IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA-45370) ON A CREDIT IN THE AMOUNT OF SDR 26.9 MILLION (US$40.0 MILLION EQUIVALENT) TO THE

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1 Document of The World Bank Public Disclosure Authorized Report No: ICR2816 IMPLEMENTATION COMPLETION AND RESULTS REPORT (IDA-45370) ON A CREDIT IN THE AMOUNT OF SDR 26.9 MILLION (US$40.0 MILLION EQUIVALENT) TO THE REPUBLIC OF MADAGASCAR FOR AN EMERGENCY FOOD SECURITY AND RECONSTRUCTION PROJECT December 20, 2013 Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized AFTSE AFCE4 Africa Region 1

2 CURRENCY EQUIVALENTS Exchange Rate Effective June 30, 2013 Currency Unit = Malagasy Ariary (MGA) MGA 2,190 = US$ 1.00 FISCAL YEAR January 1 December 31 ABBREVIATIONS AND ACRONYMS BIANCO BNGRC CDD CDP CPGU EFSRP ESMF EWS FAO FID FM GDP IDA IMF INSTAT IRR MAP MGA M&E NRMSPS PDO UNICEF Independent office of Anti-Corruption/Bureau Indépendant Anti-Corruption National Bureau for Risk and Catastrophe Management / Bureau National de Gestion des Risques et des Catastrophes Community Driven Development Community Development Project Unit for Emergency Prevention and Management / Cellule de Prevention et Gestion des Urgences Emergency Food Security and Reconstruction Project Environmental and Social Management Framework Early warning system Food and Agriculture Organization of the United Nations Intervention Fund for Development - Fonds d Intervention pour le Développement Financial management Gross Domestic Product International Development Association International Monetary Fund National Statistics Institute of Madagascar Internal rate of return Madagascar Action Plan Madagascar Ariary (national currency) Monitoring and evaluation National Risk Management and Social Protection Strategy Project Development Objective The United Nations Children s Fund Vice President: Country Director: Sector Manager: Project Team Leader: ICR Team Leader: Makhtar Diop Haleh Bridi Lynne Sherburne-Benz Philippe Auffret Andrea Vermehren 2

3 MADAGASCAR Emergency Food Security and Reconstruction Project CONTENTS A. Basic Information... 4 B. Key Dates... 4 C. Ratings Summary... 4 D. Sector and Theme Codes... 5 E. Bank Staff... 5 F. Results Framework Analysis... 5 G. Ratings of Project Performance in ISRs... 8 H. Restructuring (if any)... 8 I. Disbursement Profile Project Context, Development Objectives and Design Key Factors Affecting Implementation and Outcomes Assessment of Outcomes Assessment of Risk to Development Outcome Assessment of Bank and Borrower Performance Lessons Learned Annex 1. Project Costs and Financing Annex 2. Outputs by Component Annex 3. Economic and Financial Analysis Annex 4. Bank Lending and Implementation Support/Supervision Processes Annex 5. Beneficiary Survey Results Annex 6. Summary of Borrower's ICR and/or Comments on Draft ICR Map of Madagascar 3

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5 A. Basic Information Country: Madagascar Project Name: Madagascar - Emergency Food Security and Reconstruction Project Project ID: P L/C/TF Number(s): IDA ICR Date: 05/30/2013 ICR Type: Core ICR Lending Instrument: ERL Borrower: GOVERNMENT OF MADAGASCAR Original Total Commitment: XDR 26.90M Disbursed Amount: XDR 26.90M Revised Amount: XDR 26.90M Environmental Category: B Implementing Agencies: Fonds d Intervention pour le Développement (FID) Cofinanciers and Other External Partners: B. Key Dates Process Date Process Original Date Revised / Actual Date(s) Concept Review: 09/04/2008 Effectiveness: 03/09/2009 Appraisal: 11/10/2008 Restructuring(s): Approval: 12/16/2008 Mid-term Review: 07/31/2012 n.a. Closing: 12/31/ /30/2013 C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Risk to Development Outcome: Bank Performance: Borrower Performance: Satisfactory Moderate Moderately Satisfactory Satisfactory C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings Quality at Entry: Satisfactory Government: Satisfactory Quality of Supervision: Moderately satisfactory Implementing Agency/Agencies: Highly Satisfactory Overall Bank Performance: Moderately satisfactory Overall Borrower Performance: Satisfactory C.3 Quality at Entry and Implementation Performance Indicators Implementation QAG Assessments (if Indicators Performance any) Potential Problem Project at any time (Yes/No): No Quality at Entry (QEA): None Problem Project at any No Quality of Supervision None 4 Rating

6 time (Yes/No): DO rating before Closing/Inactive status: Satisfactory (QSA): D. Sector and Theme Codes Original Actual Sector Code (as % of total Bank financing) General water, sanitation and flood protection sector Other social services Primary education Public administration- Other social services Rural and Inter-Urban Roads and Highways Theme Code (as % of total Bank financing) Global food crisis response Natural disaster management Rural services and infrastructure E. Bank Staff Positions At ICR At Approval Vice President: Makhtar Diop Obiageli K. Ezekwesili Country Director: Haleh Bindi Ruth Kagia Sector Manager: Lynne Sherburne-Benz Lynne Sherburne-Benz Project Team Leader: Philippe Auffret Philippe Auffret ICR Team Leader: Andrea Vermehren ICR Primary Author: Julie Van Domelen F. Results Framework Analysis Project Development Objectives (from Project Appraisal Document) The Project Development Objectives are to: (i) Increase access to short-term employment in targeted food-insecure areas; and (ii) Restore access to social and economic services following natural disasters in targeted communities. Indicator Baseline Value Original Target Values (from approval documents) 5 Formally Revised Target Values Actual Value Achieved at Completion or Target Years (a) Project Outcome Indicator(s) Indicator 1 : Beneficiaries of cash-for-work program Value (Quantitative or Qualitative) 0 160, ,580 Date achieved June 30, 2013 Comments (incl. % 250% of target achieved. achievement)

7 Indicator 2 : Value (Quantitative or Qualitative) Initiated social and economic services restored within 6 months following a natural disaster 0 >75% 100% Date achieved June 30, 2013 Comments (incl. % 133% of target achieved related to the final cyclone season covered by the Project. achievement) (b) Intermediate Outcome Indicator(s) Indicator Baseline Value Original Target Values Formally (from approval Revised Target documents) Values Actual Value Achieved at Completion or Target Years Indicator 1 : Person-days of cash-for-work manual labor in targeted food-insecure areas Value million 9.94 million (Quantitative or Qualitative) Date achieved June 30, 2013 Comments (incl. % 127% of target achieved. achievement) Indicator 2 : Value (Quantitative or Qualitative) Number of sub--projects completed under the social safety net program 0 1,600 2,123 Date achieved June 30, 2013 Comments (incl. % 133% of target achieved. achievement) Indicator 3: Value (Quantitative or Qualitative) Kilometers of rural roads rehabilitated under the social safety net program ,226 Date achieved June 30, 2013 Comments 1296% of target achieved. A greater share of feeder roads were prioritized by the (incl. % community than expected at project outset. achievement) Indicator 4 : Percentage of female beneficiaries of safety net program Value At least 50 percent 61 percent (Quantitative or Qualitative) Date achieved June 30, 2013 Comments (incl. % 122% of target achieved. achievement) Number of community based subproject and number of beneficiaries under the Indicator 5 : community-driven basic infrastructure component Value 0 152; 76, ; 816,591 (Quantitative or Qualitative) Date achieved June 30,

8 Comments (incl. % achievement) Indicator 6 : 103% and 1074% of target achieved. Number of beneficiaries is above target because communities tended to prioritize feeder roads which have comparatively more beneficiaries than other sub-project types and basis for calculating road beneficiaries changed. Hectares of irrigated land rehabilitated under the community-driven infrastructure component 0 3,100 2,190 Value (Quantitative or Qualitative) Date achieved June 30, 2013 Comments (incl. % achievement) Indicator 7 : Value (Quantitative or Qualitative) 71% of target achieved. Indicator is below target as fewer communities than expected prioritized irrigation projects. However, the target was to be used for monitoring but not for evaluation as the community demand for types of subprojects could not be known ex-ante. kilometers of rural roads rehabilitated under the community-driven infrastructure component kms Date achieved June 30, 2013 Comments 82% of target achieved. The target was to be used for monitoring but not for evaluation (incl. % as the community demand for types of subprojects could not be known ex-ante. achievement) Indicator 8 : Value (Quantitative or Qualitative) Number of social and economic basic infrastructures damaged by natural disasters rehabilitated or reconstructed Date achieved June 30, 2013 Comments (incl. % 158% of target achieved. achievement) Indicator 9 : Value (Quantitative or Qualitative) Number of schools damaged by natural disasters reconstructed/rehabilitated Date achieved June 30, Comments (incl. % achievement) 237% of target achieved. The target was to be used for monitoring but not for evaluation as the community demand for types of subprojects could not be known exante. Indicator 10 : Number of classrooms damaged by natural disasters built and/or rehabilitated Value (Quantitative or Qualitative) Date achieved June 30, 2013 Comments 299% of target achieved. The target was to be used for monitoring but not for (incl. % evaluation as the community demand for types of subprojects could not be known exante. achievement) Indicator 11: Value (Quantitative or Qualitative) Number of health centers damaged by natural disasters rehabilitated or reconstructed Date achieved June 30, 2013 Comments 33% of target achieved. The target was to be used for monitoring but not for evaluation (incl. % as the community demand for types of subprojects could not be known ex-ante. achievement) 7

9 Indicator 12 : Kilometers of rural roads rehabilitated Value (Quantitative or Qualitative) Date achieved June 30, 2013 Comments (incl. % achievement) 352% of target achieved. The target was to be used for monitoring but not for evaluation as the community demand for types of subprojects could not be known exante. Project management costs as a percentage of disbursements.. The target was to be Indicator 13 : used for monitoring but not for evaluation as the community demand for types of Value (Quantitative or Qualitative) subprojects could not be known ex-ante. < 15% 15% Date achieved June 30, 2013 Comments (incl. % 100% of target achieved. achievement) Indicator 14 : Value (Quantitative or Qualitative) Percentage of subprojects completed within contracted period 75% At least 75 percent 89% Date achieved June 30, 2013 Comments (incl. % 119% of target achieved. achievement) Indicator 15 : Value (Quantitative or Qualitative) Completion of technical audit, one impact evaluation, assessments of cash for work program and post-cyclone reconstruction and submission of unqualified audits 0 All studies and audits completed Date achieved June 30, 2013 Comments (incl. % 100% of target achieved. achievement) G. Ratings of Project Performance in ISRs No. Date ISR Archived DO IP Actual Disbursements (USD millions) 1 06/16/2009 Satisfactory Satisfactory /22/2009 Satisfactory Satisfactory /23/2010 Satisfactory Satisfactory /19/2010 Satisfactory Satisfactory /21/2011 Satisfactory Satisfactory /24/2011 Satisfactory Satisfactory /23/2012 Satisfactory Satisfactory /22/2012 Satisfactory Satisfactory /22/2013 Satisfactory Satisfactory H. Restructuring (if any) Not Applicable 8

10 I. Disbursement Profile 9

11 1. Project Context, Development Objectives and Design This section summarizes the project context at the time of appraisal and Board approval. 1.1 Context at Appraisal Madagascar remains one of the poorest countries in the world, exposed to frequent natural disasters and economic shocks. With close to 80 percent of the population living below $1.25 per day and over forty percent of children showing signs of chronic malnutrition, Madagascar s population of 21 million is particularly vulnerable to shocks. In 2008, at the time the Emergency Food Security and Reconstruction Project was identified, the country faced the devastating effects of international food and fuel price increases combined with a highly destructive cyclone season. An IMF study identified Madagascar as one of the Sub- Saharan countries most affected by the combined impact of the food and fuel price increases due to reliance on imported fuel, a high transportation component of imports and reliance on rice imports as a significant part of the consumption of the poorest households. Compounding the economic crisis, in 2008 three consecutive cyclones affected 84 percent of the national territory, causing economic losses equivalent to 4 percent of GDP, with the poorest households and rural communities particularly hard hit. The Bank supported the Government s crisis response though a three-pronged approach. This included a budget support operation to address the immediate economic impacts of the crises, an additional financing operation to the existing IDA rural development project to support agricultural recovery, and the Emergency Food Security and Reconstruction Project to provide a safety net in targeted food-insecure areas and to reconstruct the infrastructure damaged from the cyclones. This response to the crises in 2008 was consistent with broader policies of the Government. The Government s poverty reduction strategy: the Madagascar Action Plan (MAP) prioritized (i) improving nutrition and food security; (ii) improving support for very poor and vulnerable segments of the population; and (iii) restoring basic social and economic infrastructure in the aftermath of natural. To supplement effective implementation of policies in the area of social protection, the Government, in collaboration with stakeholders and partners led by the World Bank, had developed a National Risk Management and Social Protection Strategy (NRMSPS) in Among the priority areas of the NRMSPS, the strategy called for increasing revenues among vulnerable groups and identified laborintensive public works as interventions to respond to increased vulnerability during the preharvest period and after natural disasters. The Bank s Country Assistance Strategy for the Republic of Madagascar for FY approved on March 7, 2007 sought to complement economic growth oriented activities with activities aimed at increasing the availability of, and facilitating access to, services. Specifically, it aimed to assist the government in improving revenue mobilization and budgetary practices to help address the resource shortage and to scale up social programs, achieve better outcomes in health and education, improve the management of weather shocks, and gradually move service delivery closer to people. The crises of 2008 generated revisions to the lending program to adequately address short-term shocks, including addition of the Emergency Food Security and Reconstruction project, which was consistent with longer-term Bank and Government strategies for Madagascar. 10

12 1.2 Original Project Development Objectives (PDO) and Key Indicators (as approved) The Project Development Objectives are to: (i) increase access to short-term employment in targeted food-insecure areas; and (ii) restore access to social and economic services following natural disasters in targeted communities. To this end, the project supported four components including (i) cash-for-work activities to increase access to short-term employment in targeted food-insecure areas and communities affected by natural disasters, (ii) community based, small-scale infrastructure investments targeted to the poorest communities, (iii) communitydriven basic infrastructure to restore social and economic services after natural disasters, and (iv) project management, monitoring & evaluation, and auditing. Key performance indicators of project outcomes and final targets: a) Number of beneficiaries of the social safety net program to provide cash-for-work among poor segments of the population in targeted food insecure areas; and b) Completion of the rehabilitation and reconstruction of at least 75 percent of the initiated sub-projects within six months. Key performance indicators were: a) Number of person-days of cash-for-work manual labor in targeted food-insecure areas b) Number of completed sub-projects under the social safety net program c) Kilometers of rural roads rehabilitated under the safety net program a d) Percentage of women beneficiaries under the social safety net program e) Completed sub-projects and number of beneficiaries under the community-driven infrastructure component f) Hectares of irrigated land rehabilitated under the community-driven infrastructure component a g) Kilometers of rural roads rehabilitated under the community-driven infrastructure component a h) Number of social and economic basic infrastructures damaged by natural disasters rehabilitated or reconstructed i) Project management costs as a percentage of disbursements j) Percentage of subprojects completed within contracted period k) Completion of technical audits, impact evaluation, assessments of cash for work program and post-cyclone reconstruction and submission of unqualified audits. a Target to be used for monitoring but not for evaluation purposes as final sector composition was based on community demand which was not known ex-ante. 1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and reasons/justification N.A. 1.4 Main Beneficiaries The project aimed to benefit over 160,000 of the poorest households through cash-for-work in targeted food insecure areas as well as communities affected by cyclones. Poor communities were to benefit through the small-scale infrastructure constructed and rehabilitated. In addition, agencies involved in cyclone rehabilitation would receive training in construction standards and risk management and community associations would receive training and hands-on experience in implementing sub-projects. 11

13 1.5 Original Components (as approved) The Project was comprised of four components: a) Social safety net (cash-for-work) to increase access to short-term employment in targeted food-insecure areas and communities affected by natural disasters as identified by the National Bureau for Risk and Catastrophe Management (Bureau National de Gestion des Risques et des Catastrophes, BNGRC). Labor-intensive sub-projects are identified by local authorities in collaboration with communities, focusing on soil erosion control, feeder roads, irrigation and cleaning of drainage canals. The labor component accounts for at least 75 percent of sub-project costs. Individual cash-for-work participants are selected through Community Targeting Committees. In order to optimize the safety net support, labor-intensive public works were programmed to coincide with the agricultural lean season, or pre-harvest time when rice prices peak and food is scarcer, or alternatively, in the period immediately following a natural disaster to stabilize consumption. b) Community-driven basic infrastructure in the poorest communities. This component finances small-scale infrastructure investments targeted to the poorest communities and prioritized through local participatory planning processes. These community-based infrastructure sub-projects seek to increase access to social and economic services among participating communities. c) Community-driven basic infrastructure in response to natural disasters. This component seeks to restore access to social and economic services in the aftermath of natural disasters, and in particular cyclones. The component targets communities in areas identified by the National Bureau for Risk and Catastrophe Management. Special attention is given to restoring social services, including schools, health centers and nutrition sites. d) Project management, monitoring and evaluation, and auditing. This component finances project operating costs including training to project staff, communities and other implementing partners. It also supports effective monitoring and evaluation, including development of the Fonds d Intervention pour le Développement (FID) s website, financial and technical audits and impact evaluations. 1.6 Revised Components There were no formally revised components. 1.7 Other significant changes There were no significant changes in design, scope or scale. 2. Key Factors Affecting Implementation and Outcomes 2.1 Project Preparation, Design and Quality at Entry Design factors. The Bank s safety net and reconstruction response built on its extensive social protection experience in the country and the Africa Region. The Bank had supported the FID since its creation in 1993 as an autonomous public agency to support investments in smallscale infrastructure in the poorest communities in Madagascar. FID had experience in previous natural disaster reconstruction and safety net operations and was the first governmental program of its scope and size to work directly with communities and local associations. The FID had executed four World Bank projects (FID I, II, III and the Community Development Project (CDP) known as FID IV) for a total of US$278 million. By 12

14 the end of 2008, FID had financed over 7,000 small-scale infrastructure projects in 84 percent of the communes (local governments) in Madagascar. The previous projects implemented by the FID had established mechanisms to reach out to poor communities, deliver basic infrastructure and provide quick and flexible responses in the aftermath of natural disasters. Community participation and mobilization was at the heart of the operational procedures of the FID. The Implementation Completion and Results Report (ICR) from the preceding CDP project found that working directly with communities is appropriate in the context of Madagascar where the central government goes through recurrent political crises and faces difficulties to reach communities, in part because of their remoteness. The CDP also developed procedures to coordinate the preparation and implementation of subprojects with sectoral policies. Moreover, FID had operational experience in capacity building of rural and urban local governments to engage further in the development process, despite limited overall progress on decentralization in Madagascar, where at the time of appraisal 95 percent of public expenditures were controlled by the central government with few responsibilities vested to local control. Some specific design changes were made based on previous experience. Labor intensity of cash-for-work program was decreased from 80 to 75 percent as it was deemed too stringent, limiting the types of investments possible. In addition, recommendations from the Government s June 2008 post-cyclone damage assessment report were incorporated, including collaboration with the Cellule de Prevention et Gestion des Urgences (CPGU) to incorporate cyclone-proof norms and standards in the design of sub-projects. Quality at entry focus on results. The EFSRP was included in the World Bank Social Protection Unit s Results Readiness Review of the FY portfolio of SP operations. EFSRP was part of the sample of twelve emergency recovery loans. The portfolio review noted EFSRP s focus on achievable objectives and its tailoring to the emergency context of the operation. The overall quality at entry in terms of results readiness was rated as satisfactory and scored above global portfolio averages. Assessment of risks. The overall risk level of the project was rated moderate. Country-level, systemic risks were rated moderate in terms of weak institutional capacity, cumbersome and ineffective financial controls and macroeconomic vulnerability. These weaknesses were to be addressed through the Government s demonstrated commitment to fighting corruption as well as periodic country-level reviews and IDA support to national governance reforms. Projectspecific risks were rated as moderate to low. The main risks were: i) that the project would not reach intended beneficiaries, which was addressed through a multi-stage targeting mechanism, ii) weak financial management capacity of communities to manage grants, addressed through FID s extensive experience working directly with community groups in poor areas, and iii) audits may not meet international standards, remedied by a dated covenant requiring contracting of an international audit firm. The Project was processed with the more flexible and accelerated procedures provided under OP/BP Emergency procedures were justified given the need to mitigate the effects of the food and fuel crises and to rebuild local infrastructure destroyed by the recent cyclones. 2.2 Implementation The project was approved December 16, 2008, with effectiveness declared on March 9, However, a political crisis in early 2009 led to the immediate suspension of Bank activities in Madagascar. The country s elected president was forced out of office, with the opposition 13

15 movement seizing power with eventual military support and forming an interim self-declared transitional government. The unconstitutional change of power and resulting political impasse negatively affected economic growth and development efforts and strained Madagascar s relations with international donors. As a result, disbursements for all Bank projects in Madagascar were suspended on March 17, 2009, a week after project effectiveness, in line with OP7.30 Dealings with De Facto Governments. Disbursements on component 1 (food security) and an initial tranche of Component 4 project (management expenses) were authorized in November 2009 as part of the humanitarian response permitted under OP7.30. The remaining components were authorized to begin operations on May 6, The Project was closely and continually monitored given the delayed start and the evolving political situation in Madagascar. Despite the challenging country context, implementation progress was rated as satisfactory throughout the life of the project. A formal mid-term review was not carried out, but the Task Team provided close backstopping to FID throughout implementation. The political situation created a constant need for FID to be responsive to the context. This context both increased the need for the EFSRP s safety net benefits because of the economic difficulties that resulted from the political situation, as well as created a more challenging institutional environment in which FID had to operate. Key implementation challenges involved: a) Given greater fiduciary risk in the political environment in Madagascar, the Bank froze any personnel changes in the FID and instituted the requirement of a Bank no objection for all new recruitments. b) Adjustments to the targeting mechanism were needed due to the political instability and need for greater controls on the allocation of resources between localities. The PAD called for local authorities to identify the neediest communities. Instead, the Bank and FID agreed on a targeting formula based on per capita resource allocations to each commune and then identification of food insecure communities following food insecurity surveys in the most affected Grand Sud region and in other regions based on available data and in concert with the Red Cross and other agencies. This mechanism was refined as national data sources on vulnerability were developed. c) The large number of people needing financial support following the devastating cyclones at the beginning of the project resulted in rotating access for households throughout the work period in order to spread the benefits. However, this risked dilution of food security benefits over time. By mid-2010, the FID disallowed rotation of workers so that each worker works for 30 days in order to increase the relevance of the program to the income of beneficiaries. d) The daily wage level was raised during project implementation, from 1,600 Ariary (MGA)/day for a five-hour work day at project launch to 2,500 MGA (about $1.16) by the end of the project in response to inflationary pressures and the needs to ensure minimum food security. This remained below market wage levels for unskilled labor, which average about 4,000 MGA/day and 2,800 MGA/day for agricultural labor (plus one meal), retaining the self-targeting feature of the cash-for-work program. e) The technical audit identified some capacity weakness in the local construction supervising firms as well as the NGOs carrying out cash-for-work. As these implementation agencies went through a formal bidding and contracting process, when serious performance issues arose, FID could cancel the contract and find replacements. 14

16 Due to the staggered start of the various EFSRP components, the final allocation of resources (Annex 1) shows that the cash-for-works component and the natural disaster response component used more of the resources, with less allocated to community-driven infrastructure (component 2). Project management cost remained below 15 percent, in line with results targets. Given the delayed initiation of project activities, the closing date was rescheduled by six months from December 31, 2012 to June 30, Monitoring and Evaluation (M&E) Design, Implementation and Utilization The design of the Project s monitoring and evaluation framework sought to capture key outcomes and outputs and to permit assessment of the achievement of project objectives and quality of operations. The key performance indicators selected for each component were measurable and appropriate given capacity and the emergency context. For example, one of the main outcome indicators the percentage of initiated social and economic services restored within 6 months following a natural disaster sought to capture the emergency goals of the project. All KPIs had baseline and target values and intermediate indicators were reasonably focused on tracking outputs and activities. The proposed M & E system built on the FID s previous experience. During appraisal, FID was deemed to have a functional management information system that could be used as the monitoring basis. Given the emergency nature of the project, significant improvements in the MIS were not envisioned at design. FID had monitoring and evaluation specialists at the central level as well as in each of the regional offices. Several evaluations were planned, including a technical audit, an impact assessment based on the baseline established during the previous Community Development Project (with follow-up not concluded within CDP due to the political difficulties in the country), and a beneficiary assessment. During implementation, the MIS system was able to report on outputs and activities on a timely basis. However, the MIS components were not fully integrated between the fiduciary components and the sub-project management components. This caused a fragmentation and lack of homogeneity of information. This weakness is being addressed through the installation of new software under the follow-on project. Moreover, beneficiary registries for cash-forwork programs were kept in lists of the NGO implementing agencies, In the follow-on operation a registry of beneficiaries will be kept by FID which permits better control. All key performance indicators were obtained by project closing and there was a sufficient evaluative base to judge development outcomes. Some adjustments had to be made to the final schedule of evaluations because of delayed start-up of several project components. A baseline for an impact evaluation of FID IV had been carried out in 2006 through the National Statistical Agency (INSTAT) with the follow-up planned for 2009, but could not be carried out due to the political crisis and insecurity in the country. Instead, it was decided that the follow-up would be done under the EFSRP to serve as the impact evaluation of the community-driven infrastructure component since this component was a continuation of the CDP project procedures and portfolio. An ex-post assessment was carried out on the other two components, as well as a final beneficiary assessment to provide insights into the overall performance of EFSRP. In addition, a technical audit, and an economic evaluation of the community-driven infrastructure subprojects were completed (see Annex 5 for methodological description of evaluations). The FID integrated many of the recommendations of these evaluations into its operating procedures. For example, the design of latrines and size of windows in schools were adjusted based on the findings of the technical audit. The findings of the cash for work impact 15

17 evaluation prompted FID to differentiate the targeting criteria between rural and urban areas where before the evaluation the criteria were standard. 2.4 Safeguard and Fiduciary Compliance Safeguards. The project triggered safeguard policy Environmental Assessment OP/BP The environmental classification for the project is Category B. The FID s Environmental Manual was revised during preparation to incorporate recommendations from an ex-post environmental impact assessment of sub-projects carried out in September 2007 for FID IV. At appraisal it was deemed FID had sufficient resources and capacities to manage the safeguard aspects of the project, including environmental specialists located in the General Directorate and in each Inter-Regional Directorate of FID. Environmental safeguards were rated as satisfactory throughout implementation. The technical audit found several positive environmental impacts of FID sub-projects. For example, the cleaning and improvements to canals has reduced flood risks and improved sanitary conditions and reforestation of mangroves helped reduce erosion and restore ecological balance. In addition, FID altered its school reconstruction designs specifically to reduce the use of local wood to help address deforestation pressures. No significant negative environmental impacts were found. Fiduciary compliance. In terms of procurement, the overall procurement risk at appraisal was rated as low. A Procurement Capacity Assessment Report showed that FID had sufficient procurement staff with previous experience with the Bank and Governments prevailing procurement rules and methods. Procurement was rated as satisfactory throughout EFSRP implementation. Ex-post procurement reviews, including visits to FID regional offices identified some minor shortcomings, mainly in consistent documentation. Financial management was also found to be satisfactory throughout project implementation. Financial supervision reports and audits were remitted in a timely fashion and found to be acceptable. An evaluation of the financial management system was carried out in March FID responded quickly to any financial management issues as they were identified. It is worth noting that FID adopted a strong anti-corruption stance in the face of the weak governance context of the country during implementation. FID engaged BIANCO, an anticorruption agency, to train FID intermediaries in anti-corruption practices and to bring awareness to the legal consequences of not fulfilling contractual requirements. Any contractual issues, for example problems with payment systems by local associations managing cash-for-work activities, resulted in immediate cancellation of contracts and pursuit of legal actions through proper national channels. 2.5 Post-completion Operation/Next Phase Post-completion sub-project operations and maintenance arrangements. In terms of the infrastructure created or rehabilitated under EFSRP, the project undertook several activities to address the systemic weaknesses in maintenance in the country: a) The labor intensive sub-projects maintained existing drainage canals and rural irrigation canals as well as rehabilitated rural feeder roads which helped address maintenance backlogs. Future maintenance reverts to the responsible agency as these cash-for-work subprojects are short-term interventions aimed primarily at transferring income. b) FID developed a manual for the management and maintenance of infrastructure under the CDD component, disseminated through community maintenance committees. In addition, 16

18 three youths in each community were designated and trained in routine maintenance practices. For the community-driven basic infrastructure sub-projects, communities contributed at least 5 percent of sub-project costs, of which a maintenance fund was established with 0.5 percent to serve as a start-up fund to support initial maintenance. These funds are required to be in place before sub-project activities can begin. As an example of best practice, these maintenance funds are included in the annual EFSRP financial audit, along with the valuations of community counterpart contributions in general. While this maintenance fund will provide an initial source of financing, longerterm operations and maintenance will depend on the performance of the sectoral agencies, users associations and local governments who are the owners of the infrastructure. The impact evaluation noted the challenges particularly in the water sector of users groups directly operating systems, but interview found that vast majority of beneficiaries confirmed better access to water so benefits were still being delivered years after. c) The sustainability of the social infrastructure created was furthered through FID s adoption of anti-cyclonic building norms and designs, mitigating the potential negative impacts of future natural disasters and better protecting the infrastructure built. Education and health personnel were already in place in the facilities damaged and destroyed. FID s focus on community management helped promote better maintenance. The technical audit found maintenance to be stronger where community management committees were formed and trained. Systemic risks of the Government not being able to fund additional staff in social facilities was partially addressed because FID did not finance any new schools or health centers, only reconstruction of existing facilities damaged by cyclones. Within the component 2 for community-driven infrastructure, the majority was road rehabilitation which helped in part to address the backlog of maintenance needs and extend the operational life of existing roads. The cash-for-work activities were all labor-intensive repair, rehabilitation or maintenance activities which did not generate incremental operating and maintenance costs. Sustaining institutional capacity and follow-on operations. The FID has continued to play a critical social protection role in Madagascar through safety net cash-for work investments, provision of infrastructure for basic services in poor communities and response to natural disasters. In November 2012, the World Bank approved the Emergency Infrastructure Preservation and Vulnerability Reduction Project of US$102 million to preserve key infrastructure and reduce household vulnerability by selectively continuing those activities started under World Bank projects in social protection, agriculture and transport. The new project funds on-going efforts of FID in the cash-for-work program and the response to natural disasters. The community-driven basic infrastructure would be taken up through the Local Development Fund program which supports decentralization efforts. In addition, a new Emergency Food Security and Social Protection Project is currently under preparation which would continue FID s social protection role and activities. Finally, the African Development Bank has shown interest to provide funds to FID to finance small-scale infrastructure, particularly in disaster prone areas. 3. Assessment of Outcomes 3.1 Relevance of Objectives, Design and Implementation Relevance of objectives. The project objectives were highly relevant to the economic shocks and natural disasters affecting the country at the time of project identification. The project was consistent with the broader poverty reduction goals of the country as well as the World Bank s country strategy for Madagascar and the Bank s evolving role in funding safety nets in 17

19 Africa. The PDO became even more relevant to the country s development needs in the context of the prolonged political crisis starting in early Between 2009 and 2013, the FID was one of the few well-functioning institutions and demonstrated the capacity to mitigate the impacts of the political crisis by providing short-term employment and access to basic social and economic services. Relevance of design. The design built on the experience of previous funding of the FID s community development and emergency response programs. The FID s ability to operate autonomously and in direct contact with local communities and local governments was particularly well-suited to delivering benefits to vulnerable groups during times of political and economic crisis. The cash-for-work safety net component helped test a core component of an eventual national safety net program and was well-tailored to the needs of food insecure households as well as areas hit with natural disasters. Relevance of implementation. During implementation, the community-driven approach of FID whereby priorities were identified by the communities themselves meant that the infrastructure investments were highly relevant to community needs. Per the 2013 beneficiary assessment, 96 percent of respondents felt the sub-project implemented was necessary or very necessary for the community. In addition, the cash-for-work safety net operations were welltimed to the seasonality of agricultural labor. 80 percent of beneficiaries surveyed affirmed the pertinence of the time frame of support. This was particularly strong in food insecure regions, where 95 percent of beneficiaries were satisfied with the timing of interventions. 3.2 Achievement of Project Development Objectives The aim of the Emergency Food Security and Reconstruction Project was to enable poor households and communities in Madagascar deal with shocks though temporary employment and improved access to social services, including the reconstruction of basic services damaged from natural disasters. The EFSRP financed a total of 2,611 sub-projects, with 2,123 cash-for-work safety net sub-projects, 157 community-driven infrastructure sub-projects and 331 sub-projects in response to natural disasters. Output details are provided in Annex 2. Technical audits found that overall the quality of the civil works was good, particularly for the structures and roofs. The basic results chain assumptions were that these sub-project outputs would provide temporary employment and income to improve food security and create or restore access to basic economic and social services. Provision of temporary employment through safety net cash-for-work The project sought to increase access to short-term employment in targeted food-insecure areas through a cash-for-work safety net. The EFSRP generated 8.9 million person-days of work, compared with an original target of 7.8 million. An estimated 400,580 people benefitted from cash-for-work, surpassing the initial target of 160,000 in large part due to the practice of rotating workers in the first year of natural disaster response sub-projects as well as a reallocation of funds toward this component. Sixty-one percent of these beneficiaries of the cash-for-work sub-projects were women, exceeding the original target of over 50 percent. Ex-post targeting analysis found that 92 percent of beneficiaries were poor compared with a general poverty rate of 76 percent in the communities evaluated. In addition to the safety net features of the temporary employment created, the EFSRP rehabilitated 6,226 kilometers of feeder roads, 660 sub-project to rehabilitate small scale irrigation plots, over 200 drainage canal cleaning sub-projects and, through an agreement with the Ministry of Environment and Forestry, the reforestation of 384 hectares of community forest and the restoration of over 1,000 hectares of mangroves 18

20 Beneficiaries expressed overall satisfaction with the project s safety net activities. Sixty-nine percent of beneficiaries were satisfied or very satisfied with the quality of implementation, with higher satisfaction rates among women and in the food insecure regions. These outputs increased food security and well-being of participant households. The beneficiary assessment reported that households used three-quarters of the cash payments to purchase food, helping to stabilize food security. An impact evaluation found that beneficiary households exhibited a significantly higher level of household expenditures than comparison households. Over three-quarters of respondents said that this additional revenue went towards their daily needs. A net gain of about one-half a day of rice consumption per week was observed among beneficiary groups versus the control group. This result may have been slightly diluted due to the rotation of workers in the early years of implementation, although this was a justifiable policy in the face of the multiple shocks and growing numbers of vulnerable. Moreover, it should be noted that the goal of cash-for-work is to improve immediate food security not raise those households out of poverty through the temporary transfers alone. An additional 6 percent of beneficiaries stated that additional revenue went to health and education expenditures. In terms of health outcomes, the presence of a sickness over the course of the last two weeks was reduced by a net three percentage points for beneficiary over control groups. Improved access to basic services through community-driven basic infrastructure In terms of community-based infrastructure sub-projects (component 2), the project exceeded its targets by supporting 157 sub-projects benefitting over 800,000 residents of poor communities, versus an end-of project target of 76,000 beneficiaries. The indicator is above target because over half the portfolio was road projects which served a higher average number of beneficiaries than other sub-project types (and the methodology for calculating beneficiaries of road projects was expanded to include all communities linked by the road and not just the originating community). In addition to 825 kilometers of feeder roads rehabilitated, the project funded 43 water supply systems, and 2,190 hectares of irrigated land. The beneficiary assessment reported that 81 percent of beneficiaries were satisfied or very satisfied with the sub-project, 98 percent affirmed that the project was a community priority, and 94 percent were satisfied with the participatory diagnostic of community needs. Over half of household felt that these sub-projects had increased revenues and productivity and 91 percent felt their living conditions had improved. The impact evaluation of community-based projects from FID IV found significant positive impacts. In the road sector, FID investments resulted in a 28 percent reduction in travel speeds versus control groups. Investments in market infrastructure improved occupancy rates slightly, with a net 2.5 percentage point increase to an average of 75.6 percent occupancy. In terms of the water sub-projects, the impact evaluation found that the time women and girls spent fetching water was reduced and people overall saw increased access, though functionality of some systems was an issue. There were no outcome indicators included on irrigation subprojects. A composite indicator of economic wellbeing of FID community infrastructure investments showed improvements for FID households versus comparators. Reconstruction of basic services damaged from natural disasters The Project sought to lessen the impact of natural disasters on vulnerable groups by ensuring a timely response to rehabilitation and reconstruction of affected infrastructure (component 3). The EFSRP reconstructed 292 schools (including 917 classrooms), 11 health centers, 3 water supply systems, 6 administrative structures, and rehabilitated 95 kilometers of roads. Overall, 19

21 FID covered 18 percent of the schools destroyed by cyclones over the last four cyclone seasons, with higher coverage up to 34 percent in the earlier years (Annex 2). Given the decline in donor and Government resources, FID provided the largest share of cyclone response in the country. One of the goals was to speed up response time following a natural disaster, seeking to complete 75 percent of reconstruction sub-projects within 6 months of being prioritized by local authorities. FID execution in this regard improved over the life of the project. Only 22 percent were completed within 6 months following cyclone Bingiza in early In response, FID adopted a series of measures, including revisions to procurement procedures, to speed up reconstruction. By the final cyclone season ( ), FID achieved 100 percent completion within 6 months (Annex 2), although this is explained in part by the relatively small number of facilities (16) for FID to reconstruct in the final season. The beneficiary assessment found that all of the schools reconstructed had a full complement of infrastructure and school furniture. Sixty-three percent of beneficiaries of health centers felt the furniture and equipment was very good or good and 99 percent were satisfied with the infrastructure. Respondents indicated that access to and utilization of schools and health centers had improved. 3.3 Efficiency Cash-for-work sub-projects were able to ensure that a high percentage of sub-project expenditures resulted in income transfers to beneficiary households, the main goal of this kind of sub-project. Over 75 percent of the safety net sub-project costs were transfers in wages to the workers, a high level of labor intensity by international safety net comparisons. And, transfers went almost exclusively to food insecure households, pointing to substantial cost effectiveness in these transfers. Cost effectiveness and cost-efficiency of community-based infrastructure was substantial. For economic infrastructure where a cost-benefit analysis could be undertaken (e.g. for roads and irrigation), ex-post economic rates of return ranged from 27 to 87 percent. For social infrastructure, like schools, where full cost-benefit analysis is not applicable, unit cost analysis (cost efficiency) comparisons between FID and other school construction programs showed that FID averages between 7 and 26 percent unit cost savings compared to other programs. As an implementing agency, FID s operating costs were 15 percent, achieving project operational efficiency targets. 3.4 Justification of Overall Outcome Rating Rating: Satisfactory The ESRP remained relevant to the country s development priorities and responsive to the economic and political crises facing the country. The community-driven approach of local identification of needs ensured that the sub-projects reflected community priorities. All key performance indicators were achieved, although KPIs were largely output oriented (number of beneficiaries, number of sub-projects, etc.). The project met its overall development objectives in terms of creating temporary employment, improving access to basic services and restoring infrastructure following cyclones, supported by the KPIs as well as impact evaluation data in most of the sub-project areas. These achievements are noteworthy given the 20