VANUATU NATIONAL INFRASTRUCTURE MASTERPLAN. Terms of Reference for Consultants
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1 VANUATU NATIONAL INFRASTRUCTURE MASTERPLAN Terms of Reference for Consultants 1. BACKGROUND INFORMATION Government of Vanuatu has requested TA support in the formulation and preparation of a national infrastructure masterplan (VNIM or the Masterplan ). The Masterplan will identify the Government s needs, strategies, policies, and immediate priorities in key economic infrastructure sub-sectors (transport, energy/power, water supply, sanitation and drainage, solid waste management, and telecommunications and ICT) for the next 5-10 years; prioritize the needs for future capital investments based on whole-of-life costs with linkages to the country s Integrated National Budget and Government Investment Program (GIP). The VNIM will use the whole-of-sector approach to identify, analyze, consolidate, and prioritize the government s needs for future capital investments. It will also identify and implement mechanisms that will: (i) strengthen the planning, financing and management capabilities of key Government agencies such as OPM, MIPU and MLNR, among others; and (ii) improve coordination among stakeholders and development partners in the planning, prioritizing and delivery of infrastructure services. 2. SCOPE OF WORK AND METHODOLOGY The development of the Masterplan will involve: (i) the conduct of an infrastructure sector review and needs analysis covering the transport (i.e., shipping, aviation and land transportation modes), water supply, energy/power, telecommunications and ICT, sanitation and drainage, and solid waste management; (ii) identification of projects/program options per sub-sector in consultation with key Government agencies, the private and non-government sectors, in-country development partners, and other stakeholders, using needs-based indicators, corporate plans, policies/regulatory frameworks, and engines for economic growth and development; (iii) ranking and prioritization of projects per sub-sector using a multi-criteria evaluation methodology based on technical, economic, financial, environmental (climate change and national disasterproofing) and social criteria and the country s absorptive capacity, that are suitable for implementation during the next 5-10 years and within the context of VNIM; (iv) investigation of the need to adjust sector policies to align with enhanced efficiency of operations, extend service frequencies, and introduce reliable services across the main islands, outer islands and remote areas; (v) preparation of a 10-year National Infrastructure Masterplan in support of the Government s objectives as described in the country s PAA and medium-term action program, Planning Long, Acting Short ; (vi) development of a coordinated and whole-of-sector approach for the country to meet those needs over the next 10 years; (vii) preparation of a funding strategy linked to the country s Integrated National Budget, Government Investment Program, and asset maintenance and renewal programs; and (viii) identification of organizational and institutional requirements necessary to develop, update and implement the masterplan on a continuing basis, including a high level review of potential institutional constraints in the various sectors and an assessment of required assistance needed to strengthen sector institutions. The development of the Masterplan will apply consultative and participatory processes with a focus on ensuring Government's sense of ownership of the components and broad-based support of stakeholders on the identified needs, priorities, outputs and costs. It is proposed to be conducted in two phases: Phase 1: Conduct of an Infrastructure Stocktake and Needs Analysis and Project Identification/Development for 2.5 months; and Phase 2: Options Prioritization and Infrastructure Master Plan Preparation for 2.5 months.
2 Phase 1: Infrastructure Stocktake, Needs Analysis and Project Identification & Development. This will involve the following activities: (i) Identifying the main drivers/sectors of economic growth and social development during the next 10 years and assessing, in qualitative and quantitative terms, the overall requirements from the economic infrastructure sector to respond to the needs of the economic drivers and attain the (ii) goals of the PAA. Collection, review and assessment of past and existing national, provincial, corporate and business plans; development partners country strategies and plans; available data, asset register(s) and information on existing infrastructure conditions; and existing and planned list of projects and programs for each infrastructure sub-sector. (iii) Conduct meetings, group consultations and/or workshops with sector agencies involving inventory of existing infrastructure, identification of current and future priority areas of intervention using needs-based indicators and policies/regulatory frameworks, and identification of individual project and program options, in each of the infrastructure subsectors (transport, power and energy, water supply, solid waste, and telecommunications and ICT). (iv) (v) Assist the Government identify and prepare a longlist of national and inter-island priority project investments, based on technical, institutional and social criteria, indicative costs (including infrastructure capital and maintenance costs, vehicle/vessel/aircraft capital and operating costs and cost savings, user charges, and costs and revenues to other sectors), environmental compliance and climate change proofing, and economic and financial viability. Identify the respective bearers and recipients thereof, the contribution of each option to the goals of national economic development and integration, and the impact of each option on the culture and environment of Vanuatu. Review institutional arrangements covering ownership, management and operation of infrastructure delivery and an assessment of user charges and cost recovery associated with port, airport, road, power, and water supply infrastructure and facilities and recommend appropriate institutional arrangements. (vi) Review of existing government policies, institutional and regulatory framework for each subsector including subsidies provided, comment on their appropriateness, efficiency, transparency and likely impact on the VNIM; and prepare recommendations aimed at improving the quality, ease of implementation, mitigating measures, and usage for the masterplan. (vii) Review and comment on present national and provincial governments criteria and methodology for sector and project planning; existing procedures for project identification, analysis, feasibility assessment, prioritization, and selection for financing, including related relationships between provincial governments and the various national government ministries. (viii) Develop a multi-criteria evaluation tool to be used in the prioritization of the development investment options and a final priority matrix of investments in economic infrastructure that will support the economic and sustainable growth strategies and objectives of the government. The development of the evaluation tool will be done in close consultation with the main stakeholders and will take into consideration the following themes. Economic - contribution to national growth agenda, cost-benefit analysis, efficiency and ease of doing business Financial whole-of-life costs, operation and maintenance costs, ability to pay Policy link to the PAA, PLAS and corporate and business plans, government policies Geography development of urban and strategic rural areas Social basic services, level of service, living standards Environmental protecting/improving the environment/ climate resilience Readiness preparation underway, e.g, feasibility studies (ix) Analyze the present operations and maintenance (O&M) practices and requirements, capabilities of MIPU and MLNR and each provincial government, and prepare recommendations for improving O&M and cost recovery, including improvements in equipment, operations, budget, organization and staffing. Phase 2: Options Prioritization and Infrastructure Masterplan Preparation, will involve the following activities:
3 (i) Consolidation of the various development investment projects and programs for the next 10 years on a sub-sector basis to be consolidated into one long-list of costed project interventions based on the "whole-of-life" costs and costs for climate proofing on major infrastructure investments. (ii) Conduct of a stakeholder workshop to obtain feedback on the long list of projects and related cost estimates and on the multi-criteria evaluation tool and its implications on project prioritization. (iii) Review government budget in relation to allocations related to infrastructure investments and O&M costs as well as the level of cost recovery of utilities and/or SOEs responsible for infrastructure service delivery in the various sub-sectors. (iv) Identification of existing government plans, budget policy statements, legislation and regulations; development partners' future country strategies and partnership agreements; crosscutting issues; and risks and mitigating measures that may have an impact on the masterplan. (iv) Assessment of the potential leverage of private sector involvement in owning, financing, (v) managing or operating selected programs and project interventions in the various sub-sectors. Preparation of a 10-year National Infrastructure Masterplan in two 5-year phases, the options to be implemented and their respective costs, in order of priority in each five-year period, together with a programme and practical guidelines for implementation that can be reviewed by the Government and subsequently be presented to development partners. (vi) Recommend a funding strategy for the masterplan for the first 3-5-years to be aligned with the National Integrated Budget and Government Investment Program. (vii) Preparation of supporting implementation strategies for the first 5 years; (viii) Preparation of a simple Monitoring and Evaluation (M&E) framework with indicators during the life of the masterplan; (ix) Recommend institutional capacity building and strengthening to facilitate further national and provincial governments capabilities in integrated economic growth sector strategies, sector planning, identification of investment projects, feasibility assessment, prioritization, and masterplan updating. During the course of the TA, the consultants will work closely with the staff of OPM, MIPU, MLNR and MFEM to provide on-the-job training and take advantage of every opportunity to integrate tools and approaches developed in this exercise into existing planning procedures of the Ministries. 3. SPECIALISTS REQUIRED The TA will require the services of three (3) international and two (2) national specialists, as follows: 3.1 Infrastructure Planner and Policy Specialist/Team Leader (international, 3.5 personmonths) The consultant will have advanced degree in infrastructure planning, policy analysis and formulation; at least 10 years experience in infrastructure project planning and feasibility studies, relevant work experience in Pacific Island Countries, preferably Vanuatu; experience in leading a multi-disciplinary team; and excellent communications and stakeholder consultation skills. The TOR for the position includes: a. Establish contact with the OPM, MFEM, MIPU and MLNR and prepare detailed work plan in consultation these ministries. b. Lead the conduct of the infrastructure stocktake including review and analysis of development plans, the condition and quantities of infrastructure assets, current and forecasted demands for infrastructure and service levels, development programs of the Government and the development partners, and other information that shapes the country s infrastructure sector. c. Lead the Team in conducting consultations with all related stakeholders in Government, infrastructure service operators, user-representative groups, and in-country development partners to develop a consensus on infrastructure projects/programs to be included in the Masterplan.
4 d. Lead in the preparation of a longlist of national and inter-island priority project investments, based on technical, institutional and social criteria, indicative costs (including infrastructure capital and rehabilitation and maintenance costs, vehicle/vessel/aircraft capital and operating costs and cost savings, user charges, and costs and revenues to other sectors), environmental compliance and climate change proofing, and economic and financial viability. Identify the respective bearers and recipients thereof, the contribution of each options to the goals of national economic development and integration, and the impact of each option on the culture and environment of Vanuatu. e. Lead the conduct of a stakeholders workshop which will apply the multi-criteria prioritization methodology to be developed by the international Economist/Financial Analyst (based on technical, economic, environmental, geographical and social criteria and the country s development needs and priorities) to determine a prioritization of project candidates within the different infrastructure sub-sectors; prioritization of project candidates between the subsectors; and prioritization of project candidates between capital investment and periodic and recurrent costs (ie., maintenance and rehabilitation). f. Lead the preparation of a 10-year National Infrastructure Masterplan in two 5-year phases, the options to be implemented and their respective costs, in order of priority in each five-year period, together with a programme and practical guidelines for implementation that can be reviewed by the Government and subsequently be presented to development partners. g. Review existing government policies, institutional and regulatory framework for the infrastructure sector including subsidies provided to the sector, comment on their appropriateness, efficiency, transparency and likely impact on the infrastructure masterplan; and prepare recommendations aimed at improving the quality, ease of implementation, mitigating measures, and usage for the masterplan. h. Ensure the incorporation of climate change and natural disaster proofing/adaptation measures, environmental assessments and management considerations in each priority project. i. Recommend a funding strategy for the masterplan to be aligned with the Government s National Integrated Budget and Investment Program. j. Recommend institutional capacity building and strengthening activities to facilitate further national and provincial governments capabilities in integrated economic and infrastructure planning, sector planning, identification of investment projects, feasibility assessment, and prioritization, and masterplan updating. k. Be primarily responsible for the production of the project deliverables including the draft and final National Infrastructure Masterplan, incorporating stakeholders comments. 3.2 Economist/Financial Analyst (international, 1.5 person-months) The specialist will have primary responsibility for preparing the prioritization methodology and the funding strategy for the VNIM. He/she should have at least 7 years of experience in resource allocation, and economic and financial analysis of infrastructure programs; familiar with the key economic and infrastructure institutions and processes in Pacific Island Countries (highly desirable, if Vanuatu); and have excellent communication and stakeholder consultation skills. He/she will perform the following tasks: a. Review the Vanuatu PAA and Planning Long, Acting Short policy implementation agenda and other country development plans and documentations identify the main economic drivers for the country, and link this with the corresponding infrastructure development needs of the Government of Vanuatu for the next 10 years. b. Develop an infrastructure prioritization methodology suitable for masterplanning based on technical, economic, financial, environmental, institutional and social criteria and the country s absorptive capacity, broken down into: Prioritization of project candidates within the different infrastructure sub-sectors; Prioritization of project candidates between the infrastructure sub-sectors; and Prioritization of project candidates between capital investment and recurrent costs (maintenance and rehabilitation). c.
5 d. Determine how future investments will be allocated between the major infrastructure subsectors using a robust, transparent and cost-effective methodology. Prepare financial analysis of the proposed investment plan including calculating FIRR and weighted average cost of capital, taking into account total financial costs, risks and benefits as well as sensitivity analyses on the financial results. e. Together with the national Infrastructure Specialist and Financial Planner and Budget Specialist, determine the additional cost for climate-proofing major investments. f. With the assistance of the national Financial Planner and Budget Specialist, analyze the strengths, weaknesses and opportunities for improvement in the current revenue generation, budget and expenditure processes of the Government with regards to infrastructure. g. Assist in preparing a draft prioritized VNIM including preliminary estimates of whole-of-life costs and costs for climate and natural disaster proofing of proposed investments. h. Determine the country s funding envelope and formulate a draft funding strategy for capital investments in infrastructure including prospective lending, co-financing and appropriate counterpart funds. i. Prepare recommendations to align the projects with the Government s standard financial management systems and design appropriate fund flow mechanisms based on the Government s integrated budget, financial management capacity, and project disbursement procedures. 3.3 Institutions and Monitoring and Evaluation Specialist (international, 1.5 months) The institutions and M&E specialist should have a degree in public administration or management; good grasp or understanding of statebuilding processes for fragile states; knowledge of the workings of Government and its various institutions in the management and delivery of infrastructure and related services; experience in preparing M&E frameworks and systems; and good communication and planning skills. Experience in Vanuatu would also be an advantage. The specialist shall perform the following tasks: a. Assist in the review of existing government policies, institutional and regulatory framework for the different infrastructure sub-sectors and prepare recommendations aimed at improving the quality, ease of implementation and usage for the masterplan. b. Conduct a rapid review of the structure, functions, procedures and resources of major government ministries and agencies as well as provincial councils with responsibilities for economic infrastructure development and services, analyze the opportunities for harmonizing and integrating their functions to improve infrastructure and service delivery. c. Using knowledge of Government processes in fragile states, develop an appropriate institutional framework and recommend institutional strengthening activities for implementing and updating the masterplan. d. Review opportunities and identify areas for involvement of the private sector in the implementation of the masterplan as well as provision, operations, maintenance and rehabilitation of the investment projects in the masterplan. Look into areas of possible publicprivate partnership in project delivery. e. Recommend supporting measures for implementation of the first 5-years of the masterplan (e.g., scoping and feasibility studies, business strategies, institutional strengthening, financing options) to be implemented by concerned agencies in the different sub-sectors. f. Assist the team leader in preparing a timeline and planning for the implementation of each major component of the infrastructure masterplan over the first 5-years including institutional strengthening activities, and identify responsible agencies in the different sub-sectors. g. Prepare a matrix of major outputs from the masterplan and indicators against which achievements can be measured and monitored; and an evaluation framework against which performance of the involved institutions can be measured and action taken for improvement. h. Assist the Team Leader in preparing and presenting the draft masterplan to the Government of Vanuatu and in incorporating any comments leading to its finalization. 3.4 Financial Planner and Budget Specialist (national, 2.0 person-months)
6 The Financial Planner and Budget Specialist should have considerable experience in Government financial and budget preparation processes as well as project costing and financial viability assessment. The Specialist should have Vanuatu working experience and excellent communication and stakeholder consultation skills. The specialist will perform the following tasks: a. Review existing government budget policy statements and related strategies, procedures, legislation and regulations including the country s National Integrated Budget, Medium Term Expenditure Framework, FMIS processes, GIP and provide feedback to enhance performance. b. Establish the level of cost recovery in each of the infrastructure sub-sectors by reviewing tariffs, costs and revenues from various sources. c. Assist the international Economist/Financial Analyst in consolidating the various investment projects and programs into one costed document based on the "whole of life" costs of the proposed interventions. d. Determine costs for climate and disaster proofing of major infrastructure investments. e. Prepare an indicative schedule of investment and recurrent cost requirements including identification of capital expenditure and foreign funding per project or per sub-sector. f. Assist the international Financial Analyst/Economist in preparing a funding strategy for the masterplan, including lending and co-financing options and appropriate Government counterpart funds. g. Assist the Team Leader in preparing and presenting the draft National Infrastructure Masterplan to the Government of Vanuatu and in incorporating the comments. h. Prepare recommendations on how to integrate tools and approaches developed under this TA in the regular planning procedures of the various ministries, departments and SOEs involved. 3.5 Infrastructure Specialist (national, 2.5 person-months) The national Infrastructure Specialist should be an engineer with at least 5 years of knowledge and exposure to the country s various infrastructure sub-sectors (transport - maritime, aviation and land; energy/power; telecommunications and ICT; water supply and sanitation; and solid waste management). He/she shall be responsible for the following tasks: a. Gather, review documents and assist in the analysis of strategies and past and current sectoral/corporate plans and programs of the different economic infrastructure sub-sectors and conduct interviews with relevant organizations to determine the existing sub-sector situation and existing and planned government proposals and investment programs. b. Lead the conduct of the Infrastructure Stocktake and Needs Analysis and assist the Team Leader in the write-up of the Stocktake Report. c. Assess technical procedures and existing technical guidelines currently used by the different infrastructure ministries and SOEs in the identification, planning, prioritizing and design of various infrastructure plans, projects and programs; and provide recommendations for needed improvement. d. Assist in the preparation of outline sector investment plans and in the preparation of summary project sheets of proposed investments. e. Work with the national Financial Planner and Budget Specialist in the preparation of cost estimates for capital and recurrent costs related to current and planned investments and phasing of such costs over the next 10 years as well as determining the overall costs for climate and natural disaster proofing of major infrastructure investments. f. Analyze the present operations and maintenance (O&M) practices and requirements, and prepare recommendations for improving O&M, cost recovery, and asset maintenance funding sources. g. Assist the Team Leader in preparing and presenting the draft VNIM to the Government of Vanuatu and in incorporating any comments. 4 REPORTING SCHEDULE The Consultants will prepare the following reports, all in the English language:
7 (i) An Inception Report 4 weeks after the start of the assignment incorporating the methodology and workplan for the conduct of an infrastructure and services stocktake and needs analysis. (ii) An Infrastructure Sector Review Report within 10 weeks of the start of the assignment, summarizing the analysis of the various infrastructure sub-sectors and including a long list of proposed project interventions per sub-sector. (iii) A draft National Infrastructure Masterplan within 19 weeks of the start of the assignment, clearly indicating the various investment priorities and programs for the various sub-sectors in two 5-year phases and implementation strategies in the first 5 years of the plan. (iv) A final National Infrastructure Masterplan for Vanuatu within 22 weeks of the start of the assignment, incorporating comments from the Government and PIAC. 5 IMPLEMENTATION SCHEDULE The estimated duration of TA implementation is 5 months to commence in July 2011, divided into 2.5 months for Stage 1 activities and 2.5 months for Stage 2 activities, of which some activities may overlap.
8 6. Submission of Applications Interested specialists are requested to their application letter and CVs to: The Pacific Infrastructure Advisory Center (PIAC) c/o ADB-Pacific Liaison and Coordinating Office Level 18, One Margaret Street, Sydney, Australia Attention: Nina Mines, Operations Officer address: or
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