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El Salvador Domestic Resource Mobilization Project
First Year Work Plan May 2017 - April 2018
June 2017
This publication was produced for review by the United States Agency for International Development. It was prepared by DAI Global, LLC.
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EL SALVADOR DOMESTIC RESOURCE
MOBILIZATION PROJECT
FIRST YEAR WORK PLAN
May 2017 - April 2018
Project Title: Domestic Resource Mobilization
Sponsoring USAID office: USAID/El Salvador Economic Growth Office
Contract Number: AID-519-C-17-00002
REQ-519-16-000023
Contractor: DAI Global, LLC
Date of Publication: June 2017
The authors’ views expressed in this publication do not necessarily reflect the views of the
United States Agency for International Development or the United States Government.
USAID El Salvador Domestic Resource Mobilization Project
TABLE OF CONTENTS
ACRONYMS ................................................................................................................................... i
I. INTRODUCTION AND BACKGROUND ............................................................................ 1
A. PROJECT GOALS AND OBJECTIVES ........................................................................ 1
B. MANAGEMENT AND ADMINISTRATION ................................................................ 6
C. INTERNATIONAL DONORS, PARTNERS AND SUBCONTRACTORS
COORDINATION ...................................................................................................................... 8
II. COMPONENT 1: BUDGET PLANNING AND PREPARATION IMPROVED .............. 9
SUMMARY OF COMPONENT 1 MILESTONES FOR YEAR ONE ..................................... 9
SCHEDULE OF ACTIVITIES FOR YEAR ONE ................................................................... 10
DISCUSSION OF ACTIVITIES .............................................................................................. 11
III. COMPONENT 2: BUDGET EXECUTION IMPROVED ................................................ 14
SUMMARY OF COMPONENT 2 MILESTONES FOR YEAR ONE ................................... 15
SCHEDULE OF ACTIVITIES FOR YEAR ONE ................................................................... 15
DISCUSSION OF ACTIVITIES .............................................................................................. 17
IV. COMPONENT 3: TAX POLICY AND ADMINSTRATION IMPROVED .................... 22
SUMMARY OF COMPONENT 3 MILESTONES FOR YEAR ONE ................................... 23
SCHEDULE OF ACTIVITIES FOR YEAR ONE ................................................................... 23
DISCUSSION OF ACTIVITIES .............................................................................................. 24
V. COMPONENT 4: TRANSPARENCY AND PUBLIC - PRIVATE DIALOGUE ON
FISCAL POLICY STREGTHENED ............................................................................................ 29
SUMMARY OF COMPONENT 4 MILESTONES FOR YEAR ONE ................................... 29
SCHEDULE OF ACTIVITIES FOR YEAR ONE ................................................................... 30
DISCUSSION OF ACTIVITIES .............................................................................................. 30
VI. PROJECT START UP ACTIVITIES ................................................................................ 33
TASK 1: ESTABLISH WORKING RELATIONSHIP AND PROTOCOLS WITH USAID .. 34
TASK 2: ESTABLISH A BASE OF OPERATIONS FOR THE PROJECT............................ 34
TASK 3: MOBILIZE AND ONBOARD APPROVED KEY PERSONNEL ........................... 34
TASK 4: ESTABLISH DAI AND USAID COMPLIANT PROJECT SYSTEMS, POLICIES,
AND PROCEDURES ............................................................................................................... 35
TASK 5: RECRUIT TOP PRIORITY PROJECT STAFF ........................................................ 35
TASK 6: FINALIZE SUBCONTRACTS ................................................................................. 36
TASK 7: ACQUIRE NECESSARY DOCUMENTATION FOR PROJECT OPERATIONS ..... 36
USAID El Salvador Domestic Resource Mobilization Project
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ACRONYMS
AECID Spanish Agency for International Development
COMPRASAL E-Procurement System
COP Chief of Party
CSMS Case Selection Management System
DAI DAI Global, LLC
DGA Customs General Directorate
DGCG General Directorate for Government Accounting
DGII General Directorate for Internal Revenue
DGP Budget General Directorate
DGT Treasury General Directorate
DINAFI National Directorate for Financial Administration and Innovation
DPEF Fiscal and Economic Policy Directorate
EU European Union
FAS Field Accounting System
FPEMP Fiscal Policy and Expenditure Management Program
GDP Gross Domestic Product
GOES Government of El Salvador
HR Human Resources
ICEFI Central American Institute of Fiscal Studies
IDB Inter-American Development Bank
IMF International Monetary Fund
IPSAS International Public Sector Accounting Standards
ISA International Standards on Audit
IT Information Technology
MOE Ministry of Education
MOH Ministry of Health
M&E Monitoring and Evaluation
MTFF Medium Term Fiscal Framework
MTEF Medium Term Expenditure Framework
MTIF Medium Term Institutional Framework
OTA US. Treasury Office of Technical Assistance
USAID El Salvador Domestic Resource Mobilization Project
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PFM Public Financial Management
PPOO Public Procurement Ombudsman Office
ROB Result Oriented Budget
SAFI National Financial Management System
SAFIM Municipal Financial Management System
TAMIS Technical and Administrative Management Information System
TAS Tax Administration Specialist
TPAR Tax Policy and Administration Reform Program
TSA Treasury Single Account
UNAC National Procurement Office
USAID United States Agency for International Development
USG United States Government
WB World Bank
USAID El Salvador Domestic Resource Mobilization Project
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I. INTRODUCTION AND BACKGROUND
This report presents the first year work plan for the United States Agency for International
Development (USAID) funded Domestic Resource Mobilization Project. It covers the period
from May 1, 2017 through April 30, 2018. USAID and DAI Global, LLC (referred to as DAI)
signed the contract on April 27, 2017. The Project is for five years and concludes on April 26,
2022.
The previous USAID fiscal project, known as the Fiscal Policy and Expenditure Management
Program (FPEMP) had successfully supported the Ministry of Finance (MOF) in the
implementation of reforms that generated an increase in tax collection of 4% of Gross Domestic
Product (GDP). Nevertheless, the gap between revenues and expenditures has remained high
over the past 15 years, generating a situation of structural deficit that is currently challenging the
fiscal sustainability of the country. The Domestic Resource Mobilization Project will continue
supporting the MOF in implementing the reforms on revenues and expenditures to solve the
short term fiscal deficit and to implement the structural reform to guarantee that the GOES fiscal
and financial environment get to a safe harbor that guarantee fiscal sustainability, sound
economic growth and a better life for all Salvadorians.
The first year of Project implementation is of critical importance to build strong foundations of
the project’s activities, to maintain continuity of previous USAID technical support provided to
the MOF, and to ensure achievement and sustainability of the project’s goals. As such, this first
year work plan defines in detail how DAI has organized its work to implement the Domestic
Resource Mobilization Project and achieve the expected results. The work plan presented herein
is the result of numerous meetings with different stakeholders, and contains a set of activities
carefully developed in concert with the MOF and USAID.
The report is divided in six (6) sections. The first section describes the Project itself, including its
goals and objectives, project management and administration, and a summary of the main
activities. Sections two through five present each component’s objectives, results, milestones and
activities expected for the first year of the Project while the last section, section six, reviews the
project star-up activities including recruitment and office establishment process.
A. PROJECT GOALS AND OBJECTIVES
The GOES is engaged in the modernization of its Public Financial Management (PFM) system
and the strengthening of its revenue collection. The reforms include the budget system reform,
the treasury system modernization, the adoption of International Public Sector Accounting
Standards (IPSAS), the development of a state-of-the-art Government Financial Information
System, the development of a fully transactional e-procurement system and the enhancement of
fiscal transparency. Through Tax Policy and Administration Reform (TPAR) and FPEMP,
USAID has supported the Government of El Salvador (GOES) over the last 11 years, carrying
out the reforms and providing transparency, efficiency and revenues increase.
Through the Domestic Resources Mobilization Project, USAID’s goal is to continue improving
public financial management practices, increase domestic revenue mobilization and generate
additional revenue for the public sector in El Salvador. The Project’s expected goals are to
USAID El Salvador Domestic Resource Mobilization Project
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contribute to the GOES effort to achieve a tax revenue increase of 2% of GDP over the baseline
established at the end of 2017; a result-oriented budget formulation in place; an improved public
expenditure management; an increased fiscal transparency and a strengthened public-private
dialogue.
The goals above are comprised of four components, which are:
Component 1: Budget Planning and Preparation Improved
Component 2: Budget Execution Improved
Component 3: Tax Policy and Administration Improved
Component 4: Transparency and Public-Private Dialogue on Fiscal Policy Strengthened
On Budget Planning, Component 1, the GOES has been adopting a new system of multi-year,
results-oriented budgeting with a Medium-Term Fiscal Framework (MTFF) and the associated
Medium-Term Expenditure Framework (MTEF). The MTFF will provide aggregate multi-year
projections of fiscal revenues, expenditures, and financing based on macroeconomic scenarios
and an analysis of risks.
The MTEF will provide multi-year expenditure projections disaggregated programmatically,
including the public investment program. The European Union (EU), Inter-American
Development Bank (IDB), International Monetary Fund (IMF), and German International
Development Cooperation (GIZ) have been providing assistance for the development of these
frameworks, with the IDB having a particular role in the evaluation of risks in the MTFF. EU
and GIZ assistance has also been instrumental in creating the internal capacity within the MOF
for developing and monitoring the implementation of its Strategic Plan. The MTEF will also be
instrumental in the gradual formulation and implementation of the government budget based on
performance or results oriented budget (ROB).
The gradual formulation of the first ROB was planned to start in 2014 for the 2015 budget, but
has been delayed. Donors have indicated that future assistance programs will include software
development and training. The Minister and Vice Minister of Finance have confirmed high-level
engagement during the implementation stage. GIZ has provided assistance for conceptual design,
including monitoring and evaluation. USAID has supported software design and implementation,
and has also provided support to three ministries for the formulation of pilot ROB in 2016
(Agriculture, Economy, and Health), which need to continue during 2017-2018.
The project will review the frameworks methodologies and will recommend the necessary
changes to the revenue and expenditure forecast model and the microsimulation models for the
MTFF. Extensive training will be provided to the DPEF and the Budget General Directorate
(DGP) staff to successfully implement the MTFF and MTEF. Training on the MTIF will be
provided to the GOES institutions.
Software for the standardization and successful development of the frameworks will be
developed. During the first year, the Project will support the development of the use cases.
Regarding the budget formulation, the project will continue supporting the DGP, Ministry of
Education (MOE) and Ministry of Health (MOH) in the successful implementation of the
program based budget system. Technical support will continue including the trilateral initiative
with the Argentinean MOF.
USAID El Salvador Domestic Resource Mobilization Project
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We expect that by the end of the second year the MOF will be fully implementing the MTFF and
MTEF, using them as the bearing point for public expenditure planning, execution and
management. The MTIT should be fully implemented by the end of the Project’s third year at all
GOES institutions.
On Budget Execution, Component 2, the GOES is moving forward in the adoption of IPSAS,
TSA, the E-procurement system, the Result Based Budget execution program under accruals
methodology, the SAFI II development and implementation, and an integral strategy for civil
society oversight and accountability.
The IPSAS adoption will dramatically change public accounting practices by fully adopting
international standards, avoiding discretionary accounting registration, improving accountability,
and providing accurate financial information to the PFM policy makers. During the past five
years, the MOF, with USAID support, has being moving forward with the IPSAS adoption,
updating the conceptual model, charts of accounts, and accounting framework; additionally, the
IPSAS accounting policy manual has been approved and incorporated in the accounting
legislation, and training has been provided to all GOES entities. During the first year, the Project
will deliver extensive training on IPSAS modules two and three, accounting matrices and IPSAS
accounting practices logic and implementation. Additionally, the Project will support the General
Directorate for Government Accounting (DGCG) administrative and functional reform.
The Treasury Single Account (TSA) System implementation will continue with the adoption of
the new SAFI II. Additionally, extensive support most be provided to the Treasury General
Directorate (DGT) to implement the budget commitment installments using microsimulation
methodologies, the closing of the GOES institutions bank accounts and the proper banking
reconciliations, and the DGT administrative and functional reform. The project, in coordination
with the OTA resident advisor, will coordinate the support to the DGT in the successful
implementation of the tasks.
In addition, the MOF is implementing the E-Procurement system and the reform of the current
LACAP to adopt the reverse auction and framework agreements modalities. During FPEMP
PAAC, Libre Gestión, Licitaciones, Contratación Directa y Concursos Públicos modules were
developed. The PAAC is fully implemented and the Libre Gestión is in the process of
implementation; Licitaciones, Contratación Directa and Consursos Públicos modules were fully
developed and are ready for implementation. The Domestic Resource Mobilization Project will
continue developing the remaining modules of COMPRASAL II and will support the training
programs of the modules already developed and in currently implementation. The Project will
continue supporting the drafting of the LACAP reform and will provide training and advocacy
for the GOES and the National Assembly to fully adopt the reverse auction and the framework
agreements.
On the program based budget system implementation, the project will continue supporting the
DGP and GOES institution in the new budget adoption with extensive training and the
development of the Budget Monitoring and Evaluation Module within the SAFI II. During the
first year, the Project will support the module use cases development and will provide extensive
training to the DGP and Technical Secretary of Presidency on Budget M&E methodologies.
Additionally, it is expected that an assessment of the proper Program Based Budget adoption will
be conducted at the end of the first year.
USAID El Salvador Domestic Resource Mobilization Project
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In order to implement the public modernization agenda, it is necessary that the SAFII II be
developed and implemented. SAFI II development has faced critical challenges during the last
three years, and its development is in a critical phase. FPEMP developed more than 70 percent of
the accounting and treasury system. The Domestic Resource Mobilization Project will continue
developing the systems and will support the deployment by January 1, 2018. The Project agreed
with DGT and DGCG directors in developing the core component for both systems and the
remaining modules (that are necessary only by the end of 2018) will be developed during the
first five months of 2018. Extensive training to GOES institutions will be provided by the end of
2017.
The previous USAID project, FPEMP, supported an integral strategy for civil society oversight
and accountability. The fiscal transparency portal was upgraded under a trilateral initiative with
the Brazilian Government, forums were developed to discuss the fiscal matters with civil society,
and the Public Procurement Ombudsman Office (PPOO) was created. The MOF is fully
committed to continue implementing the strategies for civil society oversight and better
accountability. The Project will continue supporting the PPOO strengthening and the
development of new strategies to create a civil society oversight tools taking advantage of the
SAFI II, the fiscal transparency portal and the COMPRASAL II.
On Tax Policy and Tax Administration, Component 3, the MOF is implementing important
reforms in the tax control system and the taxpayer service program to increase voluntary
compliance and enforce the tax law in a way that will increase in revenue by at least 2% of GDP
during the following five years. Implementation and strengthening of the recently created Tax
Arrears Collection directorate is a priority for the Viceminister of Revenue, and the integral and
full reform of the Customs authority is being planned by the project with the MOF.
The Project will support the General Directorate for Internal Revenue (DGII) in the full reform
of the tax control model, taking advantage of the impressive results provided by the Case
Selection Management System (CSMS) II. The data mining model will incorporate new data and
better algorithms, a new model of tax control integrated in a pipe line model will be
recommended and implemented, and the necessary protocols and procedures will be drafted and
implemented. In order to implement the new model, the project will provide extensive training in
tax control and auditor technics to DGII auditors. Special attention will be provided to the DGII
Internal Audit office to improve their tools and skills to audit the proper adoption and
implementation of the new tax control protocols and systems. A new taxpayer current account
will be developed, and during the first year the project will support the development of the
conceptual model and the use cases. Regarding fiscal reforms, the project will advocate with the
GOES and the National Assembly on the need to approve it as a way to boost tax revenues; once
enacted, full support will be provided to the implementation. For the Simplified Tax System, the
project will advocate with the MOF authorities and the Presidential House to fully draft the
regulation for the new system that will integrate the economic agents that are on the informal
economy to the fiscal system, granting them access to financial services and support and helping
them to fully comply with the fiscal system.
The project will support the DGT in the development of a new SITEP system. Five modules of
the SITEP are being developed within the SAFI II, and the remaining modules must be migrated
to a new system. The Project will support the DGT to develop the use cases and will train the
DGT IT staff on JAVA and Oracle to prepare them to develop the migration program. The
USAID El Salvador Domestic Resource Mobilization Project
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Project will provide support and supervision to the staff in the development, testing and
deployment.
The Project will fully support the implementation of the recently created Tax Arrears Collection
Directorate. The implementation of the new tax arrears management system will be fully
supported by the Project. Currently, the new directorate is working hard in organizing and
detecting tax arrears to properly begin the collection of due taxes. IT staff and tax experts will
fully support the data mining program that will detect and clean the tax arrears and the
development of protocols and procedures for the new collection model, and the development of
the transactional system of the tax arrears collection within the CSMS II will begin. During the
first year, the Project will support the development of the use cases. The Tax Arrears Crackdown
Program recommended by FPEMP will be fully supported by the Project.
The Viceminister of Revenue is fully committed to reform the entire Customs Administration,
based on the assessment develop by a Colombian Government expert under the trilateral
initiative. The experts detected that the Salvadorian customs administration had serious problems
and needed to be fully reform and modernized. The goal of the Project on the customs
modernization program will be to leave in place a world-class trade facilitation system and a
strong customs administration that enforce the law with full attachment to the Constitution and
the due process. The first task the Project will support is the development of a draft of the
Custom Code that will integrate the disperse customs regulations and will incorporate the
reforms for the private customs regulation, the electronic customs clearance process, the private
customs warehouse system, the customs statutory power to control secondary zones (post
customs clearance areas) customs value declaration, among others.
The Domestic Resource Mobilization Project will recommend the new administrative and
functional reforms of the Customs General Directorate (DGA) and will support its
implementation. Additionally, a customs fraud crackdown program will be recommended and
supported. The project will develop within the CSMS II the customs operations transactional
system, and during the first year the use cases will be developed. All these activities will be
complemented with an extensive training program.
Finally, on Fiscal Transparency and Public-Private Dialogue, Component 4, the main goal is to
support the GOES to improve fiscal transparency and improve public-private dialogue on fiscal
matters. It is key that the government improve the fiscal transparency portal expanding the open
data model to the level of Item, providing more transparency and better information to civil
society, private sector and academic community. It is necessary to recommend and support the
creation of a Transparency and Accountability Office under the Viceminister of Finance; the
office will be constantly working in the creation and implementation of mechanism of citizens
participation providing broader information in a user-friendly format, and will work with the
Public Procurement Ombudsman Office (PPOO), the taxpayer advocate and all MOF
directorates to improve accountability. The PPOO will receive technical support from the
Project. Extensive training will be provided and the project will support the development of a
risk management matrix system. The taxpayer advocate office within the DGII will receive full
support in training, technical tools and models, and standards of investigation and analysis. The
Project will continue working with the donor committee and the MOF in a public-private sector
agenda and the GOES-political parties’ agreement to support the fiscal stabilization of the
country.
USAID El Salvador Domestic Resource Mobilization Project
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The activities included in the first year work plan have been refined to prioritize the needs
identified in the different government units developed together by the MOF and USAID. This
will provide the basis to assist the GOES to advance tax reform and public financial and
expenditure systems while promoting government transparency, accountability, and more
efficient use of public resources.
B. MANAGEMENT AND ADMINISTRATION
The Domestic Resources Mobilization Project is led by a Chief of Party (COP) and three Key
Personnel. The Project has its office located on the sixth and fifth floor, Tower 3 of the MOF’s
DGII building. Figure 2 presents the current Project management and team structure.
The Project is comprised of a strong technical team lead by Mr. Enrique Giraldo and supported
by component leaders with extensive international experience in public expenditure, revenue and
change management. While the Leaders of Components 1 and 3 will have full delegation from
the COP, they will be fully monitored and coordinated by Mr. Giraldo. The team leaders will be
supported by junior experts and a large team of top-notch international experts on IPSAS,
treasury, public procurement, tax, customs, tax collection, change management, among others.
The COP will ensure that the relations with the MOF executive and technical staff be managed in
a technical, respectful and professional manner and will address any issue that arise.
Due to the complexity of the Project and the large budget, the administrative team is integrated
by a Financial and Administrative Office supported by a Financial and Administrative Manager,
Accountant, Human Resources (HR) Coordinator, Administrative and Financial Assistant, IT
System Administrator/Help Desk and a Driver. This unit will be in charge of human resources
recruitment, support the COP in evaluating the long-term staff, payroll, vendors payment, among
other administrative and financial. The Procurement Manager will be in charge of managing and
developing procurements and guarantee adherence to USAID regulations and proper due
diligence.
The IT Unit will include an IT Manager, IT Supervisor, IT Programmers and Database
Management Administrator. This office will be in charge of the development of the IT software
necessary for the accomplishment of the project goals.
The Monitoring and Evaluation (M&E) Unit will be integrated by the M&E Specialist and M&E
Assistant. This unit will be in charge of the implementation of the Monitoring, Evaluation and
Learning Plan approved by USAID.
The following staff members currently comprise the Project Management Team:
Chief of Party and Component 2 Leader: Mr. Enrique Giraldo
Expenditure Management Specialist and Component 1 Leader: Mr. Mario Gutierrez
Revenue Administration Specialist and Component 3 Leader: Mr. Jose Lopez
Public Sector Change Management Advisor and Component 4 Leader: Lee Niederman
IT Manager: Mr. Renato Bonilla
IT Coordinator: Mr. Nelson Hernandez
Monitoring and Evaluation Specialist: Mr. Carlos Quiteño
Financial and Administrative Manager: Mr. Cesar Sagastume
Procurement Manager: Mrs. Karen Melendez
USAID El Salvador Domestic Resource Mobilization Project
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FIGURE 2: PROJECT ORGANIZATIONAL CHART
Chief of Party Enrique Giraldo
Program Assistant
TBD
Expenditure Management Specialist
Mario Gutierrez
Public Sector Change Management Advisor
Lee Niederman
Accountant TBD
Procurement Manager Karen Melendez
PPP, Transparency, Civil Society Specialist
TBD
Executive Assistant
TBD
Change Mgmt Specialist/Training and
Capacity Building Advisor TBD
Budget Expert TBD
M&E Specialist Carlos Quiteno
M&E Assistant TBD
= Key positions
Revenue Administration Specialist
Jose Luis Lopez
Tax Expert TBD
Finance & Admin Manager Cesar Sagastume
HR Coordinator TBD
Finance & Admin Assistant
Ariel Lopez
Driver Omar Ortiz
IT System Admin/Help Desk TBD
IT Manager Renato Bonilla
IT Coordinator Nelson Hernandez
Database Admin. TBD
IT Programmers (17)
Communications Specialist TBD
USAID El Salvador Domestic Resource Mobilization Project
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C. INTERNATIONAL DONORS, PARTNERS AND SUBCONTRACTORS COORDINATION
The MOF is receiving additional technical assistance from the European Union (EU), German
Agency for International Development (GIZ), Spanish Agency for International Development
(AECID), World Bank (WB), Inter-American Development Bank (IDB), US. Treasury Office of
Technical Assistance (OTA) and the International Monetary Fund (IMF). Making USAID
investment more effective and efficient will require discussing and coordinating ideas and
programs with these donors and multilateral agencies.
The Project will engage in constant communication with other donors and multilaterals to
develop synergies, and will assist the MOF in gaining greater control over donor commitments
and shaping the development agenda.
In addition, the Project has two subcontractors that will provide support in several areas. Data
Mining International will support the customs data cross reference system that will improve the
customs control and the trade facilitation. TechChance will support the e-learning program
providing a state of the art e-learning system that will support all the change management
strategy. Additionally, Project partner Central American Institute of Fiscal Studies (ICEFI) will
support the development of fiscal and economic studies that will be used to support the program
activities.
USAID El Salvador Domestic Resource Mobilization Project
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II. COMPONENT 1: BUDGET PLANNING AND PREPARATION IMPROVED
Following best international practices, five years ago the GOES decided to adopt the
development and use of the medium-term fiscal framework, medium-term expenditure
framework, and the institutional framework. These macro-fiscal tools have the purpose of
providing the government fiscal and economic targets and the fiscal data and instruments that
must be guide the budget ceiling, the key budget programs and resource allocations. The
frameworks enforce a fiscal discipline that could help the government guarantee fiscal
sustainability.
Additionally, the MOF decided to reform the budget system, transitioning from a budget line
system to a program based budget on a result-oriented approach. The new budget system
enforces the GOES institutions to develop budget programs with a full set of indicators of output,
efficiency and economy, helping the GOES to improve public value creation and the
rationalization of resource allocation.
Finally, the fiscal rule requires from the government a fiscal adjustment of 3% of GDP, among
other fiscal targets and actions. The adjustment must be achieved by January 2020. The targets
are ambitious and require from the government the immediate and successful adoption of the
macro-fiscal tools and the adoption of the new budget formulation methodology.
The Project team leader, with the support of the junior budget expert and Project international
experts will work with the DPEF and the EU in the review and implementation of a strong
MTFF and MTEF. Special attention will be paid to the multiyear revenue and expenditure
forecast and the microsimulation of fiscal and economic growth scenarios. It is critical to
standardize the methodologies that support the MTFF and MTEF. Additionally, the Project will
develop software to help the DPEF, DGP and the GOES institutions develop these macro-fiscal
instruments and link them to policy decisions.
The adoption of the MTIF by the GOES institutions will be a very challenging task that will
demand extensive training and the development of a standardized model. Following the MTFF
and MTEF, the Project will develop software that will help the institutions in the development of
the MTIF.
Regarding the program-based budget formulation, full support will be provided to the Ministry
of Education (MOE), Ministry of Health (MOH), Ministry of Public Works (MPW) and the
Ministry of Defense (MOD) , which comprise more than 60% of the entire GOES budget). The
support to the MOE and MOF will be developed in coordination with the IDB, and support to
MOD with the US Department of Defense. The Project will advocate with other donors to
guarantee the support to other ministry lines. The trilateral initiative with the Argentinean
Ministry of Finance will be used to provide additional support to the MOE and MOH.
SUMMARY OF COMPONENT 1 MILESTONES FOR YEAR ONE
The following table presents the various milestones planned for Component 1 for the first year
work plan period:
USAID El Salvador Domestic Resource Mobilization Project
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Table 1 – Component 1 Milestones
Component 1 Milestones Q1 Q2 Q3 Q4
Activities Matrix for the Medium-Term Framework developed in
coordination with the MOF and European Union Fiscal Project
Medium Term Framework Assessment Developed
Training on Medium Term Fiscal Framework implementation
delivered
Training on Medium Term Expenditure Framework implementation
delivered
Training on Medium Term Institutional Framework implementation
delivered
Study of tax gaps by tax categories for monitoring of tax collection
developed
Training on ROB to Ministries in the preparation of the 2018 and
subsequent budgets delivered
Program Costing Methodology Training delivered
Ministries of Education and Health budget formulation improved
Assessment of productivity in selected government activities
developed
Initial Assessment of government investment
Initial Assessment of government spending on social programs and
recommendations
Change Management Plan for the Medium-Term Frameworks
implementation developed
Change Management Plan for the ROB adoption developed
DGP and DPEF Organizational Assessment Tool developed
SCHEDULE OF ACTIVITIES FOR YEAR ONE
Table 1 provides a list of specific tasks for each area of assistance planned for Component 1
during year one. The table is followed by a summary discussion of year one activities.
Table 2 – Component 1 Schedule of Activities
Activities by Work Area Q1 Q2 Q3 Q4
Medium Term Frameworks
Coordinate with the MOF and the European Union to work on an
activities matrix for the Medium-Term Frameworks support
Develop an assessment of the advances and challenges for the
implementation of the Medium-Term Frameworks
Deliver training on Medium-Term Fiscal Framework implementation
Deliver training on Medium-Term Expenditure Framework
implementation
Deliver training on Medium-Term Institutional Framework
implementation
Study of “tax gaps” by tax categories for monitoring of tax collection.
USAID El Salvador Domestic Resource Mobilization Project
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Activities by Work Area Q1 Q2 Q3 Q4
Result Oriented Budget
Deliver training on ROB to Ministries in the preparation of the 2018
and subsequent budgets
Support the development of a Program Costing Methodology
Support the Ministries of Education and Health to improve their
budget formulation
Assessment of productivity in selected government activities
Initial Assessment of government investment expenditure (procedures
for selecting investment projects)
Initial Assessment of government spending on social programs
Change Management for Budget Formulation
Develop the Change Management Plan for the Medium-Term
Frameworks implementation
Develop the Change Management Plan for the ROB adoption
Develop an Organizational Assessment Tool for the DGP and DPEF
DISCUSSION OF ACTIVITIES
The Project will develop a road map to discuss the different tasks, n a chronological order, with
the directors of the DPEF and DGP. Special attention will be provided on the definition of
activities of the project and the MOF, milestones and the necessary commitments. Additionally,
a conflict resolution mechanism will be established with the Viceminister of Finance in order to
avoid delays in the task implementation and targets accomplishments. Extensive coordination
will be done with the IDB, EU and the Argentinean MOF.
Medium Term Frameworks
The Project’s first year work plan will focus on activities oriented to further develop a robust
MTFF and gradually extend the development of a MTEF and ROB formulation to equip the
MOF with key tools for supporting a sound formulation and monitoring of fiscal policy and the
government budget. The support to strengthen the MOF MTFF includes ensuring consistency
between the macro-fiscal assumptions and projections; consistency between the fiscal projections
of government revenue, expenditure, and financing; and consistency between the projected
government finance and the real sector, external sector, and the monetary sector under alternative
projected scenarios. The MTFF will simulate alternative medium term budgetary scenarios based
on changes in external and internal variables, including tax and expenditure policy changes, and
consideration of key fiscal risks.
The MTEF is a key budget tool for linking policy, planning and budgeting over a medium-term
(usually three years). It connects a top-down resource envelope with the bottom-up estimation of
current and medium-term costs of existing policies, and involves rolling over this exercise each
year to reflect possible policy changes. The Project’s activities for supporting the development
and use of MTEFs in the budgeting process consider ensuring consistency between the MTFF
and government spending priorities. This would include close examination of key expenditure
categories: government wages; subsidies and transfers; spending on social protection; the
investment budget, and government spending on social security. Provision of capacity building is
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crucial for the adequate formulation and implementation of the MTFF and MTEF in the
budgeting process. The development of “tax gap” indicators is also included as part of the first-
year activities of Component 1 to support the macro fiscal assessment of government revenues
and projections in the MTFF and MTEF.
The tasks that will be performed on the medium-term frameworks activity are:
Coordinate with the MOF and EU to work on activities matrix for the medium-term
frameworks support.
Develop an assessment of the advances and challenges for the implementation of the
medium-term frameworks.
Deliver training on medium term fiscal framework implementation.
Deliver training on medium term expenditures framework implementation.
Deliver training on medium term institutional framework implementation.
Develop de use cases of the medium-term frameworks module.
Results Oriented Budget
Results-oriented budgeting (ROB) aims at improving the efficiency and effectiveness of public
expenditure by linking the funding of public sector organizations to the results they deliver. A
performance or results-oriented budget (ROB) is a key budgetary tool to hold agencies’
accountability in terms of service production and delivery, while at the same time, enabling the
budgeting process to link the country’s policy priorities with the agencies’ missions and
spending. ROB is a natural complement of the MTEF. The MTEF aims at improving expenditure
prioritization and the ROB focus on managing the efficiency and effectiveness of government
expenditure by making use of performance indicators. The Project’s activities for the first year
includes the examination of productivity in government sector activities a crucial for supporting
pillar for the formulation of a ROB.
Component 1 activities in the first year will support the formulation of a ROB approach shifting
gradually the budgetary approach from inputs and activities to outcomes. The first year plan
considers continued support to the ministries of health, public works, defense and education for
improving the budget formulation based on a ROB approach and integrating it into their MTEFs.
The work plan considers activities required in the formulation of a ROB: (1) identification of
agencies’ goals, missions, and objectives and their relation to national policy priorities (National
Development Plan); (2) identification of potential programs and quantification of the amount of
resources required (program-costing); (3) institutional procedures to ensure that budget resources
are closely linked to program output and anticipated outcomes; and (4) indicators for monitoring
agencies’ execution and the auditing of programs’ performance.
The tasks that will be performed on the ROB support activity are:
Deliver training on ROB to ministries in preparation of the 2018 and subsequent budgets.
Support the development of a program costing methodology.
Support the ministries of education, public works, defense and health to improve the
budget formulation.
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Assessment of productivity in selected government activities.
Initial assessment of government investment expenditure (procedure for selected
investment projects).
Initial assessment of government spending on social programs.
Study of tax gaps for tax category.
Change Management for Budget Formulation
The change management process will initially begin by working with MOF counterparts to
identify internal and external stakeholders. The stakeholder will be those groups affected by the
changes being promoted by the project. This will be an evolving process as we identify new
groups. Once we have identified the stakeholders, we will begin meeting with them to develop a
communications strategy. Each stakeholder, whether internal or external, may have a unique
need that will have to be addressed. The Project will develop a strategy and tools for analyzing
the organizational needs to implement the strategy.
Working with the MOF counterparts, the Project will identify the most appropriate training
solutions for each component. The Project will develop a training delivery plan depending upon
the needs of the trainees. Some of the considerations will be content, population size, employee
location, etc.
The training methodologies may include e-learning, computer based training, web-based training
and classroom training. As noted above, this will vary upon the trainee’s needs, location and
population size.
The tasks that will be performed on change management for budget formulation activity are:
Develop the change management plan for the medium-term frameworks implementation.
Develop the change management plan for the ROB adoption.
Develop and organizational assessment tool for DGP and DPEF.
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III. COMPONENT 2: BUDGET EXECUTION IMPROVED
Budget execution reform has been advancing over the past three years. The new ROB, IPSAS,
TSA and e-procurement implementation will address the current structural issues in the public
expenditure system, responsible in mayor part of the current structural deficit of the GOES.
The ROB execution will require the implementation of the budget commitment installment and
the monitoring and evaluation system, while the budget commitment will control expenditures
based on cash flow availability. The ROB M&E will help the GOES measure the public value
creation and the accomplishment of goals, efficiency and performance standards. The DGP and
DGT must receive an extensive training program to successfully implement and monitor the
budget commitment installments. The DGP and Technical Secretary of Presidency will be
trained on the M&E model and practices. An M&E module will be developed within the SAFI II,
and the module will include tools that will be used by the GOES institutions, primary registration
units, as well as the the TSP and DGP who will use it for monitoring and evaluation purposes.
The IPSAS adoption program will continue toward its implementation in 2018. Currently, the
legal system includes the conceptual model, conceptual framework, charts of accounts and the
accounting policy manual. During the first year, the Project will provide extensive training on the
matrices and IPSAS system operation and accounting logic and IPSAS rules. Additionally,
extensive recommendations and support will be provided to the DGT for its administrative and
functional reform.
The advance TSA system will start implementation in 2018. The project will support the
implementation of the budget commitment instalment and will develop a microsimulation and
forecast model, which will be used as well for cash management purposes.
The COMPRASAL II system will continue the deployment of the Libre Gestión, Licitaciones,
Concursos Públicos and Contratación Directa modules. The Administración de Contratos,
Registro de Proveedores, Garantias and Procedimientos Sancionatorios modules will be
developed. The Project will support the drafting of the Framework Agreements and Reverse
Auction modalities and will advocate with the MOF authorities on the importance to promote the
fiscal reform.
The SAFI II system development will continue during the first year. The Accounting and
Treasury system development will be finished during the year, and extensive training will be
provided to GOES institutions and technical support will be provided during the stabilization
period.
The project will start the development of the SAFIM use cases that will integrate the municipal
budget, accounting, treasury and revenues modules.
On the oversight and accountability of institutions activity, the Project will start the technical
support to the Corte de Cuentas. In coordination with the IDB, the Project will advocate on the
International Standards on Audit (ISA) adoption and will provide extensive training.
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SUMMARY OF COMPONENT 2 MILESTONES FOR YEAR ONE
The following table presents the various milestones planned for Component 2 for the first year
work plan period:
Table 3 – Component 2 Milestones
Component 2 Milestones Q1 Q2 Q3 Q4
DGT administrative and functional reform proposal developed
Cashflow Projection Tool developed
General Accounting Policy Manual implemented within GOES
institutions
GOES institutions trained on IPSAS and Accounting matrices
DGCG administrative and functional reform proposal developed
DGCG administrative and functional reform implemented
SAFI II Treasury Subsystem developed
SAFI II Treasury Subsystem tested and deployed
SAFI II Accounting Subsystem developed
SAFI II Accounting Subsystem tested and deployed
SAFI II Government Accounting Subsystem, Treasury Subsystem and
COMPRASAL II integrated with the Budget Formulation Subsystem
Medium-Term Frameworks Module Use Cases developed
Training on Accounting and Treasury Subsystem Implementation
delivered
SAFIM use cases developed
COMPRASAL II Licitaciones, Concursos Públicos, and Contratación
Directa module deployed
COMPRASAL II Administración de Contratos uses cases designed
LACAP reform proposal that includes framework agreements and
reverse auction approved
Use Cases for a Procurement Control System designed
Assessment of the Corte de Cuentas capacity to control GOES
expenditure and revenues developed
Corte de Cuentas auditors trained on ISA adoption
Change Management Plan for the SAFI II implementation developed
Change Management Plan for the IPSAS implementation developed
Change Management Plan for the COMPRASALII implementation
developed
Organizational Assessment Tool for DGT, DGCG and UNAC
developed
SCHEDULE OF ACTIVITIES FOR YEAR ONE
Table 4 provides a list of specific tasks for each area of assistance planned for Component 2
during year one. The table is followed by a summary discussion of year one activities.
Table 4 – Component 2 Schedule of Activities
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Activities by Work Area Q1 Q2 Q3 Q4
Cash Management
Support the development of the DGT administrative and functional
reform proposal
Support DGT in the development of a Cashflow Projection Tool
In coordination with OTA, provide advice and technical assistance in
the reconciliation and closing of unnecessary GOES bank accounts
In coordination with OTA, provide technical assistance to DGT to
improve Bank Tenders and Contract Tracking and Management
IPSAS
Follow up the implementation of the General Accounting Policy
Manual within the GOES institutions.
Training on IPSAS to GOES
Training on Accounting Matrices and IPSAS procedures to GOES
institutions
Develop a technical proposal for the DGCG administrative and
functional reform
Support the administrative and functional reform implementation of
the DGCG
SAFI II and SAFIM
Development of the Treasury Subsystem
Testing and deployment of the Treasury Subsystem
Development of the Accounting Subsystem
Testing and deployment of the Accounting Subsystem
Support the integration of the Accounting, Treasury and
COMPRASAL II with the Budget Formulation Module
Development of the Medium-Term Module Use Cases within the
SAFI II
Support the development of a training program for the SAFI II
Accounting and Treasury Subsystem implementation
Support the development of the use cases for the SAFIM
Procurement
Support the deployment of the licitaciones, concursos públicos, and
contratación directa module
Support use cases design for the COMPRASAL II Adminsitración de
Contratos module use cases
Advocate and support the drafting and approval of LACAP reform
proposal that includes framework agreements and reverse auction
Support the updating of the public sector vendors and contractors
registry
Support Use Cases design for a Procurement Control System for the
Public Procurement Ombudsman
Oversight and Accountability Institutions
Assessment of the Corte de Cuentas capacity to control GOES
expenditure and revenues
Provide support to the Corte de Cuentas in the ISA adoption
Change Management for Expenditure
Develop the change management plan for the SAFI II implementation
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Activities by Work Area Q1 Q2 Q3 Q4
Develop the change management plan for the IPSAS implementation
Develop the change management plan for the COMPRASAL II
implementation
Develop an Organizational Assessment Tool for DGT, DGCG and
UNAC
DISCUSSION OF ACTIVITIES
The project will develop a road map to discuss the different tasks, in chronological order, with
the directors of the DGT, DGCG, DPEF and DGP. Special attention will be provided on the
definition of activities of the Project and the MOF, the milestones and the commitment, and
additionally a conflict resolution mechanism will be established with the Viceminister of Finance
in order to avoid delays in task implementation and targets accomplishments.
Cash Management
The Treasury Single Account System implementation will continue with the adoption of the new
SAFI system. Additionally, extensive support most be provided to the DGT to implement the
budget commitment installments using microsimulation methodologies, the closing of the GOES
institutions bank accounts and the proper banking reconciliations, and the DGT administrative
and functional reform. The Project, in coordination with the OTA resident advisor, will
coordinate the support to the DGT in the successful implementation of these tasks.
The tasks that will be performed under the cash management activity are:
Support the development of the DGT administrative and functional reform proposal.
Support DGT in the development of a cash flow projection tool.
In coordination with OTA, provide advice and technical assistance in the reconciliation
and closing of unnecessary GOES bank accounts
In coordination with OTA, provide technical assistance to DGT to improve bank tenders
and contract tracking and management.
IPSAS
The Project will continue with the GOES support in the IPSAS adoption provided by FPEMP.
During year one, the project will focus on two IPSAS related activities: continue with the
training plan for the GOES centralized institutions initiated by FPEMP, and support the
administrative and functional reform of the DGCG.
The IPSAS trainings to central institutions will consist of a series of five trainings sessions:
1. Session One will be delivered to the GOES Ministries. The training will be on
presentation of financial statements, chart of accounts and income (IPSAS 1, 2, 3, 10, 14,
18, 22, 24, 33, 9 and 23) and personnel expenses (IPSAS 25), consolidation (IPSAS 20,
34, 35, 36, 37 and 38), related parties (IPSAS 5, 13, 19 and 26), provisions (IPSAS 29)
and basic financial instruments (IPSAS 3, 9, 12, 16 y 26).
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2. Session Two will be delivered to the national hospitals and decentralized entities. The
trainings will be on accounting conceptual model and government accounting system
model, property and cost module (IPSAS 11, 12, 16, 17, 21, 27, 31 and 31), presentation
of financial statements, chart of accounts and income (IPSAS 1, 2, 3, 10, 14, 18, 22, 24,
33, 9 and 23), consolidation (IPSAS 20, 34, 35, 36, 37 and 38), related parties (IPSAS 5,
13, 19 and 26), provisions (IPSAS 29) and basic financial instruments (IPSAS 3, 9, 12,
16 y 26).
3. Session Three will be delivered to the DGCG and Audit Court. This training will be on
personnel expenses (IPSAS 25), consolidation (IPSAS 20, 34, 35, 36, 37 and 38), related
parties (IPSAS 5, 13, 19 and 26), provisions (IPSAS 29) and basic financial instruments
(IPSAS 3, 9, 12, 16 y 26).
4. Session Four will be delivered to the DGCG. The trainings will be on consolidation and
practical exercises, including study cases, based on the needs detected.
5. Session Five will be delivered to the GOES centralized institutions, social security
administrator and financial and non-financial public sector. The training will be on
superior financial instruments.
Finally, the DGCG reform proposal that will be developed by the Project will seek to optimize
the administrative and functional structure of the DGCG, preparing it to face the IPSAS adoption
process. It will be necessary to contemplate the development of tasks and functions that, despite
being the best practices, DGCG is currently not carrying out.
The tasks that will be performed under IPSAS activity are:
Follow up the implementation of the General Accounting Policy Manual.
Train on IPSAS to GOES institutions.
Training on accounting matrices and IPSAS procedures to GOES institutions.
Develop a technical proposal for the DGCG administrative and functional reform.
Support the DGCG administrative and functional reform implementation.
SAFI II and SAFIM
The primary goal of the Project during the first year is to finish the development and deployment
of the SAFI II Government Accounting and Treasury subsystems, continuing the work FPEMP
started. To complete the development and deployment of these subsystems, the Project will carry
out the following task: first, it will review the functional specifications of the subsystems in order
to guarantee their integrality with the other subsystems and modules that are part of the SAFI II
and to ensure that the functional aspects embodied in their use cases comply with their
conceptual models. Second, using the use cases developed by the counterpart teams, the Project
will perform the analysis and IT design to incorporate each of the functional specifications in a
modular way, complementing what was developed during FPEMP. Third, the Project will
continue the software development process and IT programming, following the development
standards specified by the MOF. Once the subsystems are developed, the fourth task will be the
performance of a quality control process. During this phase, the project will ensure that what was
requested by the Counterpart Team in the use cases has been fully developed; the software will
then be sent to the counterpart team to perform the proper tests and give final approval. Finally,
if the counterpart team has any observation to the developed software, the project will fulfill the
requested adjustments.
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On the other side, during the first year the project will support the following SAFIM related task:
First, the project will analyze the status of the SAFIM and determine the possible development or
improvement options and check DGCG plans for this software. Second, the Project will create a
development strategy that responds to the DGCG and municipalities needs. Finally, during the
first year the Project will review all the SAFIM modules use cases to ensure the integration of
the old modules and the new ones that the Project will develop during its life.
The task that will be perform under this activity are:
Development of the Treasury Subsystem
Testing and deployment of the Treasury Subsystem
Development of the Accounting Subsystem
Testing and deployment of the Accounting Subsystem
Support the integration of the Accounting, Treasury and COMPRASAL II with the
Budget Formulation Module
Support the development of a training program for the Accounting and Treasury
Subsystem implementation
Support the development of the Medium-Term Module Use Cases within the SAFI II
Support the development of the use cases for the SAFIM
Procurement
During the first year, the Project will continue FPEMP efforts of providing technical assistance
and support the testing and deployment of the Licitaciones, Concursos Públicos, and
Contratación Directa module. This task is focused on performing internal tests to the FPEMP
developed software, with the objective of guaranteeing the optimal functioning and compliance
of the requirements and business rules established in the use cases delivered by the National
Procurement Office (UNAC). After performing internal tests, UNAC technical teams will
perform their own tests to make sure the software meet their requirements. Once the module is
finally approved by UNAC, the project will start supporting its deployment by providing help in
the development and implementation of the trainings plans for the use of the software to some
public pilot institutions.
The Project will also start supporting the use cases design and software development of the
Administración de Contratos module. The Administración de Contratos module must contain the
transactional logic of the contracting process in the monitoring and purchase order phase of the
contracts, and must be integrated with the financial and accounting system. During the use cases
design, the Project and UNAC will have to consider all the possible scenarios in which a
requirement of contract modification could emerge, as well as to establish a mechanism to
determine the level of contract compliance in order to determine possible non-fulfillment of the
vendors.
In addition, the Project will support the development and approval of the LACAP in order to
contribute to the implementation of best international public procurement practices, such as the
adoption of new contracting procedures like framework agreement and reverse auction. The
support will include discussion and review of the reform proposal, trainings and/or study tours to
Latin American countries that follows the best procurement practices. If the LACAP reform
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proposal is approved by the President of the Republic and the Legislative Assembly, the Project
will eventually incorporate the new contracting procedures to the COMPRASAL II.
In year one, the Project will also start supporting UNAC in the upgrading and updating of the
Public Sector Vendors and Contractors Registry. The purpose of this activity is to provide the
Salvadoran public sector institutions with relevant information of the market for its
procurements, such as: prices, potential vendors and list of vendors with negative records, among
others. However, at this moment, the registry is not fully able to comply because there is not a
centralized register that gathers the legal, financial and technical documentation of the vendors.
Vendors currently need to present the very same documentation for each procurement process in
which they participate, increasing the costs of developing technical and economic proposals. The
Project technical support will make the registry comply with what is required in the LACAP and
the Access to Public Information Law, and reduce the costs of public procurement process to
vendors and the public administration.
Finally, in the first year, the Project will start supporting the PPOO in the use cases design and
development of an electronic system that will allow monitoring and control of public institutions
behavior in the procurement processes that they perform, ensuring compliance with the current
regulations and the detection of possible improvements. During the first year, the PPOO needs to
be strengthened enough to be able to able to provide.
The task that will be performed under procurement activity are:
Support the deployment of Licitación, Concursos Públicos and Contratación Directa.
Development of the Administración de Contratos module.
Advocate and support the drafting and approval of LACAP reform proposal that includes
framework agreements and reverse auction.
Support the updating of the public sector vendors and contractors registry.
Support the strengthening of the Public Procurement Ombudsman Office.
Oversight and Accountability
The audit and control role that the Salvadorian agencies perform to the public resources
management and allocation is poor and had no impact on the GOES transparency, accountability
and efficiency duties. The extensive assessments of the Corte de Cuentas performance evidence
the serious inefficiencies and lack of impact of the agency results and performance. The project
will perform an assessment of horizontal and vertical accountability to the Corte de Cuentas, as a
result of the task the project will provide recommendation on strategies and ways to improve the
agency capacity an outputs.
The IDB has been supporting the Corte de Cuentas in the adoption of ISA, nevertheless, the
agency has been reluctant on adopting the standards. The project will work with the IDB in
advocating on the need for the Corte to adopt the ISA, and will provide extensive training on the
standards adoption.
The tasks that will be performed under oversight and accountability of institutions activity are:
Assessment of the Corte de Cuentas Capacity to control GOES expenditures and
revenues.
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Provide training to the Corte de Cuentas auditors on ISA.
Change Management for Expenditure
The change management process will initially begin by working with MOF counterparts to
identify internal and external stakeholders. The stakeholders will be those groups affected by the
changes being promoted by the project. This will be an evolving process as we identify new
groups. Once we have identified the stakeholders, we will begin meeting with them to develop a
communications strategy. Each stakeholder, whether internal or external, may have a unique
need to address.
Working with the MOF counterparts, the Project will identify the most appropriate training
solutions for each component. Staff will develop a training delivery plan depending upon the
needs of the trainees, for example some of considerations will be content, population size,
employee location, etc. Training methodologies may include e-learning, computer-based
training, web-based training and classroom training. As noted above, this will vary upon the
trainee’s needs, location and population size.
For this component, the Project will rely heavily on computer-based training. The system
contains a testing mode that can be adapted with simulated cases for employees to practice that
would be like real work. Hopefully, the system can be programmed to provide immediate
feedback on trainee performance.
A communications plan will be developed in coordination with the MOF communications office
in order to provide clear and suitable information on the implications and content of the reforms
to the GOES agencies employees and to civil society when needed.
The tasks that will be performed under this activity will be:
Develop the change management plan for the SAFI II implementation.
Develop the change management plan for the IPSAS adoption.
Develop the change management plan for the COMPRASAL II implementation.
Develop an Organizational Assessment Tool for DGT, DGCG and UNAC
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IV. COMPONENT 3: TAX POLICY AND ADMINSTRATION IMPROVED
The fiscal deficit and the goals of the fiscal rule are imposing huge challenges to the
Viceminister of Revenue. Mobilizing greater resources is a goal of paramount importance for the
MOF and the entire GOES. As such, the project will provide extensive support to the DGII,
DGA and the Tax Arrears Collection directorate.
The Project will continue providing support to the DGII in the implementation of the tax evasion
crackdown program, and the new model will include improved data mining models, tax control
programs pilots and protocols, and control procedures development. The creation of the tax
studies unit that will develop on a customary manner the economic map for tax control purposes
will be supported by the Project, and extensive training will be delivered. will develop an
integral change management plan and training program to improve the DGII tax control and
auditor’s skills and operational practices, this task will foresee the improvement of the DGII
performance and increase in the tax collection. Extensive support will be provided in the
stabilization of the e-filing system and in the change management strategy to facilitate taxpayers
adapting to the new system. The taxpayer current account will be improved, integrating the tax,
customs and collection data. The Project will continue advocating on behalf of the tax reform
proposal made by FPEMP and will support the implementation is enacted. The Project will
continue advocating with the MOF on behalf of the simplify tax system for small taxpayers
recommended by FPEMP. Extensive transfer training will be provided to the transfer Pricing
Unit in order to strengthen its capacity and help improve tax collection. The Project will
recommend the creation of a Fiscal Reform Unit that should be responsible for drafting and
supporting the tax reforms requested by the GOES.
The Tax Arrears Collection directorate that was created recently will be supported by the Project.
The tax arrears crackdown program recommended by USAID will continue, and the tax debt
selection and the data mining program to clean and manage the actual tax arrears will received
full support from the IT staff and the international experts. The development of the tax arrears
collection module under the CSMS II will begin with the use cases development. The Project
will support the directorate with the furnishing of the new areas. A tax collection procedure
manual will be developed under the Team Leader coordination and a change management and
training strategy will be developed and implemented. If the enforced tax collection bill is
approved, the project will support its dissemination and implementation.
The Project will support the comprehensive Customs Administration reform. The first task will
be the development of a Customs Code that will comprise customs regulation including a large
reform focused on trade facilitation and stronger statutory power. A customs fraud crackdown
program will be recommended and supported, using data mining tools as a way to improve the
control of customs violations and facilitate trade. The use cases of the customs module within the
CSMS II will be developed with Project support, and the new system will improve the customs
operations. Additionally, a customs clearance electronic system will be recommended in order to
speed up the process and support the facilitation on trade while successfully controlling customs
fraud.
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The project will support the DGT in the development of the SITEP. The SAFI II already
incorporate five modules of the SITEP, but the remaining modules must be migrated to a new IT
platform; as such, the Project will coordinate and support the use cases development. Before the
use cases are finished, extensive training will be provided to the DGT IT staff so they can
prepare for the software development. Once the development begins, the Project will provide
coordination and monitoring.
SUMMARY OF COMPONENT 3 MILESTONES FOR YEAR ONE
The following table presents the various milestones planned for Component 3 for the first year
work plan period:
Table 5 – Component 3 Milestones
Component 3 Milestones Q1 Q2 Q3 Q4
Tax reform approved by the Legislative Assembly
Tax reform implemented
DGII Fiscal Reform Unit created and established
Simplified Tax System for micro and small enterprises implemented
At least 10.000 taxpayers controlled under the Tax Evasion
Crackdown Program
Model for tax control using data mining developed
DGII Transfer Pricing Unit trained on Transfer pricing control
practices
Tax Arrears Collection Enforcement Directorate fully established
CSMS II Tax Arrears Collection Module use cases developed
E-filing System stabilized
Use Cases developed for the new SITEP
IT Training for the DGT IT staff provided
Assessment of the current customs regulations developed
Custom Code Draft developed
CSMS II Customs Modules use cases developed
Customs Fraud Breakdown Program developed
Customs Administration Reform implemented
Change Management Plan for the new tax control system
implementation developed
Change Management Plan for the customs administration reform
implementation developed
Organizational Assessment Tool for DGII and DGA developed
SCHEDULE OF ACTIVITIES FOR YEAR ONE
Table 6 provides a list of specific tasks for each area of assistance planned for Component 3
during year one. The table is followed by a summary discussion of year one activities.
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Table 6 – Component 3 Schedule of Activities
Activities by Work Area Q1 Q2 Q3 Q4
Tax Policy
Support the MOF in the tax reform approval process
Support the MOF in the implementation of the approved tax reform
Support the MOF in the creation and establishment of a Fiscal Reform
Unit within the DGII
Support the implementation of a Simplified Tax System for micro and
small enterprises
Tax Administration
Support the implementation of the Tax Evasion Crackdown Program
Development of a model for tax control using data mining
Support the development of a tax arrears collection system
Support the strengthening of the DGII Transfer Pricing Unit
Support the implementation of the Tax Arrears Collection
Enforcement Directorate
Development of the use case for the Tax Arrears Collection Module
within the CSMS II
Support the stabilization of the e-filing system
Development of the use cases for the new SITEP
Provide IT training for the DGT IT staff
Customs Administration
Review and assessment of the current customs regulations
Development of a Draft Custom Code Regulation
Development of the use cases Customs Modules within the CSMS II
Development of a Customs Fraud Breakdown Program
Support the Customs Administration Reform implementation
Change Management for Revenues
Develop the Change Management Plan for the new tax control system
implementation
Develop the Change Management Plan for the Customs
Administration Reform implementation
Develop an Organizational Assessment Tool for DGII and DGA
DISCUSSION OF ACTIVITIES
The project will develop a road map to discuss the different tasks, in a chronological order, with
the directors of the DGII, DGA, DGT and the Tax Arrears Collection directorate. Special
attention will be provided to the definition of activities of the project and the MOF, the
milestones and the commitments, and additionally a conflict resolution mechanism will be
established with the Viceminister of Finance in order to avoid delays in the task implementation
and targets accomplishments.
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Tax Policy
The COP and the Tax Administration Specialist (TAS) will market the proposed tax code
changes through a series of presentations to high government officials, including the MOF,
Presidential liaisons and other stakeholders to emphasize the need for change so the reform is
brought in front of the Salvadorian Congress as soon as possible. The Tax Administration
Specialist and consultants assigned to this area will develop and execute these presentations. If
the reform is passed by the Legislative Assembly, we will support the MOF in the
implementation of the approved tax reform. The TAS and consultants will initiate support of the
reforms by developing an Action Plan with MOF stakeholders. Consultants will be assigned to
Customs, Tax Collection, Tax Audit and contiguous and related processes to start building the
operations that will form part of the varied Tax Policy changes within the MOF.
At the same time, the Project will support the MOF to build a Fiscal Reform Unit at the DGII by
deploying a consultant with experience in this area. The Project will submit a draft design,
support its approval and begin its implementation after approval.
The MOF has expressed interest in a Simplified Tax System that will integrate the country’s
informal businesses, particularly micro and small business in El Salvador, so they can pay their
share of taxes based on a simplified system, which is not presently part of the Tax System. With
representatives of the MOF, the Project will provide support by designing a legal framework and
architecture to implement this system.
The tasks performed under the tax policy activity will be:
Support the MOF in the tax reform approval process.
Support the MOF in the implementation of the approved tax reform.
Support the MOF in the creation and establishment of a Fiscal Reform Unit within the
DGII.
Support the implementation of a Simplified Tax System for micro and small enterprises.
Tax Administration
The Project will support the strengthening of the DGII capacity to conduct investigations in a
way that respect the constitutional rights of taxpayers and address tax evasion practices while
improving significantly tax collection. The project experts will develop a platform of procedures
and training for auditors, especially in the large taxpayer section so they will have the ability to
detect fraud and tax evasion. This Data Mining software within the CSMS II will be strengthened
to improve case selection, incorporating protocols and procedures for the auditor’s guidance so
that timely and assertive results can be achieved.
The Project will support the improvement of the tax evasion crackdown to increase impact. Once
the programs are determined and case selection is completed, a pilot of two or three cases will be
performed in order to draft the protocol and procedures. The case will then be submitted to the
auditors and analysts with the associated data and the protocol that will include the standard level
of effort. The alarm system with the CSMS II will be activated in order to improve productivity.
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The creation of a tax studies unit will be recommended and supported. The unit will be
responsible for the development of tax evasion studies and the economic map that will support
the Fiscal Map and the Institutional Coverage map the tax control programs design. Extensive
training and guidance will be provided to the unit.
The Transfer Pricing Unit will receive support from the Project. Advance training on transfer
pricing investigations and study tours will be provided. Additionally, the Transfer Pricing
databases necessary to facilitate and improve control will be provided to the DGII.
The stabilization of the e-filing system will be supported by the Project. Special attention will be
provided in the support to taxpayer on the smooth transition to the new system. Additionally, the
Project will start the support in the development of the new use cases of the new taxpayer current
account.
The process of the Tax Arrears Collection System in El Salvador currently requires the
involvement of three sections of the government, each located within different Directorates or
institutions. The tax administration (DGII) does not possess either the legal enforcement powers
or administrative authority to collect taxes and other debts as prescribed by the Salvadorian Tax
and Customs Codes. Apart from the lack of resources and the inability to hire because of the
financial policies now in place in government, they are facing the enormous challenge of rising
inventory of cases and a lack resources to monitor and execute their work appropriately.
The collection process starts with a liability that is born from the non-payment of taxes, fines or
debts from Customs’ transactions, or the audit of returns. Cases are sent from the tax
administration (DGII) to the newly created Tax Arrears Collection Directorate for the persuasive
stage of collections, where the taxpayer is notified of the liability and contacted to make a
demand for payment and ask that they come and pay. This Directorate was a suggestion
previously made by FPEMP, and this Project will be supporting its implementation, as described
below. Other payment alternatives are offered. If the taxpayer does not respond or refuses to
pay, the case is then transferred to the Salvadorian prosecutor’s office for enforcement through
seizure of assets or other types of enforcement.
The following activities are proposed for the first year in support of the Tax Arrears Collection
Directorate: first, conduct an assessment of the present collection processes in each of the
sections responsible for the collection of delinquent taxes to determine immediate improvement
opportunities to make the operation more effective. Start the immediate implementation of
enhancements based on the assessment. Second, conduct an analysis of the Customs and Tax
Codes to make a determination as to whether tax changes may be needed to improve the
collection process. This will include an analysis of the current proposed changes to the Tax
Code in relation to the collection process. Third, conduct an assessment of the delinquent tax
creation process both in Customs and Tax sections to propose changes, if needed. Fourth,
analyze the status of the “Cuenta Corriente” (Master File) in terms of accuracy and
appropriateness, and to ensure that it conforms to the tax code changes that are being proposed.
Consistent with the aforementioned activities for the Tax Arrears Collection Directorate, the IT
Specialist already developed the use of the case for the Tax Arrears Collection Module within
the CSMS II, which should be fully implemented by the second quarter of the first year. The
Project will provide training and support to MOF in-house programmers to maintain this module
and eventually release the module to the Directorate.
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The tasks performed under the tax administration activity will be:
Support the implementation of the Tax Evasion Crackdown Program.
Development of a model for tax control using data mining.
Support the development of a tax arrears collection system.
Support the strengthening of the DGII Transfer Pricing Unit.
Support the implementation of the Tax Arrears Collection Enforcement Directorate.
Development of the use case for the Tax Arrears Collection Module within the CSMS II.
Support the stabilization of the e-filing system.
Development of the use cases for the new SITEP.
Provide IT training for the DGT IT staff.
Customs Administration
A consultant with expertise in the area of customs will conduct an assessment of the current
customs’ code to determine their compatibility with regional and international trends.
Recommendations will be discussed with the MOF for proposed changes to the Customs’ Code
based on the aforementioned assessment. Based on these discussions, the customs’ consultant
will draft revised code regulations to be presented to the MOF. The consultant, the TAS, and
COP will coordinate presentations to high level officials of the MOF and the office of the
President of the Republic to discuss the proposed drafted changes in order to create impetus for
the passing of the project of law.
In sync with the aforementioned tasks, the Project will continue the development of the use cases
Customs Modules within the CSMS II and the Customs consultant will design and implement the
Customs Fraud Breakdown Program.
Subsequent to the Congressional approval of the changes to the customs code and regulations, if
applicable, the Project, with the involvement of customs’ officials, will design and develop a
framework for the implementation of the new regulations. This will include training for the
appropriate personnel.
The tasks performed under the customs administration activity will be:
Review and assessment of the current customs regulations.
Development of a Draft Custom Code Regulation.
Development of the use cases Customs Modules within the CSMS II.
Development of a Customs Fraud Breakdown Program.
Support the Customs Administration Reform implementation.
Change Management for Revenues
The change management process will initially begin by working with MOF counterparts to
identify internal and external stakeholders. The stakeholder will be those groups affected by the
changes being promoted by the project. This will be an evolving process as we identify new
groups. Once we have identified the stakeholders, we will begin meeting with them to develop a
communications strategy. Each stakeholder, whether internal or external, will may have a unique
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need that we will have to address. We will develop a strategy and tools for analyzing the
organizational needs to implement the strategy.
The tasks performed under the change management for revenues activity will be:
Develop the Change Management Plan for the new tax control system implementation.
Develop the Change Management Plan for the Customs Administration Reform
implementation.
Develop an Organizational Assessment Tool for DGII and DGA.
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V. COMPONENT 4: TRANSPARENCY AND PUBLIC - PRIVATE DIALOGUE ON FISCAL POLICY STREGTHENED
The Domestic Resource Mobilization Program will take advantage of the advances made by the
previous USAID fiscal project in order to continue supporting initiatives on fiscal transparency
and public-private dialogue.
The fiscal transparency portal will be upgraded to a full open data system, should the Minister of
Finance approve the Project proposal. This will help the GOES improve its score in the Open
Budget index. Additionally, the entire public procurement information will be posted in the
transparency portal, once COMPRASAL II gets fully deployed.
The Public Procurement Advocate Office will receive full support to strengthen its capacity and
improve its work with civil society and private sector. The Project will help the office develop a
risk management system in order to priority the investigations and obtain better impact and
improve transparent public procurement.
Following the success of the White Paper on Fiscal Sustainability, the Project will continue
advocating on a public-private dialogue around the fiscal sustainability and the customs reform,
in order to guarantee consensus and proper solutions to the challenges faced by GOES. This task
will be performed in coordination with the International Donors Fiscal Committee.
The Project will develop the new SAFIM and will support the Municipal fiscal transparency
portal that will be uploading the data from the new SAFIM.
SUMMARY OF COMPONENT 4 MILESTONES FOR YEAR ONE
The following table presents the various milestones planned for Component 4 for the first year
work plan period:
Table 7 – Component 4 Milestones
Component 4 Milestones Q1 Q2 Q3 Q4
MOF Fiscal Transparency Portal improved
Sustainability Plan for the Municipal Fiscal Transparency Portal
developed
Public Procurement Ombudsman Office staff trained on citizen social
audits process for public procurement
At least two events to increase dialogue among GOES, municipalities,
civil society organization, the private sector and taxpayers carried out
Change Management Plan for the GOES expenditure and revenue
transparency developed
Change Management Plan for the public-private dialogue developed
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SCHEDULE OF ACTIVITIES FOR YEAR ONE
Table 8 provides a list of specific tasks for each area of assistance planned for Component 4
during year one. The table is followed by a summary discussion of year one activities.
Table 8 – Component 4 Schedule of Activities
Activities by Work Area Q1 Q2 Q3 Q4
Transparency
Support the improvement of the MOF Fiscal Transparency Portal
Support the development of a sustainability plan for the Municipal
Fiscal Transparency Portal
Support the Public Procurement Ombudsman Office in the design and
implementation of citizen social audit to public procurement
Recommendations and implementation for a PPOO-Civil society
common agenda implementation to oversee public procurement
Public – Private Dialogue
Support the GOES in the achievement of a fiscal agreement between
the Government, political parties and private sector
MOF-Private Sector dialogue for the customs reform program
Change Management for Transparency and Public – Private Dialogue
Develop the Change Management Plan for the GOES expenditure and
revenue transparency
Develop the Change Management Plan for the public-private dialogue
DISCUSSION OF ACTIVITIES
The project will develop a road map to discuss the different tasks, in a chronological order, with
the directors of the UNAC, DPEF, DGT DGII and DGA. Special attention will be provided to
the definition of the key policy decisions that need full support from the Minister of Finance.
A strategy to work with the MOF and private sector on tasks such as fiscal sustainability, the
customs reform and the civil society audits will be developed in a concept paper and discussed
with the Minister in order to obtain his approval. Once approved, this will be share with the
donors group in order to coordinate efforts.
A working group with key municipalities will be organized to gain cooperation of a large
number of municipalities in the SAFIM and municipal fiscal transparency portal development
and implementation.
A comprehensive dissemination program directed to civil society on the role and
communications mechanisms with the PPOO will be developed and implemented.
Fiscal Transparency
The Fiscal transparency portal will undergo important changes once the ROB, SAFI II and
IPSAS are implemented. It is key that the MOF improves its fiscal transparency portal expanding
the open data model to the level of item, instead of only by expenditure line that is currently
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available in the portal. These changes will provide more transparency and better information to
civil society, the private sector, academic community and the general public. Additionally, in the
first year the Project will start supporting the migration of the portal from the SAFI I to the SAFI
II, as the portal currently takes the financial information from the SAFI I.
The Project will also recommend and support the creation of a transparency and accountability
office under the Viceministry of Finance. The office will be constantly working in the creation
and implementation of mechanisms to promote citizen participation, providing broader
information in an understandable format. The Project will work with the Public Procurement
Ombudsman Office, the Taxpayer Advocate and all MOF directorates to improve accountability.
Finally, the PPOO will receive technical support from the Project. Extensive training will be
provided and the Project will support the development of a risk management matrix system. The
taxpayer advocate office within the DGII will receive full support on training, technical tools and
models and standards of investigation and analysis.
The tasks performed under the transparency activity will be:
Support the improvement of the MOF Fiscal Transparency Portal.
Support the development of a sustainability plan for the Municipal Fiscal Transparency
Portal.
Support the Public Procurement Ombudsman in the design and implementation of citizen
social audit to public procurement.
Public-Private Dialogue
The Project will continue FPEMP’s work with the donors committee and the MOF in a public-
private sector agenda and the GOES-Political parties’ to support the fiscal stabilization of the
country.
The project will build upon the recommendations of the USAID-GIZ-AECID white paper,
expanding them to other fiscal and social related topics such as pro-poor and gender-sensitive
budgeting. During year one, the project will organize two events will the specific purpose of
increasing dialogue among GOES, municipalities, civil society organization, the private sector
and taxpayers.
Under the customs reform that the Project will support, a dialogue with the private sector will be
recommended and supported in order to improve the customs reforms and facilitate trade.
A strategic plan for the building of scenarios of for the PPOO-Civil Society working strategy to
oversee public procurement and facilitate transparency will be develop and implemented. The
necessary IT tools will be developed to achieve the expected results.
The following task will be performed under the public-private dialogue activity:
Support the GOES in the achievement of a fiscal agreement between the Government,
political parties and private sector.
Recommendations and support in the implementation of a MOF-Private Sector
commission for the customs reform program.
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Recommendations and implementation for a PPOO-Civil Society common agenda
implementation to oversee public procurement.
Change Management for Transparency and Public-Private Dialogue
The change management process will initially begin by working with MOF counterparts to
identify internal and external stakeholders. The stakeholder will be those groups affected by the
changes being promoted by the project. This will be an evolving process as we identify new
groups. Once we have identified the stakeholders, we will begin meeting with them to develop a
communications strategy. Each stakeholder, whether internal or external, may have a unique
need that Project’s will have to address. The Project will develop a strategy and tools for
analyzing the organizational needs to implement the strategy.
The tasks that will be performed under this activity are:
Develop the Change Management Plan for the GOES expenditure and revenue
transparency.
Develop the Change Management Plan for the public-private dialogue.
Develop the Change Management Plan for the public-private dialogue.
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VI. PROJECT START UP ACTIVITIES
An important component of the long-term success of the Domestic Resource Mobilization
Project is the establishment of a solid operation from the onset. Therefore, DAI will
implement a 4-month start-up plan that will take place from April 26, 2017 through August
2017. The start-up phase will consist of the following objectives:
1) Establish working relationship with USAID, including communications and
approval protocols, reporting, and roles
2) Establish a base of operations for the project
3) Mobilize and onboard approved key personnel
4) Establish DAI- and USAID-compliant project systems, policies and procedures
5) Recruit top priority project staff
6) Finalize subcontracts with Tech Change, Inc. and Data Mining International
7) Acquire necessary documentation for project operations.
In order to assist the project team with these start-up tasks, DAI will deploy a team of STTA
start-up personnel to El Salvador as well as provide support from the Home Office in order to
oversee and implement progress toward objectives and the large volume of activity to take
place during the 4-month start-up phase. This team will also support a smooth transition from
FPEMP. A summary of the start-up team roles and responsibilities can be found below.
Name, Title Summary of Start-Up Responsibilities Adrian Carroll Project
Manager
• Oversee start-up team and ensure mobilization plan is on track while based in DAI’s Home Office.
• Support operational tasks such as procurement, staff
recruitment and training, and establishment of compliant
systems.
• Support technical start-up tasks such as work planning, and
development of the Branding Implementation Plan (BIP) &
Marking Plan (MP) and the Environmental Mitigation and
Monitoring Plan (EMMP).
Noemi Danao-Schroeder, Project Director
• Oversee high level start-up activities from the Home Office. • Provide support and review of technical deliverables submitted to
USAID. Srdjan Popovic
Start-Up IT
Systems
Specialist
• Communicate with the start-up team regarding field office IT requirements
• Evaluate quotes for local IT procurement.
• Prepare equipment specifications lists and provide help to start-up
team in preparing the RFQ documents for local procurement of IT
equipment.
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Edward Crowley, Field Accounting System (FAS) Specialist
• Remote support from the Home Office to customize project’s FAS database, based on their specific needs and requirements regarding payroll, tax withholding and remittances to the local government, bank account and wire transfers and contract-specific requirements.
• Travel to El Salvador to conduct detailed training for project’s finance team on end-to-end FAS modules as well as implementation of finance policies and procedures.
Sofia Scott
Recruiter
• Identify and recruit qualified local candidates for open positions.
• Develop comprehensive recruitment tracking system.
• Prepare personnel approval requests to USAID.
Hannah
Peterson,
Project Associate
• Manage operational and administrative support for start-up phase recruitment, procurement, staff onboarding and financial operations
• Train staff on DAI systems and processes.
TASK 1: ESTABLISH WORKING RELATIONSHIP AND PROTOCOLS WITH USAID
As part of DAI’s standard process, the home office Project Director Noemi Danao-Schroeder,
Project Manager Adrian Carroll and Contracts Administrator Michelle Gibboney will hold an
entrance conference/phone call with the USAID COR and CO to establish DAI’s relationship
with USAID/El Salvador under this Project. This discussion will review USAID expectations for
the start-up phase, establish roles and responsibilities for DAI’s relationship with the COR and
CO and review the contract in detail. DAI will also seek to discuss USAID communications and
approvals protocols, including the means in which approvals should be requested.
TASK 2: ESTABLISH A BASE OF OPERATIONS FOR THE PROJECT
During the start-up phase, a key task will be to set up a base of operations that meet essential
requirements for five years of project activity. The project will be occupying the same office
space it had previously under FPEMP in the Ministry of Finance. However, due to a more robust
team under this current project, additional space will be necessary. The Ministry of Finance has
already allocated the additional office space to the project. Therefore, the Procurement Manager
and IT Systems Specialist will be leading the effort to procure office furniture and IT equipment
as well as set up internet access to ensure appropriate accommodations for project personnel.
TASK 3: MOBILIZE AND ONBOARD APPROVED KEY PERSONNEL
As part of the proposal, DAI proposed various key personnel, all of whom confirmed their
availability and all be mobilized by the middle of July 2017. Key personnel mobilized for the
project will include:
• Jose Luis Lopez, Revenue Administration Specialist
• Mario Gutierrez, Expenditure Management Specialist
• Lee Niederman, Public Sector Change Management Advisor
Onboarding and orientation for key personnel will include equipping them with project
USAID El Salvador Domestic Resource Mobilization Project
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laptops, providing DAI’s ethics and compliance training, reviewing job descriptions and
expectations, and conducting initial technical planning and brainstorming discussions around
each of their respective areas of responsibility.
TASK 4: ESTABLISH DAI AND USAID COMPLIANT PROJECT SYSTEMS,
POLICIES, AND PROCEDURES
A key element of DAI project start-up is the customization and roll-out of key management
systems to support implementation. These include:
• Establish technical and administrative management information system (TAMIS).
During the start-up phase, DAI will customize our technical and administrative
management information system (TAMIS) specifically for the Domestic Resource
Mobilization Project. TAMIS, which is used for all DAI projects, is a web-based activity
and records management system that allows for comprehensive management of the
project work plan, activities, deliverables, staff, procurement, approvals, grants, etc. All
project staff will be required to use the TAMIS system and will be trained on its use.
• Customize Field Operations Manual (FOM). DAI develops a dedicated FOM for each
project, based on DAI’s internal policy and operations manual. This manual will be
customized to the needs of the Domestic Resource Mobilization Project and El Salvador
in the start-up phase, and staff trained on its contents.
• Establish Field Accounting System (FAS). Once the project bank account is open and
accounting staff onboarded, home office STTA will establish the FAS and train staff on
its use.
• Conduct Compliance and Ethics Training. Another key element of DAI’s systems is
our compliance and ethics training, which will be customized for the Domestic Resource
Mobilization Project and required of all staff during orientation. Compliance training
will include information on how to recognize and respond to cases of trafficking-in-
persons (TIP) and extortion. The Domestic Resource Mobilization Project will ensure
that all project staff, regardless of grade or function, participate in inclusion and
sensitivity training in line with the non-discrimination values promoted by the U.S.
Government related to race, color, religion, national origin, age, sex, gender identity,
sexual orientation, pregnancy, citizenship, familial status, disability status, and other
considerations.
TASK 5: RECRUIT TOP PRIORITY PROJECT STAFF
Since all FPEMP staff will continue in their respective roles under the Domestic Resource
Mobilization Project, recruitment will be prioritized for the new positions. These positions
include:
Budget Specialist
Tax Specialist
Training and Capacity Building Specialist
Communications Specialist
Accountant
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HR Assistant
Program Assistant
M&E Assistant
Executive Assistant
PPP, Transparency, and Civil Society Specialist
Database Administrator
IT Support Specialist.
To ensure that all personnel understand the Project and are versed in relevant DAI and
USAID policies and procedures, DAI will conduct comprehensive onboarding and training.
Training on use of DAI equipment, TAMIS, and HR procedures will occur as project staff
comes on board.
TASK 6: FINALIZE SUBCONTRACTS
Immediately following award, DAI’s Home Office will initiate the process of engaging the
Domestic Resource Mobilization Project subcontractors Tech Change, Inc. and Data Mining
International, including finalizing their scopes of work and negotiating their final
subcontracts.
TASK 7: ACQUIRE NECESSARY DOCUMENTATION FOR PROJECT
OPERATIONS
During the first weeks of implementation, DAI will need to get the following documentation in
order to correctly implement the Project for the next five years:
Obtain necessary documentation for operations in El Salvador. In order to continue
doing business in the country, DAI will need specific legal documents, Powers of Attorney
for the COP, national tax ID numbers, and a letter from USAID for VAT exoneration.
Open bank account. The process for opening a bank account in El Salvador has many
requirements, which necessitate the support of DAI’s home office, legal services in El
Salvador, and documentation from USAID that establishes the Domestic Resource
Mobilization Project as a USAID project.
Local labor agreements and benefits. Consult with local legal services to ensure the
project’s employment agreements and benefits for local staff comply with local law.