Document of The World Bank

Report No: ICR0000565

IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA-33550 IDA-3355A)

ON A

CREDIT

IN THE AMOUNT OF SDR 48.3 MILLION (US$64.7 MILLION EQUIVALENT)

TO THE

REPUBLIC OF ZAMBIA

IN SUPPORT OF THE FIRST PHASE

OF A

SOCIAL INVESTMENT FUND (ZAMSIF)

March 26, 2008

Human Development 1 Eastern and Southern Africa Africa Regional Office

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CURRENCY EQUIVALENTS

Exchange Rate Effective December 31, 2005

Currency Unit = Zambian Kwacha US$ 1.00 = [Zambia Kwacha 3,379.98]

XDR 1.00 = US$ 1.00

FISCAL YEAR July 1 to June 30

ABBREVIATIONS AND ACRONYMS

APL : Adaptable Program Lending BESSIP : Basic Education Sub-Sector Investment Program CAS : Country Assistance Strategy CBO : Community Based Organization CDD : Community Driven Development CIF : Community Investment Fund CRAIDS : Community Response to HIVAIDS CSO : Central Statistical Office DCA : Development Credit Agreement DIF : District Investment Fund DO : Development Objective DSA : District Situational Analysis GRZ : Government of the Republic of Zambia EDRP : Emergency Recovery Project ESP : Pilot Environment Fund HIV/AIDS : Human Immunodeficiency Virus/Acquired Immunodeficiency Syndrome IAPSO : International Agency for Procurement Services Organization IEC : Information, Education and Communication IMS : Indicator Monitoring Survey IPF : Indicative Planning Figures KPI : Key Performance Indicators LCMS : Living Conditions Monitoring Survey MASAF : Malawi Social Action Fund MMS : Monitoring Management System MOFED : Ministry of Finance and Economic Development MOU : Memorandum of Understanding MTR : Mid-Term Review MU : Management Unit NDP : National Decentralization Policy O&M : Operation and Maintenance OVC : Orphans and Vulnerable Children

PAD : Project Development Document PDO : Project Development Objective PMA : Poverty Monitoring and Analysis PRA : Participatory Rural Appraisal PRSP : Poverty Reduction Strategy Paper QAG : Quality Assessment Group ROADSIP : Road Sector Investment Project SRP I : Social Recovery Project SRP II : Second Social Recovery Project SOPU : Strategic and Operational Planning Unit ZAMSIF : Zambia Social Investment Fund

Vice President: Obiageli K. Ezekwesili Country Director: Michael Baxter

Sector Manager: Christopher J. Thomas Project Team Leader: Wim Alberts

ICR Team Leader: Ida Manjolo

ZAMBIA SOCIAL INVESTMENT FUND

CONTENTS

Data Sheet A. Basic Information B. Key Dates C. Ratings Summary D. Sector and Theme Codes E. Bank Staff F. Results Framework Analysis G. Ratings of Project Performance in ISRs H. Restructuring I. Disbursement Graph

1. Project Context, Development Objectives and Design............................................... 1 2. Key Factors Affecting Implementation and Outcomes .............................................. 8 3. Assessment of Outcomes .......................................................................................... 15 4. Assessment of Risk to Development Outcome......................................................... 19 5. Assessment of Bank and Borrower Performance ..................................................... 20 6. Lessons Learned ....................................................................................................... 22 7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners .......... 24 Annex 1. Project Costs and Financing.......................................................................... 25 Annex 2. Outputs by Component ................................................................................. 26 Annex 3. Economic and Financial Analysis................................................................. 32 Annex 4. Bank Lending and Implementation Support/Supervision Processes ............ 33 Annex 5. Beneficiary Survey Results ........................................................................... 35 Annex 6. Stakeholder Workshop Report and Results................................................... 36 Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR..................... 37 Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders....................... 49 Annex 9. List of Supporting Documents ...................................................................... 50

MAP

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A. Basic Information Country: Zambia Project Name:

Social Investment Fund (ZAMSIF)

Project ID: P063584 L/C/TF Number(s): IDA-33550,IDA-3355AICR Date: 03/31/2008 ICR Type: Intensive Learning ICR

Lending Instrument: APL Borrower: GOVERNMENT OF ZAMBIA

Original Total Commitment:

XDR 48.3M Disbursed Amount: XDR 48.3M

Environmental Category: F Implementing Agencies: ZAMSIF Cofinanciers and Other External Partners: B. Key Dates

Process Date Process Original Date Revised / Actual Date(s)

Concept Review: 10/05/1999 Effectiveness: 07/11/2000 07/11/2000 Appraisal: 03/13/2000 Restructuring(s): 03/26/2004 Approval: 05/25/2000 Mid-term Review: 08/25/2003 Closing: 12/31/2005 12/31/2005 C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Moderately Satisfactory Risk to Development Outcome: High Bank Performance: Moderately Satisfactory Borrower Performance: Moderately Satisfactory

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

Quality at Entry: Moderately Satisfactory Government: Moderately Satisfactory

Quality of Supervision: Moderately Satisfactory Implementing Agency/Agencies: Moderately Satisfactory

Overall Bank Performance: Moderately Satisfactory Overall Borrower

Performance: Moderately Satisfactory

C.3 Quality at Entry and Implementation Performance Indicators

Implementation Performance Indicators QAG Assessments

(if any) Rating

Potential Problem Project Yes Quality at Entry None

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at any time (Yes/No): (QEA): Problem Project at any time (Yes/No):

Yes Quality of Supervision (QSA):

Satisfactory

DO rating before Closing/Inactive status:

Moderately Satisfactory

D. Sector and Theme Codes

Original Actual Sector Code (as % of total Bank financing) General education sector 19 21 General water, sanitation and flood protection sector 18 19 Health 18 20 Roads and highways 18 16 Sub-national government administration 27 24

Theme Code (Primary/Secondary) HIV/AIDS Primary Primary Improving labor markets Primary Primary Participation and civic engagement Primary Primary Poverty strategy, analysis and monitoring Primary Primary Rural services and infrastructure Primary Primary E. Bank Staff

Positions At ICR At Approval Vice President: Obiageli Katryn Ezekwesili Callisto E. Madavo Country Director: Michael Baxter Michael N. Sarris Sector Manager: Christopher J. Thomas Dzingai B. Mutumbuka Project Team Leader: Ida Manjolo Laura Frigenti ICR Team Leader: Ida Manjolo ICR Primary Author: Ida Manjolo F. Results Framework Analysis Project Development Objectives (from Project Appraisal Document) The Zambia Social Investment Fund (ZAMSIF) is part of a two phase Program (over 10 years) intended to support two of the objectives outlined in the Government of Zambia's (GRZ) National Poverty Reduction Strategic Framework & Action Plan (1999-2004). The Development Objective (DO) for Phase 1 of the ZAMSIF Project is to achieve

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improved, expanded and sustainable use of services, provided in a governance system whereby local governments and communities are mutually accountable. The Program's main strategic objectives are: (a) to decentralize and empower local authorities to improve governance and efficiency in service delivery; and (b) to increase access to basic social services through direct poverty interventions. The Program will help to achieve these objectives also (c) by strengthening GRZ's capacity for poverty monitoring (through the Living Conditions Monitoring Unit, LCMU) and analysis (through the use of the Study Fund). Revised Project Development Objectives (as approved by original approving authority) The Zambia Social Investment Fund (ZAMSIF) is part of a two phase Program (over 10 years) intended to support two of the objectives outlined in the Government of Zambia's (GRZ) National Poverty Reduction Strategic Framework & Action Plan (1999-2004). The Development Objective (DO) for Phase 1 of the ZAMSIF Project is to achieve improved, expanded and sustainable use of services, provided in a governance system whereby local governments and communities would become mutually accountable. (a) PDO Indicator(s)

Indicator Baseline Value

Original Target Values (from

approval documents)

Formally Revised Target Values

Actual Value Achieved at

Completion or Target Years

Indicator 1 : Achieve sustainable improved availability and use of quality basic social services by beneficiaries (CIF)

Value quantitative or Qualitative)

10% 10%

Date achieved 06/20/2000 12/30/2005 Comments (incl. % achievement)

76% of beneficiaries are accessing facilities within an average of five kilometers which also translates into reduction in time it takes to access facilities.

Indicator 2 : Contribute to the building of capacity for improved local governance (DIF)

Value quantitative or Qualitative)

Full devolution of CIF & DIF activities to district authorities

i).Full devolution in 2 districts by 2005 ii)5 Districts using information from Monitoring Mgmt System (MMS) in planning

i). 4 districts ii). 8 districts

Date achieved 06/20/2000 05/26/2004 12/30/2005 Comments Full devolution was expected for all districts by end of Phase II of APL (2010).

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(incl. % achievement)

Beneficiaries have expresed satisfaction with the district staff on service delivery

(b) Intermediate Outcome Indicator(s)

Indicator Baseline Value

Original Target Values (from

approval documents)

Formally Revised

Target Values

Actual Value Achieved at

Completion or Target Years

Indicator 1 : Strengthen capacity to provide timely information on poverty and social conditions and facilitate its use in policy

Value (quantitative or Qualitative)

(i) Annual public consultation or review of poverty & social conditions (ii) Functioning SOPU (iii) 5 districts using information from Monitoring Management Systems (MMS

(i) 3 Consultations (ii) No SOPU established (iii) 8 districts using MMS

Date achieved 06/20/2000 12/30/2005 Comments (incl. % achievement)

There were 8 districts using the MMS which was three districts over the set target. Three Consultations were held during the course of the project.

Indicator 2 : Value (quantitative or Qualitative)

Date achieved Comments (incl. % achievement)

G. Ratings of Project Performance in ISRs

No. Date ISR Archived DO IP

Actual Disbursements (USD millions)

1 06/20/2000 Satisfactory Satisfactory 0.00 2 08/03/2000 Satisfactory Satisfactory 0.00 3 11/22/2000 Satisfactory Satisfactory 2.37 4 06/01/2001 Satisfactory Satisfactory 6.36 5 06/14/2001 Satisfactory Satisfactory 6.36 6 10/03/2001 Satisfactory Satisfactory 8.20 7 04/23/2002 Satisfactory Satisfactory 11.00

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8 11/27/2002 Satisfactory Satisfactory 15.84 9 05/30/2003 Satisfactory Satisfactory 19.78

10 12/17/2003 Unsatisfactory Unsatisfactory 26.35 11 05/20/2004 Unsatisfactory Satisfactory 41.31 12 06/28/2004 Satisfactory Satisfactory 42.54 13 12/29/2004 Satisfactory Satisfactory 57.45 14 05/16/2005 Satisfactory Satisfactory 64.48 15 12/27/2005 Moderately Satisfactory Satisfactory 68.73

H. Restructuring (if any)

ISR Ratings at RestructuringRestructuring

Date(s)

Board Approved

PDO Change DO IP

Amount Disbursed at

Restructuring in USD millions

Reason for Restructuring & Key Changes Made

03/26/2004 N U U 34.86

I. Disbursement Profile

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1. Project Context, Development Objectives and Design 1.1 Context at Appraisal The Government of the Republic of Zambia (GRZ) in its National Poverty Reduction Strategic Framework and Action Plan for 1999-2004 committed itself to policy measures that would lead to improvement in the welfare of its population. With a large share of the population having no access to basic social services, and having weak capacity to meet their basic needs; and with rural poverty being more prevalent (82%) due to geographical isolation, GRZ strategy for reducing poverty focused on achieving broad based economic growth through agriculture and rural development; providing the public with adequate and necessary infrastructure through labor intensive techniques; developing human resources, promoting good governance and increasing the capacity of the poor to participate fully in their own development. The GRZ in 1999 also outlined the future of the Social Recovery Program (SRP) activities, and requested for the Bank’s support. The SRP funded by the Bank, was one of the most successful poverty reduction instruments the GRZ had put in place. The GRZ indicated that even though during the preparation of the SRP II it had not envisioned an additional phase of the project, the following compelling forces made it to request for support for continuation of the SRP II activities:

• Real decrease in social indicators; • Acute economic crisis; • Increase in poverty both in rural and urban areas; and • Increase of the HIV/AIDS pandemic and other epidemic diseases.

The Zambia Social Investment Fund (ZAMSIF) was a follow-on project after the Second Social Recovery Project (SRP II) which ended in 2000. Both the SRP I and SRP II had provided support to poor rural communities for nine years, and strengthened capacity for poverty monitoring and analysis. ZAMSIF was the first part of a two phase APL (over 10 years). The Program was intended to support the Government of Zambia's (GRZ) National Poverty Reduction Strategic Framework & Action Plan (1999-2004) in two of its objectives: (i) decentralization and empowering local authorities to improve governance and efficiency in service delivery; and ii) increasing access to basic social services through direct poverty interventions.

1.2 Original Project Development Objective (PDO) and Key Indicators The project’s development objective was the same as the program development objective. The Development Objective (DO) was to achieve improved, expanded and sustainable use of services, provided in a governance system whereby local governments and communities are mutually accountable. The overall program outcome indicators and the project outcome indicators are as indicated in Tables I and II below:

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(i) Overall Program Outcomes: Table I Indicator End of Program

Indicator Targets (by eop)

Revised End of Program Indicator Targets

Achievement by end of Project

Full devolution of CIF & DIF activities to district authorities

400 CIF and 80 DIF subprojects meeting the program objectives complete and operational

500 CIF and 30 DIF projects meeting the program objectives completed and operational

549 CIF and 67 DIF

Increase in number of Community-driven activities & Community-based Organizations (CBOs);

10% increase in community driven activities, comparison between beneficiary and non beneficiary communities

10%

(ii) Specific Project Outcomes Table II Outcome Indicator Indicator Targets Revised

Indicator Targets

Achievement by end of Project

Achieve sustainable improved availability and use of quality basic social services by beneficiaries (Availability and Use) (CIF

10 % change in distance in time to facilities

10%

10% in distance to facility for roads, water, and new projects before and after the project

The ZAMSIF Evaluation (2008) recorded 76% of beneficiaries accessing facilities within an average of five kilometers

10% increase of the year community is accessible to roads projects, before and after.

25% increase in the year that community is accessible

The ZAMSIF Evaluation (2008) states that there was improved access because of the bridge and road projects

1% p.a.{5% end of project (eop) increase in school attendance in beneficiary primary schools by sex/grade more than national average (LCMS/IMS)

Proxy Indicators :Data from Ministry of Education shows that there was decrease in dropout rate in ZAMSIF impact areas from 1.8 in 2002 to 1.5 in 2005, signifying attendance (ZAMSIF Evaluation 2008)

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1% p.a. (5% eop) increase in

maternal and child health (MCH) attendance in health projects more than the national average

28%

5% increase in births attended by trained personnel

138% - these were mostly Traditional Birth Attendants trained during the life of the project

10% in increase in orphans and vulnerable children (OVCs) attending school

As a proxy indicator, based on the number of OVC reached according to the output targets, and the number of schools built an inference is drawn that this indicator was achieved, although it is not known how many of the OVC are of school going age

25% increase in numbers using safe water, in rural areas

2%

5% increase in numbers using safe water, in urban areas

4%

Contribute to the building of capacity for improved local governance (DIF)

Number of districts at each level of performance of DIF: Year 5 - 12 level 1; 20 level 2; 20 level 3; 15 level 4; 5 level 5

Year 5: Level 1: 18; Level 2: 26 Level 3: 21; Level 4: 3 Level 5: 4

Improvement between beneficiary/non beneficiary at MTR and at eop in Satisfaction with (i) Council administration; (ii) local line agency representations; (iii) NGOs/CBOs; (iv) traditional authorities; (v) number of project committees not completing community subprojects

High satisfaction was registered in ZAMSIF impact areas where subprojects were completed (ZAMSIF Evaluation 2008)

Strengthen Capacity to provide timely information on poverty and social conditions and facilitate its use in policy making

Annual public consultation or review of poverty and social conditions

3 were conducted during the project period

Functioning SOPU in MOFED managing Study Fund by end of project

Not Achieved

5 districts using information from Monitoring management Systems (MMS) in planning

8 districts

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1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and reasons/justification The revised DO for the Project was to achieve improved, expanded and sustainable use of services, provided in a governance system whereby local governments and communities would become mutually accountable. During the Mid-Term Review (MTR) preparation process in 2003, it had become apparent that the project needed restructuring as it had been lagging behind in its implementation performance. The modification of the DO was part of the corrective restructuring in 2004. The restructuring entailed: (i) rewording of the PDO, which was necessary in order to rationalize the scope of the stated objective with the investment activities under the project and to adjust it to the realities on the ground; (ii) rationalizing the scope of the objective with the investment activities under the project, which included a reduction in some of the outcome and output indicator targets, in order to lower expectations; and (iii) adjusting the implementation modalities of the project. Following the restructuring, the scope of the project activities became more limited and the expectations regarding the outputs were scaled down. The modified activities and the expected outputs could no longer have the impact that was anticipated at design stage. The modification was reflected in the adjustments in: (i) the changes in targets for the overall program outcome by increasing the number of completed and functional projects under the CIF, and reducing the number under the DIF (Table I); (ii) the key performance output indicators (Refer to Annex 2); (iii) and the triggers for moving from APL I to APL II. The output triggers for both the CIF and the DIF were adjusted downwards following the amendments in the output indicators (refer to Table III below). These modifications did not change the purpose of the project but were intended to ensure that the ZAMSIF activities and outputs could realistically achieve the desired, but more limited impact. However, the downward adjustment of the impact was not reflected in the outcome indicators, instead, the outcome indicator target measuring the ‘percentage increase a community becomes accessible through road project before and after’ was increased from 10% to 25% (refer to Table II above). Table III: Triggers for moving from APL phase I to phase II Program Development Objective

Original Triggers to Move from Phase 1 to Phase 2

Revised Triggers to Move from Phase 1 to Phase 2

Achievement at end of Phase I

Improved, expanded and sustainable use of services provided in a governance system where local government and communities are mutually accountable

1.1. 400 CIF and 80 DIF subproject meeting the program objectives completed and operational. 2. Improved level of satisfaction of beneficiary communities with (i) council administration; (ii) local line agency representatives; (iii) NGOs and CBOs

500 CIF and 30 DIF -

549 CIF and 62 DIF Achieved: Improved level of satisfaction in beneficiary communities following completion and operational subprojects has been recorded by

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the ZAMSIF Evaluation (2008)

Output Triggers

For DIF at year 5: 12 districts at level 1;

20 at level 2; 20 at level 3; 15 at level 4; 5 at level 5

12districts at level 1; 40 Level 2; 16 level 3; 2 level 4; 2 level 5

18 districts at level 1; 26 level 2; 21 level 3; 3 level 4; 4 level 5

For CIF at year 5:

12 districts at level 1; 20 at level 2; 20 at level 3; 15 at level 4; 5 at level 5

12districts at level 1: 40 Level 2; 16 level 3; 2 level 4; 2 level 5

18 districts at level 1; 26 level 2; 21 level 3; 3 level 4; 4 level 5

3. Strategic and Planning Unit (SOPU) in the Ministry of Finance and Economic Development (MOFED) established and functioning

-

Not achieved

1.4 Main Beneficiaries, The main beneficiaries of the project were poor communities in rural and mostly located in remote areas of the country. The project was to give special attention to vulnerable and disadvantaged groups such as children, orphans, the HIV/AIDS affected and the elderly. The districts and local authorities were the other beneficiary category as they were to benefit through capacity building in development planning, management and implementation skills.

1.5 Original Components According to the PAD, ZAMSIF consisted of three components: the Community Investment Fund; the District Investment Fund (DIF); and the Poverty Monitoring and Analysis. Some resources were allocated under ZAMSIF Institutional Support for implementation support; this was treated as the fourth component in both the resource allocation framework and the Key Performance Indicators table. Community Investment Fund (CIF) (US$45.8 million: IDA US$38.6 million; GRZ 1.27; Communities US$5.995): The component would finance community based small subprojects selected through participatory processes. The subproject menu included social and economic infrastructure; natural resources management subprojects; capacity building and basic skills training for stimulating local productivity. The component’s special program would target poor and vulnerable groups such as orphans the HIV/AIDS affected, among others. Communities were expected to contribute 15% of the total subproject cost in cash or in kind. It was expected that through this component, communities would have increased access to basic services and information. District Investment Fund (DIF) (US$6.148 million : IDA US$5.94 million GRZ US$.203 million): The component sought to finance larger district level infrastructure covering more than one community, and these included district health facilities and markets places. District authorities were expected to lead the implementation of these

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projects by managing resources allocated on a project by project basis and eventually manage the district’s allocation grant. The component was also to support training and activities aimed at strengthening the planning, management, and implementation skills of local authorities and community members. Through this component it was expected that the districts’ capacities would be enhanced in strategic development planning and management; and that accountability and trust would be engendered between the communities and service providers. Poverty Monitoring and Analysis (PMA) (US$3.616 million; IDA US$3.543 million; GRZ US$0.073 million): The component was to support activities carried out under SRP I and SRP II related to data collection, analysis, and assessing the impact of poverty reduction programs and government policy on poverty. The component was also to support activities aimed at strengthening the institutional, technical and financial framework for sustainable monitoring and policy use of information on poverty. Included in this was support to strengthen a coordinating Strategic and Operational Planning Unit (SOPU) in Ministry of Finance and Economic Development (MOFED); and the development of pilot District Data Banks. ZAMSIF Institutional Support (US$21.83 million: IDA US$19.83 million GRZ US$1.968 million): The component was meant for supporting administration and operating costs, beneficiary assessment, environmental impact assessment, poverty maps and other targeting, training and capacity building for ZAMSIF staff. As a follow-on project, ZAMSIF continued to support the creation of community level social infrastructure to improve access to services by the poor and by stimulating the capacities at both the district and community levels. The design of the components took into consideration the ability of the Management Unit, including its administrative and financial capacities. The project’s components were reasonably linked to achieve the development objective, this notwithstanding, the project implementation arrangements were novel, and this contributed to slow startup of the project both at the district and at the level of the implementing agency, leading to restructuring of the project.

1.6 Revised Components At design stage it was anticipated that there would be progressive transfer of responsibilities from ZAMSIF to district administrations for planning, priority setting, and facilitation of the community sub-project cycle, implementation support and monitoring processes. The lack of implementation of the National Decentralization Policy (NDP) had a strong negative impact on ZAMSIF’s ability to progress towards reaching its Development Objective. The objective of the decentralization policy was to devolve fiscal, political and administrative responsibilities to district administrations. Although the implementation of the National Decentralization Policy (NDP) was not considered as an indispensable condition to achieving the project development objectives, it was considered a critical assumption for the project activities and outputs to have the desired impact. The Government of Zambia’s commitment to local participation and local management of resources, as expressed in the policy, did not effectively materialize. Through out the life of the project, district administrations operated in an environment

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which was not supported by the effective decentralization of fiscal, financial, administrative and political responsibilities. The initial design of ZAMSIF was to progressively transfer responsibilities to the local authorities, however two years into implementation this proved to be overly ambitious. Districts continued to have dual set up of distinct line ministry departments and the local authorities because GRZ had not implemented the NDP. The restructuring of the project led to (i) re-focusing of the implementation of the CIF; (ii) realigning the DIF with the realities on the ground; (iii) relocating and integration of the PMA effectively in the MOFNP; and (iv) re-focusing the institutional strengthening It also involved increased support of ZAMSIF staff for the implementation of the community sub-projects. The overall project implementation arrangements were adjusted in order to get ZAMSIF staff more involved in implementation in the absence of the NDP.

1.7 Other significant changes The design of ZAMSIF did away with the zonal offices of the implementing agency, expecting that the districts would take the lead; this did not materialize as the NDP was not implemented (as discussed in section 1.6). The districts continued to have dual arrangements of having the council and the sector ministry staff. As a result of the change in the delivery mechanism from that of SRP II, there were few subprojects under implementation and the project had a disbursement lag of 37%, two years after Effectiveness. Implementation arrangements were enhanced by bringing back the involvement of the ZAMSIF staff to backstop the regions, handholding the districts and the communities; this meant that ZAMSIF design reverted to that of the SRPII. Following increased involvement in implementation disbursement rates improved such that by December 31, 2005, the Credit was fully disbursed; and subproject completion targets under both the CIF and the DIF were surpassed. Institutionally, approval of subprojects was the responsibility of the Steering Committee comprising senior government officials. However, recognizing the delays brought about by the Steering Committee, a subcommittee of the Steering Committee was put in place to facilitate the subproject approval processes, which, coupled with the effective support ZAMSIF provided to the districts, the project’s output targets were surpassed (Annex 2 KPI). ZAMSIF had robust systems in place and as such it was able to respond effectively to the difficult situation in the project environment by implementing a Public Works Program in 38 drought-stricken districts as part of the GRZ drought recovery efforts. Despite staff involvement in the drought recovery program, implementation of the ZAMSIF was not negatively affected as the project completed on time. The total Credit for ZAMSIF was estimated at US$74.2 million, with IDA providing US$64.7, GRZ US$5.0 million and communities contributing US$4.5 million. The actual estimates indicate that IDA provided US$68.73 million representing 6.2% over the estimate; this was due to the exchange rate gains between the SDR and the US Dollar. The GRZ provided US$1.714 million indicating under-provision of 65.7% according to

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the PAD. However, during implementation it had been agreed that the GRZ was to provide US$2.673 million following a real forecast done by the Management Unit and agreed to by the Bank. Government thus made available US$2.504 million, having a shortfall of 6%. During implementation, ZAMSIF experienced delays in receiving counter-part funding from GRZ; however, towards the end of the project the arrears were cleared. The communities contributed US$5.795 million, which was 28.8% over the PAD estimate, signifying ownership and participation. In responding to implementation demands, amendments were made to resource allocations for the components as indicated in table IV below. These changes were part of the changes to DCA as discussed in Section 2.2. A Project Preparation Facility TF025764 in the amount of US$400,000 was approved in April 1999, of which US$389,423 was utilized for all the planned activities. An amount of US$10,577 was cancelled.

Table IV: Credit Resource Allocation by Component (Expressed in Millions SDR) Component Original

Amount

Revised Amount

Community Investment Fund – CIF 25.2 27.7 District Investment Fund – DIF 6.0 3.0 Poverty Monitoring & Analysis – PMA 2.2 2.7 Institutional Strengthening 14.9 14.9 Total 48.3 48.3

ZAMSIF APL II will not be implemented although the triggers were met except for the one on establishing SOPU (Refer to Table III above). Non implementation of APL Phase II resulted in an abrupt change of the operating environment at the district level in terms of resource availability for the districts to continue with the comprehensive capacity development program; sustainability of existing basic social and economic infrastructure; and new capital investments.

2. Key Factors Affecting Implementation and Outcomes

2.1 Project Preparation, Design and Quality at Entry The project preparation was sound and it called for adoption of the Operational Manual and conducting an environmental impact assessment as conditions of Effectiveness which were timely met by the Borrower. The project had in place a financial management plan, and revised accounting and financial systems. An overall procurement risk assessment was carried out and the observations were taken into consideration in the design. The PDO was consistent with the CAS (Document Number 19582-ZA of October 7, 1999) which supported the GRZ’s PRSP strategic objectives which were: (i) decentralization and empowering local authorities to improve governance and efficiency in service delivery, and (ii) increasing access to basic social services through direct poverty interventions. The PDO was clear but overly ambitious as it was premised on a

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national decentralization policy that was not yet in place at the design but was subsequently adopted in 2002. This was one of the factors that negatively affected the project’s uptake in the early years, leading to its restructuring afterwards. At the time of design, however, there was a clear commitment of GRZ, that the Decentralization Policy would be implemented as an integral part of the Public Sector Reform Program adopted in 2004, which had decentralization as one of its pillars. On the whole, the project design was comprehensive as it was countrywide, involving many institutions and stakeholders at national, regional, and district levels. The design process was participatory with wide consultations with stakeholders, and it effectively reflected lessons learned from international experiences of social funds and also from the implementation of the SRP I and II. Most notable lessons included the need for: (i) clear objectives and having consistency with the national development strategies; (ii) key institutional characteristics such as operational efficiency, transparency and accountability; (iii) improved attention to monitoring and evaluation activities; (iv) sustainability; (v) role of local governments; and (vi) recognition of the temporary nature of the Social Investment Fund. And, in recognition of the continued negative impacts of the HIV/AIDS pandemic on Government’s efforts towards poverty reduction, the design incorporated support to HIV/AIDS related initiatives. ZAMSIF was also the first SIF in the Africa region which included an explicit exit-strategy for the SIF as a semi-autonomous institution. The project was build on the premise of gradually transferring and integrating the substantial institutional, organizational and delivery capacity of the SIF into the public sector, and by doing so making its impact more sustainable. Critical risks were mapped and minimization measures were considered, this notwithstanding, the design assumption that the National Decentralization Policy would be implemented did not materialize; at the time of closing the project the NDP has still not been implemented, in hindsight, this should have been included as a major risk to achieving the PDO.

2.2 Implementation The CIF component’s performance was Satisfactory. The component surpassed its outputs targets in number of subprojects financed, completed, and number of beneficiaries reached (Refer to Key Performance Indicators Annex 2). The over achievement in the indicators was a result of (i) prudent shopping by project committees (further discussed in Section 3.3 paragraph 2) which resulted in savings that were used to fund additional subprojects; (ii) the positive effect of more resources being available to ZAMSIF as a result from the exchange rate gains between the Special Drawing Rights and the Dollar. The over achievement is also attributable to the effective capacity building provided by the project. The completed subprojects were all reported as being operational and providing access to services by project closing time in December 2005. The total number of potential beneficiaries under CIF is 2.53 million representing 69% over achievement. Through support to vulnerable persons’ initiatives, the CIF reached 3,040 direct beneficiaries against the planned 1,000. The number of indirect beneficiaries reached was 66,460 out of the planned 80,000. ZAMSIF recognized the need for synergies thus worked with the private sector and STARZ/DFID in reaching out to people affected by the HIV/AIDS pandemic.

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In a demand driven operation, the sector distribution of subprojects denote the communities’ choices, with regard to where they see fit to invest their resources. An analysis of the ZAMSIF subproject distribution shows education having the highest percentage share at 44.5%, seconded by health at 22%, with water and sanitation at 11%, roads 8.8%, with the rest distributed among food security, environment, HIV/AIDS community welfare, and the vulnerable. Environment at 2% is one of the lowest priorities despite the broad sensitization on environmental issues (Refer to Section 2.4). Implementation of the IEC strategy increased communities’ voice by providing increased access to information, improved community sensitization and improved PRA processes, with the result that there was change in focus of subprojects from the traditional infrastructure to include provision of other opportunities for development. The positive change in focus was evidenced by the fall in the percentage share of the education sector from 80% during SRP II to 44% by the end of ZAMSIF, as per the figure below. The CIF component achievements also contributed to institutional development through the training provided to the 5,550 subproject management committee members. Through the hands-on training the committee members the project transferred skills which are now available for use by other community development initiatives; the process has enhanced the quality of community skills and community cohesion. Some of the community members have been able to find jobs afterwards (ZAMSIFEvaluation Report 2008). The performance of the community was satisfactory evidenced by the average community contribution being 16%, one percentage point above the planned figure of 15%, denoting community ownership.

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The DIF component’s performance was Satisfactory. It surpassed its outputs target having financed and completed 62 subprojects against the set target of 30. The component provided access to services to 3.0 million beneficiaries against the set target of 0.4million. Under capacity building, 8 districts were in higher levels against set target of 4; 72 districts trained in 11 modules; with 67districts having in place revised situation analysis; 28 districts against the target of 20 districts had conducted the poverty assessments (Refer to Annex 2). Two reasons contributed to the over achievement: (i) a large number of subprojects were funded as a result of the ZAMSIF capacity development efforts at the district level through delivery of the various training modules in development management; and (ii) the incentive provided by the supply driven subprojects at district level which provided councils’ offices and staff houses. The component sector distribution by end of project the funded subprojects was highest for health at 60%, second for water and sanitation 12.9%, third at 11.3% food security and markets, 9.7% community welfare and 4.8% roads. With the 60% investment in health, ZAMSIF contributed to the health sector by increasing the stock of multi-community level health facilities and consequently increased potential community access to services. Provision of staff houses in particular, created a work environment conducive for staff and thus contributed to the councils’ ability to deploy staff and get the facilities operational.

Trend in the distribution of projects among sectors 2000 to 2005

0

20

40

60

80

100

120

140

2000 2001 2002 2003 2004 2005

Year of Project Approval

Number of Projects

Community Training Community Welfare Infrastructure EducationEnvironment Health HIV/AIDSMarkets & food security Road Vulnerable Groups Water & Sanitation

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Twenty-eight (28) districts against a target of 20, had improved their levels of responsibility and involvement as they were able to facilitate community development management demonstrated by the high completion rate of projects under the CIF. Five of the twenty-eight districts had reached the top level and three of which had maintained that position for two consecutive years, an indication of maturity. While the handholding strategy by ZAMSIF enabled 50 districts to attain Level 2 by Year 4, six dropped to level 1 by Year 5, denoting that without ZAMSIF APL II, sustainability in public sector management is less likely where capacity had not taken root. This notwithstanding all 72 districts developed district situational analysis which guided effective intra-district resource allocations. The PMA component’s performance was Satisfactory. The component achieved 95% of the set output indicator targets (Refer to Annex 2). The planned Living Conditions Monitoring Surveys (LCMS), the Indictor Monitoring Surveys and other planned surveys were carried out and discriminated, although dissemination was done within the set time period. To ensure utilization of the results of the studies, the studies were institutionalized in the relevant key ministries; this led to at least 54% use of the study results for policy. According to records, some of the activities were not carried due to lack of prioritization and commitment to PMA activities. The indicator requiring that survey data be put on CD-ROM was not met due to lack of expertise at the Central Statistical Office, following the departure from service of two members of CSO staff who were trained by the project for the work. This notwithstanding, the results of the surveys and studies were disseminated, although not timely, and thus missed opportunities of effectively making an input to policies. ZAMSIF Institutional Support performance was Satisfactory, having met all the set output targets. ZAMSIF Management Unit operated efficiently recording administrative costs at 16% against the target of 20%. The Management Unit produced reports on time, a number of studies were undertaken in order to improve quality, efficiency and effectiveness of the Project. In recognition of the quality performance, the Management Unit was requested to implement other GRZ projects’ components such as the BESSIP, ROADSIP, CRAIDS, EDRP and the ESP- Pilot Environment Fund. ZAMSIF acted as a facilitator by producing manuals guiding subproject cycle management and ensuring the use of norms and standards by districts and communities which led to production of quality assets at community and district level. A result based project monitoring system produced satisfactory indicator monitoring reports on Key performance indicators, however, lack of baseline and actual data on DO indicators persisted. Midterm Review (MTR) A two staged MTR was carried out in August 2003; the out come was the corrective restructuring of the project (discussed in Section 1.3). With the effective implementation of the revised operational plans derived during the MTR and the restructuring of the program in March 2004, ZAMSIF significantly improved its chances of reaching its objectives (Refer to sections 2.2 and 3 below). The QAG had pointed out that the restructuring was delayed; an early restructuring would have brought much better results.

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Amendments to the Development Credit Agreement (DCA). Implementation of ZAMSIF was positively characterized by a number of remedial actions undertaken to keep the project on track, in the process the Development Credit Agreement (DCA) was amended three times as follows in:

i. May 2003, to provide for procurement from IAPSO; increase procurement threshold under Shopping procedure; and inclusion of a new arrangement providing for processing subprojects through a technical subcommittee of the Steering Committee;

ii. July 2004, to restructure the project which included modification of the wording of the development objective; to reallocation among expenditure categories, an increase in the Special Account from US$3.0 million to US$8.0 million; to reflect changes in the definition of the operating costs and some changes in key performance indicators; and

iii. November 2005, to reallocate resources among the categories.

2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization The monitoring and evaluation design was too detailed making it cumbersome to manage. The detail might have been necessary due to the novel nature of the project design. Despite the detailed output indicators, the MU performed well in tracking the Key Performance Indicators. This performance was not matched on following up on processes for collecting data on outcome indicators. The M&E design did not consider baseline data on the outcome indicators, as such the Impact Evaluation carried out after the project used the ‘with and without the project situation” to make assessments. The results of the ZAMSIF Evaluation Study have informed the ICR on some outcome indicators but not all, most of the information has been qualitative.

2.4 Safeguard and Fiduciary Compliance At Appraisal the project was Environment Category F. Environmental and social aspects were mainstreamed in the subproject management cycle. During implementation there was (i) extensive training on environmental and social issues for the ZAMSIF and district staff, and the subproject committees members; (ii) extensive sensitization of the communities; and (iii) sufficient monitoring of the subprojects by the districts. Records indicate that two subprojects were disallowed at appraisal for not having met the environmental requirements. As a CDD project, the bulk of procurement was carried out satisfactorily at community level by project management committees (discussed under Section 3.3 paragraph 2). Records on file indicate that at the centre, procurement was generally satisfactory, except for the delay at the end of the project in procuring the Impact Evaluation consultants which negatively affected the delivery of this ICR. The management of the consultant during the implementation of the impact Evaluation was yet another challenge as it took place after the ZAMSIF MU had closed and so all processes had to be carried out through the MOFNP administrative system.

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2.5 Post-completion Operation/Next Phase Under the CIF the project supported community demand driven subprojects in a number of sectors accounting for 58% of the project resources. While the maintenance of the assets created is the responsibility of the sectors in health and education, all the subprojects had maintenance committees and maintenance plans in place, including bank accounts for operation and maintenance (O&M) activities. Seventy five percent of the O&M committees were found to be functional in 2005 just before the project closed ((Implementation Risk Management and Sustainability Report, July 2005). The subprojects were of good quality, and for most of them it is too early after completion to start experiencing extensive or frequent maintenance. Principles of community participation, contribution and procedures to be followed in planning, design and implementation of subprojects were emphasized as sustainability elements. Community ownership was high demonstrated by the average of community contribution at 16%; and vandalism of assets was reported minimal as evidenced by the Beneficiary Assessment (2003). The assets created under the ZAMSIF were reported to be of better quality than under the SRP, the predecessor program to ZAMSIF (Implementation Risk Management and Sustainability Strategy Report 2005). The project through the DIF carried out capacity development of the districts by taking them through the various training modules. The capacity created is benefiting other development projects and development agents working through the districts as there is increased coordination at district level planning and service delivery; positive change in attitude and behavior with regard to community involvement and ownership of communal facilities; and enhanced work ethics among the staff as confirmed by the Impact Evaluation (2007). This notwithstanding, there is considerable risk to the sustainability of the capacity created due to staff attrition and inadequate resources to maintain the achievement at the desired levels as ZAMSIF support is no longer available. For the districts to retain the capacity, future financing should ensure that the districts are supported, since the second phase of ZAMSIF APL will not be implemented. In lieu of the APL phase II, and on request by the MOFNP, the Bank embarked on the preparation of a follow-on program- Support to Decentralization Implementation Program (SUDIP) – whose preparation is currently suspended due to political uncertainty surrounding decentralization and unwillingness to commit to fiscal decentralization and further Government decision not to borrow from the Bank. In addition, the Bank and other development partners through two Sector Wide Approaches are supporting two pillars of the PRSP: (i) Public Service Management; and (ii) Public Expenditure Management and Financial Accountability. As part of the transitional arrangements a recommendation was made by the Bank that the PMA activities be wholly mainstreamed in the Ministry of Finance and National Planning; and that these activities should continue so as to enhance the monitoring of the National Development Plan.

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3. Assessment of Outcomes

3.1 Relevance of Objectives, Design and Implementation The PDO continued to be consistent with the CAS of March 2004 (Report No.27654-ZA) and was still relevant in terms of the Government’s PRSP May 2002, which was extended to 2006. The Project was in line with the following CAS objectives: (i) improved lives and protection of the vulnerable, which will improve the quality of life of citizens and facilitate the achievement of the Millennium Development Goals, through better service delivery; and (ii) an efficiently and effectively managed public sector, to improve governance, public sector management, and overall effectiveness of public expenditure programs. By working through the district structures, ZAMSIF paved the way and prepared the requisite capacities of the institutions in public sector management for the implementation of the decentralization policy approved in October 2002 and yet to be implemented.

3.2 Achievement of Project Development Objectives Rating: Moderately Satisfactory. The PDO rating is also based on efficacy of the project performance on the specific objectives which were to (i) achieve sustainable improved availability and use of quality basic social services by beneficiary communities and specific vulnerable groups; (ii) contribute to the building of capacity for improved local governance; and (iii) strengthen the capacity to provide timely information on poverty and social conditions and facilitate its use in policy making. In general, the assessment of the outcomes has been constrained by the lack of baseline data and unavailability of quantitative data on the outcome indicators. (i) Achieve sustainable improved availability and use of quality basic social services by beneficiaries and specific vulnerable groups: The project contributed to the increase in the stock of community assets, improved access and use by the beneficiary communities (refer to Table II). In the project impact areas, increased use of facilities has been in education where the dropout rates have reduced, from 1.8 in 2002 to 1.5 in 2005 signifying increase in school attendance; in health, there has been 28% increase in attendance to maternal and child health clinics and 138% increase in number of trained personnel attending to births; and access to clean water has been recorded in both rural and urban areas (data from Ministries of Health and Education used in the Evaluation Report2008). Through high coverage of OVC supported under HIV/AIDS initiatives, this translated into increase in number of orphans attending schools. Internal Monitoring Records indicate that by the project closing time in December 2005, all completed community facilities under ZAMSIF were operational and that 4.4 million beneficiaries (2.5 million under CIF and 1.9 million under DIF) had potential access and use of the social services. The rehabilitated facilities reinstated access to services to 11% of the beneficiaries. The MTR Beneficiary Assessment (February 2003) recorded community observations that rehabilitated schools under ZAMSIF were attracting pupils who had left for better schools because better learning environments were on average

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within five kilometers. The ZAMSIF Impact Evaluation Report (2008) indicates that the 82% of households in the project impact areas are now within 5 kilometers of a basic school; and 76% of households in ZAMSIF impact areas are within 5 kilometers of a health facility, this reduction in distance also translates to reduced time to reach a facility. Through construction of schools, health facilities and roads, 47% of households in sampled areas expressed that the project had “extremely changed” their livelihoods in as far as access and use is concerned (Evaluation 2008). Other changes to beneficiaries’ lives include community cohesion and increased voice. The Beneficiary Assessment (2003) and the Impact Evaluation (2008) both recorded high communities’ satisfaction with services from completed subprojects, leading to improved community perception of council staff, local line agency representatives, and traditional authorities. The high outputs under the CIF and DIF for have improved availability and use and also have demonstrated positive performance towards the program outcome indicator. According to the case study of Social Funds Experience in Africa “Scaling up of Poverty Reduction in Malawi and Zambia” (World Bank, 2004), the impact on the respective beneficiary communities by both projects was rated positive thereby confirming that the project benefited the targeted communities. Output targets for both the CIF and the DIF were substantially met and in addition, the sheer numbers of functional facilities translated to service availability to the project beneficiaries. The Implementation and Risk Management Strategy Report (July 2005) found ZAMSIF supported infrastructures to be of good quality, denoting likelihood of sustainability. ii) Contribute to the building of capacity for improved local governance and service delivery: With regard to contributing to capacity building for improved local governance, ZAMSIF by providing the requisite resources and facilitating the training, managed to develop community and district capacities leading to full devolution in CIF and DIF being attained in four districts by close of the project in December 2005. The capacities developed translated into accountability at the community levels as the committee members accounted for resources, and submitted reports and delivered completed subprojects to the constituents. At district level, there is increased coordination in planning and service delivery, including positive change in attitude and behavior towards communities (Impact Evaluation 2008). The same report has confirmed community satisfaction with the district administration, particularly in areas where the subprojects were completed. Assessments conducted at district level by the regional level personnel led to sustained improved performance of 29 districts in public sector management, with 8 coming out as best performers at levels 4 and 5. The outcome was a healthy environment for implementation of the national decentralization policy in future as awareness had been created. District staff developed skills in use of pro-poor targeting and planning instruments and other poverty mapping tools – districts in levels 3-5 were exposed to the use of Indicative Planning Figures (IPFs) for inter-district resource targeting, all districts put in place

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district situational Analysis (DSA) documents for intra-district resource allocation, while others had District Development and Poverty Reduction Strategy, District Development Plans and annual investment plans. This planning and targeting process at the district level dove-tailed with the self targeting participatory processes used by the communities, and it led to efficient intra-district resource allocation; such as demonstrated by the sector distribution of subprojects where for education the percentage share dropped from around 80% in SRP to 44% in ZAMSIF. iii) Strengthen capacity to provide timely information on poverty and social conditions and facilitate its use in policy making. Performance under the three outcome indicators was varied: (i) three consultations were held with regards to the annual public consultations or review of poverty and social conditions, (ii) eight districts against a set target of five, were using information from the Monitoring Management System in planning; and (iii) functioning Strategic and Operating Planning Unit (SOPU) in MOFED managing the Study Fund was not been achieved by close of project. Although the first two indicators were met, there is no evidence to demonstrate the impacts in influencing policy. Failure to establish SOPU, and integrate the PMA activities in the Ministry of Finance is a lost opportunity which would have provided a sustainable platform for continuation of the PMA activities.

3.3 Efficiency An economic rate of return was not calculated at appraisal. However much of the returns under ZAMSIF were in the form of social capital and sustainability of community investments. An assumption was made that communities are rational economic actors and that their choices reflect the greatest return for their time, labor and materials. Thus through ZAMSIF, communities have demonstrated willingness and commitment to make contributions towards interventions averaging 16%, which is above the Appraisal estimate of 15% for community contribution, this reflected their analyzed priorities as evidenced by the MTR Beneficiary Assessment Report (February 2003). As projects were selected through the Participatory Rural Appraisal process, the sector distribution of sub-projects reflected community priorities (as discussed in section 3.2 (ii) paragraph 3 above). Cost-effectiveness was ensured by the provision to communities of subproject menus, costed standard design options and specifications, and use of local competitive procurement. Communities produced quality assets in a cost-effective manner as confirmed by the (Implementation Risk and Sustainability study Report, July 2005). Through adherence to procedures and prudent shopping, savings in the amount of US$3.3 million were realized. The savings were used to finance additional community initiatives. ZAMSIF ensured efficient pro-poor investments by introducing the use of indicative planning figures (IPF) for inter-district resource allocation. The IPF used a formula which was based on a composite index of poverty, population and accessibility for geographically targeting resources to districts.

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3.4 Justification of Overall Outcome Rating Rating: Moderately Satisfactory. On the basis of relevance and achievements in two of the major DO objectives (major in terms of resources), the DO could be rated satisfactory but for the lack of quantitative data on some outcome indicators, and the under achievement on the third outcome, the DO is rated Moderately Satisfactory.

3.5 Overarching Themes, Other Outcomes and Impacts (i) Poverty Impacts, Gender Aspects, and Social Development The Indicator Monitoring Survey (2005) recorded that 68% of the 10.9 million Zambians were poor compared to 73% in 1998 in a similar survey. Poverty levels in rural areas remained high at 78% against 83% in 1998, and 53% against 56% in urban areas. The IMS (2005) results also indicate that after the Government, ZAMSIF was the next largest sponsor for community investments in construction and/or rehabilitation of schools and health facilities. ZAMSIF contributed 14% to construction of new schools and 16% to rehabilitation while GRZ registered 33% and 37% respectively. The beneficiary figures captured in ZAMSIF internal monitoring system were not disaggregated by gender beyond the composition of the subproject committee membership, however, the project through its use of focus group discussions during the PRAs processes, gender aspects were thoroughly addressed. ZAMSIF interacted effectively with other development partners like GTZ, SNV and Kfw and DCI, who worked in different regions of the country, however the project did not involve the private sector in project processes except as traders in supplying subproject materials. (ii) Institutional Change/Strengthening The CIF component contributed to institutional development through the training provided to the 5,550 subproject management committee members. Through the hands-on training the committee members the project transferred skills which are now available for use by other community development initiatives; the process has enhanced the quality of community skills. The Project developed the capacity of districts demonstrated by all 72 districts having district situational analysis in place which guided the intra-district resource allocations. At the regional level, ZAMSIF has paved the way for the NDP implementation in that there is a structure for assessing districts performance and the process is one way of ensuring public sector accountability. At the time of the ICR mission, the districts visited indicated that the regions were still assessing districts way after closure of ZAMSIF. The capacity built in ZAMSIF staff was recognized hence the added responsibility to implement other components of community projects which included BESIP and CTI, this notwithstanding the capacity built as not been integrated in the existing system as staff have left for the private sector. Overall, useful lessons have been drawn for implementation of the project and were used in the preparation of the Support to Decentralization Implementation Project.

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Implementation of ZAMSIF engendered accountability by putting in the public domain information regarding IPFs and District use of funds. The involvement of the private sector in the project also led to the development of businesses and skills of people in the private sector, trading and seeking opportunities through the many subprojects that were implemented. (iii) Other Unintended Outcomes and Impacts (positive or negative) The positive unintended outcome of the project was that the robust systems and capacity built in the ZAMSIF staff was available to support GRZ in the implementation of the drought recovery efforts (during the 2001/2002 farming season) and fight against HIV/AIDS. ZAMSIF strengthened the understanding and confidence in community based interventions. The community window of the HIV/AIDS project which followed the same principles was successful. The malaria program also is using similar procedures to support a community component.

3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops Not Applicable

4. Assessment of Risk to Development Outcome Rating: High. i) Under the CIF the project supported community demand driven subprojects in a number of sectors accounting for 58% of the project’s resources. While the maintenance of the assets created is the responsibility of the sectors, the risk is that if the sectors/district are not sufficiently resourced maintenance of the assets created will not be given due priority. The ZAMSIF Evaluation (2008) reported that only two thirds of the completed subprojects were operational, raising concerns about sustainability. ii) While community ownership of assets created and the willingness to contribute towards maintenance was high during implementation, their ability could be constrained when major repairs are needed; and in times of major shocks to the community, such as drought which negatively affects their livelihoods, consequently, their ability to contribute towards O&M for sustainability will be affected and could lead to decline in access to services. iii) ZAMSIF through the DIF carried out extensive capacity development for the development planning and management this notwithstanding, there is risk to the sustainability of the capacity at the district due to staff attrition and inadequate resources available at the districts to sustain the achievements at the desired levels as ZAMSIF support is no longer available. (iv) Political uncertainty around the decentralization implementation and inadequate resources committed as transfers for recurrent and capital expenditures. (v) A well-organized and comprehensive capacity development and human resource management plan for district councils does not exist.

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5. Assessment of Bank and Borrower Performance 5.1 Bank Performance (i) Bank Performance in Ensuring Quality at Entry Rating: Moderately Satisfactory. The Bank quickly responded to the Borrower’s request for a follow on project to the SRPII, preparation was participatory, incorporating valuable lessons from the previous projects within the county and internationally, and from studies and capacity assessments that were conducted. The Project design was coherent, in line with the CAS, and took into account the country’s National Poverty Reduction Strategy–itself based on a participatory approach to addressing poverty issues. The Project was identified in July 1999 and appraised in October 1999. A total of three missions were undertaken by Bank teams with a good skills mix. The Project was approved by the Board in May 2000, and became effective in July 2000. The Bank granted the Government’s request for a PPF in the amount of US$400,000 to undertake preparatory activities which included studies that informed the design. As part of the preparatory activities, the Bank also consulted widely with communities, stakeholders, and donors. A financial management analysis and procurement assessment of the implementing agency was carried out, risks were identified and appropriate mitigation measures were put in place. An environmental analysis was undertaken and recommendations included mainstreaming environmental appraisal and monitoring as part of the subproject cycle, developing staff and implementers capacity and preparation of a natural resources management handbook. This good performance at preparation notwithstanding, the design of the project was premised on a decentralization policy that was not yet in place, a situation that led to some of the operational constraints at implementation. (ii) Quality of Supervision Rating: Moderately Satisfactory. Between effectiveness and the closing date, five implementation reviews were undertaken, and the sixth was the ICR mission. All reviews received input from procurement and financial management staff. The reviews included the requisite skill mix except for the environmental and social safeguard specialists who were not included. Involvement of Country Office staff was strong throughout the implementation particularly in social, financial and procurement aspects. The reviews were sufficiently resourced; field visits were well balanced and documentation through out the supervision phase was comprehensive. The Bank team maintained good relationship with the key ministries involved in the implementation; and appropriate guidance was provided to the client. Examples include: a) recognizing the need to restructure the project and facilitating the process, which included revision of the KPI; (b) encouraging ZAMSIF to collaborate more closely with existing service deliverers and to move towards harmonization with partners, and to

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ensure that communities have a voice in DIF projects; and (c) advising to improve targeting by diversifying sector coverage of DIF and CIF. The bank guided implementation and ensured that the DCA was complied with. Generally the Bank was quick in responding to issues including those that required amending the DCA. During implementation there were no deviations from the Bank’s policies and procedures. The supervision was rated Satisfactory by the QAG having narrowly missed the Highly Satisfactory rating on account of delay by the team to realize that the project was off course, and needing restructuring. The team however, did not provide timely guidance to the management unit to take a leading role on the processes for collecting data on outcome indicators. There were delays also in providing guidance on procurement leading to serious delays in procurement and managing consultants towards the end of the project. (iii) Justification of Rating for Overall Bank Performance Rating: The overall Bank performance is rated Moderately Satisfactory on the basis that the Bank provided valuable support but did not guide the processes on data collection on outcome indicators, in addition to the issues raised on quality at entry.

5.2 Borrower Performance (i) Government Performance Rating: Moderately Satisfactory. The Government took the lead and participated in all the steps of project preparation; produced the required documentation for appraisal and approval; and in a timely manner met all the set conditions of Effectiveness and Disbursement. The Government demonstrated its commitment to the poverty alleviation agenda as articulated in its PRS. Its commitment was further demonstrated through the provision of required counterpart funding, although the funding was made available towards the end of the project. ZAMSIF was an autonomous body under the policy guidance and oversight of a committed National Steering Committee (NSC) (refer to KPI). The NSC comprised of senior Government representatives. The implementation of project operations at the district level was supported by the District Development and Coordination Committee bringing together the sectors and the councils thereby engendering mainstreaming of the project’s operations. Districts also provided contributions for the DIF sub-projects. The Borrower submitted audit reports on time. This level of support not withstanding, failure by the Government to implement the NDP, and failure to fully mainstream the PMA activities negatively affected the project implementation and consequently the development outcome. (ii) Implementing Agency or Agencies Performance Rating: Moderately Satisfactory. Throughout the project implementation period, the ZAMSIF Management Unit (MU) was sufficiently staffed with qualified personnel. The systems and procedures in place ensured transparency and accountability at all levels (Management Evaluation, 2003).

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The MU’s financial management was satisfactory; consistently over the life of the project financial reports were produced in a timely manner, and received audit reports with unqualified external auditors’ opinion. However, during the final year of the project, ZAMSIF had cash flow problems; the reasons given indicate that there was inadequate financial monitoring and budgeting. As a CDD project, the bulk of procurement was carried out satisfactorily at community level by project management committees. At the centre, procurement implementation was generally satisfactory. Despite the good performance, the MU did not pay much attention to processes that would have helped the end of project assessment on outcomes. (iii) Justification of Rating for Overall Borrower Performance Rating: Moderately Satisfactory. The overall performance of the borrower is moderately satisfactory due to lack of commitment to implementing the National Decentralization Policy and failure to mainstream the PMA and establish SOPU, and issues of baseline data on outcome indicators.

6. Lessons Learned i. The implementation of the Decentralization policy was a pre-requisite for the

project activities to have its intended impact. The ZAMSIF implementation experience demonstrates that failure in public sector management can pose a serious constraint to achievement of intended project outcomes.

ii. Decentralization is by its very nature a political process of sharing administrative,

financial and political decision-making authority with lower levels of government. Sustainability of local governance and other institutional outcomes of in social investment funds depend critically on political commitment at the highest levels of government to operationalize the decentralization policy and continue to invest in local authorities in a predictable manner to improve their capacity to fulfill their mandates.

iii. Establishing baseline data on selected project outcome/output indicators is vital.

Equally important is having in place effective arrangements for implementing the M&E that focuses on both outputs and outcome. A major lesson is that even if the management of the data collection on outcome indicators is left to other entities outside the project such as the Central Statistical Office, project management units should always take an active role to ensure that the necessary information is being collected on the outcome indicators.

iv. District capacity assessments based on the capacity building ladder were a good

entry point for ZAMSIF’s capacity development interventions. It allowed for a tailor-made approach for district capacity development which could deal with different types and levels of capacity gaps (as against overly prescriptive support designed as one size fit all). In the case of ZAMSIF, it improved targeting of resources to needy areas. The capacity building ladder provided an objective guide for assessing district performance and laid foundation for capacity development in the future. However, longer time was needed for the capacity

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developed to take root. In the original plan for the ZAMSIF program, phase two of the APL could have provided the time required.

v. Use of the Formula Based Block Grant Mechanism for resources allocation: the

Indicative Planning Figure (IPF) is a transparent and objective system for inter-district resource allocation by the centre to the districts. The IPF minimizes political influence stimulates ownership, enhances transparency and resource predictability. It is also an effective way of targeting resources to poorer districts based on poverty indicators. Through the IPF, districts were informed of the available resource envelop in advance which facilitated their planning processes and enabled them to respond to community demands. The practice should be continued by any program channeling resources to local authorities

vi. Diversification of subproject portfolio achieved through improved facilitation for

PRA processes and implementation of the IEC strategy leads to improvement in the sector spread of subproject portfolio from the traditional dominant sectors such as education and health to non-traditional sectors of roads, HIV/AIDS and income enhancement in order to improve beneficiaries’ livelihoods.

vii. A well-defined communication strategy is key for building social accountability

within communities and with district authorities. An effective IEC strategy facilitates the efficient implementation of the project cycle activities by communities as it levels the play field. It helps to improve mutual accountability among stakeholders and contributes to an improved governance structure which is key to community empowerment. An IEC strategy, like M&E, needs to be part of the project design and not an add-on.

viii. Clear guidelines and procedures are a prerequisite for facilitating community

development and ensuring accountability of resources. Adherence to guidelines and processes ensures that subprojects supported meet the standards and sector norms and are addressing community priority needs.

ix. Capacity building: The capacity building ladder provided an objective guide for

assessing district performance and laid foundation for capacity development in the future, however, longer time was needed for the capacity developed to take root. In the original plan for ZAMSIF, phase two of the APL could have provided the required time period.

x. Value of partnerships in pursuit of improving local governance and supporting

local development: Overall partnerships with key GRZ sector ministries, provincial administrations, district administrations, NGOs and Cooperating Partners such as DCI, SNV and GTZ provided a unique opportunity for sharing mutual experiences and minimized duplications in processes, procedures and resource allocation. Equally important was the need to partner with the private sector in delivery of training modules or facilitating planning processes at

24

community level; this was one of the lost opportunities in ZAMSIF implementation.

xi. Design of project to be based on existing policy environment: Experience during

implementation of ZAMSIF showed that it is critical to design projects on the basis of existing policy framework.

7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners (i) Borrower/implementing agencies

The GRZ did not provide any comments.

(ii) Cofinanciers: Not Applicable (iii) Other partners and stakeholders Views from the donor and NGO community working in the field alongside ZAMSIF indicated that there was evidence of improved capacity at local government level (compared to the pre-ZAMSIF situation) as illustrated in the case of GTZ where it was observed that:

(i) Local Government now had well attended planning meetings; (ii) there were greater calls from Districts in Southern province to be backstopped

by GTZ advisors (which worked well for GTZ as demand for their services increased);

(iii) greater participation in development programs at District level; (iv) an increased planning knowledge base at District level compared to the

Provincial level in terms of, for instance: procurement procedures and experience; and project cycle related issues including project implementation.

One of the reasons for greater participation was attributed to use of the ZAMSIF ladder. The view was that in spite of its limitations, this motivated Districts to apply themselves more effectively as they were then assured of more resources once they met the benchmarks.

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Annex 1. Project Costs and Financing

(a) Project Cost by Component (in USD Million equivalent)

Components Appraisal Estimate (USD millions)

Actual/Latest Estimate (USD

millions)

Percentage of Appraisal

COMMUNITY INVESTMENT FUND 42.00 45.80 9

DISTRICT INVESTMENT FUND 13.00 6.148 8

POVERTY MONITORING AND ANALYSIS 3.50 3.616 -3

ZAMSIF INSTITUTIONAL SUPPORT 15.70 21.831 31

Total Baseline Cost 74.20 76.395 2

Physical Contingencies 0.00

0.00

0.00

Price Contingencies 0.00

0.00

0.00

Total Project Costs 74.20 76.395 Project Preparation Fund 0.00 0.00 .00 Front-end fee IBRD 0.00 0.00 .00

Total Financing Required 74.20 76.395

(b) Financing

Source of Funds Type of Cofinancing

Appraisal Estimate

(USD millions)

Actual/Latest Estimate

(USD millions)

Percentage of Appraisal

Borrower 0.00 1.71. 171. Local Communities 4.50 5. 80 28 International Development Association (IDA) 64.70 68.73 6

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Annex 2 Outputs by Component

Target at Start of Project MTR (2003) Revised

Target at EOP Achieved at EOP Comments

1. ZAMSIF INSTITUTIONAL SUPPORT

Commitments & disbursements follow profiles , procurement plans & AWPB

Profiles, procurement plans followed, a total of US$68,730,355 disbursed

Administration costs less than 20% of total ZAMSIF costs 16%

Average 50% National Steering committee membership attendance

More than 90% attendance was achieved

90% was a requirement for a minimum attendance to meet the quorum

Average 50% PMA Steering Committee membership attendance National Steering committee membership attendance

More than 90% attendance

90% was achieved as this was a requirement for a minimum attendance to meet the quorum

100% projects technically appropriate, operations sustained and maintained

100% All operational with requisite staff (under Health & Education), all projects have maintenance committees

Reports to the National Steering Committee produced on time, user friendly and accurate

1 x biannual report for 2000, 2 x biannual reports for each year (2001 to 2004) submitted to the National Steering Committee (NSC). 2 x biannual reports for 2005 prepared but not submitted to NSC

The biannual reports for 2005 were not tabled before the NSC. Due to the fluid situation of the follow on program to ZAMSIF, the NSC Chairperson advised that it would not be prudent to hold NSC meetings more so that there were no substantial issues requiring the NSCs attention.

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Key stakeholders have knowledge of ZAMSIF procedures and performance

National Steering Committee meetings held & informed, ZAMSIF news letters produced and circulated, quarterly PDCC meetings (and DDCC as ex-officio) attended and informed by the RFs, print and electronic media announcements, radio drama

CIF

500 projects financed 500 financed, EOP 555 Savings were made as funded projects completed below budget. Funds saved recommitted to new projects.

400 projects completed 500 projects completed EOP (Dec 2005) 549

More completed due to the increased number of projects financed and implemented.

0.4 million beneficiaries 1.5million beneficiaries 2,532,500 More projects were funded arising from savings thus an increase in beneficiaries.

80,000 OVCs assisted 80,000 OVC indirectly assisted 66,460 Though a lot more OVCs have benefited, poor data capturing resulted in under achievement

1,000 OVC directly assisted 3,034 More projects were funded arising from savings thus an increase in beneficiaries.

In 400 projects beneficiary HIV/AIDS module delivered

In 400 projects beneficiary HIV/AIDS module delivered

In 555 project beneficiaries trained in HIV/AIDS

More projects funded and each project included delivery of modules on HIV/AIDS from identification and through the implementation period.

50 beneficiary communities have improved counseling

20 beneficiary communities have improved counseling

20 beneficiary communities with improved counseling

500 project committees trained 555 project committees trained

More projects were funded and each project included delivery of modules on project management, environment, HIV/AIDS, gender, procurement, and financial management, management from identification and through the implementation period.

20 urban residential development committees trained

5 ADCs were trained in various modules e.g. communication skills, use of participatory methodologies etc

The equivalent of RDC is ADCs in rural areas. Training was provided to selected areas in the districts that attained level 5 statuses on the capacity building ladder and most of them were from “rural provinces”.

400 communities have completed projects 549 communities have

completed projects More projects were funded and implemented

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10% increase in community driven activities, comparison between beneficiary and non-beneficiary communities at national level

10% increase in community driven activities, comparison between beneficiary and non-beneficiary communities at national level

Refer to comments Not assessed by the ZAMSIF Evaluation Study 2008

DIF

Staff in 72 districts trained in various modules

Staff in 72 districts trained in various modules

Staff in 72 districts trained in 11 modules (i.e. a total 792 modules delivered)

There were 10 modules, the additional module (1 No.) delivered was District Planning Information System (ZAMSED/ Development Information). This was necessary for the designed planning process to be functional

Districts in levels of CIF

Level 1: 60 Level 1: 50 Level 1: 58

Level 2: - Level 2: - Level 2: 6

Level 3: - Level 3: - Level 3:

Level 4: - Level 4: - Level 4:

Year 1 (2001)

Level 5: - Level 5: - Level 5:

At the end of year 1, 8 districts had not yet signed MoUs with ZAMSIF which was the entry requirement for capacity building & ZAMSIF support. The total number of district in levels 1 & 2 was 64

Level 1: 55 Level 1: 58 Level 1: 32

Level 2:10 Level 2:14 Level 2: 40

Level 3: - Level 3: - Level 3: 0

Level 4: - Level 4: - Level 4: 0

Year 2 (2002)

Level 5: Level 5: Level 5: 0

The number of districts attaining level 2 was higher due to the training that was provided i.e. District Planning for Development & Poverty Reduction; at this stage most districts had employed District planning officers (DPOs).

Level 1: 30 Level 1: 25 Level 1: 12

Level 2: 20 Level 2: 47 Level 2: 47

Level 3: 15 Level 3: - Level 3: 13

Level 4: 5 Level 4: - Level 4: 0

Year 3 (2003)

Level 5: - Level 5: - Level 5: 0

The progression of districts on the ladder improved due to the “handholding strategy” that was adopted after the MTR. The strategy focused on capacity building interventions specific to the identified gaps.

Level 1: 20 Level 1: 12 Level 1: 6

Level 2: 20 Level 2: 40 Level 2: 50

Level 3: 15 Level 3: 16 Level 3: 9

Level 4: 12 Level 4: 4 Level 4: 4

Year 4 (2004)

Level 5: 5 Level 5: - Level 5: 3

More districts than anticipated reached higher levels (Level 5) on ladder due to application of “handholding strategy.” The incentive ladder was also better appreciated by the districts at this time.

Level 1: 12 Level 1: 12 Level 1: 18

Staff attrition and perception that “ZAMSIF was closing” and therefore “no more incentive available” led to “laxity” and deterioration of performance in some districts resulting in the relegation of 12 districts from the other levels to level 1

Level 2: 20 Level 2: 40 Level 2: 26

Level 3: 20 Level 3: 16 Level 3: 21

Level 4: 15 Level 4: 2 Level 4: 3

Year 5 (2005)

Level 5: 5 Level 5: 2 Level 5: 4

Districts on higher levels of ladder had seen the benefits (funds for projects & capacity development) of progressing on ladder and therefore endeavored to maintain consistence in performance

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40 training modules for district staff developed

14 Modules were developed – See notes below on the listing of the modules

Modules were only developed in 14 thematic areas that were deemed relevant to capacity development i.e. provide support that will enable districts acquire requisite capacities and progress on ladder

All districts develop situation analysis

67 districts had DSA prepared using the revised manuals.

All 72 districts have developed DSA during the life of the ZAMSIF project. The achieved at EOP was based on the number of districts with DSAs prepared using the revised manuals

40 districts have completed poverty assessment

40 districts have completed poverty assessment

28 districts had conducted the poverty assessments

40 districts had developed the PA during the life of the ZAMSIF project. The achievement by EOP was based on the number of districts with Poverty Assessments conducted using DSAs prepared following the revised manuals

20 districts have completed district development and poverty reduction strategy

20 districts have completed district development and poverty reduction strategy

28 districts had the DDPRS prepared and approved by both DDCC and the Council

Training provided in district planning led to more districts understanding the planning process and being able to develop DDPRS

15 districts implementing annual investment plans

8 districts were implementing the annual investment plan financed from the annual allocation

In line with the revised targets of districts to be in levels 4 & 5 (i.e. 4 in total) the number expected to implement the Annual Investment Plan were 4. Training provided in district planning led to more districts being able to develop Annual Investment Plans

40 districts implementing DIF projects

30 district projects completed, EOP

62 district projects completed (of these, 17 are District Council Office Block & Staff Housing construction).

The number of DIF project was higher due to the decision to support construction of office blocks for councils (No. 17) on “supply basis” based on MTR. In addition, the district that progressed to higher levels on ladder (i.e. levels 3, 4 and 5) had acquired capacity for project management with some implementing more than one DIF project.

40 district projects financed, EOP

62 district (DIF) projects financed and implemented

As above.

2 districts using information from management and information system (MIS) in planning

8 districts were trained in the District Planning Information System (DPIS) - ZAMSED/ DevInfor

The DPIS – ZAMSED/DevInfor training was provided to all 8 districts that passed through level 4 at one time or the other as opposed to the target of 2 districts. This was necessary for the planning process to be functional

0.8million beneficiaries 0.4 million beneficiaries 3 million

More projects were implemented and completed in relation to what was planed. A total of 62 DIF projects have been completed against the planned 40 therefore reaching a lot more beneficiaries.

5% increase in successful project applications by EOP Not assessed by the Evaluation study

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5% increase in communities satisfied with district services

The Evaluation Report states that satisfaction with district services was high except in projects that were not functional.

PMA

Full cycle of household surveys Living Conditions Monitoring Survey (LCMS) & Indicator Monitoring Survey (IMS) completed by end of phase

Full cycle of household surveys Living Conditions Monitoring Survey (LCMS) & Indicator Monitoring Survey (IMS) completed by end of phase

LCMS III and IMS (LCMS IV) were conducted

Year 1 (2001)

Preparation LCMS and Household Budget Survey (HBS)

Preparation for the LCMS

LCMS III design, HBS included as a module within the LCMS

CSO and its stakeholders spent a lot of time to debate the methodology and budget. This process continued to last quarter of year 2

Year 2 (2002) LCMS implemented Preparation of LCMS

Preparation completed and implementation started

Field work commenced in November, 2002

Year 3 (2003)

Dissemination of LCMS & preparation of IMS

LCMS implemented Implementation completed

Field work was completed in October, 2003 as it was designed to collect data over 12 months. Dissemination of results for LCMS III and preparations of IMS were done in year 4

Year 4 (2004) Implementation of IMS Dissemination of LCMS,

preparation of IMS

LCMS III results disseminated and report produced. IMS was conducted in December/January 2004/2005

Start funds (K4 billion) were sourced from the GRZ while the Bank took long to approve the finish up funds.

Year 5 (2005)

Dissemination of IMS & preparation of LCMS

Implementation and dissemination IMS, preparation of LCMS

IMS results disseminated and report produced

LCMS III report LCMS III report available

The information from the report has been by many documents in the country

Provincial reports Completed and printed

LCMS III sample design did not allow for district estimates, it was thus unrealistic to produce provincial reports.

Poverty reports

Report completed but not printed. The informal sector report completed and printed.

The poverty report had to be based on the IMS report for purposes of capturing the poverty trend. The manuscript available.

IMS report IMS report ready.

6 persons trained in the following: household survey design, data entry, analysis and report writing

The 6 were trained in Washington, Ghana and Angola through hands on approach and workshops.

LCMS data available 4 months after field work

LCMS data available 4 months after field work

Data available 8 months after field work

The staffing levels in the Living Conditions Monitoring Branch (LCMB) not adequate to cope with the demand for reports. The matter is worsened by the fact that this lean staff is also tasked to undertake other activities in CSO other than just those under LCMB

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LCMS report completed 6 months after field work

LCMS report completed 6 months after field work

Report available 12 months after field work

As above.

IMS report available 6 months after field work

IMS report available 6 months after field work

Report available 8 months after field work.

As above.

HHS data available on CD-ROM and WWW 2 months after report

HHS data available on CD-ROM and WWW 2 months after report Not done

CSO has no expertise to undertake the task. The two officers who were trained under SRP have since left LCMB/CSO

Annual public consultation or review of poverty and social conditions, EOP

3 Annual Poverty Conferences were held

The fourth annual poverty review conference was not held because the bulk of the funds were not released by MoFNP.

4 annual poverty reports years 2-5

4 annual poverty reports years 2 – 5

2 annual poverty reports ready

As part of transfer of PMA functions into PEMD/MoFNP the 3rd annual poverty review report was to be produced by PEMD.

40 demand led studies, phase 1 34 demand led small studies 33 demand led studies completed

Though all studies were funded only 33 were completed because one was cancelled on account of misconduct by the researcher.

10 priority studies 6 priority studies 6 priority studies undertaken

15 capacity building workshops 17 capacity building workshops 16 capacity building workshops conducted

At least 12 studies funded by the Study Fund use survey data 5 studies funded using

survey data

Being demand led only 5 fundable study proposals were received partly attributed to delayed availability of the LCMS III data and results.

5 studies analyze impact of HIV/AIDS 4 HIV/AIDS impact studies 3 HIV/AIDS impact

studies completed

One study by Ministry of Home Affairs could not be completed due to inadequate capacity in the ministry.

10% of study results used for policy, EOP

8% of study results used for policy, EOP At least 54%

To ensure utilization of study results in policy the studies were institutionalized in relevant key ministries or sectors and dissemination was done to policy related institution and other key stakeholders.

Strategic & operational Planning Unit (SOPU) managed at least 5 studies, EOP.

Functioning SOPU in MoFNP managing Study Fund, EOP nil

Initially three (3) studies were given to PEMD whose staff could not find time to see them completed. Although there was sufficient budgetary allocation of funds for the Study Fund this could not be utilized because of inadequate staff to operate the Fund.

NOTES 1. The details of the modules developed include : Gender Mainstreaming, Environment mainstreaming, District Planning for poverty reduction, Facilitation for Social Development, HIV/AIDS advocacy, Technical Skills training, Financial Management, District Planning Information System – ZAMSED (DevInfor), Costing and Budgeting, Participatory Monitoring and Evaluation, Strengthening and Establishment of ADCs, Training in the District Assessment process & tools, Maintenance and Project Implementation

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Annex 3. Economic and Financial Analysis See section 3.3.

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Annex 4. Bank Lending and Implementation Support/Supervision Processes

(a) Task Team members

Names Title Unit Responsibility/ Specialty

Lending Laura Frigenti Task Team Leader AFTH1 Hope C. Phillips Volker Operations Officer AFTH1 Mirey Ovadiya Operations Analyst AFTH1 Marian Fay Economist (Decentralization) Wendy Roseberry Senior Technical Specialist (Health) Trina Haque Economist John Ngwafon Economist /Staistcian Leendert J. Sinke Architect

Francisco Pichon Natural Resources Management Specialist

Steen L. Jorgensen Sector Manager – Social Protection Quality Assurance Jim Hicks Lead Specialist Quality Assurance Charles Magnus Senior Financial Analyst Quality Assurance Brightson Musungwa Financial Management Specialist V. S. Krishnakumar Senior Procurement Specialist Steve Gaginis Senior Disbursement Officer Aberra Zerabruk Senior Counsel

Supervision/ICR Wim H. Alberts Senior Social Protection Specialist AFTH1 Fenwick M. Chitalu Financial Management Specialist AFTFM Helen Mbao-Chilupe Sr Social Protection Specialist AFTH1 Mirey Ovadiya Senior Operations Officer AFTH2 Randa El Rashid Operations Officer HDNSP Ida T. W. Manjolo Social Protection Specialist AFTH1 Neta Mulenga Walima Program Assistant AFMZM

(b) Staff Time and Cost Staff Time and Cost (Bank Budget Only)

Stage of Project Cycle No. of staff weeks USD Thousands (including

travel and consultant costs)Lending

FY00 39 139.78 FY01 0.00 FY02 0.00 FY03 0.00

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FY04 0.00 FY05 0.00 FY06 0.00 FY07 0.00

Total: 39 139.78 Supervision/ICR

FY00 7.50 FY01 19 59.58 FY02 32 138.12 FY03 46 147.34 FY04 40 132.70 FY05 39 127.75 FY06 28 90.29 FY07 0.94

Total: 204 704.22

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Annex 5. Beneficiary Survey Results N/A

36

Annex 6. Stakeholder Workshop Report and Results N/A

37

Annex 7. Borrower's ICR and/or Comments on Draft ICR Section 1 Background Zambia Social Investment Fund (ZAMSIF) was one of the Government of the Republic of Zambia’s (GRZ) poverty reduction programs. The Project was approved in June 2000 following the signing of the Development Credit Agreement (DCA) between GRZ and the International Development Association (IDA) of the World Bank for a sum of SDR 48.3 million (US$ 64.7 million). The Project was designed within the framework of the World Bank Country Assistance Strategy (CAS 2000-2003and 2004-2007) which was in support of the broader poverty reduction strategy for Zambia. The ZAMSIF was to be an Adaptable Program Loan (APL) to be administered in two phases over a period of 10 years. The first phase became effective in July 2000 and closed in December 2005. This Implementation Completion Report (ICR) assesses the achievement of outcomes and impacts of the first phase. ZAMSIF was a follow on Project to the Social Recovery Projects (SRPI & II) which were implemented concurrently over a period of 10 years (1991-2000) and also supported by IDA. Whilst the objectives of SRP I & II were to finance community initiatives and build capacity to help protect the poor against economic shocks during the structural adjustment period, the aim of ZAMSIF was to contribute to GRZ poverty reduction program through investment in community initiatives and capacity building for local governance and for poverty monitoring and analysis. The Project supported two strategic objectives of the GRZ namely i) decentralization and empowerment of local authorities to improve governance and efficiency in service delivery and ii) increasing access to basic social services through direct poverty interventions in communities. Section 2 ZAMSIF Development Objective The strategic goal of ZAMSIF was to contribute to the GRZ’s strategy for poverty reduction by improving the welfare and the living conditions of many poor and vulnerable communities all over Zambia. The overall development objective of the project was to achieve improved, expanded and sustainable use of services provided in a governance system where local governments and communities are mutually accountable. The specific objectives were to:

• achieve sustainable improved availability and use of quality basic social services by beneficiary communities and specific vulnerable groups

• contribute to the building of capacity for improved local governance and • strengthen the capacity to provide timely information on poverty and social

conditions and facilitate its use in policy making. Section 3 ZAMSIF Institutional Arrangements and Components 3.1 Institutional Arrangements ZAMSIF was managed by a semi-autonomous Management Unit based in the Ministry of Finance and National Planning (MoFNP) and reporting to the Permanent Secretary,

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Budget and Economic Affairs Department through the Programme Director. The Programme Director was supported by a management team comprising of Operations, Technical Services and Finance and Administration. The operations of ZAMSIF were decentralized to all nine provinces of Zambia through a network of Regional Offices which supported and facilitated district and community level activities. Committees at every level facilitated policy guidance and decision making for the allocation of resources and ensured upward and downward information flows to stakeholders. At the national level the National Steering Committee (NSC) provided oversight, policy guidance and monitored the performance of the Project. At the provincial level the Provincial Development Coordinating Committee (PDCC) provided the necessary coordination at that level. In particular the Provincial Assessment Team (PAT), a sub-committee of the PDCC was a key organ for assessing district performance and recommending and undertaking appropriate capacity building interventions. At the district level the District Development Coordinating Committee (DDCC) was the key coordinating body and a subordinate organ of the full Council. It was responsible for planning and coordinating development activities at the district level and was supported by several specialized sub-committees. The Full Council provided final authority in approving community subprojects and various planning documents. 3.2 ZAMSIF Components 3.2.1 Community Investment Fund (CIF). This component accounted for expenditure of US$ 38.630 million representing 56.2% of IDA funding. The CIF supported sub-projects for basic social and economic infrastructure in education, health rural water and sanitation, community transport infrastructure, income enhancement, natural resource management and initiatives dealing with cross-cutting issues of HIV/AIDS, Gender, Environment and Orphans and Vulnerable Children (OVC). The initiatives under this component were aimed at stimulating local participation and productivity. 3.2.2 District Investment Fund (DIF). This component accounted for expenditure of US$14.111 million representing 20.5% of IDA funding. The DIF component had two sub-components: (i) The capacity building sub-component provided funds to local governments and administrations for capacity building and skills training for district officers and members of communities on a demand led basis to enable them facilitate the activities of both CIF and DIF project cycles, training of trainers for community capacity building such as home based care, HIV/AIDS counselling and participatory techniques. The component also supported the process of strengthening the capacity of local governments and administrations in order to improve their strategic development planning, technical and financial management capacity and thereby contribute to improved local governance.

39

(ii) The district projects sub-component was available to district Councils to finance capital projects in economic and social infrastructure benefiting more than one community such as district health facilities, market places and bus stations. In anticipation of gradual devolution of project cycle activities to local governments, a major innovation in the whole capacity building framework was the introduction of district assessments to assess district performance based on the capacity building ladder. The graduation of districts on the ladder rewarded districts with more responsibilities, resources and decision making powers according to the capacity attained. The ladder also enabled dysfunctional districts to address their weaknesses. 3.2.3 Poverty Monitoring and Analysis (PMA). This component accounted for expenditure of US$ 3.569 million representing 5.2% of IDA funding. The variance of US$ 0.569 between the PAD allocation and actual expenditure is insignificant and may be due to price escalations during the implementation of the Project and exchange gain. The component provided a framework for poverty monitoring and analysis activities and enhanced the linkages of these activities to policy making. The overall objective of the PMA component was to strengthen the capacity of national and district level institutions to provide timely information on poverty levels and social conditions and facilitate its use in policy making. The PMA had two sub-components: (i) The poverty monitoring sub-component which was aimed at financing capacity building and data collection through the LMCS; and (ii) the poverty analysis sub-component which was aimed at financing research studies on poverty and social issues in a demand driven framework. For purposes of sustainability, the survey part was implemented by the Living Conditions Monitoring Branch (LCMB) of the Central Statistical Office (CSO) while the studies part was expected to be gradually integrated into the Strategic Operations Planning Unit (SOPU) of the MoFNP where its role would be to mainstream study findings into policy formulation and the planning process. The PMA component financed a range of activities that were designed to strengthen the institutional, technical and financial framework for sustainable monitoring and policy-use of poverty information. The component supported the establishment of a district management information system to strengthen district capacity for data collection and analysis. 3.2.4 Institutional Support. This component accounted for expenditure of US$20.586 million representing 30% of IDA funding. Of this 16.2% supported administration costs while 13.8% supported training and capacity building. The variation of US$6.385 between PAD allocation (US$ 14.200) and actual expenditure was due to (i) increased capacity building in districts, communities (handholding) and staff of the Project, (ii) general price escalation during Project implementation, and (iii) cost of office accommodation not budgeted for from November 2001 to end of the Project. In addition, other expenditure items under this component included Information, Education and

40

Communication (IEC) campaign strategy, fiduciary requirements of independent audit, administration and operating costs such as purchase of motor vehicles and office equipment. Section 4 Assessment of the Project. ZAMSIF activities closed on 31st December 2005. The project closed at a time when GRZ had completed the IMS (2004) which shows improvements in some poverty and social indicators. Poverty levels dropped from 73% in 1998 to 68% in 2004 with rural poverty recorded at 78% compared to 83% in 1998 while urban poverty stood at 53% from 56% in 1998. There was a reduction in the number of people living below the poverty line from 58% in 1998 to 53% in 2004. The situation of orphans however deteriorated from 16% in 1998 to 18% in 2004. The Project was rated moderately satisfactory at the close in December 2005. Positive results (Annex 2 of the Bank ICR) in the form of construction and rehabilitation of roads and bridges, schools, health facilities, water and sanitation facilities improved the quality of infrastructure and therefore service delivery. The Project increased access to and utilization of social and economic services. The quality of infrastructure and services certainly changed the lives of many individuals, community groups and communities. These achievements suggest that ZAMSIF being the single largest poverty reduction agency for GRZ at the time made a contribution to the positive movement in the poverty indicators described above. The Project closed as scheduled and the whole credit was disbursed inclusive of an exchange gain of US$ 4.03 million. The total disbursed was therefore US$ 68.730 million against a budgeted amount of US$ 64.7 million. GRZ total contribution as per PAD was expected to be US$ 5.0 million. However based on actual financial requirements (based on budgets approved from 2000 to 2005) the amount reduced to US$ 2.673 million. The actual availability of funds throughout the implementation of the Project was unpredictable and irregular from GRZ. Communities contributed about 15% of subproject costs in the form of labour, local materials and or cash. It is estimated that this amounted to approximately US$ 5.8 million compared to US$ 4.50 million estimated in the PAD thereby representing 28.8%. 4.1 Amendment of DCA. Disbursements to infrastructure development of the Project were slow in the first two years owing to among other reasons lack of understanding of the Indicative Planning Figure (IPF) modalities and non-implementation of the National Decentralization Policy (NDP) by GRZ. In order to improve performance of the ZAMSIF Project, it was found necessary to amend the DCA. In May 2003, DCA amendments were effected to provide for IAPSO procurement and increased the threshold for procurement under shopping. In order to reduce the lead-time to first disbursement of funds to sub-projects the DCA was amended to allow processing of sub-project applications on “absence of objection basis” by a Technical Sub-Committee of the NSC.

41

During the MTR held in August 2003, a number of amendments were recommended and these were effected in March 2004 in order to realign the operational procedures to the strategy that had been developed for the Project. The following items were therefore amended:

• Project Development Objective • Special account limit (increased from US$3million to US$8million) • Procurement aggregates • Definition of operating costs • Performance indicators • Schedule 1 (reallocation)

In June 2005, it was clear that schedule 1 would not accommodate expenditures to be incurred under various categories to the end of the Project. A request to reallocate schedule 1 was approved by IDA and the amendment was effected in November 2005. Restructuring of the Project at MTR had many positive impacts on the overall implementation of the Project. Commitments and disbursements improved tremendously while movements of districts on the capacity building ladder improved. Among other tasks, the introduction of operational planning and a strategic re-alignment of the components brought the Project back on track as discussed at Section 5 (ii). 4.2 Project Development Objective (PDO). ZAMSIF original PDO was “to contribute to the achievement of improved, expanded and sustainable use of services provided in a governance system where local governments and communities are mutually accountable”. During the MTR, the achievement of the PDO was rated unsatisfactory (US) due to overall poor performance of the Project. Rewording of the PDO was effected to read “to contribute to the achievement of improved, expanded and sustainable use of services provided in a governance system where local governments and communities would become mutually accountable”. The rewording was made in the context of unsatisfactory progress on project implementation. Commitments, disbursements and progression of districts on the capacity building ladder were considerably behind target. There was no indication that GRZ would proceed to implement the National Decentralization Policy (NDP). 4.3 Project Design. The design assumptions were ambitious in terms of implementation of the NDP. The policy though approved by Cabinet in October 2002 during the early life of the Project was never implemented. This affected the performance of the Project. The policy was launched by the President on 20th August 2004 and the timeframe for implementation is now ten (10) years from the date of the launch long after implementation of the Project. The Decentralization Implementation Plan (DIP) had not been approved by Cabinet Office even by the date of this report. 4.4 Achievement of Project Development Objective. At the close of the Project, ZAMSIF had made considerable progress in achieving “improved, expanded and

42

sustainable use of services provided in a governance system where local governments and communities would become mutually accountable”. Under the CIF the Project created numerous assets that improved the quality and accessibility to services by beneficiaries. The improvements made real life differences in people’s lives and most cost effectively than GRZ, private sector or donor financed initiatives. The bottom up approach to community development enabled communities to manage their own sub-projects including funds. DIF components built capacity at district and community levels to improve performance, transparency and accountability and governance. The PMA achieved most of its target outputs but did not fully achieve its integration objectives into the MoFNP. 4.5 Achievement by component Based on key performance indicators presented in Annex 2 of the World Bank ICR, it is clear that the CIF, DIF and Institutional Support components substantially achieved their target output objectives while the PMA component though achieving most of its output targets did not fully achieve its integration objective. 4.6 Sustainability Social fund models that channel funds directly to communities have been perceived as models that bypass Government and therefore not sustainable in the long-term. It is true that ZAMSIF channelled funds directly to communities but the Project was designed deliberately to work through the existing institutions in order to ensure sustainability. A unique strategy of building capacity within those institutions was for purposes of sustainability. According to the Risk Management and Sustainability Study (2005), even the sustainability of infrastructure and service delivery under the CIF component was found to be feasible but could not be guaranteed due to resource constraints within community, sector and even local authority. This is exacerbated by the ad-hoc intergovernmental transfer system which has failed to guarantee predictable recurrent costs at the local level. This is now being addressed through fiscal decentralization. However Government interest in community based approaches employed by ZAMSIF was based on the belief that they would lead to:

• Better targeting of resources to help communities • Reduced corruption and misuse of resources so that more development assistance

would reach the poor and • Increased transparency and accountability by working directly with the ultimate

beneficiaries. The sustainability of ZAMSIF through components supported may not be evident now because the effect of some interventions take long to manifest. Capacity building interventions for example take long to bear fruit. The sustainability of ZAMSIF as a project is better assessed through systems and procedures developed overtime which have the propensity to be used within Government operations. Below are some of the systems and procedures:

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i) Distribution of resources to districts through the IPF – the IPF was a pre-determined amount of money allocated to a district to be used over a five year period (2000-2005). It was designed as a composite index based on population, poverty and deprivation. This index was formula based and transparent in allocating resources to districts. It was used by the Project in a similar manner as an objective intergovernmental fiscal transfer system.

ii) Transparency and accountability in the utilization of resources – direct funding to communities through the CIF did not only improve Government response to community needs (downward accountability) but also improved the capacity of community capacity to account for allocated resources and even to make demands on Government for additional resources (upward accountability).

iii) District planning – ZAMSIF insisted that a plan was an important tool for targeting resources and encouraged many stakeholders to harmonize the planning processes and procedures. The introduction of clear planning stages has since made planning a rewarding exercise.

iv) Project cycle system – districts used the project cycle as an important instrument for managing the various aspects of a project and also for information sharing.

v) Procurement procedures – these were simplified to accommodate capacities of communities and made it much easier for district teams to supervise the whole procurement process and make it more transparent.

vi) District Performance Assessments – these were standardized and applied throughout the country using indicators from the capacity building ladder. Based on performance, the assessments enabled a district to graduate to a higher level for additional responsibilities or to demand additional capacity building support if the district was underperforming.

Section 5. Overall Implementation and Operations Experience ZAMSIF operated within GRZ policy and therefore enjoyed political commitment from top GRZ leadership. There was smooth collaboration between ZAMSIF and all sector ministries and departments at national, provincial and district levels. However, the following challenges were experienced:

i) Non implementation of the NDP ZAMSIF was designed on the assumption that GRZ would implement the NDP and that the Project activities would gradually be devolved to district administrations where project cycle activities would be facilitated by district officers. The NDP was approved by Cabinet in 2002 but was never implemented. Non implementation of the NDP became a major challenge throughout the implementation of the Project because this implied constrained budgetary resources and limitations in human resource capacities at the district level.

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ii) Inadequate funds for projects

The major objective of ZAMSIF was to build community capacity to demand and manage development resources. This was accomplished through learning- by- doing process where the funds financed initiatives which the communities implemented and managed. This process created so much demand among communities that they started to hold Government accountable for not committing additional resources towards their priorities. There was so much demand that the available IPF was inadequate to meet the proposals generated. As at close of the Project 75 project proposals had been processed and received by ZAMSIF Head Office but could not be funded due to inadequate funds. At the average cost of US$ 80,000 per sub-project, ZAMSIF needed US$ 6.0 million to commit to these projects. iii) Negative perceptions of the Project. Because of its operational autonomy and direct funding to communities, many stakeholders perceived ZAMSIF as a donor and not a Government project. ZAMSIF had three roles; a donor, an assessor and a provider. Some members of the donor community felt uncomfortable with this position and queried the role of both building capacity and funding projects. Critics felt that the Project was loosely integrated with the overall administration and therefore operating not as part of government but parallel to government. Some stakeholders felt that the Project structure was confusing beneficiaries and not contributing to normal government reforms. Section 6. Major factors affecting implementation. There were many positive and negative factors that affected the implementation of the project. The timely and successful completion of the Project can be attributed to the positive factors. They included the following :

i. Enabling environment provided to the Project by GRZ through provision of clear policy guidelines ;

ii. Allocating of Project activities to GRZ officials ; iii. Availability of GRZ counterpart funding ; iv. Smooth flow of financial resources from IDA ; v. Availability of predictable technical support from IDA ;

vi. Clear procedures and guidelines from IDA ; vii. Clear roles and responsibilities among key stakeholders in the implementation of

the Project ; and viii. Active community participation through various types of contribution to sub-

projects costs. However some of the negative factors included the following: i). Non implementation of the NDP. As described at section 4.1 and 5 (i) above, the non implementation of the NDP significantly affected the performance of the Project because the implementation of the NDP was a critical assumption for the success of the

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Project. ZAMSIF is seen as having contributed positively to commencement of the implementation of the policy by preparing the districts a head of the of the DIP approval by Cabinet. ii. Drought. During the 2001/2002 farming season, Zambia experienced drought. This affected community participation especially in areas where drought was severe. The result was that in some areas, communities withdrew their labour and other local contributions from the sub-projects as they were preoccupied with casual work for cash to buy food thereby affecting the rate of implementation. As a mitigation strategy, Government requested ZAMSIF to support activities to cushion the impact of drought in 38 districts that were severely affected. The activities included primarily high labour content ones such as road works and small dams. ZAMSIF worked in very close liaison with the Emergency Drought Relief Credit (EDRC), executed in the office of the Vice President under the Disaster Management and Monitoring Unit (DMMU). ZAMSIF funding for these projects was drawn from the respective district Indicative Planning Figures. iii. Prices. Although the Project benefited from the exchange gain of US$ 4.03 million, cost-over-runs were experienced on some individual sub-projects arising from general increases in prices and poor budgeting by district staff. Such projects received supplementary funding to enable them complete the agreed activities. A total of 92 CIF subprojects (16.6 %) overspent by as much as US$ 1.352 million. ZAMSIF strategy for mitigating over expenditure was to handhold communities and district staff during procurement. iv. Contractor projects. In some cases delayed implementation of sub-projects was due to inadequate capacities among contractors engaged to do the works. v. Focus on outputs and not outcomes. As many sub-projects had a significant infrastructure component and because most sub-projects were supported for one year there was a tendency among key partners to focus on outputs rather than outcomes. vi. Size of subprojects. To assure service delivery, most ZAMSIF sub-projects were supplied as a package. In some cases the size of sub-projects became too big in relation to the capacity of communities to implement. Such sub-projects experienced delays in implementation and experienced cost-over-runs. vii. Staff turnover. District staff attrition was a significant problem during the life of the Project. This was due to poor conditions of service in GRZ and local authorities and due to the impact of HIV/AIDS. The outcomes of capacity building interventions were negatively affected and thereby affecting the implementation of the Project. viii. ZAMSIF MU support to other programmes.. Due to the successful and efficient performance of SRP, community based components of other programmes namely Community Transport Infrastructure (CTI), Basic Education Sub-Sector

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Investment Programme (BESSIP) and Pilot Environmental Fund (PEF) were appended to the Project for implementation. These components together with Community Response to HIV/AIDS (CRAIDS) were subsequently appended to the successor Project ZAMSIF for overall management. Because ZAMSIF was already a large Project by design, these additional components significantly overstretched the capacities of staff. Section 7. Government Performance during the development and implementation of the Project Overall, GRZ performed well during the development and implementation of the Project. Enabling environment was provided for the whole design process to appraisal which culminated into signing a DCA with IDA for a total Credit of US$ 64.7 million in June 2000. In addition and as part of its commitment, most of ZAMSIF activities were performed by GRZ staff at both provincial and district levels. GRZ provided office accommodation to all 12 ZAMSIF Regional Offices during the implementation of the Project. During the MTR, GRZ responded adequately to the implementation problems the Project was experiencing and together with the Bank team went through a thorough and comprehensive restructuring of the Project to bring it back on course and ensure successful implementation and completion. GRZ was expected to defray costs of the Project expenditures not financed from the proceeds of the credit. The amount as per PAD was US$ 5.0 million. However based on actual implementation of the Project and the financial requirements, this amount was agreed at US$ 2.673 million in August 2004. At closure of the Project, GRZ performed well in this aspect by releasing US$ 2.504million as total contribution to the Project leaving a shortfall of US$ 0.169 (6.32%). The availability of GRZ funds during the life of the Project was not as regular as expected. It was only towards the end of the Project that most of the contribution was provided by GRZ. Section 8. IDA’s Performance during the development and implementation of the Project The IDA of the World Bank performed well during the development and implementation of ZAMSIF. The Bank teams facilitated all design processes to appraisal which culminated into signing a DCA with the Government in June 2000. Upon signing the DCA Government was entitled to receive US$ 64.7 million for the Project. Cash inflow from the Bank was regular, predictable and adequate. Bank technical support both during project preparation and implementation was adequate. During project implementation Bank missions visited Zambia several times. The missions contributed significantly to supporting implementation. In particular the Bank facilitated the MTR restructuring and helped the Project to get back on track. During the missions the TTL together with other Bank staff visited a number of sub-projects to assess operations on the ground and held discussions with district teams, provincial teams and communities in various districts.

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However there were occasions when the Bank response to procurement matters was slow. This negatively affected the rate of implementation of some of the sub-projects involved in such procurement. It is hoped that the Bank will draw lessons from ZAMSIF on this matter and make amends in the manner procurement issues are dealt with. Section 9. Major Lessons Learnt

i. Direct financing and community contribution lower the cost to Government of delivering infrastructure.

ii. Use of Indicative Planning Figure to allocate resources. The IPF was a pre-

determined amount of money that was allocated to all the 72 districts in Zambia based on a composite index. Given the agreed components in the index, it was a transparent and objective system of transferring resources from the centre to the lower tier of GRZ administration. It can be used as a basis for designing an intergovernmental fiscal transfer system for Zambia.

iii. Diversification of sub-project portfolio. There was an improvement in the

sub-project portfolio from the traditional dominant sectors of education and health to non-traditional sectors of roads, HIV/AIDS and income enhancement. However it appears public-private partnerships at prioritization level of sub-projects may help make more progress in local economic development type sub-projects.

iv. Well-defined communication strategy (IEC). IEC strategy facilitated the

effective and efficient implementation of the project cycle activities. It was a powerful tool for fostering community social capital and empowerment. Many community members benefited significantly from the information flows as a result of IEC activities. Information flows through radio, newspapers, newsletters and electronic media improved substantially top down and bottom up accountability.

v. Guidelines and procedures. Given clear guidelines and procedures, it was evident that districts are able to support community development and ensure accountability of resources. Guidelines and processes ensured that sub-projects supported were addressing community priority needs and helped communities open up to local opportunities.

vi. Inadequate design for monitoring. ZAMSIF was more focused on

measuring quantitative goals of outputs than on qualitative goals of outcome because of an implicit assumption that meeting quantitative goals will automatically fulfil the qualitative goals. However, measuring outcomes requires a different set of indicators that equally require a clear baseline in the design phase.

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vii. Government commitment to policy implementation – Experience during implementation of ZAMSIF showed that it is critical to design programmes or projects on the basis of existing policy and not on anticipated or expected policy as this may not materialize.

viii. Predictable allocation of resources – the IPF concept allocated resources to

districts based on poverty levels and vulnerability. It was apparent during the implementation of ZAMSIF that the nation requires a more predictable intergovernmental fiscal transfer system from which programmes such as LDP can benefit.

ix. District Assessments based on capacity building ladder: this was an ideal

entry point for capacity building interventions and enabled targeting resources to needy areas. It still remains a relevant tool for awarding recurrent and capital grants for district councils and recommending interventions.

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Annex 8. Comments of Co-financiers and Other Partners/Stakeholders Refer to Section 7 (iii).

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Annex 9. List of Supporting Documents

(1) Project preparation documents (2) ZAMSIF PAD (3) Back to Office Reports, ISRs and Aide Memoires (4) Project Annual and Bi-annual Reports (5) Environmental Analysis (2000). (6) Beneficiary Assessment (February 2003) (7) Implementation Risk Management and Sustainability (July 2005) (8) LCMS Report 2004 (9) Indicator Monitoring Survey (10) MTR Management Evaluation (March 2003) (11) ZAMSIF Evaluation Study (2008)