Focus on helping countries make tangible and time-bound governance improvements, while acknowledging and seeking to resolve trade-offs between:
- Committing Bank support for institution building over the long term and ensuring accountability for results (for example, in service delivery, public financial management, regulation) in the short term;
- Supporting systemwide public sector reforms and supporting selective public management improvements in priority service delivery sectors;
- Helping governments respond to demand-side pressures and directly engaging non-state actors in order to motivate demandside pressures;
- Upgrading of country systems through their deliberate use and safeguarding Bank funds from abuse.
Original Response: Agreed: Management notes that the first recommendation is fundamentally challenging; the 2011 WDR stresses a 20 year time horizon for institution building, while recognizing that citizens have immediate needs. Decisions regarding trade-offs can be made only at country level and congruent with Bank comparative advantage. The final three recommendations may not entail trade-offs; the alternatives in each case may be complementary. [see actions] Management cannot commit to time-bound actions by countries. Management does commit to support countries that have countryowned time-bound strategies to improve governance and will report on that support as part of GAC monitoring.
Articulate its approach to upstream public sector reforms (those focused on core government functions and systems) and downstream reforms (which focus on service delivery) in the context of GACII , to be discussed with Executive Directors in the second Quarter of FY 2012.
A strengthened approach to supporting demand-side measures will be set out in an annex to the GACII strategy.
Continue and deepen work on supporting strengthening of country systems and continue to monitor and report periodically to Executive Directors on progress in use of country systems in procurement, financial management, and project management implementation.
The latest progress update on the agreed actions is as follows:
(i) articulating approach to upstream public sector reforms: The GAC approach has been articulated and discussed with the Board. The positioning of the GAC agenda was strengthened by the issuance of the GAC Strategy Update in March, 2012, which remained relevant until 2014. The creation of the new Governance Global Practice (GGP) was accompanied by a thorough review of the substantive areas for Bank engagement, under which, core government functions and systems (including center of government, PFM, machinery of government and pay and employment) remained vital to the Bank's broader governance effort. Close working relations were established with a number of sectors, such as health and education, to further broaden and deepen our treatment of governance issues in service delivery. The GGP has been undergoing restructuring and a final organizational structure has emerged. The GAC Strategy Update of 2012 is still live, but remains dormant. An alternative GAC strategy has not emerged, but supporting enhanced institutional competencies and capacity continues to be the core function and objective. However, anti-corruption efforts are now focused mostly on monitoring international financial flows. The 2016 WDRs on Law and Institutions and Digital Dividends and the 2015 WDR on Mind, Society, and Behavior continued to explore the challenge of creating inclusive institutions but have not been synchronized into a new GAC Strategy or an update of the earlier one.
(ii) a strengthened approach to supporting demand-side measures: It was agreed that a strengthened approach to supporting demand-side measures will be set out in an annex to the Updated GAC Strategy, but that document is dormant now. However, the Bank's Strategic Framework for Mainstreaming Citizen Engagement in World Bank Group Operations (2013) has been put to use to improve development results. More recent engagement with the Open Government Partnership and Open Contracting have helped contribute to promoting transparency and citizen engagement. Publication of the study: Making Politics work for Development: Harnessing Transparency and Citizen Engagement was an important contribution to thinking about how to translate information and citizen demand into improved accountability and outcomes.
(iii) continue and deepen work on supporting strengthening of country systems: The management has taken significant steps towards strengthening country systems by the use of Program for Results (PforR) Lending Instrument, which aims to support the implementation of government programs, using the government's own fiduciary, environmental and social safeguard systems. Under IEG's Approach Paper for PforR Process Evaluation (2015) a two-year review of early projects was done, which concluded that the PforR instrument has been successfully rolled out across a broad range of countries and sectors, policy requirements have been met, with implementation broadly on track for all but one of the approved operations. The Bank's new Procurement Policy has also laid emphasis on use of country systems. As per Section III.E of the Procurement Policy, the Alternative Procurement Arrangements (APA) allow the Bank to adopt a progressive approach to using a borrowers procurement arrangements in particular projects depending on their performance. This is being tested in India and Bhutan and early results are positive.
As per previous Management responses, supporting enhanced institutional competencies and capacity is our function and objective. The 2016 WDR and Law and Institutions, which comes right after previous WDRs on Digital Dividends (2016) and Mind, Society, and Behavior (2015) continues to explore the challenge of creating inclusive institutions that serve the needs of people and help achieve the Bank's twin goals. The Bank's new Procurement Policy also reflects the institutions greater focus on supporting local institutions and aligning the Bank's policies and resources towards achieving better outcomes. Similarly, the Bank's Strategic Framework for Mainstreaming Citizen Engagement in World Bank Group Operations (2013) and its more recent engagement with the Open Government Partnership, and with initiatives like Open Contracting, are important steps in promoting transparency, and citizen engagement. Publication of the study Making Politics work for Development: Harnessing Transparency and Citizen Engagement was an important contribution to thinking about how to translate information and citizen demand into improved accountability and outcomes. Finally, the creation of the Bank's Global Tax Team, and the scaling up of work on strengthening local competencies and capacities in regard to tax administration, and the implementation of new global standards on sharing of information indicates our responsiveness to changing demands and evolving priorities in regard to institutional development, accountability, and transparency.
The GAC approach has been articulated and discussed with the Board. Re the demand side, no information is provided above by Management, or in the GAC Portal. Looking on the Spark page, IEG found useful publications, including How, When, and Why to Use Demand-Side Governance Approaches in Projects, and Using Demand-Side Governance Approaches to Identify and Manage Risks in Projects; however, these publications aren't dated, so it isn't possible to see if they were produced in FY15. Re progress in country systems, the GGP has produced: Early Experiences with Program-for-Results Lending in World Bank Governance and Public Management Operations, final draft January 2014. This thoughtful report has very useful results, but has not been published because of unknown objections from OPCS. Overall, there are promising signs of achievement under each of the three sub-recommendations, but it is challenging to evaluate progress for the reasons stated.
Strengthening governance institutions to carry out their functions is at the core of the Governance Global Practice program of work. Continued efforts to build the competencies of public sector institutions has been increasingly combined with engagements designed to support greater engagement and participation of non-state actors in governance. Modern information technology features increasingly in World Bank engagements and the 2015 World Development Report, focused on the use of the Internet in development, advanced knowledge on how best use to utilize ICT to improve public sector performance and service delivery.
The GAC approach has been articulated and discussed with the Board.
Re the demand side, the GAC scorecard states "Work is underway to develop indicators for monitoring important demand-side dimensions of governance, such as transparency and social accountability. Beyond the Bank, the field is evolving rapidly, and a variety of NGOs, think tanks and private sector organizations are developing indices that cover a range of governance issues with varying degrees of rigor and comprehensiveness. Efforts are underway to link this indicators work to the incorporation of a governance dimension in the post-2015 MDG process, with particular emphasis upon transparency, the strength of public management systems and revenue mobilization."The Social Accountability E-guide is an online resource that offers a practical approach to integrating social accountability mechanisms into investment lending projects. http://wbes922r.worldbank.org/saeguide/
Re progress in using country systems, The improved performance of Bank contribution to behavioral changes in public sector management systems between fy12 (67 cases) and fy13 (86 cases) is encouraging. However, the progress in use of country systems by Bank operations is unknown.
The creation of the new Governance Global Practice (GGP) is being accompanied by a thorough review of the substantive areas for Bank engagement. Although a final set of priorities have yet to be identified, it is clear that core government functions and systems (including center of government, PFM, machinery of government and pay and employment) will remain vital to the Bank's broader governance effort. A directorate has been established to look after the PFM agenda, and another has been established deal with both core public sector reforms as well as service delivery issues. Close working relations are being established with a number of sectors, such as health and education, to further broaden and deepen our treatment of governance issues in service delivery. A technical briefing with the Board that will address these and other issues has been scheduled for October 3, 2014.
The positioning of the GAC agenda -- the main thrust of this recommendation -- has been strengthened by the issuance of the GAC Update. The Update and its companion pieces havesought to address the importance of balancingshort-term results (for instance, fiduciary controlsorprocess improvements in public financial management)with longer term priorities (for instance, improved service delivery outcomes and an improved investment climate). Specifically, the companion piece on PSM does emphasize problem-driven approaches rather than blanket comprehensive approaches reform. Similarly, the newly launchedeffort to significantly reform Bank procurement signals a renewed commitment to usingcountry systems as the default for Bank operations. To a lesser extent, the demand side of governance companion piece clarifies trade-offs between government transparency efforts and directed efforts to actively motivate civil society responses. Despite these signs of progress the position of the GAC has been eclipsed by the larger World Bank Change Agenda. Once key change initiatives have been finalized, there will be need to reassess and reaffirm GAC issues to ensure that they continue to receive appropriate attention.
Update on Action 0085-01: New World Bank approach, endorsed by the Executive Directors in February 2012.
Update on Action 0085-02:Paper titled Strengthening the World Bankï¾s Engagement on Demand for Good Governance (DFGG) produced in the context of GAC Strategy Update Preparation in August 2011.
Update on Action 0085-03:The Bank is committed to the use and strengtheningthe country procurement systems. Bank procurement guidelines provide a lot of flexibility in the use of country procedures and methods for procurement under certain thresholds. In addition, procurement under Development Policy Operations and the Program for Results lending instrument is done using one hundred percent country procurement systems. Looking into the future, the ongoing procurement policy review is recommending that country procurement systems be the default method of procurement in all Bank operations. The Bank has in the past supported first wave procurement reforms in many countries. The reforms were aimed at strengthening the legal framework, establishment of a procurement regulatory body and complaints mechanism etc. The Bank is at present supporting the second wave procurement reforms which are aimed at improving the performance of country procurement systems