Expected results of the Trust Fund and corresponding indicators (including baselines, result goals and sources of data) are set out in Annex 4.

Transcription

1 Administration Agreement between the European Commission and the International Bank for Reconstruction and Development concerning the Part H Europe 2020 Programmatic Single-Donor Trust Fund Trust Fund (No. TF072466) (EC Contract No 2015.CE.16.BAT.041) This Administration Agreement is concluded under Direct Management in the context of the Framework Agreement between the World Bank Group and the European Commission which sets the general conditions for this Agreement. The Framework Agreement shall be applicable and form an integral part of the Administration Agreement for the Trust Fund. 1. The International Bank for Reconstruction and Development (the "Bank") acknowledges that the European Commission (the "Donor", and together with the Bank, the "Parties" and each a "Party") agrees to provide the sum of one million Euro (1,000,000) (the "Contribution") for the Part II Europe 2020 Programmatic Single-Donor Trust Fund, (No ) (the "Trust Fund") in accordance with the terms of this Administration Agreement. The estimated total budget of the Trust Fund is Euro one million (1,000,000). The indicative budget set out in Annex 5 shall be used for monitoring purpose only and shall not be binding. 2. The Contribution shall be used to finance the activities set forth in the "Part II Europe 2020 Programmatic Single-Donor Trust Fund Description" attached hereto as Annex 1, and shall be administered by the Bank on behalf of the Donor in accordance with the terms of this Administration Agreement, including the "Standard Provisions" attached hereto as Annex 2 and "Governance" attached hereto as Annex 3. Expected results of the Trust Fund and corresponding indicators (including baselines, result goals and sources of data) are set out in Annex 4. The Implementation period shall start on the date following that on which the last of the two parties signs. 3. The Donor shall deposit the Contribution in accordance with the following schedule and in the currency specified in Section 1 above ("Contribution Currency") into such bank account designated by the Bank (each amount deposited hereinafter referred to as an "Installment") upon submission of a payment request by the Bank: (A) Promptly following countersignature - E 500,000 (B) C 250,000 subject to the disbursement of 70% of the preceding installment. (C) E 250,000 subject to the disbursement of 70% of the preceding installment. The period for payment of further installments shall be 60 days. The period for payment of the balance shall be 90 days. 4. When making any deposit, the Donor shall instruct its bank to include in its deposit details information (remittance advice) field of its SWIFT deposit message, information indicating: the amount deposited, that the deposit is made by the Donor for TF (the Part II Europe 2020 Programmatic Single-Donor Trust Fund), the Commission internal reference number and the date of the Administration Agreement, the name of the project for which the funds are intended, the name of the Commission department responsible for the Trust Fund and the date of the deposit (the "Deposit Instructions"). In

2 addition, the Donor shall provide a copy of the Deposit Instructions to the Bank's Accounting Trust Funds Division by sent to tfremitadvice@worldbank.org or by fax sent to +1 (202) Except with respect to the Deposit Instructions, any notice, request or other communication to be given or made under this Administration Agreement shall be in writing and delivered by mail, fax or e- mail to the respective Party's address specified below or at such other address as such Party notifies in writing to the other Party from time to time: For the Bank (the "Bank Contact"): Country Director ECCU5 The World Bank 17 av Marnix, 1000 Brussels - Belgium Tel: For the Donor (the "Donor Contact"): RudolfNiessler (or successor thereto) Director for Policy European Commission, Directorate General for Regional and Urban Policy Avenue de Beaulieu 5, 1160 Bruxelles - Belgium Tel: rudolf.niessler@ec.europa.eu 6. In the event any amounts are to be returned to the Donor under this Administration Agreement, the Bank shall transfer such amounts to the Donor, unless otherwise agreed with the Bank. 7. All annexes hereto and the Framework Agreement between the World Bank Group and the European Commission constitute an integral part of this Administration Agreement, whose terms taken together shall constitute the entire agreement and understanding between the Donor and the Bank. In the event of any inconsistency, the Framework Agreement prevails over the the Administration Agreement and the Administration Agreement prevails over its Annexes. Unless otherwise specified in an annex hereto, this Administration Agreement may be amended only by written amendment between the Bank and the Donor. 8. The measures taken to identify the EU as a source of financing shall be in accordance with Attachment 4 of the Framework Agreement.

3 9. Each of the Parties represents, by confirming its agreement below, that it is authorized to enter into this Administration Agreement and act in accordance with these terms and conditions. The Parties are requested to sign and date this Administration Agreement, and upon possession by the Bank of this fully signed Administration Agreement, this Administration Agreement shall become effective as of the date of the last signature. INTE A ON ANK FOR RECONSTRUCTION AND DEVELOPMENT By: Name: Christian Bodewig Title: Acting Country Director Date: EUROPEAN UNION represented by ee EAN COMMISSION By: Name: Rudolf Niessler Title: Director Date: '_

4 ANNEX 1 Part II Europe 2020 Programmatic Single-Donor Trust Fund Description This Annex shall be applicable to and form an integral part of the Administration Agreement for the Trust Fund between the Bank and the Donor. 1. Objectives The objectives of the Trust Fund are: The European Commission and the Bank share a common objective of building competitive and sustainable economies and reducing poverty and social exclusion - goals of the Europe 2020 Agenda which is built on three pillars of smart, sustainable and inclusive growth. The European Commission and the Bank concur that direct interaction is beneficial to both institutions and through them to the beneficiary countries. This applies particularly to the provision of analytical, advisory and knowledge services and technical assistance. The European Commission has expressed an interest in ensuring that the Bank continues to provide technical assistance in the framework of the Trust Fund in furtherance of the common objective set forth above. 2. Activities The sub-objectives and description of activities are: 2.1 The European Commission, particularly the Directorate General for Regional and Urban Policy (DG REGIO) supports the regional economic development goals of its member states. The 6th Cohesion report of the Commission shows that governance problems not only delay the implementation of Cohesion Policy programmes, but also reduce the impact of these investments. The report also highlights (i) that the quality of governance is particularly low in the countries benefitting most from Cohesion Policy and (ii) that there are significant disparities in the quality of governance both at national and regional level. A comprehensive and comparable set of actionable regional governance indicators does not exist in the European Union (EU). To this end, DG REGIO has requested the Bank's assistance in identifying and developing actionable indicators measuring the quality and capacity of public administrations at national and regional level of the EU Member States. The activity's overall objective is to inform the European Commission and EU Member States' and to identify and develop a set of actionable governance indicators that measure EU Member States' administrative capacity to implement cohesion programmes at national and regional level. The activities (which may be described as "components" of activities) to be financed by the Trust Fund, in support of the sub-objectives cited in Section 2.1 above, are the following Bank-executed activities, for which the Bank has implementation responsibility: A. Component One: Indicators of Strength of Public Management Systems This Activity will seek to develop indicators that provide a means of assessing the strength and quality of governance and public management systems in EU's regions as it links to the implementation of cohesion policy and national and regional development goals. This activity draws on the recent Bank analytical work on the Indicators of the Strength of Public Management Systems (ISPMS). The ISPMS initiative is

5 a multi-stakeholder effort coordinated by the Bank which seeks to develop a consensus among practitioners around a set of cross-national performance indicators of the strength and quality of governance and public management systems. ISPMS indicators are selected based on the following criteria, they: point governments towards actions that they can take to address a performance problem ("actionable"); measure how institutions actually work rather than what they look like ("behavioral"); measure management systems that are relevant for achieving broader development outcomes ("action-worthy"); and use data that is routinely gathered through existing systems, assessments and surveys. The ISPMS project has compiled a set of 100 indicators covering 188 countries (with a total of 22,700 observations) that meet these criteria. These compiled indicators focus on five core public management systems such as financial management, tax administration, procurement, public administration/civil service, etc., and draw on available international indicator sets (including Public Expenditure and Financial Accountability, the Open Budget Survey, Global Integrity and Doing Business). The Bank can access additional information that the Bank is compiling on Financial Management Information Systems, e-government, Open Budget Data and Open Contracting Partnership. In order to refine and narrow this large database of public sector management indicators, the Bank will: 1) Take stock of the available indicators that meet ISPMS criteria (including those listed above and the ISPMS list) and identify a subset that are responsive to the objective of measuring the strength and capacity of public sector management based on the Bank's operational experience in supporting public sector reforms in EU Member States and candidate countries. 2) Filter this subset of applicable indicators based on the availability of routinely collected data by the European Commission, EU Member States, statistical authorities and other stakeholders within the EU. Identify data and coverage gaps and propose means of closing the gaps at a reasonable cost, exploring alternative data collection methods. 3) Draft Public Sector Indicator Report - Prepare initial Report on proposed public sector management indicators, identifying data needs, coverage gaps and proposing data collection and data mining alternatives 4) Participate to meetings with DG REGIO and other European Commission services in the context of the European Commission's inter-service group on public sector modernization to discuss and agree on the public sector indicators that should be tested under this component through future piloting; including on: * feasibility of implementing the indicators for regions across the EU; * the extent to which the systems measured are "action-worthy" - behavioral change in these systems is associated with improvements in development outcomes; * discuss measures the European Commission could take to strengthen the quality and coverage of the selected indicators through administrative measures; and * identify lagging EU Member States and regions where selected indicators could be piloted using existing data sets and data solicited from the pilot locations. 5) Finalize the Public Sector Indicator Report based on the outcome of the consultations. B. Component Two: Citizen-Focused Governance Indicators This Activity will seek to develop indicators that provide a means of assessing the quality of public service and the performance of public institutions from EU citizens' perspective.

6 Citizen-focused governance embodies the spirit of public service - a government dedicated to serving citizens. Citizen-focused governance indicators explore how institutions influence wellbeing, how institutions impact citizen's behavior and what drives citizen's satisfaction and trust in public institutions. Most measures of the quality of "public service" focus on citizens as clients, measuring the quality of service delivery by looking at aspects of timeliness, cost and accessibility. Others - Gallup, World Values Survey, and regional barometers - ask citizens directly the extent to which they trust government officials or are satisfied with the services they receive. The Bank will undertake a stocktaking of existing initiatives on governance and citizen engagement indicators originating from civil society organizations, think tanks and researchers to better identify existing approaches and indicators applicable to Europe. Particular attention will be given to the indicator's complementarity with public management system datasets and open data. The work will be complemented by dialogue with European CSOs and researchers to ensure feedback among a large group of governance practitioners. The Bank will also explore the viability of a more innovative approach in using data sets - such as household surveys, administrative data and data mining from open and private sources - to measure citizen behavior and preferences. This approach seeks to overcome the limitations of perception surveys by generating evidence of how citizens actually interact with public institutions. The Bank will develop this basket of indicators through the following activities: 1) Conduct a desk review of existing research and data using citizen-centric governance indicators and compile a set of indicators available for use across EU Member States and subnational regions. 2) Based on consultations with European Commission counterparts, conduct a series of interviews and round tables with EU non-governmental organizations (NGOs), academics and survey firms to review the initial set of citizen-centric governance indicators and identify additional indicators. Consultations will result in a short Citizen-Centric Governance Consultation Note summarizing the results and views of participants. 3) Conduct a workshop with European Commission counterparts to test the proposed set of citizen-centric governance indicators to determine the extent to which they are measurable, actionable, action-worthy and complement available public administration data and other open data. 4) Produce Citizen-Centric Governance Indicator Report based on the Consultation Note and outcomes of the European Commission workshop. C. Component Three: Regulatory Governance Indicators This Activity will seek to develop indicators that provide a means of assessing a country's or region's capacity and practices to prepare, assess, consult and disseminate high-quality regulation. Regulatory practices are a dimension of governance most closely linked to ensuring a level playing field for private sector actors. Regulatory design and enforcement are at the forefront of investors' concerns. The quality and predictability of interactions with licensors, inspectors, etc. is one of the key elements factoring into investment decisions. As such, they contribute to competitiveness in the economy that drives economic development in the regions. Regulatory governance focuses on a critical dimension of institutional performance that is not adequately captured by indicators of public management systems or other indicators of regulatory performance. In order to address this gap, the World Bank Group has begun to develop a set of comparative indicators of

7 the "de facto" quality of various dimensions of regulatory governance such as regulatory consultation, transparency and ex-ante assessment. The indicators may be gradually expanded over the coming years to include additional measures of regulatory governance. In addition, the Bank will look to develop indicators measuring "regulatory delivery" - governments' capacity to enforce regulations or delivery a regulatory service (e.g., a license). Work on this dimension will draw upon insights from the full range of earlier indicator surveys in the World Bank Group, including the Investment Climate Assessment, World Governance Indicators, Doing Business, Sub-national Doing Business, as well as other work by academia, think tanks and others. Where needed, the Bank can draw upon and integrate questions and data from the existing Doing Business questionnaire, and design indicators which draw upon insights and specific data points used in the Doing Business surveys. This work stream will drill down into regulatory governance practices in EU Member States, widening the scope of information collected and focusing on both the content and process of regulatory governance. Building on initial work on indicators of regulatory governance, the Bank will undertake the following activities: 1) Conduct an introductory workshop with European Commission counterparts, represented in the inter-service group on public sector modernization to discuss possible areas of measurement for regulatory governance and identify focal areas of geographic (and sector) coverage. This workshop will also present results of an initial scanning and review of existing indicators (including Doing Business and past sub-national surveys) capturing relevant aspects of regulatory governance. 2) Review and assess existing indicators capturing relevant aspects of regulatory governance in order to select, refine and develop new indicators relevant for EU Member States and regions. The review will focus on indicators' validity, reliability, the extent to which they are actionable, and data collection methodologies in light of the possible scale of the project. This activity will propose a set of questions that could be given to relevant stakeholders, including both national and regional government officials and private sector actors that can help to identify gaps in regulatory governance practices, regulatory delivery, stakeholder awareness and usage. 3) Produce an initial Regulatory Governance Indicator Report that proposes a set of regulatory governance indicators and sets out options for data collection methods. Indicators will be assessed according to their validity, cost efficiency to measure and the extent to which they are actionable. 4) Organize a workshop with European Commission services, represented in the inter-service group on public sector modernization and external experts to discuss and reach consensus on: * The applicable set of regulatory governance indicators; * Data collection methodology; and * Set of questions to be presented to national and regional government officials and relevant stakeholders 5) Pilot the regulatory governance indicators in a few selected lagging EU regions/member States following agreement with DG REGIO. 6) Produce final Regulatory Governance Indicator Report based on outcome of the pilots and evaluation of data collection methodologies. D. Methodology of Work

8 The scope and methodology of work will be based on three dimensions of governance: public management systems, citizen-centric governance and regulatory governance. While the three dimensions do not cover the full range possible governance systems, they provide information about key points in the overall policy cycle: from policy formulation to policy implementation and delivery through user feedback and corrective action and back again to policy formulation. Indicators of public sector management assess core management systems against international standards and their effectiveness in the formulation and implementation of public policies, including investment programmes co-financed by cohesion policy. Citizen-centric governance indicators assess citizen engagement in and satisfaction with the policy cycle. Regulatory governance indicators assess the process of policy formation, its inclusiveness and openness. The Activity will also develop innovative measures of regulatory delivery in order to assess the implementation of public sector policies under this dimension. In order to identify an indicator set that measures the strength and quality of governance and public administration systems across the EU at the national and regional levels, the Bank will undertake the following steps as part of its work: a) Stock taking of existing indicators in each dimension to identify those that are most action-worthy and identify data access and measurement issues such as availability and cost-effectiveness of data collection; b) Identify any additional administrative management and performance issues not covered by indicators in the existing dimensions and propose alternative measures to address these issues; c) Identify a subset of the indicators that are believed to be most relevant (action-worthy, cost effective to measure and actionable) in the EU context and best fit the objective of contributing to inclusive economic growth; and d) Use and test a subset of indicators to measure public administration capacity and performance based on criteria of relevance to objective, cost-effectiveness of data generation and gathering. The Bank will consult with DG REGIO and the inter-service group on public sector modernization of the European Commission to identify a narrow group of lagging EU Member States and regions where the indicators will be tested through the analysis of existing data. An initial testing of the application of the regulatory governance indicators is included in the activities above. E. Indicative Outputs and Timeline ActIvities " Outpou Timeframe. Regulatory Governance Introductory workshop with European Commission Indicators counterparts to develop common vision for the new indicators months after date * Present initial overview of existing indicators 2 th aft d) * Define broad of areas the of Agreement investigation (D) * Clarify project's regional coverage Review and assess existing indicators capturing relevant aspects of regulatory governance (including Bank and OECD surveys): * Select, refine and develop relevant indicators * Assess data collection methodology D +6 months

9 Activiti 4poutasTnerm * Develop draft questions Draft initial Regulatory Governance Indicator Report with: * set of regulatory governance indicators and D + 11 months * options for data collection methods Organize a workshop with European Commission counterparts and external advisors * Receive feedback on proposed set of indicators D + 14 months * Identify cities for piloting Pilot the regulatory governance indicators in selected EU lagging regions Produce final Regulatory Governance Indicator Report (including outcome of the pilots and evaluation of data collection methodologies) D months (timing and scope is dependent on number of EU regions/member States covered and available funds) D + 23 months Indicators of Strength of Identify subset of ISPMS and other available public sector Public Management indicators to measure strength and capacity of public sector D + 6 months Systems management Filter this subset of applicable indicators based on the D months availability of routinely collected data: (timing is dependent * identify and suggest way to fill data gaps on receipt of inputs * identify alternative data collection methods from DG REGIO on [DG REGIO to provide information on data collected by available data European Commission and EU Member States.] sources.) Prepare draft Public Sector Indicator Report: * Identify data needs, coverage gaps, and * Propose data collection and data mining D + 14 months alternatives Conduct meetings and consultations with the DG REGIO and other relevant European Commission services to focus on: * feasibility of implementing the indicators for regions across the EU; * the extent to which the systems measured are "action-worthy" (changes will impact development); * discuss measures European Commission can take to strengthen the quality and coverage of the D + 17 months

10 AitivitkaeMfM selected indicators through administrative measures; and identify specific lagging regions where selected indicators can be piloted using existing data sets and data solicited from the pilot locations. Finalize the Public Sector Indicator Report D 20 months Citizen-Focused Compile a set of citizen-centric governance indicators Governance Indicators based on a desk review of existing research and data D + 4 months Produce Citizen-Centric Governance Consultation Note based on consultations with DG REGIO and other relevant European Commission services, and interviews with EU NGOs, academics and survey firms to review the initial set of citizen-centric governance indicators D +10 months Conduct a workshop with European Commission counterparts to test the proposed set of citizen-centric governance indicators for: * measurability, D 12 months * action ability, and * complementarities with available public administration data Produce Citizen-Centric Governance Indicator Report based on the Consultation Note and outcomes of the Commission workshop D + 16 months *All deliverables will be approved in writing 3. Eligible Expenditures 3.1 For Bank-executed activities, the Trust Fund funds may be used to finance: 4. Taxes (a) Staff and individual consultant services; (b) Cost of travel; (c) Cost of training and workshop; and (d) Other services including translation. 4.1 The foregoing activities and categories of expenditures may include the financing of taxes in accordance with the Bank's applicable policies and procedures. 5. Program Criteria 5.1 Activities are to be financed in accordance with the following program criteria:

11 The Trust Fund is established to enable the European Commission and the Bank to continue to collaborate and exchange experience and expertise on a number of themes under all three pillars of the Europe 2020 Agenda - of smart, sustainable and inclusive growth. The express purpose of this Trust Fund is to allow the European Commission to avail itself of the Bank's technical assistance and analytical and policy capacity for the purpose of pursuing the goals of Europe The three pillars of Europe 2020 are broadly in line with the objectives and strategies adopted in the Europe and Central Asia Region of the World Bank Group. All activities that are in pursuance of these three pillars are eligible to be financed and implemented under this Trust Fund. A

12 ANNEX 2 Standard Provisions This Annex shall be applicable to and form an integral part of the Administration Agreement for the Trust Fund between the Bank and the Donor. 1. Administration of the Contributions 1.1 The Bank shall be responsible only for performing those functions specifically set forth in this Administration Agreement and shall not be subject to any other duties or responsibilities to the Donor, including, without limitation, any duties or obligations that might otherwise apply to a fiduciary or trustee under general principles of trust or fiduciary law. Nothing in this Administration Agreement shall be considered a waiver of any privileges or immunities of the Bank under its Articles of Agreement or any applicable law, all of which are expressly reserved. 1.2 Each Donor Contribution (collectively, the "Contributions") shall be administered in accordance with the Bank's applicable policies and procedures, as the same may be amended from time to time, including its procurement, financial management, disbursement and safeguard policies, its framework to prevent and combat fraud and corruption and its screening procedures to prevent the use of Bank resources to finance terrorist activity, in line with the Bank's obligations to give effect to the relevant decisions of the Security Council taken under Chapter VII of the of Charter of the United Nations. The Donor acknowledges that this provision does not create any obligations of the Bank under the antiterrorist financing and asset control laws, regulations, rules and executive orders of an individual member country that may apply to the Donor. 2. Management of the Contributions 2.1 The funds deposited in the Trust Fund shall be accounted for as a single trust fund and shall be kept separate and apart from the funds of the Bank. The funds deposited in the Trust Fund may be commingled with other trust fund assets maintained by the Bank. The Bank, in its capacity as trustee, has legal title to the funds deposited in the Trust Fund. 2.2 The currency in which the funds in the Trust Fund shall be held is Euro (the "Holding Currency"). 2.3 The Donor agrees to deposit its Contributions in the Contribution Currency stated in its respective Administration Agreements. In the case of deposits received in a Contribution Currency other than the Holding Currency, promptly upon the receipt of such amounts and the accompanying Deposit Instructions, the Bank shall convert such amounts into the Holding Currency at the exchange rate obtained by the Bank on the date of the conversion. Where deposits prove to be insufficient to complete activities as a result of exchange rate fluctuations, neither the Bank nor the Donor shall bear any responsibility for providing any additional financing. 2.4 The funds deposited in the Trust Fund may be freely exchanged by the Bank into other currencies as may facilitate their disbursement at the exchange rate obtained by the Bank on the date of the conversion. 2.5 The Bank shall invest and reinvest the funds deposited in the Trust Fund pending their disbursement in accordance with the Bank's applicable policies and procedures for the investment of trust

13 funds administered by the Bank. The Bank shall transfer all income from such investment to the Donor's applicable donor balance account with the Bank. 3. Trust Fund Fees and Costs 3.1 The Bank shall deduct and retain for its own account, as a deduction from each Installment, an amount equal to five percent (5%) per Installment as an administrative fee for the Trust Fund. 3.2 The Donor acknowledges and agrees that the percentage deductions for fees in this Trust Fund Fees and Costs section are estimated on the basis of anticipated Contributions. If actual Contributions significantly differ from what was originally anticipated at the time of signature of the first Administration Agreement, or if other circumstances affecting Trust Fund fees or costs change, the Bank reserves the right to request a change to the terms of this Trust Fund Fees and Costs section, which would be effectuated by amendments made to the Administration Agreements of the Donor and which would thereafter be applicable to all new Contributions that are provided either as amendments to supplement existing Administration Agreements or from new Administration Agreements. 4. Accountin2 and Financial Reportin2 4.1 The Bank shall maintain separate records and ledger accounts in respect of the funds deposited in the Trust Fund and disbursements made therefrom. 4.2 The Bank shall furnish to the Donor current financial information relating to receipts, disbursements and fund balance in the Holding Currency with respect to the Contributions via the World Bank's Trust Funds Donor Center secure website. Within six (6) months after all commitments and liabilities under the Trust Fund have been satisfied and the Trust Fund has been closed, the final financial information relating to receipts, disbursements and fund balance in the Holding Currency with respect to the Contributions shall be made available to the Donor via the World Bank's Trust Funds Donor Center secure website. 4.3 The Bank shall provide to the Donor via the World Bank's Trust Fund Donor Center secure website, within six (6) months following the end of each Bank fiscal year, an annual single audit report, comprising (i) a management assertion together with an attestation from the Bank's external auditors concerning the adequacy of internal control over cash-based financial reporting for all cash-based trust funds as a whole; and (ii) a combined financial statement for all cash-based trust funds together with the Bank's external auditor's opinion thereon. The cost of the single audit shall be borne by the Bank. 4.4 If the Donor wishes to request, on an exceptional basis, a financial statement audit by the Bank's external auditors of the Trust Fund, the Donor and the Bank shall first consult as to whether such an external audit is necessary. The Bank and the Donor shall agree on the appropriate scope and terms of reference of such audit. Following agreement on the scope and terms of reference, the Bank shall arrange for such external audit. The costs of any such audit, including the internal costs of the Bank with respect to such audit, shall be borne by the requesting Donor. 5. Progress Reporting 5.1 The Bank shall provide the Donor with semi-annual reports on the progress of activities financed by the Contributions. Within six (6) months of the End Disbursement Date (as defined below), the Bank shall furnish to the Donor a final report on the activities financed by the Trust Fund.

14 5.2 The Donor may review or evaluate activities financed by the Trust Fund at any time up to six (6) months following the End Disbursement Date. The Donor and the Bank shall agree on the scope and conduct of such review or evaluation, and the Bank shall provide all relevant information within the limits of the Bank's applicable policies and procedures. All associated costs, including any costs incurred by the Bank, shall be borne by the Donor. It is understood that any such review or evaluation will not constitute a financial, compliance or other audit of the Trust Fund. 6. Disbursement: Cancellation: Refund 6.1 It is expected that the funds deposited in the Trust Fund will be fully disbursed by the Bank by July 31, 2017 (the "End Disbursement Date"). The Bank shall only disburse funds deposited in the Trust Fund for the purposes of this Administration Agreement (other than returns to Donor) after such date to the extent such date is changed in accordance with amendments made to the Administration Agreement(s) of the Donor. Following the End Disbursement Date, the Bank shall return any remaining balance of the Trust Fund to the Donor in the Holding Currency in the manner specified in its respective Administration Agreement on a pro rata basis with regard to the total funds deposited in the Trust Fund by such Donor relative to the total funds deposited in the Trust Fund by the Donor, all calculated as Holding Currency amounts. 6.2 The Donor may cancel all or part of such Donor's pro rata share/contribution, and the Bank may cancel all or any Donor's pro rata share/contribution, upon three (3) months' prior written notice, of any Contributions (paid and not yet paid) that are not committed pursuant to any agreements entered into between the Bank and any consultants and/or other third parties for the purposes of this Administration Agreement, including any Grant Agreements, prior to the receipt of such notice. In the event of a cancellation, the Bank shall return to the Donor its pro rata share in the Holding Currency as specified in the Administration Agreement unless otherwise agreed between the Bank and the Donor. 7. Disclosure: Dispute Resolution 7.1 The Bank shall disclose the Administration Agreements and related information on this Trust Fund in accordance with the Bank's Policy on Access to Information. By entering into Administration Agreements, the Donor consents to such disclosure of their respective Administration Agreements and such related information. 7.2 The Donor and the Bank shall use their best efforts to amicably settle any dispute, controversy, or claim arising out of or relating to the Administration Agreements.

15 ANNEX 3 GOVERNANCE OF THE ACTIVITIES This Annex shall be applicable to and form an integral part of all Administration Agreements between the Bank and the Donor. 1. Working Arranements The Bank and DG REGIO will consult each other regularly on the implementation of the Activities in accordance with the description of the Activities in Annex I of this Administration Agreement, including the indicative (and therefore non-binding) output timetable in said Annex. DG REGIO will be responsible for organizing and inviting, as needed, the appropriate participants from other relevant European Commission services, represented in the Commission's inter-services group on public sector modernization, for all workshops, meetings and presentations included in the Activities. DG REGIO will have sole responsibility for providing consolidated comments, if any, on the outputs from the Activities in Annex Payment requests Requests for payments related to the Activities set forth in Section 2.1 of Annex 1 to this Agreement will be sent by the World Bank to the Commission with the reference CCI No 2015.CE.16.BAT.041, shall be addressed to: Greffe Financier DG REGIO A3 Directorate Generalfor Regional and Urban Policy European Commission B Brussels (Belgium)

16 ANNEX 4 INDICATIVE INDICATORS FOR THE ACTIVITIES Expected Indicators Baselines Result goals Sources of data Assumptions Results (logic intervention) of outputs Produce set of No existing To provide For existing indicators Discussed and actionable public agreed set of Member States for EC countries: agreed with 1. Public Sector sector indicators with an ISPMS dataset; relevant Management performance approach and PEFA; Open Budget stakeholders; Systems indicators at tools to assess Survey; Global accepted by DG regional level public sector Integrity; REGIO (including capacity PAM/EUROPAM description of database; Univ. of pilot assessment Goteburg; EuroStat; using EC and Doing Business; Member State BEEPS; and Open data) Contract Partnership. For indicators tracked within the EC: Justice Scoreboard; Consumer Markets Scoreboard; Digital Agenda Scoreboard; Single Market Scoreboard and other data from the Commission and Member States. For indicators used in countries other than EU but relevant because of their approach: PAPI, QSDS. A final report on No existing To provide Existing surveys and Commission citizen-centric agreed set of Member States other data on trust in supports logistics 2. Citizen- governance indicators with an government and and planning of focused indicators is approach and satisfaction with workshop Governance delivered, which tools to assess government services, Indicators includes a desk citizen such as review report and satisfaction with Eurobarometer summaries of the quality and Surveys (standard and consultations, performance of special). 496>1

17 Expected Indicators Baselines Result goals Sources of data Assumptions Results (logic of intervention) validation public workshop and institutions. Data and inputs on pilot exercise citizen-focused reviewing governance from existing data. NGOs, CSOs and other organizations provided during workshops. Development and Current To provide Existing work on the EC support for 3. Regulatory launch of new indicators Member States quality of regulatory workshop with Governance comparative focus with an governance conducted EC and Member Indicators indicators adapted primarily on approach and by World Bank in State to the EU, regulatory tools to assess 2014 and 2015 pilots. stakeholders. capturing de facto outputs and/or regulatory quality of key are self- governance Additional sources: EC and World dimensions of reported by Investment Climate Bank team reach regulatory governments Assessment, World agreement on governance and based on Governance lagging regions perceptions. Indicators, Doing and Member Business, Sub- States for national Doing piloting of the Business, as well as indicators other work by (contingent on academia, think tanks available and work from other funding). donors and organizations. Cooperation in data collection from the pilot regions and Member States Outcomes Improved ability Limited and To improve EC and Member EC and/or to measure public uneven ability Commission States Member States sector across EU staff, citizens collect the type 1. Public Sector performance and countries to and policy of data necessary Management capacity at measure public makers' ability for the set of Systems regional level sector to monitor actionable performance at public sector indicators regional level performance developed under and absorption the project of cohesion funds at regional level Awareness of Currently Awareness Participants' feedback,a L7

18 Expected Indicators Baselines Result goals Sources of data Assumptions Results (logic intervention) of 2. Citizen- citizen-centric knowledge and towards citizen- at consultations and focused governance use of these centric the validation Governance indicators will indicators is governance workshop Indicators increase among limited and indicators will consulted highly increase among population idiosyncratic consulted population during implementation New regulatory Pilot regions' To improve Second round of Decision-makers governance baseline scores Commission regulatory data in the 3. Regulatory indicators are will be staff, citizens gathered for pilot Commission and Governance used in pilot determined and policy regions (and Member States Indicators regions as the through initial makers' ability additional regions are aware of the basis for capacity- piloting of the to measure and under direction of the Regulatory building and agreed set of monitor EC) Governance decision-making. Regulatory regulatory Indicators and Governance governance at measures Indicators regional level required to improve regulatory governance. Available funding and commitment for a new round of data collection. Impact Adoption and/or No To improve EC and Member EC and Member use of the comprehensive capacity to States States agree to indicators by and absorb cohesion incorporate 1. Public Sector citizens and comparable set and investment indicator set into Management policymakers of of actionable funds to Member State Systems Member States regional improve reporting cycle governance economic indicators development in exists in the Europe's EU regions Adoption and/or No To improve Feedback from the EC and Member 2. Citizen- use of the comprehensive capacity to Commission and States agree to focused indicators by and absorb cohesion Member States incorporate some Governance citizens and comparable set and investment of the citizen- Indicators policymakers in of actionable funds to centric

19 Expected Indicators Baselines Result goals Sources of data Assumptions Results (logic intervention) of Member States regional improve governance governance economic indicators indicators development in recommended by exists in the Europe's the World Bank EU regions team into Member State reporting cycle Adoption and/or No To improve EC and Member Improvements in 3. Regulatory use of the comprehensive capacity to States' data as well as regulatory Governance indicators by and absorb cohesion results from business governance Indicators citizens and comparable set and investment and expert surveys affect cohesion policymakers in of actionable funds to policy Member States regional improve implementation governance economic capacity; EU indicators development in regions will take exists in the Europe's measures to EU regions improve regulatory governance as measured by the proposed indicators.

20 ANNEX 5 INDICATIVE BUDGET FOR THE ACTIVITIES SET FORTH IN SECTION 2.1 OF ANNEX 1 TO THIS ADMINISTRATION AGREEMENT Expenditure Category Amount in Euro Staff and individual consultant services 712,000 Cost of travel 182,000 Cost of training and workshop 26,000 Other services including translation 30,000 Sub-total 950,000 Administration fee (5%) 50,000 Total 1,000,000 The amount estimated for personnel is calculated taking into account different levels of expertise estimated to be required for carrying out the activities described in Annex 1. The World Bank Group entity may transfer amounts between categories of the indicative budget. This does not require an amendment of the Administration Agreement if the Action is carried out as described in Annex I. c 7~