Tajikistan - Second Public Finance Management Modernization Project

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The development objective of the Second Public Finance Management Modernization Project for Tajikistan is to improve the effectiveness, control, and accountability of public expenditures of the Republic of Tajikistan. The project comprises of five components. The first component, public finance management modernization supports implementation of the public finance management reform strategy (PFMRS), strengthening the budget planning, budget execution, treasury, accounting, and financial reporting functions across government. It consists of following three sub-components: (i) build capacity to implement PFM reforms; (ii) support the development of information systems; and (iii) support improvements in accounting and financial reporting practices. The second component, strengthening public procurement seeks to strengthen the regulatory and institutional framework for public procurement and support implementation of an e-Procurement system. It consists of following three sub-components: (i) improvements in the legislative and regulatory framework for public procurement; (ii) support capacity-building for the state agency for public procurement (SAPP); and (iii) support the development of the e-Procurement system. The third component, strengthening external audit will assist the chamber of accounts (COA) in implementing the strategy and action plan for developing external audit body. It consists of following two sub-components: (i) support organizational development of the COA; and (ii) support development of professional audit capacity. The fourth component, managing public administration reforms seeks to develop the institutional capacity of the Executive Office of the President (EOP) and dependent entities responsible for functions critical to the effective development of the PFM system. It consists of following three sub-components: (i) support strengthening of the strategic planning function; (ii) support development and implementation of the e-Government roadmap; and (iii) support development of the human resource (HR) management system. The fifth component, project management will finance the ministry of finance (MOF’s) administrative and procurement support team (APST).
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96378 DISCUSSION PAPER NO. 1502 Social Protection in Fragile and Conflict-Affected Countries Trends and Challenges Mirey Ovadiya, Adea Kryeziu, Syeda Masood and Eric Zapatero April 2015 Social Protection in Fragile and Conflict-Affected Countries: Trends and Challenges Mirey Ovadiya Adea Kryeziu Syeda Masood Eric Zapatero April 2015 Abstract: This study examines the role of social protection programming, and programming design and implementation features, that are prominent in fragile and conflict-affected states. The main objective is to build on existing, available information from a sample of fragile and conflict-affected countries and develop operational guidance that addresses policy, design, and implementation issues and offers operational solutions for social protection programming and policy making in different fragile settings. The analysis showcases the universe of social protection objectives that are evident in these countries as well as the programming trends, types, coverage, and expenditure patterns. The paper also examines dimensions specific to fragile and conflict-affected settings in implementing social protection and labor programs, such as social cohesion, the role of community-driven development, and postwar benefits. Finally, the study highlights social protection and labor program delivery in seven different country contexts, and discusses the country-specific programming options chosen to achieve the objectives and overcome capacity and operational constraints. Keywords: Social protection and labor, fragile and conflict-affected states, capacity, enabling environment, social assistance, social insurance, labor market programs, community-driven development (CDD), trends, challenges. JEL classification: H53, H54, I38 2 Acknowledgments The paper has benefited from valuable advice, inputs and guidance from Lucy Bassett, Carine Clert, Aylin Isik Dikmelik, Ugo Gentilini, Samira Ahmed Hillis, Matthew Hobson, Mira Hong, Kelly Johnson, Maddalena Honorati, Alex Kamurase, Cem Mete, Montserrat Pallares Miralles, Suleiman Namara, Matthew Norton, Junko Onishi, Stefano Paternostro, Nicola Pontara, Lucian Pop, Laura Rolston, Nina Rosas Raffo, Anita Schwarz, Victoria Strokova, John Van Dyck, Briana Wilson, Emily Weedon, Ruslan Yemtsov, Giuseppe Zampaglione, and Yongmei Zhou. It was developed under the overall guidance of Anush Bezhanyan. The document was edited by Nita Congress. i Abbreviations ASPIRE Atlas of Social Protection—Indicators of Resilience and Equity CPIA Country Policy and Institutional Assessment GDP gross domestic product PMT proxy means testing ii Contents 1. Introduction .............................................................................................................................................. 1 2. Basic Concepts: Social Protection and Fragility ........................................................................................ 2 2.1. Social Protection ................................................................................................................................ 3 2.2. Characteristics of Fragility ................................................................................................................. 5 2.3. Fragility and Poverty .......................................................................................................................... 6 3. Arriving at a Typology ............................................................................................................................... 8 4. Trends and Findings on the Role of Social Protection in Fragile and Conflict-Affected Countries ........ 12 4.1. Objectives ........................................................................................................................................ 13 4.2. Programming Choices ...................................................................................................................... 14 4.3. Coverage .......................................................................................................................................... 18 4.4. Expenditures .................................................................................................................................... 23 4.5. Delivery Mechanisms....................................................................................................................... 27 5. Highlights of Social Protection Program Delivery in Fragile and Conflict-Affected Countries ............... 29 6. Conclusions ............................................................................................................................................. 36 7. Bibliography ............................................................................................................................................ 39 Box 4.1: Evaluation Results for the Yemeni Social Fund for Development ................................................... 28 Figure 2.1: Moving from Fragility to Institutional Resilience, Security, Justice, and Jobs ............................... 4 Figure 2.2: Characteristics of Fragile and Conflict-Affected Situations ........................................................... 6 Figure 2.3: The Share of the World’s Poor Living in Fragile States .................................................................. 7 Figure 3.1: Typology of Fragile and Conflict-Affected States........................................................................... 9 Figure 4.1: Total Number of Social Assistance Programs in Fragile and Conflict-Affected Countries, by Program Type ................................................................................................................................................. 15 iii Figure 4.2: Total Number of Social Assistance Programs in Fragile and Conflict-Affected Countries, by Program Type ................................................................................................................................................. 17 Figure 4.3: Social Assistance and Social Insurance Coverage in Fragile and Conflict-Affected Countries, as a Percentage of Total Population ..................................................................................................................... 20 Figure 4.4: Social Assistance and Social Insurance Coverage, as a Percentage of the Poorest Quintile ....... 21 Figure 4.5: Social Insurance Expenditures in Selected Fragile and Conflict-Affected Countries as a Percentage of GDP ......................................................................................................................................... 25 Figure 4.6: Share of Safety Net Spending of GDP in Fragile and Conflict-Affected Countries ....................... 27 Table 4.1: Benefits Incidence of Social Protection in Selected Fragile and Conflict-Affected Countries ...... 19 Table 4.2: Safety Net Spending as a Percentage of GDP in Fragile and Conflict-Affected Countries ............ 26 iv 1. Introduction This discussion paper is the first output under the umbrella of the programmatic work on social protection in fragile and conflict-affected states. This work aims to develop operational guidance to teams on the likely determinants of effective social protection programming and policy making in fragile and conflict-affected settings. This paper elaborates on the role of social protection programming, and programming design and implementation features, that are prominent in fragile and conflict-affected states. In particular, the paper describes the universe of social protection objectives in these countries, reflects on their revealed objectives, and discusses programming options chosen to achieve those objectives as well as how several countries have overcome particular operational and capacity constraints. It is important to understand how social protection works in these settings, which often feature a combination of circumstances such as the following:  Acute poverty either concentrated or widespread (areas affected by conflict have lagged behind) and vulnerability to shocks  Lack of social cohesion/weak social fabric  Weak or destroyed infrastructure (physical, financial, etc.)  Implicit need for conflict management among special groups (e.g., war veterans)  Implicit need for developing citizen trust in the state Despite many common characteristics, fragile and conflict-affected states are actually quite diverse, particularly with regard to metrics of state capacity and the extent to which they have an enabling environment. This paper presents a methodology that has been devised to group countries based on income, capacity, and extent of enabling environment. Use of this 1 methodology will aid in understanding trends, patterns, and key factors in policy making and programming choices—good and bad. 2. Basic Concepts: Social Protection and Fragility One and a half billion people (nearly 30 percent of the world’s poor) live in areas affected by fragility, conflict, or large-scale organized criminal violence. To date, no low-income fragile or conflict-affected country has achieved a single United Nations Millennium Development Goal. While much of the world has made progress in reducing poverty in the last 60 years, areas affected by cycles of conflict have lagged economically and have not advanced their human development indicators (World Bank 2011h). Poverty and fragility become mutually reinforcing in such settings. In this regard, “fragility” should be recognized as a dynamic and multidimensional concept. Fragility extends over a broad spectrum of circumstances that manifest in a range of countries, including Iraq, Malawi, Myanmar, Sierra Leone, and Timor-Leste, among others. As suggested in the literature, perhaps a better way of approaching fragility is to differentiate among contexts by considering an entity’s level of resilience. Resilience is defined (e.g., in OECD 2008 and World Bank 2011h) as a political and social system’s capacity to adapt to shocks. Unlike the more amorphous concept of fragility, this is a highly useful concept, in that it is more aligned with the process any entity—a person, a family, a community, a country—must go through when facing multiple challenges. One of the main mechanisms to help build resilience and protect the poor and vulnerable is context-specific, effective social protection programming. However, it is often the case that ‘‘the greater the need for social protection, the lower the capacity of the state to provide it” (Devereux 2000); this is particularly true in fragile contexts. Government capacity is likely to be even weaker in terms of social protection than for social services such as health and education, since line ministries often retain some capacity even in postconflict and fragile situations. These realities highlight both the need for social protection in fragile and conflict-affected states, as well as the difficulties in setting up programs with limited capacity, funding, and—at times—political will. 2 2.1. Social Protection By definition, social protection plays an important role in providing income support and access to basic social services to populations most at risk of being affected by systemic shocks, such as cycles of conflict and violence. In fragile settings in particular, social protection often has a dual and simultaneous role of contributing to state building and to reducing social inequalities and exclusion. By design, social protection policies can provide income security to individuals through income support, access to employment opportunities, and insurance mechanisms. These policies then lead to improved social cohesion and reduced probabilities of social conflict and violence. Governments often rely on short-term youth employment, entrepreneurship support, and/or input or food distribution programs (e.g., as in Iraq, Liberia, Sierra Leone, South Sudan, and Timor- Leste), as they realize the political and social significance of these programs in building confidence, including disenfranchised groups, and reducing social tensions. The 2011 World Development Report (World Bank 2011h) argues that strengthening legitimate institutions and the ability of a state to provide stability, justice, security, and jobs lessens the probability of conflict and fragility. Social protection thus plays an important role in restoring confidence; transforming the institutions that provide security, justice, and jobs; addressing external stresses; and mobilizing international support to overcome fragility, violence, and conflict (figure 2.1). For instance, through the provision of short-term employment to disenfranchised individuals, public works programs have the potential to restore a sense of identity to individuals and confidence in the ability of the state to deliver services and improve social inclusion and equity (Andrews and Kryeziu 2013). This, in turn, contributes to the objective of state building. 3 Figure 2.1: Moving from Fragility to Institutional Resilience, Security, Justice, and Jobs Source: World Bank 2011h. While evidence on the impact of social protection programming and policies on social cohesion is scant, international experience suggests that social protection can be an important platform for  Promoting voice and participation through program processes,  Improving social inclusion and equality through temporary labor market participation, and  Smoothing social tensions and building trust in response to sudden shocks as well as longer-term fragility (Andrews and Kryeziu 2013). A recent stocktaking exercise of World Bank–supported community-driven development operations implemented in fragile and conflict situations notes that, even though many operations do not explicitly have peace-building objectives and emphasize service delivery instead, the implicit theory of change is one of short-term service delivery outcomes improving voice; instilling trust, confidence, and cohesion; and leading to improved governance and a compact between citizens, service providers, and the state (de Regt, Majumdar, and Singh 2013). 4 Yet, particularly in emergency situations, immediate relief and long-term social cohesion may be contradicted by the need to rebuild the state quickly. Some interventions that may be necessary to provide assistance quickly may trigger unintended consequences, inequalities, and tensions. Thus, while social protection can make an important contribution toward state building and conflict reduction, it must also be acknowledged that not every type of social protection program or policy can or does contribute effectively, and in a timely manner, to these objectives. There is much to be learned about social protection in fragile states, particularly in the move away from fragmented programs and toward effective institutions and systems. Many operational challenges remain. For example, quite a number of fragile countries may have long- standing, politically difficult-to-revoke social protection policies that are ineffective, regressive, and benefit very small and/or fairly well-off populations; or that may have spawned a plethora of small and fragmented programs that do not inform or complement one another. Common logistical issues include low coverage, high costs, information gaps, and poor administrative infrastructure and physical settings. 2.2. Characteristics of Fragility The World Bank categorizes countries as fragile if they have a harmonized average Country Policy and Institutional Assessment (CPIA) rating of 3.2 or the presence of a United Nations and/or regional peace-keeping or peace-building mission during the past three years. A total of 36 countries constituted the list of fragile states in 2014. They are generally characterized by weak institutional capacity, weak governance structures, fragmented societies and competing elites, a tendency to repeated cycles of conflict, poor infrastructure, poor access to services, often very high poverty and vulnerability to multiple sources of shocks, and weak financial capacity (figure 2.2). They also often have non-inclusive political and economic institutions (Acemoglu and Robinson 2012). 5 Figure 2.2: Characteristics of Fragile and Conflict-Affected Situations Poor Weak financial infrastructure capacity Weak Poor access to governance services Low Fragmented institutional societies capacity Fragile & Non-inclusive High poverty conflict- political and and affected economic vulnerability institutions setting Source: Adapted from World Bank 2012a. Although many non–fragile and conflict-affected countries may face most of these issues, what exacerbates the situation in fragile and conflict-affected settings is that deficiencies exist across multiple issues at the same time and the deficiencies are mutually reinforcing (Andrews et al. 2012). In these environments, building social protection systems requires an analysis of the above constraints, as well as of context-specific challenges to identify suitable objectives and solutions. It is important to ana
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