RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING
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1 Public Disclosure Authorized The World Bank REPORT NO.: RES30835 RESTRUCTURING PAPER Public Disclosure Authorized Public Disclosure Authorized ON A PROPOSED PROJECT RESTRUCTURING OF REHABILITATION AND RECONSTRUCTION) SOCIAL, URBAN, RURAL AND RESILIENCE GLOBAL PRACTICE EAST ASIA AND PACIFIC APPROVED ON MAY 10, 2016 TO MINISTRY OF FINANCE Public Disclosure Authorized Regional Vice President: Country Director: Senior Global Practice Director: Practice Manager/Manager: Task Team Leader: Victoria Kwakwa Rodrigo A. Chaves Ede Jorge Ijjasz-Vasquez Abhas Kumar Jha George Soraya
2 ABBREVIATIONS AND ACRONYMS APBN : Anggaran Pendapatan dan Belanja Nasional (National revenue and expenditure) aron : Community group BNPB : Badan Nasional Penanggulangan Bencana (National Disaster Management Agency) BPBD : Badan Penanggulangan Bencana Daerah (Local Disaster Management Agency) CBDRM : Community-based Disaster Risk Management CD : Country Director IP : Implementation Progress MoF : Ministry of Finance MPWH : Ministry of Public Works OSP : Oversight Service Provider PDO : Project Development Objective PMU : Project Management Unit REKOMPAK : Community-Based Settlement Rehabilitation and Reconstruction TF : Trust Fund
3 BASIC DATA Product Information Project ID P Original EA Category Partial Assessment (B) Approval Date 10-May-2016 Financing Instrument Investment Project Financing Current EA Category Partial Assessment (B) Current Closing Date 31-Dec-2017 Organizations Borrower Ministry of Finance Responsible Agency Ministry of Public Works and Housing Project Development Objective (PDO) Original PDO The objectives of the Project are to support the Republic of Indonesia in meeting the needs for disaster-resilient settlements for disaster-affected communities and to mainstream community-based processes into the national framework for disaster relief and mitigation. Summary Status of Financing TF Approval Signing Effectiveness Closing Net Commitment Disbursed Undisbursed TF-A May May May Dec Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No
4 I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING The project ratings on the progress towards achievement of the PDO and overall implementation progress (IP) are moderately satisfactory. The progress is negatively affected by the on-going eruption of Mount Sinabung which continues to erupt today a few years after the initial eruption. Due to the active state of the volcano, reconstruction activities overlap with humanitarian aid activities, and the policy and action plan have not yet been adjusted to this situation. Although there has been a significant delay in the initial stage, as of end of November 2017, two out of three PDO indicators has achieved the target: Community Settlement Plans have been prepared in 80% of kelurahans and 80% of community based housing and/or infrastructure are of good quality. The third indicator which remains in progress is on collaboration among key agencies and stakeholders to apply CBDRM. All Intermediate Result Indicators fulfill the target. By May 2017, 22 community groups known as aron (a total of 1,389 families) had made deals with land owners, verified by the REKOMPAK team. In June 2017, several groups started the construction process, and it is estimated that 685 houses are to be complete by the end of November 2017, and about 618 additional units are expected to be finished by the end of December This makes a total of 1,311 units by the end of the year. It is expected that the target 80% of good qualities will met. The authority given to arons to supervise construction had a positive significant positive effect on quality, in some cases requiring contractors to redo work or replace building material. By December 2017, two settlements which the Grant will finance will be completed including the infrastructure. Progress has accelerated since a consulting firm was procured and been operational since July Also, 103 facilitators have been mobilized and trained to facilitate communities to formulate Community Settlement Plans and/or community site plans (CSP) and build their housing and village level infrastructure. Training for local government and 22 arons was carried out on community-based housing reconstruction by August The REKOMPAK team has been able to rectify incorrect interpretations of the REKOMPAK approach and principles despite initial resistance. A total of 22 site plans and one village level CSP have been completed with generally good quality and by October 2017 most of the physical works have started. At the request of the National Disaster Management Agency (BNPB), the REKOMPAK team has focused the replication component on recovery in the Sinabung (Kabupaten Karo) - eruption affected areas and limited the support in Manado to evaluation. The mainstreaming component is conducted in collaboration with the IDF secretariat. Along with consolidation of REKOMPAK guidelines and technical material, follow-up to the post-reconstruction process of the Mt. Merapi eruption in the districts of Sleman and Magelang will be part of the mainstreaming process. With the project s support, the local government of Sleman held a multi-stakeholder workshop to agree on rules and actions towards sustainability of settlements within the Merapi risk zones, which is to be followed-up by thematic conferences among related agencies.. While the disbursement to the Special Account has reached 100%, the utilization of the fund has experienced delay. An extension of the project for three months is necessary to fully utilize the trust fund an complete the work. Below are the major constraints that the project had to cope with such as: disaster not over yet and eruption is continuing, significant corrective actions were required in the field when the Rekompak team was mobilized, access to relocation sites were on poor conditions, and low local government capacity. Extension of the closing date is required considering the state of continuous eruption of Sinabung, and associated delay of construction, as well as lack of certainty at the local government level due to a current staffing change. While the disbursement to the Special Account has reached 100%, the utilization of the fund has experienced delay as mentioned above. By extending 3 months, it is expected that most of infrastructure investments will have been completed and community institutions for the maintenance will have been established. Government is still processing the conditionality we have established for extension which include commitments of Local Government in finalization of the works and
5 budget allocation for Currently the request extension letter from MPWH is in the final stage for Bappenas and MoF's approval. MPWH has confirmed that it could expedite the completion of books and administration with shorter the grace period as a result of this extension. II. DESCRIPTION OF PROPOSED CHANGES The closing date for the Replication and Mainstreaming of Rekompak (Community-Based Settlement Rehabilitation and Reconstruction) will be extended from December 31, 2017 to March 31, This is in line with Government projection for completion of project period. III. SUMMARY OF CHANGES Changed Change in Loan Closing Date(s) Not Changed Change in Overall Risk Rating Change in Implementation Schedule Change in Implementing Agency Change in Project's Development Objectives Change in Results Framework Change in Components and Cost Cancellations Proposed Additional Financing Proposed Reallocation between Disbursement Categories Change in Disbursements Arrangements Change in Disbursement Estimates Change in Safeguard Policies Triggered Change of EA category Change in Legal Covenants Change in Institutional Arrangements Change in Financial Management Change in Procurement Other Change(s)
6 OPS_DETAILEDCHANGES_LOANCLOSING_TABLE OPS_DETAILEDCHANGES_SORT_TABLE The World Bank IV. DETAILED CHANGE(S) LOAN CLOSING DATE(S) TF Status Original Closing Revised Closing(s) Proposed Closing Proposed Deadline for Withdrawal Applications TF-A2519 Effective 31-Dec Dec Mar Apr-2018 OVERALL RISK RATING Risk Category Rating at Approval Current Rating Overall High
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