowing full disclosure of arrears and better control. A medium-term plan was to be

prepared to reduce expenditure arrears (OGPFM-2 and 3 triggers). Moreover, the OGPFM intended to

support the extension of the TSA and its configuration in the IFMIS by closing bank accounts and ensuring

monthly reconciliation of all TSA bank accounts. At the time when the PAD (Project Appraisal Document)

was finalized, 21 regional treasuries were processing payments using commercial bank accounts outside

the TSA on behalf of regional MDAs, which are not connected to the IFMIS. The OGPFM supported the

piloting of payments by regional MDAs through the EFT and TISS systems (OGPFM-1 prior action) and

a plan to expand the use of EFT and TISS systems to LGAs (OGPFM-2 trigger). It was also to support the

consolidation architecture of two IFMIS system (OGPFM-3 trigger) - one for MDAs and the other for

LGAs - that are in place and not automatically linked, thus making it difficult to have a consolidated cash

balances. Originally, the OGPFM had sought to limit the borrowing powers of the minister contained in

the appropriation act to a debt cap authorized by parliament for financing the budget, rather than the full

3 This was an advisory committee to the Minister of Finance and Planning (MoFP) which was chaired by the Permanent Secretary of the MoFP, the

Accountant General, other members of MoFP, Tanzania Revenue Authority (TRA), and the Bank of Tanzania (BoT).

７

budget amount. However, the Appropriation Act of 2017 still authorizes the minister to borrow the full

amount of the budget as before, except that this is stated in the actual budget figure rather than the wording

in the Act4 (footnote 2).

19. Pilot program-based budgeting was initiated in six MDAs. These MDAs included the

Ministries of Education, Water, Health, Transport, Finance, and Community Development, Gender &

Children) (OGPFM-1 prior action). The Government planned to align the appropriation regime to the

program based budget (OGPFM-2 trigger) in order to realize the potential benefits of program-based

budgeting, during the rollout in FY 2015/16. Further roll-out of a program-based budgeting and

appropriation system would then have been possible in FY 2016/17 (OGPFM-3 trigger).

Policy Area 4: Public Investment Management

20. There was no central mechanism to guide the translation of plans into strategic, prioritized

public investments. There was also no common standard approach to preparing, presenting, and analyzing

the value of public investments. This is further compounded by weak capacity for selection, preparation

and implementation of projects. Under PRSC 11, the Government took a decision to prepare a Public

Investment Management (PIM) manual to guide spending units in the preparation and execution of

projects. The drafting of the PIM manual was completed and instructions for its implementation were

issued in the budget guidelines 2015-16 in November 2014 (OGPFM Prior Action) by requiring MDAs to

selecting new investment projects in line with the PIM manual. The program planned also that the POPC

(President’s Office-Planning Commission) would publish a report on investment projects which are

screened following the PIM manual (OGPFM-2 trigger) and that improved monitoring and evaluation of

public investment projects would allow regular updates of the progress for strategic investments in the

“Quarterly Economic Review and Budget Execution Report” (OGPFM-3 trigger).

Policy Area 5: Procurement

21. Procurement processes continued to be cumbersome and compliance with the law and

regulations remained a major area of concern. Non-compliance with the laws and regulations was

reflected in the use of inappropriate and non-competitive bidding methods, poorly or non-recorded stores

in the ledger, and inadequate records of procurement processes. Enforcement of procurement legislation

was not properly instituted. Furthermore, shortage of qualified staff made procurement extremely

vulnerable to mismanagement and resource misallocations. To address some of these weaknesses, the

OGPFM supported the replacement of the 2004 Public Procurement Act (PPA 2004) by the 2011 PPA,

with the publication of the new regulations in December 2013 (OGPFM-1 prior action). The PPRA

undertook measures to build compliance in the procurement system but is under-resourced and was able

to audit only a third of the public entities. To help address weaknesses in the procurement system, the

OGPFM series identified e-procurement as an area which need support as this reform initiative was

expected to enhance transparency and improve compliance. The establishment of e-procurement required

a law that recognizes electronic transaction (OGPFM-2 trigger). Following its enactment, e-procurement

was first scheduled to be launched for the Medical Stores Department and the Government Procurement

4 “The Minister may, at any time or times not later than the thirtieth day of June, 2018, borrow within or outside the United Republic or partly

within and partly outside the United Republic, any sum or sums not exceeding in the whole sum of Thirty One Trillion, Seven Hundred Eleven

Billion, Nine Hundred Eighty Five Million, Eight Hundred Eighty Four Thousand Shillings by way of loan, advance, the issue of bills or bank

overdraft and on such terms and conditions as the Minister may deem expedient, and may charge that loan or advance on any of the assets of the

United Republic, including securities forming part of the Consolidated Fund.” - Appropriation Act 2017.

８

Services Agency (OGPFM-3 trigger) with the objective of improving the drugs supply in the health sector

and public procurement of goods and services for the government.

1.5 Revised Policy Areas

22. None of the policy areas were revised.

1.6 Other Significant Changes

23. The OGPFM series was designed to have three successive DPOs. The first one of the series was

disbursed in 2015 and was to be followed by two other DPOs the following years in 2016 and 2017.

However, only the first DPO was implemented and disbursed (US$100 million). The two following DPOs

were dropped and merged into a new DPO series, called “Growth and Service Delivery (GSD) DPO series”,

which is currently under preparation. Since these two operations were initially planned as part of a three-

year series that was later redesigned and merged after the first year, the operation failed to achieve the

expected outcomes. Outcomes.

2. KEY FACTORS AFFECTING IMPLEMENTATION AND OUTCOMES

2.1 Program Performance

Table 1: Key Dates of the OGPFM series

Operation Approval Date Effectiveness

Date

Amount Closing

Date

OGPFM-1 June 23, 2015 June 26, 2015 USD 99.99M 12/31/2015

OGPFM-2 Dropped -- -- --

OGPFM-3 Dropped -- -- --

24. The new government that came into power in 2015 requested the Bank to consolidate some

of the four ongoing DPOs due to lack of implementation capacity. These were on energy sector,

pension reform (dropped), business environment and OGPFM. The pension reform program was prepared

but not implemented. While the Power and Gas Sector DPO series completed 2 out of 3 operations, the

Bank decided not to pursue further as the program lapsed. Compared to the previous multi-donor general

budget support under the PRSC series, the transaction costs associated with the series on both the GoT and

the Bank became quite significant. The second OGPFM was pre-appraised in March 2016 and a draft PCN

was prepared under the renewed name of “Strengthening fiscal management and transparency DPF”.

However, it was decided to merge it with another DPO series under the MoFP supervision. It was called

the “Business Environment for Jobs DPO” and was also at the first DPO stage of three DPOs series. Due

to slow progress in reforms, only 3 out of 9 triggers were ready at the time of OGPFM-2 pre-appraisal

９

mission in March 2016. The change of government also affected the program performance as the priorities

were changed. Some ongoing reforms were abandoned or suspended, as described below.

Pillar 1 - Open Government Partnership – Support Tanzania’s commitment to promote access to

information, open budget, and open data in Education, Water and Health

25. As mentioned above, some activities were suspended after the change of political orientation

by the new government. While Tanzania was the second African government that joined Open

Government Partnership (in 2011) after South Africa, the new government withdrew from the OGP in June

2017, justifying that similar objectives were advocated by African Peer Review Mechanism of the African

Union. Therefore, some activities related to OGP, including the ongoing work on implementing Open Data

system which was a significant part of the OGPFM series (Pillar 1), were suspended. The “Big Results

Now!” initiative that was launched under the former government - and was the basis of the OGPFM series

- was disbanded and its activities were merged into the mainstream government systems. The Big Results

Now program was officially closed in June 2016.

Policy Area 1 - Establishing the Legal Framework for Access to Information

26. Following a controversial and long ATI bill drafting process, the bill was finally adopted and

its implementation will start with the new DPO series. While initial prior action was met, and the ATI

bill submitted once to the Parliament in March 2015, it was suspended upon the request of several civil

society organizations. This was to allow further public consultations, as the earlier consultations were

viewed to be inadequate and that some of the articles proposed by the bill were in contradiction with

promoting access to information. Following the new public consultations on the ATI bill in the first quarter

of 2016, the bill was approved by the Parliament in September 2016 and the related regulations in

December 2017. However, planned triggers for OGPFM-2 and 3 were not implemented during the series’

timeframe. Part of the OGPFM-2 trigger, namely “Government issues implementing regulations for the

ATI Act”, has been implemented as a prior action for the new GSD series.

Policy Area 2: Establishing an open data system and practice for government budget and sector

performance

27. Establishment of open data system was strongly associated with the OGP and the top-level

leadership, which, in part, caused the end of these activities. The new government, by withdrawing

from the OGP, imposed a freeze of all related activities. These included the data dashboards on 3 key

sectors, namely education, water, and health (OGPFM-2 trigger and results indicator), which had become

operational on the government website (opendata.go.tz) with the DFID/World Bank TA (SOGDAT -

Support for Open Government Data and Accountability in Tanzania). The dashboards were not updated

following the government withdrawal from the OGP. Due to increasing political pressure, all related

ongoing work were forced to be put on hold. For example, the municipality of Kigoma-Ujiji that had

initially intended to continue the OGP work as an independent member even after the government, had to

withdraw from it. Currently, NBS is considering the migration of the dashboards to its own platform to

dissociate these dashboards with the open government initiative, but so far, no specific plan has been put

in place.

１０

Pillar 2 - Public Financial Management - Improve budget credibility and execution, through better cash


28. Despite the progress in cash management reform, budget credibility and execution remain

weak. While the new government is committed to improving cash management systems, shift of priorities

suspended or delayed other reforms. Growing arrears notably remain a key concern, along with the lack of

full commitment towards implementing public investment management (PIM) reforms. Meanwhile, donor-

funded PFMRP IV has continued to provide TA support to implement PFM reforms.

Policy Area 3 - Cash Management

29. The reforms contributed to the elimination of most of the arrears on recurrent budgeted

items. That said, a large part of the remaining arrears comes from unbudgeted items and on capital

spending rather than from current expenditures, indicating that budget planning remains weak. For

instance, over-commitment of capital expenditures, that leads to an unrealistic revenue collection target,

remains the de facto adjustor in the initial budget. Part of the OGPFM-2 trigger is currently being met as a

prior action for the new DPO series through the preparation of a strategy for expenditure arrears prevention

and clearance (OGPFM-2 trigger and GSD-1 prior action). The implementation of this strategy - which

was an OGPFM-3 trigger - will be carried out through the new GSD DPO series.

30. Greater discipline for more credible budget was to be reached through Amendments to the

Appropriation bill (OGPFM-3 trigger). The OGPFM had sought to limit the borrowing powers of the

Minister of Finance contained in the appropriation act to a debt cap authorized by parliament for financing

the budget, rather than the full budget amount. The Annual Appropriation Act in its Section 5 authorizes

the Minister to borrow for the full amount of the expenditure appropriated. By aligning the broad borrowing

powers of the Minister of Finance granted annually in the Appropriation Act to the borrowing limitations

set in the Loans, Guarantee and Grants Act (1974, as amended), this policy action was to promote the

discipline required to develop more credible budgets. However, the Appropriation Act of 2017 still

authorizes the minister to borrow for the full amount of the budget as before, except this is stated in the

actual budget figure rather than the wordings in the Act (see: footnote 2).

31. Cash management systems reforms are progressing albeit with some delays. For example,

OGPFM-1 prior action for MDAs to commit all expenditures through the IFMIS was met and significantly

improved cash management, since all MDAs are fully connected to IFMIS and TISS/EFT (with some

exceptions such as defense budget that has a direct connection to TSA). Currently, works are ongoing to

link LGAs to TISS/EFT by June 2018. Approval of the plan to link LGAs to TIS/EFT was a OGPFM-2

trigger and was met in 2016. Treasury Single Account (TSA) is expected to be linked to IFMIS and

TISS/EFT by July 2018. Consolidation architecture for the IFMIS data of MDAs and LGAs is starting its

technical pilot user testing stage - to date, MDAs and LGAs have two separate IFMIS systems and the

consolidation of more than 600 LGAs is carried out manually through Excel at the Accountant General’s

department. A Central Budget Management System (CBMS), which was not part of the OGPFM series,

was prepared to link the planning system with IFMIS (accounting). It is being used to prepare the FY 2018-

19 budget and its operationalization is planned for FY2018-19. In the future, CBMS is expected to link the

revenue collection system as well.

１１

32. While programmatic classification and budgeting were initiated for 8 pilot ministries, they

were not implemented. Substantial support was provided by AFRITAC to the 8 pilot Ministries on

programmatic budgeting. These include the Ministry of Health Community Development, Gender, Elderly

and Children; the Ministry of Water and Irrigation; the Ministry of Works, Transport and Communication;

the Ministry of Agriculture, Livestock and Fisheries; the Ministry of Education, Science and Technology;

the Ministry of Finance and Planning; the Ministry of Energy and Minerals; and the Ministry of Industry,

Trade and Investment. These eight ministries prepared an ex-post programmatic budget classification for

the FY2016-17. However, the activity is currently suspended and at the time of the ICR, there was no

ongoing or planned activity for programmatic budgeting.

Policy Area 4 - Public Investment Management

33. Mandatory use of the Public Investment Management (PIM) manual in preparation and

screening of investment projects was not implemented. Instructions in the budget guidelines on the

systematic use of the PIM manual by MDAs were issued in November 2014 (OGPFM-1 prior action) and

were expected to optimize the screening of capital investment projects. At the time of PRSC-11, the work

to prepare a PIM manual was almost completed and hence, including the adoption of PIM manual a prior

action (#7) for OGPFM-1 was already rather weak to begin with the use of the manual was an OGPFM-2

trigger (#8). Implementation of PIM manual was delayed due to the delay in rolling it out to MDAs and

LGAs caused in large part to the weakening of mandate of the Planning Commission - which was expected

to lead this initiative – by its merger with the Ministry of Finance in 2015 and a subsequent dissolution in

2018. Since the 2015 elections, large flagship projects are introduced through the Second Five Year

Development Program (FYDP II) which are not screened by PIM manual and lack either time or cost

indicators. Moreover, increased capital spending in recent years, and notably for these flagship projects,

has caused the over-commitment in capital expenditures that led to over-ambitious revenue collection

forecast and greater arrears.

Policy Area 5 - Procurement

34. Procurement procedures remain cumbersome and progress in compliance rates remain slow,

despite continuous reforms. Under the OGPFM-1, regulations to implement the Public Procurement Act

2011 were adopted in 2013 (OGPFM-1 prior action). However, a new Public Procurement Act was adopted

in 2016 along with the related regulations. While the initial PPA 2011 was said to be based on the

international standards, the PPA 2016 adapted it to the local context. It notably aims to: (i) reduce the

public procurement processing time; (ii) reduce the cost of public procurement by allowing procurement

of used items and directly from manufacturers abroad (guidelines are being drafted by the PPRA); (iii)

reduce the time and cost; and (iv) increase the independence of appeals mechanism by separating PPRA

authority from the appeals mechanism (appellant can submit directly to Public Procurement Appeal

Authority (PPAA) so that decisions of the High court do not require physical presence on the basis of

documents submitted and the cost of appealing procedures is shared between government and suppliers.

Other amendments are on life threatening commodities and emergency procurement (to be implemented)

and the possibility for PEs (Public Enterprises) to be tenders. Nevertheless, progress in compliance rates -

as a percentage of procurement entities that comply with PPA - is slow and were even slightly reduced for

LGAs in the last fiscal year. Due to lack of resources, PPRA is only able to audit a third of the procurement

entities (about 100) annually. The government is preparing a new Code of Ethics and Conduct that will

expand its coverage to all public officers engaged in the public procurement process. It will also include

１２

accounting officers, members of the tender boards, procurement management units, and user departments

(GSD-2 trigger).

35. E-procurement is being introduced. The bill for electronic transaction was adopted by the

Parliament in 2015 (OGPFM-2 trigger) creating a legal basis for e-procurement. The system was made

technically ready in 2017 (GSD-1 prior action) and training for e-procurement was to start with a piloting

phase with the two key procuring agencies and related 100 procurement entities, namely the Medical Stores

Department (MSD), and Government Procurement Services Agency (GPSA), expected to start by

May,2018 (GSD-2 trigger).

Table 2- Prior Actions and Status at the time of the ICR

Priors Actions Implementation Status

Pillar 1 - Open Government Partnership – Support Tanzania’s commitment to promote access to information,

open budget, and open data in Education, Water and Health


Prior Action #1: Cabinet approves an

Access to Information (ATI) bill for

submission to Parliament in line with the

OGP action plan, following broad

consultations with stakeholders.

The prior action was met, but the bill was approved by the

Parliament only in September 2016, and regulations were issued

only in December 2017. While the prior action was met, and the ATI

bill submitted once to the Parliament in March 2015, it was

withdrawn upon the request of several civil society organizations to

allow for further public consultations, as they viewed the earlier

consultations inadequate and some of the articles proposed by the bill

in contradiction with promoting access to information. New public

consultations on the ATI bill were held in the first quarter of 2016.

These included clauses that contained punitive sanctions for people

going against this requirement. The ATI bill was approved by the

Parliament in September 7, 2016.

Policy Area 2 - Establishing an Open Data system and practice for Government Budget and Sector Performance

Prior Action #2: Government initiates

the pro-active disclosure of data by:

a. Issuing instructions to establish an

interagency working group to set policies,

advise on standards, and coordinate

implementation of open data across

MDAs and LGAs.

b. Issuing a circular with interim

guidelines for publishing data in Open

Data format on the Government OD

portal.

The prior action was met and implemented once, but all related

work was suspended. Sector dashboards published key data on

education, water, and health through Open portal. However,

Tanzania withdrew from the Open Government Partnership in 2017

and all work related to open data was suspended including sector

dashboards.



Policy Area 3 - Cash Management

Prior Action #3: MOF issues instructions

to spending units to commit all

expenditures through the Integrated

Financial Management Information

System.

Prior action was met and implemented. All MDAs are fully

connected to IFMIS (with some exceptions such as the defense

budget). It reduced arrears in the system as well as possibility for

fraud. However, some expenditures are committed outside the

system which is the main source of the current arrears.

１３

Prior Action #4: Appropriated Budget

FY14/15 provides funding to reduce the

level of expenditure arrears.

Prior action was met by clearing of expenditure arrears

through the appropriated FY2014-15 budget for Vote 21

(Budget Department) - line item 290700 (Contingencies, non-

emergency - TSh 227 billion). However, expenditures arrears have

continued to accumulate, and reached Tsh 3.77 trillion at the end of

June 2017 (which is 12.8% of original budgeted expenditure, 3.5

percent of GDP).

Pror Action # 5: MoFP pilot payments

by regional MDAs through the Tanzania

Inter-Bank Settlement Scheme (TISS)

and Electronic Fund Transfer (EFT).

Prior action was met and implemented. All MDAs are fully

connected to TISS and EFT that are fully linked IFMIS (with some

exceptions such as defense budget that has a direct connection to

the TSA). MoFP is currently working to link IFMIS, TISS and EFT

to the TSA with target to finalize by July 2018.

Prior Action #6: MoFP and POPC

jointly issue budget guidelines for six

pilot MDAs, including education, water,

and health, to present 2015/16 estimates

on a programmatic classification as a

supplementary budget document.

While the prior action was met, program budgeting exercise

was suspended. Eight pilot ministries were trained and prepared an

ex-post program-based classification budget on FY2016-17. No

further program-based budgeting activity is currently planned.


Prior Action #7: MoFP issues budget

guidelines that require the mandatory use

of the Public Investment Management

(PIM) manual in preparation and

screening of investment projects.

While the prior action was met, the mandatory use of the PIM

manual was not implemented. Increased capital spending in

recent years, notably for these flagship projects, has caused over-

commitment in capital expenditures and greater arrears.

Policy Area 5 – Procurement

Prior Action #8: MoFP publishes the

regulations to implement the Public

Procurement Act 2011 and a notice to all

procuring entities to implement the Act

and regulations.

Prior action was met, but a new PPA was adopted in July 2016,

and related regulations by MoFP in December 2016. The

implementation of the new PPA has started in 2017.

Table 3: Implementation status of Indicative Triggers Triggers Implementation Status (as of end-2017 target date)

Pillar 1 - Open Government Partnership – Support Tanzania’s commitment to promote access to information,

open budget, and open data in Education, Water and Health


OGPFM 2 Trigger #1: Government approves

implementing regulations for the ATI Act and

establishes public information focal points in the

Education, Water and Health ministries.

Met: Implementing regulations for the Access to

Information (ATI) Act were adopted in December 2017

and information officers have been appointed in the

respective ministries as focal points for the ATI.

OGPFM 3 Trigger #1: Government establishes a

mechanism for monitoring implementation of the

ATI legislation in line with the provisions of the

ATI Act.

Not met: No mechanism is in place to implement or

monitor the ATI.

Policy Area 2 - Establishing an Open Data system and practice for Government Budget and Sector Performance

OGPFM 2 Trigger #2: Government adopts a

policy on open data applicable to all public

institutions following wide stakeholder

consultations.

Not met: The policy was drafted in 2016 but abandoned

following the government withdrawal from the Open

Government Partnership in 2017.

１４

OGPFM 2 Trigger # 3: Ministries of Education,

Water and Health will pilot an Open Data

dashboard on the Government open data portal

which includes a citizen Feedback mechanism.

Abandoned: The 3 pilot ministries initiated Open data

dashboards, but all related activities were suspended after

the government withdrew from the Open Government

Partnership.

OGPFM 3 Trigger #2: Ministries of Education,

Water, and Health will expand the dashboards to

include performance data and

roll them out.

Not met: All Open data related activities are suspended

including expansion of the dashboards.



Policy Area 3: Cash Management

OGPFM 2 Trigger #4: Cabinet approves a plan

that: (i) establishes a verifiable level of

expenditure arrears; (ii) finances the payment of

such arrears through the budget; and (iii)

prevents the buildup of further arrears.

Not met but implemented in 2018: The trigger was not

met during the timeframe but has been implemented as a

prior action for GSD-1: “Government settles at least Tsh

900 billion in outstanding payment obligations in

FY17/18, and adopts a central government expenditure

arrears prevention and clearance strategy”. The strategy

was issued as a Paymaster-General Circular. The

government has financed payment of arrears in the

budget and approved an arrears strategy in May 2018 and

issued a circular to prevent arrears accumulation.

OGPFM 3 Trigger #3: MoFP continues to

implement the plan to reduce the stock of

expenditure payment arrears

Not met: The trigger was combined with the above GSD

prior action.

OGPFM 2 Trigger #5: Cabinet approves a set of

transparent rules for cash rationing of the

appropriated budget when revenue and grants are

under collected

Not met: Allocation rules of the ceiling committee were

circulated in an inter-governmental letter in January

2016, but no further action was adopted.

OGPFM 3 Trigger #4: Cabinet approves

amendments to the Appropriation Bill to ensure

consistency in the borrowing powers granted to the

Minister of Finance and debt ceilings, as specified

in the Loans, Guarantee, and Grants Act (1974, as

amended).

Not met: The Appropriation Act of 2017 still authorizes

the minister to borrow for the full amount of the budget

as before, except this is stated in the actual budget figure

rather than the wording in the Act (please see footnote 2

for appropriate wordings in the ACT).

OGPFM 2 Trigger #6: MoFP approves plan to link

LGAs to the TISS and EFT.

Met: The plan was approved during the FY2016-17.

However, LGAs are not yet linked to TISS and EFT.

MoFP target is to link them by June 2018.

OGPFM 3 Trigger #5: MoFP initiates

implementation of consolidation architecture for the

IFMIS data of MDAs and LGAs, for budget

execution data (revenue and expenditure), and

related financial asset and liability data.

Not met: The reform is ongoing, the MoFP IT

department is starting the user testing stage, to which

LGAs requested to be a part. (So far, the consolidation is

still undertaken manually through Excel sheets)

OGPFM 2 Trigger #7: MoFP implements a

program-based budgeting and appropriation

system for the six pilot MDAs.

Not met: 8 pilot ministries were trained for program

budgeting, and lastly prepared an ex-post FY2016-17

budget with programmatic classification, but no further

action is planned.

OGPFM 3 Trigger #6: MoFP continues to roll-out

a program based budgeting and appropriation

system to an additional six MDAs.

Not met: Program-based budgeting is not planned to be

implemented.


１５

OGPFM 2 Trigger #8: POPC publishes a report on

investment projects screened following the PIM

manual

Not met: The PIM manual is not used and time or cost

indicators are not available for large flagship projects (as

defined in the FYDP II).

OGPFM 3 Trigger #7: Report in the Quarterly

Economic Review and Budget Execution Report on

progress with the public investment program.

Not met: No reporting mechanism is planned.

Policy Area 5 - Procurement

OGPFM 2 Trigger #9: Ministry of

Communication Science and Technology submits a

bill to Parliament that will provide the legal

framework for electronic transactions.

Met: The bill was adopted by the Parliament in February

2015.

OGPFM 3 Trigger #8: Government launches the

use of e-procurement for goods purchases at the

Medical Stores Department and Government

Procurement Services Agency.

Not met: The trigger was taken over by the GSD series to

be implemented in two steps, and the first step was

implemented in May 2018.

- The trigger was partially taken over by the GSD-1:

“Government launched the E-Procurement system

including registration of vendors” in May 2018; and

- Partially as a trigger for the GSD-2: “E-Procurement

used for procurement of goods and services by the

Medical Stores Department and Government

Procurement Services Agency, and for goods, works,

and services by the largest 100 procuring entities.”

2.2 Major Factors Affecting Implementation

36. Adequacy of Government’s commitment: Long program preparation time and weak policy

matrix indicate that there was limited government ownership even at the design stage. The change of

government in October 2015 led to a significant change in the policy orientation. As a result, some reforms

made limited progress (Cash management, Procurement) while some other reforms were not implemented

or suspended (Open data, Program-budgeting, PIM which were 3 prior actions out of 8). The government’s

withdrawal from the OGP and freezing of all work related to open data, suspension of program-based-

budgeting activities including for pilot ministries, non-implementation of PIM manual, and a proliferation

of top-down flagship priority projects that in part led to greater arrears, all affected implementation

performance5.

37. Assessment of the operation’s design: This DPO was among the first sectoral DPOs after 13 years

of multi-donor general budget support with 11 PRSC series from 2001 to 2014. As explained in the above

section 1.1, the Bank decided to launch four sectoral DPO series, including this OGPFM series, instead of

broad and joint PRSCs with donor group. The preparation of OGPFM-1 itself was a long process. The

OGPFM DPO was initially planned to be delivered in FY2013-2014. However, the preparation was

delayed, and the ROC authorized to appraise it in September 2014. It took 6 months for the appraisal to

complete, partly due to the bunching of several DPOs appraisals (at least 3 DPO series were in appraisal

at the same time). The long preparation process most likely indicates the low intensity of the policy

dialogue. Moreover, the OGPFM DPO was approved in June 2015, just before the October 2015 general

5 While not directly related to the DPO, there are some PFM reform areas where the new government has tightened the laxity compared to previous

government. For example, there is a consolidated wage bill which removed a large number of ghost workers, and removal of wasteful recurrent

expenditure such as foreign travel, etc.

１６

election where the change of government was inevitable due to the presidential term limit. Yet few policy

changes were expected since the newly elected President was also from the same incumbent party.

However, the change of government in 2015 not only affected its capacities to manage and implement

these series but also policy orientation and DPO reforms outcomes. As a result, all newly launched DPO

series were suspended, and the Bank was requested to merge two series that were under MoFP supervision,

namely Business Environment and OGPFM, into one new GSD DPO series. The OGPFM program heavily

counted on the strong political will at the country’s highest level for Open government and BRN initiative.

However, clear indication of high level commitment often remains a serious risk factor, especially when a

change of government is expected within the next several months. Since this operation was part of a three-

year series that was re-designed and merged after the first DPO, the merging process - which took more

than a year - affected the achievement of expected program outcomes.

38. Coordination: Tanzania traditionally enjoys a strong coordination framework notably through the

Budget Support (BS) group of development partners that was in place for the PRSC, combined with

development partners thematical working groups. This series was part of the working sub-group on

governance and public financial management. The results matrix of the OGPFM series were prepared in

collaboration with the budget support donor group and strong coordination with the multi-donor technical

assistance on PFM (PFMRP IV). Therefore, Performance Assessment Framework for BS in 2015 included

a policy action and an indicator on open government to ensure the harmonization of donor programs

towards a coordinated dialogue on governance. While traditionally, the MoFP played a strong role in the

overall coordination, the new government which promotes greater ownership has so far remained less

inclined to actively assume this responsibility, largely due to its capacity constraints and policy orientation.

39. Soundness of the background analysis: The OGPFM series was built on a number of analyses,

both on open government and PFM. Policy areas 1 (ATI) was supported by Open Government Declaration

(2011); Policy area 2 (Open data) was supported by Open Data Readiness Assessment (2013), Demand for

Open Data (2014), Open Budget Index - Tanzania Report (2012); Policy area 3 (PFM) was supported by

Public Expenditure and Financial Accountability (PEFA) assessment report (2013), Non-Technical Drivers

of PFM (2013), PER study on the prevention and management of payment arrears (IMF, Draft Oct 2014),

PFMRP IV Program Document, Inter-Governmental Funds Flow study (2013), Rapid Budgetary Analysis

(2013), Assessment of reallocation warrants in Tanzania (September 2014), and PER 2010; and Policy area

4 (Procurement) was supported by Non-Technical Drivers of PFM (2013), PPRA Annual Performance

Evaluation Report (2012). These analyses contributed to the quality of technical design of the operation.

40. Relevance of the risks identified: Based on the Bank’s Systematic Risk Assessment Tool (SORT),

the overall risk was rated Moderate in the program document. Some risks were underestimated, and

materialization of these risks was mainly due to the change in policy orientation of the new government

which was not identified as a risk.

41. Political and governance risks were rated as Moderate: This DPO was approved in June 2015, just

before the October 2015 general elections, where the change of government was inevitable due to the

presidential term limit, although limited policy change was expected at the time since the new president

came from the incumbent party. As mentioned above in section 1.1 and 2.2 (assessment of design)), the

new government significantly changed both policy orientation and the design of the operation, which were

not anticipated. Hence, the political risk was not correctly identified.

１７

42. Macroeconomic risks were rated as Moderate: The program document identified international

prices fluctuation of fuel, food, and minerals (gold) as external risks, in addition to wider fiscal deficit and

arrears as well as the level of debt with increased non-concessional borrowing. The risks were, by and

large, correctly identified and rated. As described above (section 1.1), while Tanzania was facing

significant external financing shortfall in FY2014-2015, at the time of program appraisal, Tanzania had

recorded stable growth, subdued inflation, and limited fiscal deficit 6 . Tanzania’s macroeconomic

framework has remained robust, except in the case of growing arrears, which in FY2017-17 reached an

estimated 3.5 percent of GDP.

43. Sector Strategies and Policies risks are rated as Moderate: While stating “unlikely”, the program

document acknowledged the risk of a weaker political will for the new government towards open

government agenda and towards PFM reforms. As mentioned above (in section 1.1 and 2.2), the new

government withdrew from the open government partnership and suspended some of the PFM reforms.

Associated mitigation measure was the alignment to the “Big Results Now” initiative which was also led

by the country’s top-level leadership as for the Open government. Both were abandoned by the new

government. In addition, the Bank was to hold frequent meetings with the government officials and

development partners, as well as with the CSOs. The CSOs were to advocate for the open government and

better public service delivery. Despite their involvement in the technical assistance under SOGDAT, CSOs

did not appropriate the Open data instrument.

44. Technical Design of Program risks were rated as Low: The scope of the operation was considered

to be feasible before the elections and was to demonstrate the usefulness of open government and better

PFM in a changing political environment. The change of government led to the suspension of key reforms.

Moreover, triggers identified for the series were over-ambitious, with many triggers not met (6 out of 9) at

the time of OGPFM-2 pre-appraisal that was dropped. Hence the risks were not correctly identified.

45. Institutional Capacity for Implementation and Sustainability risks were rated as Substantial: The

program document noted as risk the government’s capacity to implement the program and as challenges

which include (i) insufficient technical capacity; (ii) possible delays in the implementation of open

government and public financial management programs to support the sector institutions; and (iii) shifts in

government priorities away from the BRN, open government, and improved service delivery. These risks

were correctly identified and materialized with the new government. Notably the challenge (iii) implicitly

acknowledges the change of government as source of risks. A number of parallel technical assistance

programs were introduced to mitigate these risks. For instance, along with other partners, the Bank

provided TAs to the associated areas such as access to information legislation, Open Data, and PFM. A

large TA program SOGDAT which was funded by DFID and implemented by the Bank, supported the

technical requirements for achieving open data. In addition, a multi-donor funded PFMRP IV provided

support to PFM reforms. However, despite the support provided through these TAs, open government and

some PFM reforms (PIM, Program budgeting) were suspended. The change of government affected the

capacities to manage these operations and to implement the proposed reforms. reforms outcomes

46. Fiduciary risks were rated as Moderate: The program document judged the overall PFM system to

be adequate for DPOs but also noted that capacity constraints in PIM and PFM represented a risk. The

mitigation measures were mainly complementary supports in PFM, such as the PFMRP IV program, the

PER dialogue process, and the PSI, which were to maintain the quality of the PFM system. Even though

6 However, as noted in Para 2, there was a large current account deficit.

１８

some PFM reforms were suspended, and expenditures arrears increased, fiduciary risks were accurately

flagged.

47. Environmental and Social Risks are rated as Low: The program document specified that the policies

supported by this series were not expected to have negative effects on Tanzania’s environment, forests,

water resources, habitats or other natural resources, and that no short or long-term climate change or geo-

hazard risks were associated. It highlighted Tanzanian environmental controls and legislation as adequate,

and that the PIM manual (prior action) incorporated economic and social welfare as well as environmental

considerations in the selection of projects. These risks did not materialize.

48. Stakeholder Risks are rated as Moderate: The program document noted that local non-state actors

became interested in governance and accountability only recently. Capacity building of local NGOs for

open data by SOGDAT was to increase demand for information and greater accountability. Nevertheless,

despite some legal (ATI) and technical (open data) progress, no greater involvement from the civil society

was noted. Moreover, stakeholder risks materialized unexpectedly, coming from the new government that

opposed some of the policies adopted by its predecessor.

Table 4: Systematic Risk Assessment Tool (SORT) (High, Substantial, Moderate or Low)

Risk Categories Ratings in

Program Document

Ratings of ICR (materialization of risks)

Political and governance M H

Macroeconomic M M

Sector strategies and policies M S

Technical design of project or program L M

Institutional capacity for implementation and sustainability S S

Fiduciary M M

Environment and social L L

Stakeholders M S

Overall M S

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

M&E Design

49. The results framework proved insufficient to the task of monitoring the achievement of the

operation. Many of the indicators in the first pillar (ATI and Open government) imperfectly capture the

institutional achievements towards the PDO. The results framework had several shortcomings which are:

(i) Weak links between the objectives and the results indicators. For instance, the indicator 3 on increased

downloads of budget and expenditure data is not linked to any of the specific OGPFM reform prior action

or trigger. (ii) Some indicators are not easily measurable, such as the above-mentioned indicator 3, or

indicator 4 (number of information intermediaries). (iii) Some indicators lack specification, notably for the

indicator 3 - increased downloads of budget and expenditure data - which implies open data (among many

other budget and expenditure data published), but not specified. Similarly, indicator 4 - the number of

information intermediaries that use open data - is unclear both in terms of definition of “information

intermediaries” and the way in which it should be monitored or collected. (iv) No mechanism was planned

１９

to collect indicators. The indicator 1 on percentage of ATI requests granted remained non-available.

Overall, at the program level, no arrangement was in place for monitoring indicators. (v) The results

framework for the pillar 2 (PFM) proved more adequate with clear and measurable indicators. (vi)

However, with only 1 out of 9 indicators targets achieved, over-ambitious targets characterized both pillars.

M&E Implementation and Utilization

50. M&E system was not used. The M&E system was not in place for the ATI request for information

(indicator 1) and the number of information intermediaries (indicator 4). Indicators 5-7 on fiscal and PEFA

indicators were easier to collect and monitor. The indicators were not collected by either the government

nor the Bank, including during the supervision mission or the pre-appraisal mission of the dropped

OGPFM-2.

2.4 Expected Next Phase/Follow-up Operation

51. A new series, Growth and service delivery DPOs (GSD) is currently under preparation. While

the OGPFM-1 was designed as the first of a series of 3 DPOs, the following 2 DPOs were dropped, as

explained above (in sections 2.1 and 2.2). The new government that came into power requested the Bank

to merge this OGPFM series with another series on Business environment that was under the MoFP

supervision. The new GSD series took over 5 triggers from the OGPFM series as prior actions and triggers.

２０

3. ASSESSMENT OF OUTCOMES

3.1 Relevance of Objectives, Design and Implementation

Relevance of Objectives - Modest

52. The OGPFM series’ objectives have not remained relevant. The Program Development

Objective (PDO) of the series was to support the government to establish open data in order to increase

access and use of service delivery information as well as to improve budget credibility and execution. They

were relevant before the 2015 general elections, but policy priorities changed with the new government.

The capacity to implement reforms and to handle DPOs instruments were seriously in question (section

2.1-2.2). Two following DPOs of the series that were dropped also represent a lack of clear commitment

on the part of the new government. As noted earlier, change of priorities by the new government led to the

country’s withdrawal from the Open government partnership and abandon of the BRN initiative that

supported the Pillar 1, and consequently to the suspension of all open data activities (policy area 2).

Similarly, change of priorities also led to the freezing of PIM and program budgeting reforms even though

the frameworks of the program have remained broadly consistent with government plans. For instance,

the initial OGPFM series was framed with the country’s 5 years plan FYPD-1 and the new government

prepared a FYPD-2 covering FY2016-17 – FY2020-21 which took over key priorities of FYPD but with

an emphasis on flagship projects and without some previously introduced initiatives (BRN, open

government). The OGPFM series was initially based on the FY12-FY16 Country Assistance Strategy

Progress Report. The Bank prepared an SCD (Systematic Country Diagnostic) in 2017 and a CPF (Country

Partnership Framework) for 2018-22 which includes the new GSD series. However, the program was too

wide, covering a set of complex reforms which were too ambitious instead of focusing on few key areas

of reform (‘less is more’). While one of the main objectives of the operation was the need for external

financing (see Para 1), Bank Management should have been more candid and transparent in expressing

this objective in the program document.

Relevance of the Design - Modest

53. Weaknesses in the Bank’s quality control and internal clearance processes contributed to

poor design of some prior actions which did not translate into institutional (including legal) changes.

Long program preparation process and weaknesses in the policy matrix of the program indicates low

intensity of dialogue and limited government ownership even at the design stage (section 2.2). There was

a 6-month-long lapse between the ROC meeting, held on September 22, 2014, and the Board approval,

and it is not clear as to why no decision was made to hold a second ROC. Minutes of the ROC meeting

indicate that the Policy Matrix presented at the ROC was to be revised and recirculated to several Bank

units7 for final review so that triggers will be fine-tuned “to ensure that they support a robust set of reforms

without being a set of discrete activities and process steps”. While the revised Matrix was recirculated to

the requested units, there is no evidence that further guidance was provided because the final Policy Matrix

of the operation is still substantially weak and appears to be “a set of discreet activities and process steps”

that the ROC meeting cautioned against. Most of the prior actions and triggers were internal documents

to the government which did not involve legal/institutional changes. Some of the prior actions were almost

complete before the OGPFM preparation (such as PIM manual, as described in section 2.1) and hence, one

could question the rationale for including them in the current operation. Despite these difficulties at the

design stage, the program covered broad and complex reforms with limited complementary technical

２１

assistance. There M&E system in place was inadequate, and neither the Bank nor the government

systematically collected or recorded results indicators. The closing date was set six months after the

approval with only one formal supervision by the Bank team., As a result, only 1 out of 12 indicators and

only 4 triggers were achieved at the end of 2017 target date.

54. Underestimation of political risks closer to a tightly contested election weakened program

design. The program was approved in June 2015, and it appears that inadequate attention was paid to the

potential risks associated with the commitment of the new government. The newly elected government

encountered capacity constraints in implementing a complex DPO series for which it had expressed little

or no firm commitment to begin with. This led to the suspension of key reforms (section 2.1-2.2). There

was an assumption that once open data becomes available, there will be a corresponding increase in

demand from citizen groups leading to sustained access to open data. In fact, the demand was quite

insignificant, as shown by the results indicator 4 (“number of information intermediaries that use open

data”). Notably the limited capacity of the civil society and media to analyze and to disseminate relevant

information, was the main reason for the weak demand. A better assessment of the demand for open data

would have tempered the expectations and led to reassess this reform objective. Similar expectations were

also associated with the preparation of PIM manual and its eventual utilization for better project preparation

and completion. As for the growing arrears, a better understanding and a strategy from the Bank team on

arrears on off-budget items and the government’s commitment for a tighter control on capital spending

would most likely have contributed to improved program outcomes. Discontinuation of the OGPFM series

contributed to the delays in implementing these reforms although some reforms are currently being

implemented under the new GSD series. Given all of the above, it would be important to reassess the

suitability of the DPO instrument. Even if a decision was made to select DPO, a single tranche DPO –

with an understanding to launch a new series once the new government came on board - would have been

a far more suitable given the existing policy context at the time.

Complementarities with Other World Bank Activities

55. The program was complemented with technical assistance from the Bank and the multi-

donor basket fund. Open data (Policy area 2) was supported by a large TA (SOGDAT), and the PFM

reforms (Pillar 2) were supported by the multi-donor funded PFMRP IV. The completion of SOGDAT

coincided with the government’s withdrawal from OGP which contributed to the abandonment of all

associated activities. Part of the PFMRP IV support helped to finance training activities in program

budgeting. As a result, the MoFP could translate the ex-post FY2016-17 budget into program-based

classification while the timing of full implementation of program budgeting remains unclear.

3.2 Achievement of Program Development Objectives

56. The PDOs of the program were not achieved. Only 1 out of 12 results indicators achieved the

target value. Most of the reforms made no or limited progress since disbursement, except in linking cash

management systems, which is related to the indicator that achieved the target (indicator 8: percentage of

annual expenditure by Regional MDAs paid through TISS and EFT).

7 These units were: AFRVP, OPCS, AFRDE, and GGODR.

２２

Objective 1 – Establishing the Legal Framework for Access to Information

Rating: Modest

57. Despite the adoption of the ATI act and regulations, the ATI remains to be implemented. No

mechanism is currently in place to ensure that requests for information are granted. Adoption of regulations

was taken over as a prior action for the new GSD series and was implemented, and information officers

are appointed as focal point in the ministries. As a next GSD trigger, reporting of the level of compliance

with ATI legislation in Regional Administration, Local Government Department of the President’s Office,

and health and education MDAs is planned.

Objective 2 – Establishing an Open Data system and practice for Government Budget and Sector

Performance

Rating: Negligible

58. On the contrary, while Open data portal has become operational, a political decision was

made to suspend all associated activities. These include the sectoral dashboards that were online with

increasing data and updates. It was expected that once the portal is online, it would create demand from

the civil society and media, which however, did not materialize. Despite the involvement of civil society

organizations as part of the technical assistance SOGDAT, there were limited interest and capacity to digest

these data by civil society and the media which may have contributed to the limited outcomes in the related

sectors, including when open data was operational. National Bureau of Statistics (NBS) is considering

taking over the portal but no specific plan is established yet. However, it should be noted that there has

been an increased awareness of government data as a public resource. NBS now publishes statistical tables

in excel format and the three sectors open data websites are still online with data up to 2016.

Objective 3 – Improve Cash Management

Rating: Modest

59. Progress exceeded expectation in improving cash management systems. This is where the only

indicator achieved the target (MDAs payment through TISS/EFT) and the reform associated with the

trigger was implemented (plan to link LGAs to TISS/EFT). The government is also operationalizing the

Central Budget Management System (CBMS), which was not part of the OGPFM series. CBMS is

currently being linked to IFMIS (accounting) and it is expected that both planning and revenue collection

systems will also be linked to IFMIS in the future. However, despite the progress in cash management

systems which led to limited arrears on budgeted items and current expenditures, growing arrears are

increasingly caused by off-budget items and capital spending. Similarly, program budgeting was initiated

through a new classification and training supported by PFMRP IV. However, so far its operationalization

is not planned.

Objective 4 – Improve Public Investment Management

Rating: Negligible

60. Public Investment Management showed limited progress, even though PIM manual was

nearly complete at the time of OGPFM preparation. The limited progress in its adoption was due to the

large flagship projects that were introduced by the new government under FYDP-2. PIM manual which

was prepared to help better screen large projects was never used during this process. It is important to note

２３

that the premise that preparing a manual and disclosing this information will lead to improved project

preparation rests on weak grounds to begin with. PIM reforms should go beyond the preparation of a

manual as these reforms involves the achievement of a complex set of milestones which range from project

identification and screening, to costing and ex-post evaluation (see below: Figure 1).

Figure 1: World Bank’s PIM Diagnostic Scheme: Eight Must-Have Features

Source: The Power of Public Investment Management, World Bank, 2014

Objective 5 – Improve Public Procurement

Rating: Modest

61. Procurement reform made progress, driven by a strong ownership from the government. As

a result, a new PPA was prepared and adopted along with related regulations. The new PPA was adopted

in 2016 and some clauses and bidding documents are still under preparation. Hence, there is no assessment

of the new PPA implementation. However, some changes seem to benefit the administrations rather than

the bidders. For instance, reducing processing time led to tighter deadlines for bidders while the

government seems to be wining more cases with the new appeals mechanism. Despite some delays, e-

procurement is progressing both legally (adoption of electronic transaction bill) and technically and is

expected to be operational at the end of the next GSD series.

3.3 Justification of Overall Outcome Rating

Rating : Unsatisfactory

62. Weakness in the relevance of design led to limited achievement of PDOs. The operation’s

design was over-optimistic due to inadequate risk identification and mitigation measures, and insufficient

２４

follow-up support for implementation. Implementation had several shortcomings, including the

discontinuation of DPOs that slowed progress toward achieving the PDOs and led to the suspension of

some reforms (Open government, Program budgeting, PIM).

Table 5: Achievement of PDOs

Relevance of Efficacy Overall

Outcome Objectives Design Objective 1 Objective 2 Objective 3 Objective 4 Objective 5

Modest Modest Modest Negligible Modest Negligible Modest Unsatisfactory

3.4 Overarching Themes, Other Outcomes and Impacts

(a) Poverty Impacts, Gender Aspects, and Social Development

63. Although less than expected, an increased accountability and transparent and a more

efficient public administration are expected to contribute towards greater efficiency in public service

delivery. Such improvements, in turn, could have a positive impact on poverty reduction and inclusive

growth in the long run if the reforms are sustained. ATI and open data, if fully implemented, would have

contributed to greater participation of citizens in policy discussions and debates. Improved cash

management systems and public procurement reduce frauds and enhance the capacity to better manage

public finances with greater accountability and efficiency, thereby contributing to increased growth and

social welfare.

(b) Institutional Change/Strengthening

64. Despite limited achievements, the program contributed to enhancing accountability in the

administration. ATI, even though yet to be implemented, introduced a new concept for the administration

on citizen’s right for ATI and an obligation for the administration to respond to citizens request for access

to information. In the long run, if adequately implemented, it would contribute to strengthening the overall

governance. Cash management systems and procurement reforms are expected to contribute towards a

more efficient and a transparent budget formulation and execution process.

(c) Other Unintended Outcomes and Impacts

65. Not applicable

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

66. Not applicable

２５

4. ASSESSMENT OF RISK TO DEVELOPMENT OUTCOME

Rating: Substantial

67. Along with the OGPFM series, most of the reforms were suspended or slowed down (section

2.2 and table 4). Initiation of preparation for the new GSD series revived some reforms (ATI, cash

management, procurement), but reforms remained suspended in other areas (open data, PIM, program

budgeting). Risks rating in the table 4 remains valid, and sustainability of development outcome will depend

mainly on politics, governance, institutional capacity, and stakeholders. The rating takes also into account

the growing concerns over both political governance and fiscal management of the government.

5. ASSESSMENT OF BANK AND BORROWER PERFORMANCE

5.1 Bank Performance

(a) Bank Performance in Ensuring Quality at Entry

Rating: Unsatisfactory

68. The Bank failed to ensure a proper quality control process. As described in section 3.1, despite

long program preparation process indicating a low intensity of policy dialogue and limited government

ownership. Despite a 6-month laps after the ROC, there was no formal second review of the revised Policy

Matrix before the program was submitted to the Board. As a result, the approved (revised) policy matrix

remained quite weak, having little impact on institutional reforms. Moreover, underestimation of political

risk that led to initiating a DPO series just before the 2015 elections was a critical weakness in the program

design. No adjustment plan was considered at the design stage in case of potential change of new

government priorities. The series was suspended upon the new government’s request and due to its limited

implementation capacity, high transaction costs, and lack of political will, several key reforms were hence

abandoned or suspended. Insufficient technical assistance support to implement reforms also limited the

outcomes and contributed to the discontinuation of the program and associated reforms. Technical design

was overly complex and M&E design was inadequate to allow proper monitoring of program progress.

(b) Quality of Supervision


69. The program lacked continuous supervision and support from the Bank. The closing date was

set for only 6 months after program approval, thus the program was formally supervised only once, in

November 2015, due to the suspension of the series. The recorded ISR briefly described the status of each

trigger for the following DPO (OGPFM-2). However, results indicators were not collected. While there was

only one supervision mission, the Bank conducted a technical mission for OGPFM-2 pre-appraisal in March

2016. An aide-memoire was recorded, which details status of triggers and discussed alternative triggers,

without including any reference to results indicators. A draft PCN (Project Concept Note) was prepared in

January 2017 for OGPFM-2 (“Strengthening fiscal management and transparency DPO”), but the series

was formally abandoned to be merged into a new GSD series. Its preparation revived some of the reforms,

２６

including some OGPFM triggers (Table 3). Despite early supervision and pre-appraisal missions, no follow-

up support was envisaged to accelerate reforms and no mitigation measures were considered to support the

reforms when the DPO series was suspended. In part, lack of continuous dialogue with the government

contributed to weak outcomes. Successive operations (OGPFM-2 and 3) were not cancelled and the program

was not closed with relevant date in the system (ISR8). The limited access to program data led to a

considerable challenge in preparing the ICR.

(c) Justification of Rating for Overall Bank Performance


70. The quality at entry was unsatisfactory as was the quality of supervision. Correspondingly, the

overall Bank performance is rated as unsatisfactory.

5.2 Borrower Performance

(a) Government Performance


71. Since the change of government in November 2015, the reforms made limited progress. As

indicated in the previous section, the program lacked clear ownership even at the design stage and was

ultimately suspended which contrasted with the initial optimism of the program. The government itself

recognized its capacity weakness to manage several DPOs series and associated reforms and requested to

merge them to limit the number of DPOs series. However, with the new GSD series is still under

preparation, limited progress was made since the 2015 elections. Some key reforms such as open data,

PIM, program budgeting, were abandoned. Nevertheless, the government demonstrated a strong ownership

and achieved a significant progress notably in building and linking cash management systems as well as

swiftly adopting a new PPA and regulations.

(b) Implementing Agency or Agencies Performance


72. At the time of the ICR, no administrative unit had an oversight of the full program supported

by the series. Change of government after the 2015 elections led to a change of management in the

administrations. New management was not familiarized with DPOs instrument and associated reforms,

which characterize the past 3 years since OGPFM-1 disbursement. The government was unable to provide

its own ICR. Bank received comments from the Ministry of Agriculture on August 15, 2018 which are

attached in Annex 2.

(c) Justification of Rating for Overall Borrower Performance


8 ISR is the Implementation Status and Results Report which should be periodically updated during the program/project implementation period.

２７

73. The government performance was unsatisfactory, as was the implementing agencies performance.

Correspondingly, the overall Borrower performance is rated unsatisfactory.

6. LESSONS LEARNED

74. Political context needs to be taken into consideration at the design stage to identify all

conceivable risks and potential mitigation measures: Tanzania had a relatively stable political context

and elections, but the last election was a tightly contested one compared to previous elections and resulted

in changes in policy. Therefore, launching a new series of several DPOs just before the general elections

was not timely. As an alternative, a single DPO may have had some implementation success which could

be built upon with a new series once the new government was in place and would have given the Bank

more time to assess the new government’s mandate, implementation capacity, and commitment to adopt

proposed reforms of the DPO series. Suitability of the DPO instrument as compared to other alternatives

needs to be carefully weighed to determine the most effective way to start a dialogue and incentivize

reforms. A complementary PforR may have been helpful to initiate the requisite policy changes and to

incentivize areas of reforms which pose potential implementation challenges.

75. Implementing several DPOs was challenging for the government: This was the first series

launched after 14 years of multi-donor general budget support programs under PRSC. Compared to multi-

donor general budget support, focus of the series was to establish a high-quality dialogue and reforms on

thematical/sector DPOs. However, there was little consideration of the government’s capacity to handle

several series and instruments which consequently led to poor outcomes. The end of PRSC also meant

the end of the large budget support donor group which had lightened the burden for the government.

Hence, implementing several DPOs series incurred unsustainably high transaction costs to both the

Government of Tanzania and the Bank.

76. Broader objectives may have dominated quality control and review process. As noted earlier,

the policy matrix presented at the ROC had weaknesses and was to be revised to “ensure that this DPO

program supports robust set of reforms without being a set of discrete activities and process steps like a

Program for Results (PforR) instrument”9". The revised policy matrix was presented to the recommended

units for quality control and further guidance and yet the policy matrix of the DPO still appeared to be a

“set of discrete activities” which the ROC cautioned against. This suggests that there were weaknesses

in the Bank Management’s quality assurance process. That said, if one of the main objectives of the

operation was to support the Government of Tanzania in addressing a serious shortfall of external

financing that it faced at the time (as mentioned in para 1), the Bank Management should have been more

candid and transparent in expressing this objective in the program document.

77. Donor driven reforms without strong government ownership are unsustainable: Long

program preparation and the weak policy matrix indicate that policy dialogue was most likely supply-

driven. Several reforms (ATI, OGP, PIM, Program budgeting, PPA2011) were promoted by donors and

were not necessarily internalized by the administration, which resulted in the suspension of the reforms

(OGP, PIM, Program budgeting) or delays (ATI) or re-adaptation (PPA2011 vs. PPA2016) after the

9 Minutes of the ROC Meeting held on September 22, 2014.

２８

change of government10. Moreover, some reforms (ATI, OGP) heavily relied on top-level commitment

which was always poses a considerable risk especially when such commitments were made before the

new government came on board.

78. Deeper analysis of the demand for reforms prior to launching the operation would have

helped improve program performance: Some of the reforms such as open data, PIM manual, program

budgeting, assumed that once the product (ex: PIM manual) is in place, a demand would automatically

generate to make these reforms sustainable. However, a priori, analysis of the potential demand which

include an associated risk mitigation and implementation support strategy, could have contributed to

better performance.

79. Each key policy reform areas should be supported by adequate complementary assistance

to guarantee better reform implementation: For instance, when the DPO instrument focuses on

adopting legal or regulatory text, consideration should be given to corresponding support that may be

needed through well-coordinated TA to operationalize such reforms. One way of doing this is to consider

utilizing the Bank’s newest instrument, Program for Results (PforR), which provides opportunities to

incentivize effective project implementation. The operation reviewed by the ICR had weak program

performance due in part to the insufficient support for implementing reforms.

10 Pleases see the World Bank publication “Political Economy of Public Financial Management: Experiences and Implications for Dialogue and

Operational Engagement” – Verena Fritz, Marijn Verhoeven, and Ambra Avenia.

ANNEX 1: BANK LENDING AND IMPLEMENTATION SUPPORT/SUPERVISION PROCESSES

(a) Task Team members

Names Title Unit Responsibility/

Specialty

Lending

Chiara Bronchi Lead Public Sector Specialist GGO19 TTL

Gert Johannes Alwyn

Van Der Linde

Lead Financial Management

Specialist GGO13 Co-TTL

Denis Maro Biseko Senior Public Sector

Specialist GGO19 Team member

Verena Knippel Senior governance specialist GTI11 Team member

Mercy Mataro Sabai Senior Financial

Management Specialist GGO31 Financial Management

Gisbert Joseph Kinyero Senior Procurement

Specialist GGO01 Procurement

Emmanuel A. Mungunasi Senior Economist GMF07 Economist

Edward Charles

Anderson Senior ICT Policy Specialist GTI11 ICT

Mary-Anne D.

Mwakangale Program Assistant AFCE1 Team member

David A. Bontempo Operations Analyst GGOOS Operations Analyst

Christiaan Johannes

Nieuwoudt Finance Officer WFALA Finance Officer

Michael Christopher

Jelenic

Operations Officer / Public

Sector Specialist GGO13 Team Member

Supervision

Chiara Bronchi Lead Public Sector Specialist GGO19 TTL

Gert Johannes Alwyn

Van Der Linde

Lead Financial Management

Specialist GGO13 Co-TTL

Denis Maro Biseko Senior Public Sector

Specialist GGO19 Team member

Mercy Mataro Sabai Senior Financial

Management Specialist GGO31 Financial Management

Gisbert Joseph Kinyero Senior Procurement

Specialist GGO01 Procurement

Emmanuel A. Mungunasi Senior Economist GMF07 Economist

Edward Charles

Anderson Senior ICT Policy Specialist GTI11 ICT

Mary-Anne D.

Mwakangale Program Assistant AFCE1 Team member

Zoe Kolovou Lead Counsel LEGAM Counsel

(b) Staff Time and Cost

Stage of Project Cycle

Staff Time and Cost (Bank Budget Only)

No. of staff weeks USD Thousands (including travel and

consultant costs)

Lending

Total: 128.24 695,601.89

Supervision/ICR

Total: 0.23 7,729.04

ANNEX 2: SUMMARY OF BORROWER'S COMMENTS ON DRAFT ICR

ANNEX 3: LIST OF SUPPORTING DOCUMENTS

East AFRITAC, Aide Memoire, Tanzania, Strengthening Expenditure Controls in IFMIS, March 2017

European Commission, Public Expenditure and Financial Accountability (PEFA) Assessment Mainland

Tanzania (Central Government) Government of Tanzania and World Bank, Tanzania Open Data Readiness

Assessment, June 2013

Government of Tanzania and the Danish Ministry of Foreign Affairs (Danida), Tanzania – Assessment of the

Public Finance Management systems of the Central Government applying the PEFA 2016 Framework,

September 2017

Government of Tanzania, Ministry of Finance and Planning, Strategy for Management of Arrears, Draft, March

2017

Government of Tanzania, Ministry of Finance and Planning, The Budget Execution Report for the Fourth Quarter

and Fiscal Year 2016/17 (July 2016-June 2017), October 2017

Government of Tanzania, National Audit Office, The Annual General Report of the Controller and Auditor

General on the Financial Statements for the Year ended 30th June 2017

Government of Tanzania, Sub-national (Local Government) PEFA Assessment in Tanzania, July 2016

IMF, United Republic of Tanzania, 2014 Article IV Consultation, Third Review Under the Standby Credit

Facility Arrangement, May 2014

IMF, United Republic of Tanzania, Request for a Three-Year Policy Support Instrument – Staff Report, July

2014

IMF, United Republic of Tanzania, First Review under the Policy Support Instrument – Staff Report, January

2015

IMF, United Republic of Tanzania, Second Review under the Policy Support Instrument – Staff Report, July

2015

IMF, United Republic of Tanzania, Third Review under the Policy Support Instrument – Staff Report, February

2016

IMF, United Republic of Tanzania, Staff Report for the 2016 Article IV Consultation and Fourth Review Under

the Policy Support Instrument-Press Release, July 2016

IMF, United Republic of Tanzania, Fifth Review under the Policy Support Instrument – Staff Report, January

2017

IMF, United Republic of Tanzania, Sixth Review under the Policy Support Instrument – Staff Report, July 2017

IMF, United Republic of Tanzania, Seventh Review under the Policy Support Instrument – Staff Report, January

2017

Political Economy of Public Financial Management: Experiences and Implications for Dialogue and Operational

Engagement” – Verena Fritz, Marijn Verhoeven, and Ambra Avenia.

Political Economy of Tanzania, Hoffman, Barak D. March 2013.

Public Procurement Regulatory Authority, Annual Performance Evaluation Report for Financial Year 2012/2013





Twaweza, Building Bridges TAGCO, Data Stories, March 2018

World Bank, First Business Environment for Jobs DPO, August 6, 2015

World Bank, Country Partnership Framework for the United Republic of Tanzania, February 14, 2018

World Bank, Tanzania Growth & Service Delivery (GSD) DPO 1, Discussion Note -Expenditure Arrears, Draft,

November 9, 2017

World Bank, Tanzania Growth & Service Delivery (GSD) DPO 1, Program Concept Note, April 28, 2018

World Bank, Tanzania Open Government and Public Financial Management DPO, Decision Note of the Roc

Meeting, September 22, 2014

World Bank, Tanzania Open Government and Public Financial Management DPO, Implementation Status &

Results Report, November 18, 2015

World Bank, Tanzania Open Government and Public Financial Management DPO, Program Document, April

15, 2015

World Bank, Tanzania Poverty Reduction Support Credit Series 9-11, Implementation Completion and Results

Report, September 27, 2016

World Bank, Support to Open Government Data and Accountability in Tanzania, Year one progress report, May

2014 - February 2015

World Bank, Tanzania Systematic Country Diagnostic, February 23, 2017

World Bank, Tanzania Second Open Government and Public Financial Management (OGPFM) Development

Policy Financing Operation Technical Mission, Aide Memoire, August 4-17, 2016

World Bank, Tanzania Second Open Government and Public Financial Management Development Policy

Operation, Aide Memoire of the Technical Mission - February 29 to March 24, 2016

World Bank, Tanzania Growth & Service Delivery (GSD) DPO l, Discussion Note - Expenditure Arrears, Draft

October 30, 2017

World Bank, Tanzania, Strengthening Fiscal Management and Transparency DPO, Draft Program Document,

January 12, 2017

world bank document...estimated revenues, as reported in the final budget execution report value 12%...

Documents