Enhanced Smallholder Livestock Investment Programme. Supervision Report. Ms Abla Benhammouche. National Programme

Transcription

1 REPUBLIC OF ZAMBIA Enhanced Smallholder Livestock Investment Programme (E-SLIP) Supervision Report: April 2018 Type of mission Project Name Country Country programme manager Name of Project Director Supervision Report Enhanced Smallholder Livestock Investment Programme (E-SLIP) Ms Abla Benhammouche Ms. Olive Chiboola Date of mission (month/year) April 2018 Project Area: Days in the field Field sites visited Mission composition National Programme 11 days Fodder production trial sites in Shesheke Ms Abla Benhammouche, IFAD Country Director, with the participation of Mr Mohamed Tounessi (Agricultural Economist/Deputy Mission Leader); Mr Waseem Khan (Procurement Specialist), Mr Oscar Anaadumba: (Knowledge Management/Monitoring and Evaluation Specialist) and Mr. Fabrizio Vivarini, (Financial Management Specialist) East and Southern Africa Division (ESA) Programme Management Department (PMD) 31 May 2018 Report n.: 4801-ZM

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3 Abbreviations and acronyms AfDB APMEP AWPB BTOR CBPP DLD DVS E-SLIP ECF FAM IFAD ITM KM LISP M&E MFL MIS MoF ORMS PC PCO PIM RIMS SLIP TOR Africa Development Bank Agricultural Productivity and Market Enhancement Project Annual Work Plan and Budget Back To Office Report Contagious Bovine Pleuropneumonia Department of Livestock development Department of Veterinary Services Enhanced Smallholder Livestock Programme East Coast Fever Finance and Administration Manager International Fund for Agricultural Development Infection and Treatment Method Knowledge Management Livestock Infrastructure Support Project Monitoring And Evaluation Ministry of Fisheries and Livestock Management Information System Ministry of Finance Operational Results Management System Programme Coordinator Programme Coordination Office Project Implementation Manuel Results Impact Management system Smallholder Livestock Programme Terms for Reference i

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5 A. Project Overview (auto-generated by the system) Region: Country: Project Name: East and Southern Africa Division Zambia Enhanced Smallholder Livestock Investment Programme Project Id: Project Type: CPM: Project Director: Project Area: Livestock Abla Benhammouche not available yet not available yet Project at Risk Status: Environmental and Social Category: Climate Risk Classification: Executing Institution: Implementing Institutions: Not at risk B 3 Ministry of Agriculture and Livestock not available yet Approval Date 01/09/2014 Signing Date 11/05/2015 Entry into Force Date 11/05/2015 Available for Disbursement Date 24/07/2015 First Disbursement Date 02/09/2015 MTR Date not available yet Original Completion Date 30/06/2022 Current Completion Date 30/06/2022 Financial Closure not available yet Last audit receipt 11/07/2017 Date of Last SIS Mission 10/11/2017 Number of SIS Missions 6 Number of extensions 0 Effectiveness lag 8 months Project total financing IFAD Financing breakdown IFAD $14,226,000 East and Southern Africa Division $868,000 Beneficiaries $8,621,000 Domestic Financing breakdown National Government $10,568,000 Co-financing breakdown, OPEC Fund for International Development $12,000,000 Project total financing $46,283,000 Current Mission Mission Dates: Days in the field: Mission composition: Field sites visited: April Ms Abla Benhammouche, IFAD Country Director, with the participation of Mr Mohamed Tounessi (Agricultural Economist/Deputy Mission Leader); Mr Waseem Khan (Procurement Specialist), Mr Oscar Anaadumba: (Knowledge Management/Monitoring and Evaluation Specialist) and Mr. Fabrizio Vivarini, (Financial Management Specialist) Fodder production trial sites in Shesheke 3

6 B. Overall Assessment Key SIS Indicator #1 Rating Likelihood of Achieving the Development Objective Effectiveness and Developmental Focus Effectiveness 4 Targeting and Outreach 4 Gender equality & women's participation Agricultural Productivity Nutrition Adaptation to Climate Change 3 Sustainability and Scaling-up 4 Institutions and Policy Engagement 4 Partnership-building 4 Human and Social Capital and Empowerment Quality of Beneficiary Participation 4 Responsiveness of Service Providers 4 Environment and Natural Resource Management Exit Strategy 4 Potential for Scaling-up N/A N/A 4 3 Key SIS Indicator #2 Rating Assessment of the Overall Implementation Performance Project Management 3 Quality of Project Management 4 Knowledge Management 4 Value for Money 3 Coherence between AWPB and Implementation 3 Performance of M&E System 3 Requirements of Social, Environmental and Climate Assessment Procedures (SECAP) Financial Management and Execution 3 Acceptable Disbursement Rate 5 Quality of Financial Management 3 Quality and Timeliness of Audit 4 Counterparts Funds 2 Compliance with Loan Covenants 4 Procurement 3 2 B. Mission Objectives and Key Conclusions Background and main objective of the mission 1. The GRZ and IFAD carried out a supervision and implementation support mission of the E-SLIP from April, This was the sixth supervision and implementation support mission to E-SLIP, which is scheduled for implementation completion in June The main objective of the mission was to a) undertake a detailed review of implementation progress of the E-SLIP 2018 Annual Work Plan and Budget (AWPB), particularly focusing on the period after the last supervision fielded in November 2017; b) assess the readiness and extent of implementing the 2018 approved AWPB and provide any implementation support to the different implementing agencies as may be needed. c) Undertake field visits to interact with the beneficiaries to assess benefits reaching them and receive their views on how improvements can be made and systems created sustained; c) review fiduciary aspects, focusing on financial management, disbursement and procurement issues and assess provision of counterpart funds in terms of amount and timeliness, and compliance with loan covenants; d) overview of issues affecting sustainability related to institution building, rural poor empowerment, beneficiary participation, responsiveness of service providers and exit strategy; and e) check actions taken on the last Mission's recommendations. 3. The mission worked in close collaboration with Programme Coordination Office (PCO); visited one programme focal district and held discussions with E-SLIP beneficiaries at a fodder production trial site with several numbers of cooperatives present. 4

7 4. The mission wrap-up meeting was held on 26/05/2018 in Lusaka, chaired by the Permanent Secretary for the Ministry of Fisheries and Livestock. Key mission agreements and Conclusions 5. Notwithstanding, progress with some of the last supervision mission recommendations, the Mission reiterates that all pending recommendations made in the last Aide Memoire of November 2017, be expedited. It is now critical that the programme management closely follows the following key actions that need to be undertaken; and are detailed further throughout the supervision report. 6. By the end of 2018, the programme should complete the set-up of the programme management system, including: (i) The baseline survey for E-SLIP; (ii) Completion of the programme M&E system, KM system including the draft communication strategy and the Programme Management System (MIS); (iii) Revision of the PIM; and (iv) Full utilisation of the Financial Accounting Software (SAGE/PASTEL). Main Conclusion 7. E-SLIPs central objective is reducing the incidence of ECF and eradication of CBPP as well as Sustainably Improved Livestock Production and fodder production in Zambia. Observations from the field visit indicate an overall perception of acceptance of the programme by beneficiaries especially in terms of improving the livelihoods of beneficiaries involved in the livestock value chain in project areas. However, issues related to financial management of the Project, procurement and M&E needs to be addressed urgently to ensure that the gains of the programme by focusing its attention on completing all initiated activities by closely monitoring the implementation progress to ensure that all activities are satisfactorily completed on time as planned. C. Overview and Project Progress 8. More technical details on the progress made with regards to the various components can be found in Appendix 4 (technical Annex). 9. The E-SLIP Programme is a seven-year programme, which became effective in May 2015 and has been operational for 36 months. A low, but much improved implementation performance of the programme, incomplete staffing of the PCO, inadequate management system, delayed procurement and lack of financing from OFID, were identified as major concerns. 10. The PCO Team was only operational in October However, the critical position for stocking and re-stocking is not yet filled and has direct negative impact on livestock production component. The OFID co-financing loan, which is critical for the implementation of component two: Livestock production and productivity, was approved by OFID in December 2017 and is planned for signature in April The set-up of the management system is work in progress and is expected to be fully operational by the end of The procurement of goods and services continue to be a recurrent issue, since the start-up of the programme and limited progress has been noted in effectiveness and efficiency of the procurement, which is under the control of the PSU, under the MFL. The procurement processes are too lengthy and too slow to match with the expected performance of the programme and therefore, are negatively affecting the programme performance. Most of the delays in implementing the 2017 AWPB are linked to an under-performing procurement system. 5

8 11. The 2017 AWPB disbursement, as at 31st December 2017 was USD 3,152,449 against a budget of USD 6,206,280, representing a disbursement rate of 51%. With regard to component, the financial execution rate is as follows: Under component 1: (animal disease control sustainably improved) whose objective is to reduce the prevalence of CBPP and ECF, about USD 1,130,130 was disbursed, against a budget of USD 2,345,969, representing a disbursement rate of 48%. Under component 2: (Livestock Production and Productivity Increased) about USD 439,739 was disbursed, against a budget of USD 1,996,862, representing a disbursement rate of 22%. Under component 3 (Effective Programme Management) about USD 1,582,580 was disbursed, against a budget of USD 1,996,862, representing a disbursement rate of 85%. 12. Of the USD 3,152,449 disbursed by E-SLIP, at the end of 2017, the Programme Management Component absorbed 50% of the overall expenditure for The major expenditures include: purchase of equipment and materials; motor vehicles for field staff, office furniture for all components and payment of salary arrears, gratuity and leave pay for the Programme Coordinator and Finance and Administration Manager (FAM). 13. The low utilisation of the 2017 budget in component one and two, is due to the challenges the Programme encountered, such as delayed Programme start up, delays in recruitment of the technical staff under component two and procurement of goods and services. However, compared to the expenditure rate of 2015/16 AWPB, which reached 24%, there is an improvement in 2017 AWPB execution, which reached 51%. 14. During the first quarter of 2018, the expenditure rate of the 2018 AWPB stands at 35.1%. As of March 2018, the financial execution for the first quarter by component had reached 38% for component one; 16% for component two and 47% for component three. 15. Despite the initial start-up delays and low implementation performance, E-SLIP is gaining momentum. The PCO is established with adequate office premises and office equipment. The staffing of the PCO is completed, only one position Stocking and Re- Stocking Specialist is yet to be filled. 16. E-SLIP responded to the Agreed Actions of the previous supervision mission of November 2017, key amongst them are the OFID approval of the loan of USD 12 million, as co-financing to be used for activities under Component 2: Livestock Production Systems Sustainably Improved. The financing agreement is scheduled for signature on by the end of April Progress was also made in the livestock stocking/restocking activities, by targeting farmers specifically in provinces, where there is a conducive environment for livestock farming. The Livestock Stocking and Restocking strategy and road map was developed, and is the basis of the livestock stocking/restocking activities to be implemented in A farmers needs assessment was conducted in Kazungula and Nalolo in readiness for community and individual farmer selection as well as capacity building. The forage demonstration plots were assessed to draw lessons needed for scaling-up in 2018 farming season. In conformity with the cost-recovery stipulated in the concept note, the ECF calf immunisation fee was increased from K15 to K25 in Actions Responsibility Deadline Status Now that the co-financing of USD 12.1 million from OFID was approved in December 2017, the Programme should accelerate the effectiveness of the OFID loan and the implementation of activities to MoF/MoJ/MFL/PCO support the E-SLIP market-oriented forage production and livestock June 2018 stocking and restocking across the country. The programme should be proactive and engage the PSU/ MFL to speed up the implementation of the programme procurement plan for , so that programme activities that depend on procurement of equipment and materials are not delayed such as MFL/PCO Continuous 6

9 CBPP vaccination and ECF immunisation; and livestock stocking and restocking programmes. The programme should complement and foster synergies with donor programme. For the already identified AfDB Agricultural Productivity and Market Enhancement Project (APMEP), E-SLIP should prepare a concept note for partnership and engage dialogue for the set-up of collaborative framework. PCO June The programme should conduct scoping of experiences in fodder production in Zambia and mapped different interventions and organizations active in that area for establishing a dialogue and partnership. PCO May 2018 The programme needs to finalize the proposed partnership with Heifer International and other NGOs and institutions, which have comparative advantage and key competencies in stocking and restocking A training programme should be designed for farmers in the management of cattle, goats, pigs and chickens, cost record keeping, the preparation of business plans to access to financial services credit schemes, and access to market. The programme should prepare and submit report to IFAD and the Government on the results of the pilot fodder schemes, including an action plan for scaling up The programme should plan for a gradual increase of farmers contribution to the cost of ECF ITM immunization, so that among other things the increased price does not become a hindrance for current and new farmers from taking their animals for ECF immunisation. In view of limited budget under E-SLIP, ECF disease control interventions should be strategically focusing and giving priority to communities which are willing to participate in line with the cost recovery policy. PCO PCO PCO June 2018 July June Continuous Continuous D. Project implementation i. Effectiveness and Development Focus Development Effectiveness Effectiveness Rating: 4 Justification of rating 18. This section assesses, E-SLIP s progress towards achieving the target outputs and outcomes in relation to both annual and cumulative/appraisal targets. The achievements made, thus far, are presented in Section I (Updated Log Frame: Progress against Objectives, Outcomes and Outputs including RIMS Indicators) of the Supervision Report and Appendix 1 (Physical Progress Measured against AWPB,) in the Supervision Report. Implementation of the Programme was analysed through the 2017 progress report, and the first quarter of 2018, feedback from PCO staff, the DVS and Department of Livestock development (DLD), District Veterinary Officers, provincial staff and beneficiaries. The overall programme implementation in terms of outputs is rather limited, to analyse outcomes that benefit the target group. Log-Frame Analysis & Main Issues of Effectiveness 7

10 19. The mission reviewed the Logical Framework and noted that it is generally within IFAD Guidelines of the new Operational Results Management System (ORMS) as of October E-SLIP has reduced the number of indicators from 21 to about 15 annually and will keep other indicators for internal quarterly reporting. The reduced indicators were based on the existence of target values, with those that did not have any target values being dropped. The cumulative estimated number of households reached by the programme by 31 December 2017 is 39,425. The mission noticed that, the number of estimated household beneficiaries has increased by 85% as compared to the year Outcomes: For the Physical progress measured against AWPB, the Mission noted that most planned activities were yet to be implemented or are on going. The slow implementation pace of planned activities has affected budget usage negatively for Components 1 and 2 as mentioned above for the period under review. Therefore, these challenges mentioned above compromised the coherence between the AWPB and implementation of planned activities. However, the Mission commends E-SLIP for putting in place appropriate corrective measures to address the matter through the formulation of a fast-track plan, which has yet to produce the desired outputs and outcomes. Development Focus Targeting and Outreach Rating: Moderately Satisfactory ( 4) Justification of rating 21. E-SLIP is a national programme although it focuses in specific areas with a high prevalence of ECF or CBPP. E-SLIP has a clear targeting and outreach approach which involves the economically active poor; the very poor, Female headed households and youth. In terms of outreach, to-date, E-SLIP has reached 39,425 households with the activities focusing on training, capacity building, ECF and CBPP sero-surveillance and removal of positive herds, ECF-ITM calf immunisation and CVRI-produced stabilate efficacy trials, cattle branding, ECF endemicity studies and farmer exchange visits in forage production and livestock stocking and restocking. Main issues 22. This approach will be monitored from this year 2018 and onwards, since the M&E officer is recruited and operational. Under Component 1, self-targeting is evident in the sense that focus is on those who own livestock. Appropriate criteria for targeting and outreach for Component 2 is also in place and needs to be monitored in Gender equality & women's participation Rating: Moderately Satisfactory ( 4) Justification of rating 23. For Component 2, nearly 80% of farmer group members are women who also dominate leadership positions. This is consistent with the emphasis placed by the PDR, which states that The main and ultimate target group of E-SLIP is the rural poor, in particular, women and the youth, adding that while Component 1 will be gender neutral, Component 2 will be strongly gender targeted as at least 50% of beneficiaries will be women, while 20% will be rural youth under the stocking and re-stocking programme. Gender equality and women s participation will be monitored from this year 2018 and onwards, since the M&E officer is recruited and operational. Agricultural Productivity (if relevant) Justification of rating Rating: NA 8

11 24. E-SLIP s core business is livestock production; its rural focus unavoidably often leads to activities that affect agriculture production directly or indirectly. For example, healthy livestock arising from effective disease control will enable farmer s access to draft power as well as manure; which in turn, will increase agricultural production. Nutrition (if relevant) Justification of rating Rating: NA 25. E-SLIP has included nutrition concerns in its Baseline Survey TORs, which is expected to be prepared before the end of Main issues 26. Although nutrition is not the main objective of the programme it is well recognised that impact derived from diversification of livestock to include dairy cattle, small ruminants, and village chicken, are potential sources of protein and improved food security and incomes of the beneficiaries. However, without anecdotal evidence, e.g. discussions with beneficiaries that are in the early stage of implementing nutrition-sensitive activities, it is difficult to establish at this stage any assessment. Adaptation to Climate Change Rating: Moderately Unsatisfactory (3) Justification of rating 27. Although the E-SLIP design is compliant with IFAD s climate change strategy and the subject is given due attention in the PDR, given the late start of activities there is not sufficient data on which to draw detailed assessment to justify a rating of 4. It is suggested that households' perception on climate risk and access to adaptation measures are included in the project baseline. Main issues 28. Given the late start of activities there is not sufficient data on which to draw detailed assessment. ii. Sustainability and Scaling-up Institutions and Policy Engagement (if relevant) Rating: Moderately Satisfactory (4) Justification of rating 29. E-SLIP continuing from SLIP works within MFL structures and in this way contributes to building its capacity in terms of staff training and provision of much needed equipment. In addition, the cost recovery policy on ECF will increase Government s capacity to deploy much needed resources to other needy areas. With regard to policy engagement, the programme is playing a pro-active role for example in the initiative to domesticate in-country stabilate production, which has strengthened national capacity to sustainably provide the inputs needed for on-going vaccination campaigns. It has also been instrumental in influencing MFL to introduce a cost recovery policy in ECF and has continued to refine the CBPP & ECF strategies, as well as a revised livestock stocking and restocking strategy. Partnership-building Rating: Moderately 9

12 Satisfactory (4). Justification of rating. 30. Maintaining dialogue with various parties and proactively exploring opportunities for linkages is one of the important tasks for the PCO. The programme has yet to develop strategic partnership with the identified projects financed in particular by the World Bank, African development Bank and Heifer International. Main issues 31. The PCO needs to carry out a mapping of donor financed projects that could be complementary or similar and to harmonize programme activities in particular, with the AfDB financed Livestock Infrastructure Support Project (LISP) in Muchinga and Northern provinces and AfDB Agricultural Productivity and Market Enhancement Project (APMEP). Human and Social Capital and empowerment Rating: Moderately Satisfactory (4) Justification of rating 32. E-SLIPs implementation approaches is leading to substantial human and social capital development and empowerment. The programme is under implementation through government structures and may not always have its on way to affect the pace at which beneficiaries are empowered or developed, however, it employs the best means to ensure that interventions succeed. Therefore, closer monitoring and enhanced reporting systems including documenting lessons; success stories and best practices can increase the Programme s influence to equip its beneficiaries with enhanced bargaining power, for better services to improve their livelihoods. Quality of beneficiary participation Rating: Moderately Satisfactory (4) Justification of rating 33. The supported community groups demonstrated good levels of participation and engaged the mission in discussions regarding challenges they face and search of appropriate solutions. Further, beneficiary participation continues to be exhibited in the leadfarmer mobilisation of other farmers in ECF and CBPP activities and forage development as well as the involvement of community CBPP task forces in disease sensitisation and illegal cattle movement monitoring. However, there is room for improvement especially with reporting, monitoring, evaluation and networking. Responsiveness of service providers Rating: Moderately satisfactory (4) Justification of rating 34. Implementation of Programme activities under components 1 and 2 are largely under the control of DVS and DLD. Main issues 35. It is critical for the PCO, to provide a result based management framework to ensure quality of services and mechanism to monitor and evaluate annually, the performance of the implementing partners. The introduction of the private sector in service provision will be an added benefit to smallholders in terms of access to timely service delivery, which of course 10

13 will be at a cost. Responsiveness of service providers will be monitored from this year 2018 and onwards, since the M&E officer is recruited and operational. Environment and natural resource management Unsatisfactory (3) Justification of rating Rating: Moderately 36. There are interventions such as fodder production and rangeland management, which will add value to the environment and its management by way of introducing new drought, overgrazing and fire-resistant leguminous species in communal grazing lands. The introduction of supplementary feeding using crop residues will also limit open grazing and overgrazing, promote regeneration of forage, and ultimately reduce methane emissions to the atmosphere. Exit Strategy Rating: 4 Justification of rating 37. The E-SLIP sustainable exit strategy provides for full cost recovery for the delivery of private goods and services by programme end namely: a) ECF vaccination and livestock restocking; b) ECF stabilate production, and c) establishment of a private forage seed market. Exit strategy entails sustainability of the above by ensuring that the stream of benefits to the 180,000 households will continue after E-SLIP. Main issues 38. For the period under review, there is no specific mention in the report on E-SLIP s exit arrangements on various interventions. 39. The Mission recommends that E-SLIP should develop an exit plan and monitor progress or lack of it. This will help E-SLIP to identify and address possible risks to the sustainability of its interventions during implementation. For example, if only 25% cost recovery for ECF has been achieved so far, how does the programme intend to achieve 100% cost recovery within the remaining 4.5 years before programme end which is defined in the ECF-ITM cost-recovery concept note should also be included in the exit strategy. Potential for Scaling-Up Rating: Moderately Satisfactory (4) Justification of rating 40. It is the view of the Mission that, as evidenced during the field visit, with systematic monitoring, data can be generated from fodder pilots to come up with informed decisions for scaling up and replication. On the other hand, a number of interventions carried over from SLIP are being scaled-up, e.g.: Task Forces these are being introduced to other districts; ECF ITM - introduced calf immunisations to Lusaka, Central and Copper-belt provinces and CBPP vaccinations to Northern and Muchinga provinces; reinforcement of the Livestock as a business approach to farmers during sensitisation and capacity building exercises, the use of lead farmers in farmer mobilisation and the collection and payment of ECF fees into the ECF beneficiary account and the holding of periodic performance reviews providing feedback into the planning process. Main issues Actions Responsibility Deadline Status E-SLIP should develop an exit plan and monitor progress or lack of it 11 PCO

14 41. Interventions especially under Component 2 are new and will need to be tested over time to ensure replicability. At this stage, there is not adequate reported information from which to draw conclusion or form an opinion. 42. iii. Project Management Quality of Project Management Rating: Moderately Satisfactory (4) Justification of rating 43. The PCO Team was only operational in October 2017 and has made progress in the set-up of operational PCO, with adequate office premises and office equipment. 44. Implementation of Programme activities under components one and two are largely under the control of DVS and DLD. In the last quarter of 2017 and onward in 2018, the PCO improved the overall coordination of the programme, following the recruitment of 8 PCO key staff and is expected to accelerate the implementation of planned activities in 2018 in order to catch up delayed implementation of some key activities by prioritising the most critical activities. The PCO has a close working relationship with MFL, while the PSC provides the needed technical and oversight support. Main issues 45. The critical position for stocking and re-stocking is not yet filled and has direct negative impact on livestock production component. The set-up of the management system is work in progress and is expected to be fully operational by the end of The procurement of goods and services continue to be a recurrent issue, since the start-up of the programme and limited progress has been noted in effectiveness and efficiency of the procurement. 46. To fast-track programme implementation, especially given the delays of about one year the programme needs more efforts and inputs, to streamline the PCO organization and to enhance strategic planning, coordination process, project reporting and M&E. Therefore, the mission recommends that key professional staff should strengthen teamwork culture in aspects of team building, leadership skills and communication. 47. In particular, the mission has noted some critical issues in the project management that need to be addressed. The PCO needs to streamline its management tools and focus on all aspects of financial management, MIS, M&E and KM. To this effect, the PCO should finalize the management process and system, including the revision of the PIM, the set-up of the M&E system, the validation of the Base line survey, the set-up of the KM system and the formulation of a communication strategy. 48. Along the same line the programme should strengthen the budget monitoring system that provides reliable data/information for assessing implementation delivery on a timely basis. Moreover, the PCO should institute the validation of project staff TORs before any mission in the field or outside the country and also establish rules for mandatory Back To Office Report (BTO), which should highlight the proceeding of the mission and the main outcome of the mission. Finally, to complete the picture of programme's improvement plan, annual review and planning workshops should be organized in order to provide an opportunity for programme staff, DVS, DLD, key stakeholders and selected programme to review programme performance, to draw lessons and to recommend improvements for the way forward for the next year programme implementation. Based on the low cost efficiency of trainings and workshops, the mission recommends that future-planning exercises should be held in Lusaka in view of minimizing the cost. 12

15 49. In addition, the PCO should maintain a dialogue with various projects and proactively exploring opportunities for linkages and complementarities. To this effect, the PCO should carry out a mapping of donor financed projects that could be complementary or similar and to harmonize programme activities in particular, with the AfDB financed Livestock Infrastructure Support Project (LISP) in Muchinga and Northern provinces and AfDB Agricultural Productivity and Market Enhancement Project (APMEP). Knowledge Management Rating: Moderately Satisfactory (4) Justification of rating 50. E-SLIP has recently recruited a KM Officer to systematically gather process and package information to inform future designs of projects. Since his recruitment, the programme has drafted a KM & communication strategy, which will be finalized by mid-june The programme has started to document success stories from the few on-going activities and continued to capture lessons learnt for different intervention to build on what has already been captured by the prior interim KM officer. The mission recommends that E- SLIP should continue to utilize TV stations, e-newsletter, radio stations at both national and community level, and various social media channels in airing recorded success stories from the beneficiaries to increase awareness and dissemination of various E-SLIP interventions. Main issues 51. The mission would also like to highlight that the pending contract for obtaining a web server for the programme s site should be finalized ASAP to enable sharing of value chain experiences among stakeholders within and outside Zambia. Actions Responsibility Deadline Status Linkages between KM and indicators to be properly reflected in reporting. KM Continuous Finalize the draft knowledge management and communication strategy KM Continuous Complete the E-SLIP website and upload all necessary KM documents KM August 2018 Have regular meeting with NAIS to share success stories from programme KM Continuous Value for Money Rating: Moderately Unsatisfactory (3) Justification of rating 52. The Value for Money (VfM) analysis shows a critical imbalance between the financial and physical performance of the programme. Although the disbursement rate is satisfactory for a programme in its third year of implementation, its overall performance (i.e. output achievement) has been low. Furthermore, the unsatisfactory performance of the counterpart in meeting its expected contribution and the delay in covering the financing gap under Component 2, puts the financial viability of the programme at risk. Value for Money Review 53. The E-SLIP programme is built on a shared participation between IFAD, GRZ and the co-financier of Component 2, each contributing with 33%, 23% and 26% of the total project budget, respectively; the beneficiary s contribution was estimated to be 19% of the total budget. However, due to GRZ s lower contribution (with disbursements being 2.6% 13

16 of the planned budget) and the problem of the delay in covering the financing gap under C2 and the ECF beneficiary contribution expected to commence in the second quarter of 2018, the programme has exclusively relied on IFAD s funds throughout its first three years of implementation. The financing gap of OFID is being addressed with the signing of the OFID agreement by the end of April The VfM analysis revealed substantial gaps with regards to the programme efficiency and its capacity to implement activities in respect of the anticipated budget. While this is partly explained by inaccurate allocation during programme design, when DSA and fuel allowances were approximately 40% of the current rates, the Mission is concerned about the scaling up of costs related to field travels and DSAs, which are substantially high. This has brought the programme to exhaust the funds planned for Category III, which cost reached the amount of USD 1.6 million, being 170% of the total allocation. Part of the Category III funds amounting to USD 1,370, are expected to be contributed by OFID financing. 55. Investment vs recurrent costs. For instance, the cost analysis under the Control ECF Vaccination Programme shows that the recurrent costs incurred in 2017 under Training, TA and Study amount to approximately USD 217,617 which is higher than what allocated for the entire seven-year duration of this sub-component (USD 214,000). At the same time, the investment expenditures under this sub-component are low: the total expenditures under Goods & Equipment are only USD 12,666 (excluding commitments of USD 900,000), and vehicles are USD 125,000 approximately). 56. Cost for meetings and workshops. The cost analysis shows that funds for meetings and workshops are generally high. More effort should be made to substantially reduce costs to achieve maximum economy and efficiency. Actions Responsibility Deadline Status Cost of Meetings, trainings and workshops The Mission recommends to substantially reduce the cost of meetings, trainings and workshops. PCO/DCU/LPPU Continuous Coherence between, AWPB and implementation Rating: Moderately Unsatisfactory (3) Justification of rating 57. The Mission reviewed the progress reports and budget usage and found them to be inconsistent in terms of budgeted amounts, planned activities and actual especially at output level. If not addressed, this may ultimately affect the outcome and impact level results. The low usage of the budget compromised the coherence between the AWPB and implementation of planned activities as the programme has encountered challenges in adhering to the AWPB both in terms of timeliness and budgeting of activities. 58. Despite the improvement in 2017 AWPB execution to 51% compared to the expenditure rate of 24% of the 2015/16 budget, there is a need to fast track the 2018 AWPB, in order to accelerate implementation of the planned interventions. AWPB Review (3800) 59. Quality of budgets. The AWPB does not present a sufficient description of key activities and their cost assumptions. The cost of most the outputs are presented as a lump/sum. As a result, the budget for the programme s costs associated to field travels, such 14

17 as DSA, fuelling and transportation are not clearly disclosed in the AWPB. The 2019 AWPB should be improved accordingly. 60. In this regard, the Mission recommends that the quality of the next 2019 AWPB should be improved by developing a detailed Training, Meetings and Workshop Plan in the form of Annex to the AWPB. The document should provide: (i)an evidence-based analysis that justifies the need for each training/meeting/workshop activity, including description of event s objectives and target participants; and ( (ii)clear budgetary assumptions, including costs associated with the events such as: hire of the venue, publications and stationaries, eventrelated travel costs, per-diems paid to training participants/facilitators and lunch allowances. Training, Meetings and Workshop Plan Performance of M&E System Rating: Moderately Unsatisfactory (3) Justification of rating 61. Despite the challenges faced by programme due to late start-up, E-SLIP has made a good use of information available for planning and progress reporting (including RIMS reporting, levels 1, 2). It has also revised indicators for outputs and outcomes and share them with the implementing partners, to ensure adequate data collection for the need of the programme. Moreover, the PCO is providing support to field staff in operationalizing the Planning, Monitoring and Evaluation System, by using standard formats for data collection. M&E system Review Actions Responsibility Deadline Status The AWPB 2019 shall include the Training, Meeting and Workshop Plan as per the sample template shared during the Mission. Programme Coordinator May/ The mission notes that progress has been made in improving the reporting system, based on M&E plan for E-SLIP. After three years of implementation, reporting is still focused on outputs and expenditure activities rather than outcomes, first because the M&E system is yet to be set up and second, few activities are initiated in the field. As the programme is expected to catch up with implementation delays and in view of the planned MTR by the end of 2018, the programme is urged to set up the M&E system as soon as possible. The PCO initiated the set-up of a beneficiary database that is currently being updated to include all the beneficiaries with address, name, age, gender and type of support received. The mission strongly recommends that, while finalizing the contract for the consultant to prepare the M&E system, the programme needs to exert more efforts in capturing data related to outcomes on programme interventions by the end of year Baseline Survey The Programme is in the process of procuring services to undertake a baseline survey to serve as a benchmark against the progress made towards the achievement of the E-SLIP goal and development objective. The Mission expressed concerns about the fact that the Programme has started implementation, albeit at a very slow pace, but with no baseline information to be used to establish cause and effect of the different interventions. The tender documents together with the RFPs were submitted to IFAD for a No objection, however, IFAD felt that there was a need to align their decision with that of MPCs recommendation, hence, didn t give a No objection to the programme. To that effect, IFAD recommended that the programme may proceed to hire the services of a Consulting Firm through Limited Bidding Process to complete the Baseline survey on time before the Mid Term Review (MTR) as this activity has been delayed. Actions Responsibility Deadline Status 15

18 Finalize the baseline survey Regularly report on the indicators included in the revised logical framework, using the M&E system for planning, decision-making and knowledge management. Continued capacity enhancement on skills among the M&E at provincial and district level Linkages between KM and indicators to be properly reflected in reporting. Finalize the draft knowledge management and communication strategy Complete the E-SLIP website and upload all necessary KM documents M&E M&E M&E M&E/KM M&E/KM 30 September 2018 Continuous Continuous Continuous August, 2018 Requirements of SECAP 1 Rating: Unsatisfactory (2) Justification of rating 64. E-SLIP was not subjected to the Social, Environmental and Climate Assessment Procedures (SECAP) approved by IFAD in 2014 which outlines how Programme should address the social, environmental and climate impacts associated with its operations. Due to its implementation arrangements and delays in the implementation of activities, social, environmental and climate adaptation sustainability considerations, shall be treated on a case-by-case basis, if and when they occur. IV. Financial Management and Execution Disbursement Rate Acceptable Disbursement Rate Rating: auto-calculated Justification of rating 65. The disbursement is rated as satisfactory (5). The total IFAD financing of the E-SLIP programme amounts to SDR 9.87 million which includes an IFAD loan of SDR 9.3 million and an IFAD grant of SDR 0.57 million. As of 15 th April 2018, the total IFAD disbursements amount to SDR 3.95 million which represents 40% of the total financing. As the programme is in its third year of implementation, the disbursement performance is aligned to the average disbursement profiles of livestock projects in the IFAD portfolio. 66. However, this rating requires further analysis that takes into consideration the performance under the two IFAD financing instruments as well as the disbursement rate under cost category III. Main issues 67. The disbursement under the IFAD Loan is SDR 3.88 million (including the authorized allocation of SDR 1.35 million) representing 42% of the Loan. A marked increase is noted in the disbursement of the IFAD loan when compared to the figures reported in last year s 1 Social, Environmental and Climate Assessment Procedures (SECAP) 16

19 supervision mission (from 33% to 42%) as the PCO submitted three WAs for a total amount of USD 0.53 million. 68. As of 15 th April 2018, the disbursement under IFAD grant was SDR 0.07 million representing 12.5% of the total allocation of SDR 0.57 million. However, the disbursement corresponds to the initial advance only, which has not yet been utilized either. 69. The under-performance of the latter is explained by the delay in the implementation of sub-component 2.1: Sustainable forage production and utilization due to the financing gap. However, at the time of this supervision, the Loan Agreement of USD 12 million between MoF and OFID was being finalized. The grant disbursement rate is therefore expected to increase substantially as soon as the Loan Agreement becomes effective and OFID funds disbursed. Financing amount (SDR) Disbursement (SDR) % IFAD Loan 9,300,000 3,879, % IFAD Grant 570,000 71,175 12% TOTAL 9,870,000 3,951,172 40% 70. Cost categories III Training, TA & studies and II Vehicles under the IFAD Loan are overdrawn by SDR 201,053 (130%) and SDR 117,752 (127%) respectively. The review also revealed that the total expenditures under Category III reached USD 1.6 million (including expenditures not yet claimed) this being 170% of the initial allocation for the entire project life. 71. In this regard, the Mission expresses its concern about the rapid scaling up of costs under Category III. While a reallocation of funds is inevitable to ensure continuity of programme activities, the Mission recommends that the PCO closely manage and monitor with due diligence future activities that involve trainings, meetings and workshops. 72. It is also noted that, there are expenditures incurred under Component II which will be reimbursed to the IFAD Loan through the OFID financing, as follows: USD 146,000 under component 2.2 and USD 200,000 under 2.1. Reimbursement of Component II expenditures Actions Responsibility Deadline Status FAM needs to prepare a detailed schedule of OFID expenditures - by loan cost categories - that will reimburse the IFAD Loan. FAM May / 2018 The Mission recommends that the PCO should submit the cost reallocation request to IFAD in line with the mission inputs. FAM May/2018 Fiduciary Aspects Quality of financial management Rating: Moderately Unsatisfactory (3) Justification of rating 73. The quality of the programme s Financial Management (FM) is rated as moderately unsatisfactory (3). Overall, the programme has been able to cope with most of the fiduciary requirements, although shortcomings in FM persist and need to be promptly solved by the Management. Some important recommendations raised in the previous supervision, such as the timely retirement of imprest and customization of financial software, are yet to be fully addressed. The use of the accounting software ensures the timely preparation of financial reports; however, the reporting is still affected by some limitations in terms of adherence to 17

20 IFAD required formats. The programme budgeting and internal controls are considered to be the areas with major difficulties and therefore in need of improvement. Main issues 74. Internal control. The internal control system established under E-SLIP ensures a clear segregation of duties and a control of programme expenditures under the oversight of the PSC, and MFL. However, the system does not systematically ensure that activities are planned and executed as per the estimates made during project design. The Mission is especially concerned about the scaling up of costs related to field travels and DSAs which should be consistently monitored against the initial allocations. 75. The total expenditures under Category III Training, TA and Studies reached USD 1.6 million (including expenditures not yet claimed) this being 170% of the initial allocation for the entire project life. Hence, there is a risk of programme funds being spent without due regard to economy, efficiency and effectiveness, see Value for Money section. 76. The trainings and meetings attendance lists are not adequately maintained by the programme as they do not show the trainee/participant contact numbers. 77. The Mission acknowledges that the amount of spend in imprest has reduced from the previous supervision; however, the amount of unretired imprest to staff are still too high (USD 215,515 at 31 st March 2018), which risks jeopardizing the safeguarding of programme funds. The unretired advances above 120 days are still high at USD 50,000 approximatively. Furthermore, the imprest tracking register is not regularly updated and reconciled with the software. 78. Motor vehicle s daily logsheets have been issued for each programme vehicle; however, the maintenance of books does not fully adhere to PIM requirements with regard to fuelling information and preparation of monthly summaries for the approval of the Programme Coordinator. The programme logo has not yet been attached to the programme motor vehicles due to the non-availability of the programme logo; the mission received assurance that with the recent recruitment of the knowledge management officer, the logo will be finalised and attached to the vehicles shortly. 79. Budgeting. See comments under Coherence btw. AWPB and implementation. 80. Flow of Funds. The programme s funding has been affected by the persistent problem of the financing gap under Component 2. This issue has finally been addressed as MoF is expected to sign a USD 12 M Loan Agreement (LA) with OFID in April Accounting. The SAGE Evolution accounting software has not been put to optimum use; the review did not reveal any significant improvement in the use of the software since the last supervision. As a major fact to highlight, the software does not produce comparison between budget and expenditures. No improvements have been done with regard to the hiring of the SAGE Pastel consultant currently engaged by RUFEP. 82. The PCO shall ensure that the accounting software is fully operationalized and meets the following (minimum) requirements: (i) preparation of budget vs expenditures reports; (ii) allow full control over the purchasing process (procurement module); (iii) automatic preparation of FS as per IFAD templates; (iii) preparation of SoE statements with indication of vendor, date of transaction and reference. PCO also needs to discuss with the consultant whether the software can be tailored for the full preparation of SMART WAs. 83. Financial Reporting. The programme did not submit the IFR for the period ending June 2017; the unaudited FS are regularly submitted. It has been agreed that the FAM will prepare IFRs each semester, according to IFAD template shared during the supervision. 84. Internal Auditing. The Mission is satisfied with the quality of the report prepared by IA department; however, the frequency of IA is not satisfactory since only one report (