Completion Report. Philippines: Governance in Justice Sector Reform Program

Transcription

1 Completion Report Project Numbers: and Loan Numbers: 2489 and 2840 Technical Assistance Numbers: 7210 and 8006 June 2017 Philippines: Governance in Justice Sector Reform Program This document is being disclosed to the public in accordance with ADB s Public Communications Policy 2011.

2 CURRENCY EQUIVALENTS Currency Unit peso/s(p) At Appraisal At Program Completion Loan November February 2010 P1.00 = $ $ $1.00 = P49.42 P46.17 Loan November March 2012 P1.00 = $ $ $1.00 = P42.80 P42.99 ABBREVIATIONS ADB Asian Development Bank ADR alternative dispute resolution CA Court of Appeals CTA Court of Tax Appeals DBM Department of Budget and Management DILG Department of the Interior and Local Government DOF Department of Finance DOJ Department of Justice JOW Justice on Wheels JSCC Justice Sector Coordination Council PPPF post-program partnership framework TA technical assistance NOTE In this report, $ refers to US dollars. Vice-President S. Groff, Operations 2 Director General J. Nugent, Southeast Asia Department (SERD) Director K. Bird, Public Management, Financial Sector, and Trade Division, SERD Team leader E. Sasaki, Senior Financial Sector Specialist, SERD Team members C. de Vera, Operations Assistant, SERD L. Levaque, Social Development Specialist (Gender and Development), SERD D. Nguyen, Financial Sector Economist, SERD A. Santos, Senior Financial Management Officer, SERD In preparing any country program or strategy, financing any project, or by making any designation of or reference to a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.

3 CONTENTS Page BASIC DATA I. PROGRAM DESCRIPTION 1 II. EVALUATION OF DESIGN AND IMPLEMENTATION 1 A. Relevance of Design and Formulation 1 B. Program Outputs 2 C. Program Costs 5 D. Disbursements 5 E. Program Schedule 6 F. Implementation Arrangements 6 G. Conditions and Covenants 6 H. Related Technical Assistance 6 I. Consultant Recruitment and Procurement 7 J. Performance of the Borrower and the Executing Agency 7 K. Performance of the Asian Development Bank 8 III. EVALUATION OF PERFORMANCE 8 A. Relevance 8 B. Effectiveness in Achieving Outcome 9 C. Efficiency in Achieving Outcome and Outputs 9 D. Preliminary Assessment of Sustainability 10 E. Impact 10 IV. OVERALL ASSESSMENT AND RECOMMENDATIONS 11 A. Overall Assessment 11 B. Lessons 11 C. Recommendations 11 APPENDIXES 1. Design and Monitoring Framework Policy Matrix Post-Program Partnership Framework Technical Assistance Completion Reports Summary of Gender Equality Results and Achievements 29 i

4 BASIC DATA A. Loan Identification 1. Country 2. Loan Numbers 3. Program Title 4. Borrower 5. Executing Agencies 6. Amount of Loan 7. Program Completion Report Number B. Loan Data 1. Appraisal for Subprogram 1 Reconnaissance for Subprogram 2 Date Started Date Completed 2. Fact-Finding Date Started Date Completed 3. Loan Negotiations Date Started Date Completed 4. Date of Board Approval 5. Date of Loan Agreement 6. Date of Loan Effectiveness In Loan Agreement Actual Number of Extensions 7. Closing Date In Loan Agreement Actual Number of Extensions 8. Terms of Loan Interest Rate Maturity (number of years) Grace Period (number of years) Republic of the Philippines Loan 2489-PHI (Subprogram 1) Loan 2840-PHI (Subprogram 2) Governance in Justice Sector Reform Program Republic of the Philippines Supreme Court and Department of Finance Subprogram 1 Subprogram 2 $300 million $300 million 1622 Subprogram 1 Subprogram 2 15 September June September July November August May August November October November October December December December January March April February February February March February March LIBOR-based Disbursements a. Dates Initial Disbursement Final Disbursement Time Interval Subprogram 1 Subprogram 2 12 February February November February months 0

5 ii Effective Date Original Closing Date Time Interval Subprogram 1 Subprogram 2 10 February February February March months 1.5 months b. Amount ($ million) Last Revised Allocation Net Amount Available Category or Subloan Original Allocation Amount Canceled Amount Disbursed Subprogram Subprogram Total C. Program Data 1. Program Cost ($ million) Cost Appraisal Estimate Actual Foreign Exchange Cost Subprogram Subprogram Total Financing Plan ($ million) Cost Appraisal Estimate Actual Implementation Costs ADB Financed Subprogram 1 (2 tranches) Subprogram 2 (single tranche) Total ADB = Asian Development Bank. 3. Cost Breakdown by Program Component ($ million) Component Appraisal Estimate Actual Subprogram 1 Tranche 1 Tranche 2 Subprogram 2 Undisbursed Balance Total Program Schedule Item Appraisal Estimate Actual Other Milestones Subprogram 1 Tranche 1 12 February 2009 Tranche 2 27 November 2009 Subprogram 2 16 February 2012

6 iii 5. Program Performance Report Ratings Implementation Period Development Objectives Ratings Implementation Progress Subprogram 1 From 10 February 2009 to 28 February 2010 S S Subprogram 2 From 15 February 2012 to 31 March 2012 S = satisfactory Note: No ratings in eops for program loans. D. Data on Asian Development Bank Missions Name of Mission Date No. of Persons No. of Person-Days Specialization of Members Subprogram 1 Fact-finding a 7 November 2007 a, b, c, d, 30 May Appraisal September a, b, c, d Review b September October a, c, d, e, f Subprogram 2 Reconnaissance 7 June 13 July a, d Fact-finding 1 23 August a, b, d, g, h, i, j Program completion review 2 6 k, l a = economist, b = counsel, c = governance specialist or consultant, d = public sector management specialist, e = justice sector reform and/or policy expert, f = jail decongestion expert, g = gender specialist, h = country specialist, i = justice sector coordinator, j = fiscal planning and budget expert, k = financial sector economist, l = national officer. a Fielded reconnaissance mission that was upgraded to fact-finding. Mission was fielded intermittently. b Mission was fielded intermittently in conjunction with the review mission of TA 7210-PHI: Supporting Governance in Justice Sector Reform in the Philippines.

7 I. PROGRAM DESCRIPTION 1. The Governance in Justice Sector Reform Program was designed to address weaknesses in the judiciary and justice sector institutions that are mainly caused by inadequate resources a situation exacerbated by weak financial management. Chronically insufficient resources have undermined capacity and incentives to meet institutional mandates and performance targets. The lack of resources has also created conditions that jeopardize the integrity of justice sector agencies and their staff, and has weakened the independence of the courts. The program aims to help address these issues. The Board of Directors of the Asian Development Bank (ADB) approved the program cluster on 16 December 2008, comprising two subprograms anchored in a well-defined medium-term framework. 1 The $300 million loan for subprogram 1 (covering January 2006 August 2009) was disbursed in two tranches of $150 million each in February and November The $300 million loan for subprogram 2 (covering September 2009 to March 2012) was disbursed in a single tranche in February II. EVALUATION OF DESIGN AND IMPLEMENTATION A. Relevance of Design and Formulation 2. Binding constraints. Ensuring the rule of law and a strong independent judiciary are prerequisites to economic development. Effective enforcement of laws and contracts strengthens investor confidence, facilitating growth in domestic and foreign direct investment. Investors cite the judicial system in the Philippines as complex. Judicial processes are lengthy, resulting in delayed case resolution. An impartial and accessible justice system is also crucial to reducing poverty. Delays in the delivery of justice disproportionately affect the poor, in terms of prolonged unemployment and income foregone as a result of detention, since the majority of detainees are poor, marginalized, and underprivileged. Delays in criminal proceedings, weak capacity, lack of coordination, and jail overcrowding undermine the criminal justice system in the Philippines. 3. Government commitment. The Philippine Development Plan, and the Medium-Term Philippine Development Plan, emphasized strengthening the rule of law to improve governance. The judiciary has undertaken several reforms since The Supreme Court commenced implementation of the action program for judicial reforms a comprehensive reform program of three successive chief justices that identified, prioritized, and implemented judicial reforms. The action program was regarded as a concrete step in laying the foundation for the long-term development of the judiciary, supported by the executive branch. 4. Lessons learned and the program design. Judicial reforms obtained significant donor support for a wide range of projects, which focused on judicial efficiency and independence, fiscal autonomy and accountability, and access to justice. The projects require sustained support and commitment over the medium to long term. ADB s lessons from the Philippines in implementing judicial reforms underline the importance of ownership, political will, leadership, and interagency coordination as essential conditions to reform success. Engagement should be long-term, while flexibility, continuous efforts, and persistence are key ingredients. These lessons are reinforced by a special evaluation study on ADB support to legal and justice sector reform in developing 1 ADB Report and Recommendation of the President to the Board of Directors: Proposed Program Cluster, Loan for Subprogram 1, and Technical Assistance Grant to the Republic of the Philippines for the Governance in Justice Sector Reform Program. Manila. 2 ADB Report and Recommendation of the President to the Board of Directors: Proposed Policy-Based Loan for Subprogram 2 and Technical Assistance Grant to the Republic of the Philippines for the Governance in Justice Sector Reform Program. Manila.

8 2 member countries. 3 The design of the program was underpinned by these lessons. ADB s country strategy and program for the Philippines supports judicial reforms as an integral element of governance-oriented reforms, and the strengthening of the government s commitment to implement the rule of law. 4 ADB has provided continued support to address capacity, efficiency, and accountability weaknesses in the judiciary since Technical assistance (TA) projects sustained this engagement, helping to provide the foundations for the current program. The program priorities are aligned and well coordinated with development partners to maximize synergies. B. Program Outputs 5. Progress under subprogram 1 in achieving its objectives was significant, fully complying with all eight policy conditions. Subprogram 2 built on the reforms initiated under subprogram 1, and had 16 policy actions under the following five broad medium-term objectives: (i) strengthened judicial fiscal autonomy and improved justice sector accountability and access to resources, (ii) enhanced justice sector integrity, (iii) supporting efficiency in the justice sector, (iv) access to justice by the poor and vulnerable groups, and (v) expanding the delivery of justice through alternative dispute resolution (ADR). The program cluster s policy actions are in the policy matrix (Appendix 2). 6. Over the implementation period of the program cluster, increases in the resources of justice sector agencies were accompanied by improved performance in the program s policy areas where reforms were instituted. Greater resources strengthened the demand for increased accountability for expenditure management. ADB s involvement facilitated regular and more open dialogue between the judiciary and the executive over the level and use of budgetary resources, without undermining judicial autonomy. The budget increases were particularly notable as they occurred against the backdrop of fiscal consolidation. ADB has been a strategic partner of the judiciary in placing the decentralization of court administration at the forefront of the policy agenda, and incremental progress continues to be made. 7. Output 1: Strengthened judicial fiscal autonomy, and improved justice sector accountability and access to resources. Under subprogram 1, the Department of Budget and Management (DBM) continued to release the judiciary s budget and cash allocations on a regular and single-line-item basis, providing it with full autonomy in reallocating expenditures. Such treatment is unique among government agencies. Fiscal autonomy is complemented by increased resources along with reforms aiming to increase efficiency and accountability. Results-based management has been gradually mainstreamed, as judiciary and justice sector agencies have made significant progress since 2008 in budget preparation compliant with the medium-term expenditure framework and the organizational performance indicator framework. The organizational performance indicator framework directs resources toward priorities and results (measured by agency performance indicators). Gradual progress in making remuneration competitive for justices and judges, and optimizing staff levels, were being achieved. Selected justice sector agencies received increases in their annual appropriations over the program period, averaging 35%, which was notably higher than the national average of about 25%. Justice sector agencies also received increases in their 2011 appropriations, averaging 15%, which was also significantly higher than the national average of 7% of the 2010 national expenditure program. Among other things, increased funding allowed for the creation of 22,000 additional positions 3 ADB Special Evaluation Study: ADB Technical Assistance for Justice Reform in Developing Member Countries. Manila. 4 ADB Country Strategy and Program: Philippines, Manila; and ADB Country Partnership Strategy: Philippines, Manila.

9 3 across justice sector agencies to help address severe staffing-related bottlenecks in carrying out core functions (policy action 3). 8. In addition, a significant increase in the number of women in managerial and technical positions underscores a gender-responsive structure to reduce gender bias (policy action 4). Under subprogram 1, the judiciary s budget reached the targeted 1.0% of the 2010 National Expenditure Program. In terms of real increase, justice sector agency appropriations increased by 10% against a national average of 3% (policy action 5). Reforms supported by the program are under way to improve efficiency and strengthen transparency and accountability in the use of resources by the judiciary, in part through capacity building and administrative decentralization to regions. This process started under subprogram 1 with the establishment of a pilot regional court administration office in judicial region 7 starting in July The addition of regional court administration offices in two more regions was approved in 2009, and an oversight unit was created in March 2010 to ensure the implementation of the phased decentralization process, beginning with procurement functions (policy action 6). 9. Output 2: Enhanced justice sector integrity. Notable progress has been made on integrity-related measures across justice sector agencies, including the judiciary and the Department of Justice (DOJ). During subprograms 1 and 2, the Judicial and Bar Council, which is constitutionally mandated to nominate to the President candidates for judicial posts, continued to adopt clear and objective criteria that measure the integrity, probity, and independence of judicial nominees to improve the quality of judicial appointments and to reduce judicial vacancies. The Supreme Court continued to institute measures to strengthen (i) the integrity of the courts to address corruption through the adoption of a judicial code of ethics for justices, judges, and court personnel; (ii) rules and procedures involving judicial appointments; and (iii) the disciplinary system. Following an integrity development review in 2009, the Supreme Court formed an Integrity Development and Review Committee that meets regularly and recommends integrity measures to the Supreme Court en banc. Decisions and resolutions of the Supreme Court, Court of Appeals, Court of Tax Appeals, and Sandiganbayan (the court that adjudicates graft and corruption charges against high-level government officials) also became publicly available. Judicious filing of administrative cases against erring judges, after investigation, increased 109% from 193 in 2006 to 403 in The publication of Supreme Court decisions of public interest takes place within 24 hours of the issuance of the decision. The Supreme Court approved a newly developed human resource manual on 29 March During the subprogram 1 implementation period, the DOJ worked with the Bureau of Internal Revenue to develop common guidelines on the prosecution of tax evasion cases. The DOJ adopted a code of conduct and established central and regional internal affairs units for the evaluation and investigation of complaints against prosecutors and staff of the National Prosecution Service. 10. Output 3: Supporting efficiency in the justice sector. Justice sector agencies continued to demonstrate improvements in efficiency under subprograms 1 and 2. Efforts were deepened to (i) strengthen case tracking and case flow management (case management information system Court of Appeals, Court of Tax Appeals, and Sandiganbayan); (ii) strengthen interagency coordination, jurisdiction, investigation, prosecution, and adjudication functions; and (iii) streamline rules and procedures of courts. The average duration of a case in the court was reduced as targeted from 4 years to 3 years. From 2007 to 2010, backlogs were reduced in metropolitan trial courts by 25%, in metropolitan trial courts in cities by 43%, and in municipal trial courts by 37% (all above targets), resulting from the implementation of small claims reforms, the Justice on Wheels (JOW) program, and mediation reforms. The Supreme Court has established a committee to address case congestion and delay in the lower courts, and reviewed and streamlined the system for hearing and adjudicating disputes rules, systems, and procedures

10 4 (policy action 7). The Court of Appeals implemented its zero-backlog policy effectively to decide quickly on older cases, giving priority to criminal cases involving detained convicts (policy action 8); the court has successfully resolved most of these types of cases. It also enhanced its case management information system to improve case management and public access to case status and decisions. The Court of Tax Appeals installed an online case tracking and case management system, making possible greater public access to case status information as well as supporting efficient case management for justices (policy action 9). 11. The National Prosecution Service developed and pilot tested a case flow management system in selected offices across the country that enables chief prosecutors to monitor the efficiency of prosecutors in case processing. Institutionalization of the Justice Sector Coordination Council (JSCC) through an agreement (Manila Declaration of April 2010) between the chief justice of the Supreme Court, the secretary of the DOJ, and the secretary of the Department of the Interior and Local Government (DILG) continued to improve coordination and provided a common and regular forum where issues of mutual interest in strengthening sector performance can be identified and addressed. The work of the JSCC was aligned with the government s agenda of strengthening the rule of law and addressing corruption (policy action 10). 12. Output 4: Access to justice by the poor and vulnerable groups. The judiciary continued to focus on improving access by the poor and vulnerable groups. The Supreme Court conducted regular forums on linking reforms in court policies and rules, including a forum on environmental justice in 2009, to ensure that poor and marginalized communities do not suffer a disproportionate burden of the cost of justice. The operation of the JOW program was strengthened over subprograms 1 and 2. The JOW, which deploys mobile courts to municipalities or cities with high caseloads and high vacancy rates and to detention centers without courts or judges to hear cases in the area, complements the existing court-annexed mediation program. 5 To the end of the subprogram 2 implementation period, the JOW released 5,334 inmates, settled 6,880 civil cases through mobile court-annexed mediation, and provided free legal aid to 2,750 poor detainees. From eight mobile courts, the JOW was expanded in mid-2010 to cover all courts nationwide. The 44 pilot small claims courts created during subprogram 1 were implemented in all lower courts. The Supreme Court simplified rules for cases involving small claims so that people who cannot afford a lawyer can still understand the process, while judges can render decisions on the same day of the hearing (policy action 11). To increase understanding and skills related to handling gender-based violence, activities were undertaken in the Philippine National Police and the DOJ through increased training and the preparation of manuals and handbooks. These improved the capacities of prosecutors and police to investigate and process gender-based violence cases and respond to the needs of victims (policy action 12). 13. Institutional measures to address jail congestion were strengthened. A major development in addressing jail congestion was the National Summit on Persons Deprived of Liberty held in November 2010 (policy action 13). An interagency executive committee has been monitoring implementation of the commitments (policy action 14). A Supreme Court committee for the decongestion of provincial, city, and municipal jails and an interagency technical working group under the DOJ have been addressing the underlying systemic issues involved in reforming the correctional system. This includes measures to improve inter-organizational coordination in scheduling case hearings, streamlining cumbersome legal processes, and improving information sharing. These efforts complement the various legislative initiatives to reform the correctional system in the Philippines. 5 Court-annexed mediation, as practiced in the Philippines, is a procedure before the main trial that involves settling cases filed in court with the assistance of a mediator accredited by the judiciary.

11 5 14. Output 5: Expanding delivery of justice through alternative dispute resolution. ADR mechanisms have continued to expand and have been institutionalized within the judiciary through the creation of court-annexed mediation units; the Philippine Mediation Center was the program s oversight body. Court-annexed mediation mechanisms such as mediation, arbitration, and conciliation have contributed to easing the caseload burden of the formal court system. During subprogram 1, there were 102 court-annexed mediation units. The remit of these units was expanded through the creation of court-annexed mediation units in all lower courts nationwide in 2010, requiring the mandatory referral of all cases identified for mediation under the existing rules, and inclusion of offenses punishable by up to 6 years imprisonment. In September 2009, the Supreme Court adopted the special rules of court on ADR and launched a series of seminars nationwide to train regional trial court judges on their use. The rules lay down, among other things, a comprehensive framework on the enforcement of arbitral awards. In January 2011, the Supreme Court adopted consolidated and revised guidelines to implement the expanded coverage of court-annexed mediation and judicial dispute resolution. These policies significantly expand the cases that are required to be referred to mediation (i.e., those punishable by imprisonment of less than 6 years). As a result of these reforms, the number of cases referred to court-annexed mediation increased from 21,211 in 2006 to 46,311 in 2010, or by 118%; cases referred to judicial dispute resolution increased by 250%, from 1,437 in 2006 to 5,032 in 2010 (policy action 15). In December 2009, the DOJ promulgated the implementing rules and regulations of the ADR Act, which created the Office for ADR, and emphasized its lead role in promoting and developing ADR in the public and private sectors (excluding court-annexed ADR, which is under the jurisdiction of the Supreme Court). To make the Office for ADR operational, the DBM provided a budget of P10 million in 2011 for its initial organization (policy action 16). 15. Given the long-term nature of some of the critical reforms, and the efforts to sustain implementation, a post-program partnership framework (PPPF) was established through the JSCC. This has created the basis for continuous policy dialogue and engagement during the critical period. The PPPF focused on the key priorities in the reform of the judiciary and justice sector agencies. Details of the proposed PPPF for the judiciary and justice sector agencies are in Appendix 3. C. Program Costs 16. The government requested a loan of $300,000,000 from ADB s ordinary capital resources in support of subprogram 1, and a loan of $300,000,000 from ADB s ordinary capital resources to support subprogram 2. The program loans reflected the development financing needs of the government, aiming to increase development and social spending, and produce economic gains through increased resources, efficient resource use, and greater accountability, resulting in a higher quality of public service in the justice sector. D. Disbursements 17. The $300 million loan for subprogram 1 was disbursed in two tranches of $150 million each in February and November 2009 upon the government s full compliance with the policy actions for both tranches. The $300 million loan for subprogram 2 was disbursed in a single tranche in February 2012 after confirmation of the government s full compliance with the policy actions. The disbursement schedule was appropriate, retroactively financing the justice sector reforms in a sequential manner through the two subprograms.

12 6 E. Program Schedule 18. The first tranche of subprogram 1 covered January 2006 to July All actions in the policy matrix under the first tranche were implemented within this period. The second tranche of subprogram 1 covered July 2008 to August All actions in the policy matrix under the second tranche were implemented within this period. The subprogram 2 implementation period, from September 2009 to August 2010, was extended until March Eight additional policy actions were added to the initially approved eight triggers under subprogram 2 to reflect the enlarged scope and depth of reforms and the achievements of justice sector agencies under the following five broad medium-term objectives: (i) strengthened judicial fiscal autonomy and improved justice sector accountability and access to resources, (ii) enhanced justice sector integrity, (iii) supporting efficiency in the justice sector, (iv) access to justice by the poor and vulnerable groups, and (v) expanding the delivery of justice through ADR. All policy actions under subprogram 2, including eight additional policy actions, were implemented. F. Implementation Arrangements 19. Implementation arrangements established under subprogram 1 continued under subprogram 2. The Supreme Court and the Department of Finance (DOF), as the executing agencies, were responsible for the overall implementation of the two subprograms, including program administration, disbursements, maintenance of all program records, and reporting to ADB. Key implementing agencies were the Supreme Court, the DOJ, the DILG, the DBM, and the Office of the Solicitor General. The program coordination committee established under subprogram 1, co-chaired by the head of the International Finance Group of the DOF and the Supreme Court s court administrator, met regularly and, when needed, on an ad hoc basis with representatives from the DBM, the DOJ, the DILG, and the Office of the Solicitor General to coordinate and ensure effective implementation of the proposed reforms. In coordination with the program coordination committee, ADB carried out periodic reviews and monitored progress under the program. 20. ADB s support also facilitated more formal and regular coordination among multiple justice sector agencies through the establishment of the JSCC, and strengthened interbranch coordination to address sector-wide issues such as case decongestion and delay reduction. The JSCC, chaired by the chief justice and whose membership includes the secretary of justice and heads of all justice sector agencies, met regularly. It transcended the constitutional divide between the executive and judicial branches of the government. G. Conditions and Covenants 21. The first tranche of subprogram 1 was from January 2006 to July All actions in the policy matrix under both the first and second tranches of subprogram 1 were implemented. All policy actions under subprogram 2, including eight additional policy actions, were also implemented. The detailed compliance status is in the policy matrix (Appendix 2). H. Related Technical Assistance 22. Two TA projects were provided under the program cluster: (i) an advisory TA grant attached to the subprogram 1 loan, designed to strengthen the delivery of targets envisioned under subprogram 2; and (ii) a capacity development TA grant attached to the subprogram 2 loan to ensure that the policy and institutional reforms would be sustained beyond the program

13 7 implementation period. The TA completion reports (Appendix 4) rate both TAs successful. Overall, the two TA projects contributed to the success of the program. 23. The original implementation period of the $2 million advisory TA was from 6 May 2009 to 31 August The TA was extended for 21 months to 31 May 2012 because of a change in leadership of the judiciary and the executive, which caused the delays in implementation. The TA largely delivered on its outcome and outputs, with the number of cases referred to court-annexed mediation increased by 118% from 2006 to The TA (i) strengthened judicial fiscal autonomy and justice sector accountability, and improved access to resources; (ii) improved integrity and individual accountability in the sector; (iii) supported efficiency in the justice sector; (iv) supported ADR; and (v) promoted access to justice by the poor and vulnerable groups. 24. The original implementation period of the $1 million capacity development TA was from 31 July 2012 to 28 February The TA was extended for 20 months to 31 October 2015 because of the change in leadership of the Supreme Court, which led to changes in reform priorities. The TA achieved impact indicators, with the Rule of Law index improved from 33.8% in 2007 to 53% in 2015, and the overall corruption perception index ranking improved from 141 in 2007 to 95 in Outcome indicators were largely achieved, with an increase in the case clearance rate from 27.3% in 2006 to 37.8% in 2010, a 10% increase in the number of clients served by the Public Attorney s Office from 2007 to 2010, and the number of cases referred to court-annexed mediation increased by 118% from 2006 to I. Consultant Recruitment and Procurement 25. No consultants were recruited and no procurement was made under the program cluster loans. J. Performance of the Borrower and the Executing Agency 26. The Supreme Court and the DOF, as the executing agencies, implemented the two subprograms effectively, through coordination between the implementing agencies (the Supreme Court, the DOJ, the DILG, the DBM, and the Office of the Solicitor General); program administration; disbursements; maintenance of all program records; and reporting to ADB. 27. The program coordination committee established under subprogram 1, co-chaired by the head of the International Finance Group of the DOF and the Supreme Court s court administrator, met regularly and, when needed, on an ad hoc basis with representatives from the DBM, the DOJ, the DILG, and the Office of the Solicitor General to coordinate and ensure effective implementation of the proposed reforms. 28. ADB s support facilitated formal and regular coordination between multiple justice sector agencies through the establishment of the JSCC, and the attached TA projects helped improve institutional capacity and interbranch coordination to address sector-wide issues such as case decongestion and delay reduction. The JSCC met regularly, and transcended the constitutional divide between the executive and judicial branches of the government. 29. The performance of the borrower and the executing agencies is rated highly satisfactory.

14 8 K. Performance of the Asian Development Bank 30. In coordination with the program coordination committee, ADB carried out periodic reviews and monitored progress under the program. The attached ADB TA projects provided timely and relevant assistance to the strengthening of institutional and operational capacities in the justice sector through consultations, policy advice, training, and workshops. ADB s facilitated establishment of the JSCC to strengthen interbranch coordination to address sector-wide issues such as case decongestion and delay reduction, and ameliorated the constitutional divide between the executive and judicial branches of the government. 31. The performance of ADB is rated satisfactory. Even so, subprogram 2 was extended beyond the initial time frame and the attached TA was also extended. III. EVALUATION OF PERFORMANCE A. Relevance 32. The program design was highly relevant. It was to support the Philippine Development Plan, and the earlier Medium-Term Philippine Development Plan, , which both emphasized strengthening the rule of law to improve governance. Investors cited the judicial system in the Philippines as complex, and the judicial processes as lengthy, resulting in delayed case resolution. Ensuring the rule of law and a strong independent judiciary are prerequisites to economic development. Effective enforcement of laws and contracts strengthens investor confidence, facilitating growth in domestic and foreign direct investment. An impartial and accessible justice system is crucial to reducing poverty. 33. Delays in the delivery of justice impact disproportionately on the poor in terms of prolonged unemployment and income foregone as a result of detention, since the majority of detainees are poor, marginalized, and underprivileged. Delays in criminal proceedings, weak capacity, lack of coordination, and jail overcrowding undermine the criminal justice system in the Philippines. 34. The program cluster was designed against this background in line with the government s development plans. It aimed to support the implementation of comprehensive judicial reforms in laying the foundation for the long-term development of the judiciary, supported by the executive branch. The program was built on ADB s lessons from the Philippines in implementing judicial reforms, which underlined the importance of ownership, political will, leadership, and interagency coordination as essential conditions to reform success. Lessons also showed that engagement should be long-term, while flexibility, continuous efforts, and persistence are key ingredients. These lessons are reinforced by a special evaluation study on ADB support to legal and justice sector reform in developing member countries (footnote 3). 35. ADB s country strategy and program for the Philippines supports judicial reforms as an integral element of governance-oriented reforms, and the strengthening of the government s commitment to implement the rule of law (footnote 4). ADB has provided continued support to address capacity, efficiency, and accountability weaknesses in the judiciary since TA projects sustained this engagement, helping to provide the foundation for the program. The program priorities were also aligned and coordinated with development partners to maximize synergies.

15 9 B. Effectiveness in Achieving Outcome 36. The program achieved its outcome successfully. Progress under subprogram 1 in achieving its objectives fully complied with all eight policy conditions. Subprogram 2 built on the reforms initiated under subprogram 1, and had 16 policy actions. All policy actions under subprogram 2, including eight additional policy actions, were implemented. Over the implementation period of the program cluster, increases in the resources of justice sector agencies were accompanied by improved performance in the program s policy areas where reforms were instituted. Greater resources strengthened the demand for increased accountability for expenditure management. ADB s involvement facilitated regular and more open dialogue between the judiciary and the executive over the level and use of budgetary resources, without undermining judicial autonomy. The budget increases were particularly notable as they occurred against the backdrop of fiscal consolidation. 37. The outcome indicators in the program s design and monitoring framework comfortably achieved the performance targets: (i) The court case clearance rate was targeted to increase from 27.3% in 2006 to 34.0% by The actual overall judiciary clearance rate was 37.8% in % in the Supreme Court, 52.0% in metropolitan trial courts in cities, and 43.0% in metropolitan trial courts and municipal trial courts. (ii) The number of clients served by the Public Attorney s Office was targeted to increase by 10% from 2007 to The actual number of clients served by the Public Attorney s Office increased from million in 2007 to million or by 420,000 clients (10%). (iii) The number of cases referred to mediation was targeted to increase by at least 50% from 2006 to The number of cases referred to court-annexed mediation increased from 21,211 in 2006 to 46,311 in 2010, or by 118%; and the number of cases referred to judicial dispute resolution increased from 1,437 in 2006 to 5,032 in 2010, or by 250%. The design and monitoring framework, which also shows substantial outputs achievements, is in Appendix 1. C. Efficiency in Achieving Outcome and Outputs 38. The program is rated successful in delivering its results. All actions in the policy matrix under the first tranche of subprogram 1 were taken within the implementation period from January 2006 to July All actions in the policy matrix under the second tranche were implemented within the program implementation period from July 2008 to August However, the originally planned subprogram 2 implementation period from September 2009 to August 2010 was extended until March 2012 because progress was slower than expected, with eight additional policy actions added to the initially approved eight triggers to reflect the enlarged scope and depth of reforms and the achievements of justice sector agencies under the following five broad medium-term objectives: (i) strengthened judicial fiscal autonomy and improved justice sector accountability and access to resources, (ii) enhanced justice sector integrity, (iii) supporting efficiency in the justice sector, (iv) access to justice by the poor and vulnerable groups, and (v) expanding the delivery of justice through ADR. All policy actions under subprogram 2, including the eight additional policy actions, were implemented during the extended implementation period.

16 10 D. Preliminary Assessment of Sustainability 39. The project sustainability in the future is less likely. 40. ADB has provided continued support to address capacity, efficiency, and accountability weaknesses in the judiciary since The sector reform obtained significant donor support for a wide range of projects, which focused on judicial efficiency and independence, fiscal autonomy and accountability, and access to justice. The judiciary has undertaken several reforms since The Supreme Court commenced implementation of the action program for judicial reforms a comprehensive reform program of three successive chief justices that identified, prioritized, and implemented judicial reforms. The action program was regarded as a concrete step in laying the foundation for the long-term development of the judiciary, supported by the executive branch. ADB s involvement facilitated regular and more open dialogue between the judiciary and the executive over the level and use of budgetary resources, without undermining judicial autonomy. 41. Over the implementation period of the program cluster, increases in the resources of justice sector agencies were accompanied by improved performance in the program s policy areas where reforms were instituted. Greater resources have strengthened the demand for increased accountability for expenditure management. The budget increases are particularly notable as they occurred against the backdrop of fiscal consolidation from 2000 to The government achieved fiscal consolidation by 2010, and the budget surpluses supported its commitment to justice sector reform thereafter. 42. ADB s support facilitated more formal and regular coordination among multiple justice sector agencies through the establishment of the JSCC, and strengthened interbranch coordination to address sector-wide issues such as case decongestion and delay reduction. The JSCC meets regularly, and helps address the constitutional divide between the executive and judicial branches of the government. 43. Ensuring the sustainability of reforms poses challenges. Recent events highlight continued weakness in the sector over congestion in prisons and a potential rising backlog of cases addressed. Moreover, budgetary allocation to the judiciary in the government s national expenditure plan falls below 1% of the total government expenditure. Targeting a 1% allocation of the total expenditure was one of the triggers for the second tranche disbursement of the subprogram 1 loan. 6 Thus, the sustainability of reforms is less likely. E. Impact 44. General. Positive impacts were generated during program implementation. Progress under subprogram 1 in achieving its objectives was significant, fully complying with all eight policy conditions. All policy actions under subprogram 2, including eight additional policy actions, were also implemented. Over the implementation period of the program cluster, increases in the resources of justice sector agencies were accompanied by improved performance in the program s policy areas where reforms were instituted. Greater resources strengthened the demand for increased accountability for expenditure management. ADB s involvement facilitated regular and more open dialogue between the judiciary and the executive over the level and use 6 National Expenditure Plan (NEP) for 2010 budget to show Department of Budget Management proposal to provide the Judiciary with budget sourced from the National Government equivalent to at least 1% of total government expenditure proposed under the 2010 NEP.

17 11 of budgetary resources, without undermining judicial autonomy. The budget increases were particularly notable as they occurred against the backdrop of fiscal consolidation. ADB has been a strategic partner of the judiciary in placing the decentralization of court administration at the forefront of the policy agenda, and incremental progress continues to be made. 45. Gender. The program was successful in achieving gender equality results: (i) improving the capacity of the police and judiciary to deliver gender-sensitive services, particularly to women survivors of gender-based violence; (ii) strengthening institutional mechanisms for planning, implementing, and evaluating gender mainstreaming initiatives; and (iii) increasing women s representation in the judiciary and justice sector agencies. These gender results, including increased access for women to gender-sensitive justice services, were key ingredients in the overall achievement of the program s outcome and effectiveness. More details on the gender results are in Appendix 5. A. Overall Assessment IV. OVERALL ASSESSMENT AND RECOMMENDATIONS 46. The program cluster delivered its results successfully, fully complying with all policy actions under the two subprograms. Throughout program implementation, increases in the resources of justice sector agencies resulted in improved performance in the program s policy areas increased accountability for expenditure management; improved coordination between the judiciary and the executive over the level and use of budgetary resources; and enhanced integrity, efficiency, and inclusiveness of the justice sector. The program is rated qualified as successful given concerns with sustainability that impacts may not be long-lived (para. 43). B. Lessons 47. Judicial reforms involve a wide range of institutions and require sustained support and commitment over the medium to long term. Justice sector institutions are conservative and resistant to change. Lessons from the Philippines in implementing judicial reforms underline the importance of ownership, political will, leadership, and interagency coordination as essential conditions to reform success. It is one of the most complex sectors, making consensus building among different stakeholders mainly constitutional bodies unstable and difficult. The program targets may have been too scattered and could have been more focused on capacity and institutional development rather than policy improvement to ensure sustainability. The program could benefit from an investment project or a sector development program involving investment components, rather than a policy-based loan. C. Recommendations 48. It is recommended to monitor closely if the results delivered by the program are sustained and extended along the PPPF of the program in the future, especially in (i) regular and open dialogue between the judiciary and the executive over budget management, (ii) judicial autonomy, (iii) decentralization of court administration at the forefront of the policy agenda, and (iv) effective interagency coordination by the JSCC to address sector-wide issues such as case decongestion and delay reduction.

18 12 Appendix1 Design Summary Impact Greater public trust and confidence in the justice system Outcome A more efficient justice sector Performance Targets and Indicators with Baselines By 2016: Improvement in rule of law index (2007 baseline: 33.8%) and corruption perception index (2008 baseline rank of 141 and score of 2.3) Foreign direct investment stock as a percentage of gross domestic product increased to 20% by 2016 (2006 baseline: 14.4%) Increase in case clearance rate a in courts from 27.3% in 2006 to 34.0% by 2010; increase in number of clients served by PAO b by 10% between 2007 and 2010; and increase in cases referred to mediation by at least 50% between 2006 and 2010 DESIGN AND MONITORING FRAMEWORK Achievements Achieved: Rule of law index improved from 33.8% in 2007 to 35.4% in 2009 Overall corruption perception index ranking improved from 141 in 2007 to 134 in 2010 and corruption perception index score from 2.3 to 2.4 Foreign direct investment stock was 14.4% of gross domestic product in 2009 Achieved In 2010, overall actual clearance rate in the judiciary was 37.8% 44.0% in the Supreme Court, 52.0% in metropolitan trial courts in cities, and 43.0% in metropolitan trial courts and municipal trial courts. Number of clients served by the PAO increased from million in 2007 to million, or by 420,000 clients (10%). Number of cases referred to courtannexed mediation increased from 21,211 in 2006 to 46,311 in 2010, or by 118%; and number of cases referred to judicial dispute resolution increased from 1,437 in 2006 to 5,032 in 2010, or by 250%. Data Sources and Reporting Mechanisms The World Justice Project Rule of Law Index Transparency International, corruption perception index Bangko Sentral Ng Pilipinas, NSCB Supreme Court, Office of the Court Administrator, CAMIS case statistics ; judiciary annual report Annual report and statistical reports, PAO, DOJ Supreme Court, Philippine Judicial Academy, CAM and JDR reports Assumptions and Risks Assumptions Macroeconomic and political stability and continued adoption of sound macroeconomic policies Sustained commitment to strengthen rule of law and governance reforms Strong civil society and media oversight Risk Political economy risks for institutional change, and reforms in the judiciary Risks Institutional risks from vested interests to change, weak management systems, and lack of strong and effective commitment to reforms Weak implementation capacity for case decongestion and delay reduction reforms

19 Appendix 1 13 Design Summary Outputs 1. Strengthened judicial fiscal autonomy, and improved justice sector accountability and access to resources 2. Enhanced justice sector integrity 3. Supporting efficiency in the justice sector Performance Targets and Indicators with Baselines Real increases in the justice sector s annual budget and in judiciary s share in national budget from 0.83% 2007 to about 1.00% in 2010 Judiciary accomplishments and expenditures published and publicly available Supreme Court integrity infrastructure strengthened by 2010 Decrease in the average duration of a case in lower courts from 4 years to 3 years by end of 2010 Reduction in backlog of court cases by 15% by Achievements Achieved Judiciary and justice sector agencies received real increases in their 2011 budgets (judiciary 2.26%, DOJ 5.19%, PAO 38.28%, BuCor 6.43%, Office of the Solicitor General 5.17%, PPA 6.45%, and BJMP 10.61%). Judiciary s actual 2010 obligations (P billion) was 1.019% of 2010 actual obligation of P1.473 billion) Achieved Judiciary s annual report containing details of its caseloads and outputs in expenditures are published annually on its website Achieved Two standing committees on enhancing institutional integrity and ethics established to address integrity issues Filed administrative cases against judges increased from 193 in 2006 to 403 in 2009, or an increase of 109% In 2010, 47.38% of all cases in the lower courts were 1 year old or less, 14.00% were 1 2 years old, and 9.19% were 2 3 years old, so 70.57% of all cases were 3 years old or less. Backlog of cases in metropolitan trial Data Sources and Reporting Mechanisms Table B10, Budget of Expenditures and Sources of Financing 2012 Supreme Court budget Supreme Court annual report Monitoring number of complaints, administrative cases filed versus number resolved annually Agency reports Statistical Reports Division, CMO, Office of the Court Administrator CAMIS statistics, Supreme Court Assumptions and Risks Assumption Adoption of public financial management measures, with adequate budget resources Risks Institutional resistance to introduce budget reforms Opportunities for corruption arising from resistance Lack of effective delegation of administrative and financial management functions Assumption Supreme Court commitment to REPIrecommended reforms sustained Risk Weak mechanisms for ensuring accountability for performance and delivery of service and corruption risks Assumptions Effective implementation of rule of law reforms, including measures streamlining court rules and procedures Strong interagency coordination