INSTITUTIONAL SUPPORT

Danish Ministry of Foreign Affairs Danida Road Sector Programme Support Phase 2, 2007-2012 INSTITUTIONAL SUPPORT Reformulated Component Description Document ZAMBIA This report contains restricted information and is for official use only. Ref. No.104.Zam.815-200-3 June 2009

Table of Contents Executive Summary Cover Page Abbreviations and Acronyms 1 Introduction... 1 2 Description of the component... 1 2.1 Revised Component Strategy... 2 2.2 Development and Immediate Objectives... 3 2.3 Outputs and Activities... 3 2.4 Inputs... 9 2.5 Cross-Cutting Issues... 10 3 Budget... 11 4 Management and organisation... 11 4.1 Management of the Component... 11 4.2 Planning, Budgeting and Contract Procurement... 12 5 Financial management and procurement... 13 5.1 Budgeting... 13 5.2 Flow of Funds... 13 5.3 Accounting... 14 5.4 Financial Monitoring and Reporting... 14 5.5 Procurement... 14 5.6 Auditing Procedures... 14 6 Monitoring, reporting, reviews and evaluation... 15 6.1 Organisation of Monitoring System... 15 6.2 Targets and Indicators... 15 6.3 Joint Sector Reviews... 16 6.4 Cross Cutting Issues... 16 6.5 Timing of Key Monitoring Instruments... 16 7 Assessment of key assumptions and risks.... 16 7.1 Assumptions... 16 7.2 Risks... 17 8 Component Implementation Plan.... 18 ANNEX 1: Terms of Reference for the Technical Advisor to Road Development Agency and Local Road Authorities... 1 ANNEX 2: Overview of indicators by output.... 5

Executive Summary The Institutional Support Component is one out of three components of the Danish financed Road Sector Programme Support phase 2 (RSPS 2). The overall programme will contribute to, and form part of, Zambia s 10-year Road Sector Investment Programme phase II (ROADSIP II). The objectives of ROADSIP II, relevant to the RSPS 2 Institutional Support Component, include the development of the management capacity of the sector agencies, improved management of district-level access, better management of environmental and social issues and improved road safety. The reformulation of the Main Roads and District Roads Components does reflect on the activities of the Institutional Component since they are interlinked: environmental studies, road safety campaigns and impact studies are examples. However, other developments have required changes in the institutional support incl.: a slow decentralisation process, combined with a shortage of maintenance funding at the local level, and a lack of analytical instruments to assess road investments. The Institutional Support Component includes the following three subcomponents: Subcomponent A Institutional Support to the Road Development Agency (RDA) aims at: (i) strengthening the management capacity of RDA in general, (ii) assist the further integration of the management of environmental and social issues; and (iii) development of national guidelines for the establishment and operation of local road authorities (LRAs) and the management of accessibility at the district and community levels (including a Technical Advisor); The Technical Advisor will focus on capacity building, particularly with regard to decentralisation and development of guidelines and procedures for LRA. This will be the basis for providing targeted budget support to LRAs. Subcomponent B Support to the Road Transport Safety Agency (RTSA), will support the development of a national accident information system; the development of national road safety education campaigns for schools and roadside communities and road safety audits. Subcomponent C - Social Accounting Matrix (SAM) and Transport Indicators, will support the establishment of a Social Accounting Matrix for the Transport Sector and an indicator framework. The financial crisis has made a continued focus on reducing transport costs essential for maintaining or increasing Zambia s competitiveness and sustainable development of road infrastructure assets is a major contributing factor to economic growth and poverty reduction. The SAM and indicators should provide the analytical framework for analysing the role of transport for Zambia's economy. i

The subcomponents will be managed by the following agencies: RDA, RTSA and ZIPAR, each agency taking responsibility for the procurement of supplies and service providers in accordance with Government of Zambia standard procedures but with the requirement of no objection from the Danish Embassy at specified critical stages. The component financing is aligned with the Zambian Government systems. The National Road Fund Agency (NRFA) will have overall responsibility for the financial management of the component, including producing regular financial statements. The RDA, RTSA and ZIPAR will prepare subcomponent plans, budgets and reports on progress for the Programme Coordination Committee (CC). The CC will approve the annual work plans and budgets. The component budget will be included in the Zambian Government s national budget and the CC will organise an independent annual audit of the component. The total Danida budget for the component is DKK 27 million. ii

Cover Page Country: Zambia Sector : Roads Title: Road Sector Programme Support (RSPS) Phase 2 National Agencies: Road Development Agency; Road Transport and Safety Agency; National Road Fund Agency, Zambia Institute for Policy Analysis and Research Duration: 5 years Starting Date: 1st July 2007 Completion Date: 30th June 2012 Overall Budget Frame: DKK 27 million (including DKK 9 million for Technical Advisors) Details of Component: This component will support the national transport policy and sector strategy (ROADSIP II) in strengthening the management capacity in the road sector. The component comprises the following subcomponents: Subcomponent A - Institutional Support to the Road Development Agency (RDA) - for strengthening the management of RDA and, in particular, assist with the integration of environmental and social management issues into road projects; the development of national guidelines for establishment and functioning of LRAs and the management of accessibility at the district and community levels, and Subcomponent B - Support to the Road Transport and Safety Agency (RTSA) for the development of a national accident information system, the development of national road safety education campaigns for schools and road side communities and for undertaking road safety audits. Subcomponent C- Social Accounting Matrix (SAM) and Transport Indicators - for supporting the establishment of a Social Accounting Matrix for the transport sector and an indicator framework. iii

Abbreviations and Acronyms CC Danida DHID DKK EIA EMU ESMU EU FNDP GRZ KfW Km LDP LRA MCT MLGH MOFNP NRFA NTP PDD PRE RAMP RDA RSPS RTSA ROADSIP TA TOR USD ZIPAR ZPPA ZMK Coordination Committee RSPS2 Danish International Development Assistance Department of Housing & Infrastructure Development Danish Kroner Environmental Impact Assessment Environmental Management Unit Environmental and Social Management Unit European Union Fifth National Development Plan Government of the Republic of Zambia Kreditanstalt fur Wiederaufbau Kilometre Local Development Programme Local Road Authority Ministry of Communication and Transport Ministry of Local Government and Housing Ministry of Finance and National Planning National Road Fund Agency National Transport Policy Planning and Design Division Provincial Roads Engineer Rural Accessibility and Mobility Programme Road Development Agency Road Sector Programme Support Road Transport and Safety Agency Road Sector Investment Programme Technical assistance Terms of Reference United States Dollar Zambia Institute for Policy Analysis and Research Zambia Public Procurement Authority Zambia Kwacha Zambia Kwacha (ZMK) DKK 1.00 = ZMK 993 USD 1.00 = DKK 5.293 USD 1.00 = ZMK 5,260 (Rates of exchange 26 th June 2009 Financial Times, UK) Fiscal Year: January - 31 December iv

1 INTRODUCTION Denmark has provided Danish support to the rehabilitation of roads in Zambia since 1991. From December 2002, this has been part of a comprehensive road sector programme of support (RSPS). During RSPS Phase I, the focus for the institutional support component was on the provision of technical assistance (TA) to build capacity at the District Council level and for support to the Environmental and Social Management Unit (ESMU). Based on the positive experience of phase 1, the Government of the Republic of Zambia (GRZ) requested continued Danish support in a phase 2. A concept paper for RSPS 2 was developed in January 2006 with continued support to ESMU; TA support for the development of national strategies and guidelines for district roads; road safety and financial support. In addition, the provision of assistance to RDA for the development of national guidelines for Local Road Authorities (LRAs) and the management of district and community level access were included. The comments from the appraisal and the results of an institutional assessment were incorporated into final draft documents produced in February 2007. These provided the basis for the submission to the Danida Board in May 2007 and after approval by the Danida Board, a government agreement was drawn up to permit phase 2 to commence on 1st November 2007. Late 2008, it became apparent that the Main Roads and District Roads Components could not be implemented as planned and that a reformulation was required. A Reformulation Consultant visited Zambia in January 2009 and made a proposal for changes, which was appraised by the Joint Sector Review of RSPS2 in March 2009. In that process, it was decided to adjust the Institutional Component to the new situation. 2 DESCRIPTION OF THE COMPONENT RSPS 2 is defined within the overall framework of the Fifth National Development Plan (FNDP) and the national Road Sector Investment Programme, Phase 2 (ROADSIP II). The component will continue to contribute to achievement of the objectives of ROADSIP II, which recognize the need to strengthen management capacity in the road sector; to improve the management of environmental and other cross cutting issues and to provide a safer road transport system. One of the key objectives of the government is to facilitate economic growth and poverty reduction through diversification, particularly in the agricultural sector. A 1

precondition for attaining this objective and the development of the Zambian economy in general is good sector management. 2.1 Revised Component Strategy The reformulation of the Main Roads and District Roads Components does reflect on the activities of the Institutional Component since they are interlinked: environmental studies, road safety campaigns and impact studies are examples. However, other developments have required changes in the institutional support: slow decentralisation process combined with a shortage of maintenance funding at the local level and a lack of analytical instruments to assess road investments. These developments and their implications for RSPS 2 are described below. The decentralisation of responsibilities for district and rural roads towards the Local Road Authorities (LRA) has been slow and the RSPS 2 activities linked with decentralisation has faced difficulties. Furthermore, the funding gap of the Road Fund does not permit allocation of sufficient funds towards rural district roads. Sector Budget Support (SBS) for that purpose has therefore been given priority in the Programme Document. It will be targeted towards LRAs responsible for District and Rural Roads maintenance, on the condition that they have the capacity to carry out routine maintenance. The focus of the institutional support will, therefore, be directed towards developing guidelines and procedures for LRAs and their work and towards reinforcing their capacity. Due to the global economic crisis, the price of copper has fallen dramatically and the ZMK has depreciated significantly against the USD. This is reducing GRZ general revenues substantially, including revenues arising from the fuel levy, the main source of road maintenance funding. This situation calls for reconsideration of the prioritisation of road sector interventions and new instruments to assess investments are required. Focus on the strategic role of transport as a catalyst for development has therefore been essential and an additional subcomponent has been included with the aim to develop an economic analytical framework for analysing the role of transport for Zambia's economy. The Component aims in general at the institutional strengthening of the sector agencies. The overall component strategy is to provide support to institutional strengthening in areas considered a priority by the GRZ, complementing other development assistance in the sector. Therefore, some flexibility is built into the outputs and activities of the component. As a consequence of the change in focus of the assistance, the Technical Advisor has been moved to Lusaka (see Annex 1 for TOR). The TA will focus on capacity building, particularly with regard to decentralisation and development of guidelines and procedures for LRA. This will be the basis for providing targeted budget support to LRAs as described in the RSPS 2 Programme Document. Local 2

TA for the provinces may be provided if a specific need for capacity building is identified. EU has funded technical assistance to RDA from 2005 and will continue to do so under EDF-10. The need for a second Danida financed full-time technical assistance posts at RDA Headquarters to support general work was originally identified but with the continuation of EU assistance, it is no longer judged necessary and is stopped. 2.2 Development and Immediate Objectives This component supports the objectives of the Fifth National Development Plan (FNDP), the National Transport Policy (NTP) and the national road sector programme (ROADSIP II), all of which recognize the need to strengthen management capacity in the road sector; to improve the management of environmental and other cross cutting issues and to provide a safer road transport system. The development objective of this component is: Support the establishment of effective institutions that enable the transport sector to promote national socio-economic development through the provision of a well-maintained, safe and sustainable network delivering net environmental and social benefits. The immediate objectives of this component are: Subcomponent A: Management of road sector improved, including development of general road management capacity, environmental management and national guidelines for LRAs. Subcomponent B: Road safety improved and a more road safety conscious community built through carrying out priority actions in RTSAs corporate plan. Subcomponent C: Improved effectiveness of implementation of policies and development programmes for the transport sector, including related infrastructure and services 2.3 Outputs and Activities 2.3.1 Subcomponent A: Institutional Support to Road Development Agency The outputs, activities and indicators of this subcomponent are: Output A.1: Strengthening of RDA s Management Capacity The Technical Advisor will provide on the job training and assistance to the RDA Division for Planning and Implementation of road network improvements with 3

particular focus on the RSPS2 roads. The draft Terms of Reference for a Technical Advisor (for the duration of the programme) is attached in Annex 1 and provides more details of the planned output and activities. Output A.2: Internal capacity of RDA and LRA to manage environmental and social issues strengthened. Staff from RDA s headquarters & provincial offices and the LRAs with a role and responsibility in the implementation of the environmental and social management procedures, will be trained and equipped with the knowledge and skills required to undertake these responsibilities. Prior to the development and implementation of the capacity building programme, the procedures developed by the ESMU, that will form the basis for RDA s environmental and social management system, will be reviewed and approved by RDA senior management. These procedures will be informed by the various manuals and guidelines that have been developed by ESMU over the years, including but not limited to: the HIV/AIDS awareness manuals; the guidelines for environmental monitoring of road works; occupational health and safety manuals and the gender equality training manuals. The key activities associated with the delivery of the training will be the procurement of consultants to assist the environmental manager with the development, preparation and delivery of the training programmes. The environmental manager will evaluate all training programmes and maintain a record of the individuals trained, their position, their responsibility for environmental and social management and the content of training received. Output A.3: Capacity of environmental and social consultants advising the sector strengthened. Environmental and social impact consultants will be invited to submit proposals for inclusion on a short-list of preferred service providers. The short-listed consultants will be required to undertake additional professional training for the provision of environmental and socio-economic impact assessments, monitoring and evaluation services for the road sector. The key activities associated with this output will be the procurement of consulting services for the development, preparation and satisfactory delivery of the training programme. 4

Output A.4: Capacity of consulting engineers and contractors to manage and address environmental and social issues during design and construction strengthened. The mitigation of the direct environmental and social impacts associated with road improvement and maintenance activities will be enhanced by training the consulting engineers and contractors involved in the design, construction and supervision of works under RSPS 2. The training for local contractors working on the district road improvements will be integrated in the capacity building activities for local contractors under subcomponent C of the support to district component. It is anticipated that 4 5 contractors undertaking road improvement works, and 5 10 small-scale contractors for maintenance works, will be trained per district. The training programme for the consulting engineers will be delivered as a standalone programme. It will be delivered in advance of any design or supervision activities being undertaken for works under RSPS 2. The key activities associated with this output will be the procurement of consultants to assist the environmental manager with the development, preparation and delivery of training interventions. Output A.5: Environmental effects and socio-economic impact monitoring methodology, procedures and database, developed under RSPS 1 and with EU poverty and social analysis TA, piloted and revised. The key activities associated with this output fall into two groups. The first group of activities relates to the effects and impact monitoring along pilot roads. The main activities will include: (i) Collection of monitoring data for three pilot roads; and (ii) Evaluation of the monitoring system. The experiences of the pilot activity will be used to evaluate the informative value of the data obtained; and the ESMU methodology, procedures and database. ESMU s approach to environmental effects and socio-economic impact monitoring will be revised, based on the findings of this evaluation. The second group of activities is related to the monitoring and evaluation of the environmental effects and socio-economic impacts of the improvements to selected main roads supported by RSPS2 and associated accessibility improvements in the districts. The monitoring and evaluation will apply the revised methodology and procedures developed under the above first group of activities. Monitoring will also take into account the employment generated; adherence to Zambian labour laws; the work environment and terms of employment in connection with the road construction. The collection of monitoring data and the impact evaluation will be undertaken by the ESMU. 5

Output A.6: Strategies, Guidelines and Procedures for the establishment and functioning of LRAs and the management of district and community level accessibility developed. This will include the following areas: Support to Department of Housing and Infrastructure Development (DHID) and RDA in relation to the development of national strategies and guidelines for the management of district roads by LRAs, in particular for prioritisation and planning of road works, management and supervision of contractors and consultants as well as financial management of the roads budget. This will be done in collaboration with the Rural Accessibility and Mobility Programme (RAMP) Coordinator within the Ministry of Local Government and Housing, who is responsible for coordinating community access infrastructure projects and programmes Support to DHID and RDA for developing the capacity of the LRAs to plan and manage the improvement and maintenance of their road networks in collaboration with a similar EU-financed initiative in Central and North Western provinces and a KfW financed programme in Southern Province. Support the establishment of national guidelines and strategies for community access improvements and maintenance based on lessons learned from the RSPS 1 and other programmes. Assist in setting up improved financial management systems for road works in the districts and establish the procedures for control and operation of these accounts. Monitor the operation of this system and produce guidelines to incorporate it into an accounting procedures handbook. Supporting LRAs in setting up and maintaining a computerised database of the road network for planning and management purposes. The long-term advisor will support the DHID, RDA and LRAs in drawing together the various experiences and lessons learned from: The establishment of the LRAs under the EU programme of assistance and during this programme; Capacity building activities to improve the sustainable management of the core road network; and The numerous programmes working with community level access, including the pilot activities under RSPS 1 and 2. A process approach will be used to develop the guidelines in close consultation with DHID, RDA, the LRAs and key stakeholders such as district councils, road user committees and local communities that were involved in the activities. The Technical Advisor will play an important role in this. It is likely that separate guidelines will be prepared for the establishment and operation of LRAs, which 6

are mainly concerned with the core road network and for community access, which include roads, paths and tracks that are not part of the core network. 2.3.2 Subcomponent B - Support to RTSA The outputs, associated activities and indicators of this subcomponent will be: Output B.1: National accident information system developed and piloted in selected local administrative centres RTSA is currently in the process of inviting consultants to submit expressions of interests to develop the national accident information system. Therefore, the first activity under this output will be the development of Terms of Reference for the assignment and the continuation of the procurement of a consultant to undertake the assignment. The system will be developed in close consultation with stakeholders (i.e. staff and agencies that will be providing data for the system, operating the system or applying the reports generated) in order to develop ownership. When the accident information system has been developed, it will be piloted at the head office and in selected local administrative centres. Subsequently, a programme and budget to roll out the system nationally, and to build capacity related to its management and use, will be developed. The local administrative centres selected for the pilot will be improved and equipped accordingly. For each administrative centre, an assessment of the physical works and equipment required will be made and contracts tendered for the works and supply of equipment. Output B.2: A national road safety education campaign for schools and roadside communities developed and piloted in communities along the Lusaka - Mongu road and the main roads supported under RSPS2. Creating road safety and conscious road users & communities will contribute considerably to reducing the number of road accidents on Zambian roads, especially since many road accidents are the result of road user behaviour. Activities will include the development of national road safety education campaigns for schools, and for roadside community education, as identified in the RTSA corporate plan. Consulting services will be procured to develop the road safety education programmes; identify appropriate channels for disseminating information and capacity development needs (e.g. teacher and NGO training); identify appropriate communication media and design information and communication materials. A consultant will work alongside RTSA publicity section staff and provide on the job training and development to the staff. 7

The programmes developed will be piloted along the Lusaka Mongu road corridors and subsequently evaluated. Consequent revisions will be made and a programme and budget developed to roll out the education campaigns. First on RSPS2 Main Roads, then nationally, to build the capacity of the resources required in order to implement the campaigns. Output B.3: Road safety audits undertaken to ensure compliance with road safety requirements Road safety audits will contribute to ensuring greater compliance by road design engineers, contractors, maintenance programmes and road safety enforcement agents with the implementation of road accident prevention measures. Annual road safety audits programmes will be developed by the road safety engineer and submitted for approval. The road safety engineer will be responsible for conducting these audits and be equipped with a vehicle for this purpose. For the RSPS2 main roads, road safety audits will specifically be undertaken on the road design and during construction activities. The findings of these particular audits will be presented to RDA. 2.3.3 Subcomponent C - Support to Transport Sector Monitoring A Subcomponent Description was developed in May 2009; it details the background, output, activities and budget. The outputs, associated activities and indicators of this subcomponent will be: Output C.1: A comprehensive database of road sector related data and indicators, covering road network management, rural accessibility and impact on poverty and attainment of MDGs. Activities will include identification of the data required and their sources; the establishment of a database with assistance of a national IT consultant and training of MCT staff in database management. The data will be obtained from existing sources. This activity will be coordinated with support from the EU aimed at elaborating indicators in the road sector. Output C.2: Establishment of a functional Performance Assessment Model. The model will assess the current state of the road network and their effects on Vehicle Operating Costs. They will be used to project the future state of the 8

network under various funding regimes. Training and introduction to the model of key technical and management staff is foreseen. Output C.3: The development of a Zambian Social Accounting Matrix (SAM) for the transport sector. The SAM is an accounting matrix representing the transactions and transfer of income between economic sectors and agents. It may be used to assess the employment impact of investments in roads, airports etc as well as the poverty impact. The SAM is based on basic input-output data for the Zambian economy, thus it relates directly to the national economy. 2.3.4 Other Support Besides the support through the three subcomponents, funds for procurement of international consultancies, especially for a Technical and Financial Audit of the Road Sector, has been included. The EU financed the audit for 2007 and an agreement has been made that Danida should finance the one for 2009. 2.4 Inputs The Government of Zambia, through RDA, RTSA, ZIPAR and the National Road Fund Agency (NRFA), will provide overall management and control and all running/operational costs associated with this component. This includes the costs of monitoring the performance of consultants engaged, the production of evaluation reports for training programmes and running costs associated with vehicles and equipment procured under the programme. The inputs to be provided by Danida are: Funds for technical advisors and short-term assistance, consultancies and studies; Funds for specific training, including workshop logistics and materials; Funds for effects monitoring along RSPS2 main roads and selected routes in the districts that were improved under RSPS 2; Funds for the equipment of the accident information system and for upgrading local administrative centres piloting the system; Funds for information and communication materials for the pilot of the road safety education programmes for schools and communities; and Funds for road safety audits. Funds for a Technical and Financial Audit of the Road Sector to be made available for the NRFA. It should be noted that, in general, the costs associated with the EIA studies and project briefs for individual projects, and with the environmental and social 9

monitoring activities during construction, are not funded under this component. These costs will be included in the project costs. 2.5 Cross-Cutting Issues The ESMU is undergoing a process of change, not only with its complete integration into the PDD of RDA, but also in terms of its scope of work. Having previously focused on environmental issues alone, it is now tasked with the responsibility of managing a broader range of crosscutting issues including HIV/AIDS, gender, occupational health and safety and socio-economic impacts. Since strategies and management practices are developed to manage these various risks and opportunities, staff within RDA and the LRAs tasked with the responsibility of their implementation will need to be made aware of them. 2.5.1 HIV/AIDS An HIV/AIDS policy for the Transport Sector was published in August 2004 and the ESMU has developed guidelines, manuals and training materials under RSPS 1 for the management of HIV/AIDS in the road sector. The delivery of HIV/AIDS awareness for contractors and communities has been managed through the contract, contractors being responsible for appointing service providers to deliver awareness workshops. However, there has been concern about the quality of the delivery of the awareness training by the organisations appointed by contractors. For this reason, the management of the delivery of HIV/AIDS awareness has been taken away from contractors and RDA now directly finances, procures and manages the provision of HIV/AIDS awareness programmes. During the capacity building activities of the institutional support to the RDA subcomponent, the strategy, procedures and guidelines developed for managing the HIV/AIDS risk in the sector will be included. Additional support will also be available from the ROADSIP HIV/AIDS coordinator in the Ministry of Communications and Transport. 2.5.2 Gender Although there is no specific gender policy in the transport sector, the ESMU has developed training manuals to address the issue of gender equality in the sector. This training will be integrated into the capacity building activities of subcomponent A. Additional support will also be sought from the new Ministry of Women s Affairs. 10

3 BUDGET A summary of the Phase 2 budget for Danida contributions to the institutional support at national level component appears below in Table 3.1, broken down by year. The total budget is DKK 27 million of which subcomponent A) accounts for 12 million, B) for 3 million and C) for 10 million. Table 3.1 Institutional Support Component Phase 2 in DKK million Phase II : 2007-2012 Sub-Component Items Expenditures Budget Phase II 2007 2008 2009 2010 2011 2012 Total A - Institutional Support to RDA 1,94 2,53 2,70 2,70 1,97 0,16 12,00 Strengthen RDA management capacity A.1 Support to RDA 0,44 0,80 0,80 0,80 0,16 3,00 A.2 TA Contract 1,94 2,09 1,40 1,40 1,17 8,00 A.3 Local TA 0,50 0,50 1,00 B - Support to RTSA 1,00 1,00 1,00 3,00 C.-Support to Sector Monitoring 2,00 3,00 3,00 2,00 10,00 Technical and Financial Audit 1,00 1,00 2,00 Total Budget (DKK million) 1,94 2,53 6,70 7,70 5,97 2,16 27,00 4 MANAGEMENT AND ORGANISATION 4.1 Management of the Component RDA is the main partner for RSPS 2, the ultimate responsibility resting with the Chief Executive/Director. However, with the inclusion of support to road safety, RTSA will take responsibility for the implementation of subcomponent B. ZIPAR, together with the Central Statistics Office and the Ministry of Communication and Transport, will take responsibility for subcomponent C. RDA, RTSA and ZIPAR will report to the CC directly. 4.1.1 Subcomponent A - Institutional Support to RDA The Planning and Design Division within RDA will manage this subcomponent. The Manager will provide the overall direction and the Environmental Manager will assume day-to-day responsibility for the implementation of the environmental and social management capacity building activities. The scope of work of the Technical Advisor comprises support to the Department of Planning & Design at RDA.HQ; the Department of Housing & Infrastructure Development (DHID) under MLGH; the RDA Regional offices in Mongu (Western Province), Mansa (Luapula Province) and the LRAs in the participating district councils. The Technical Advisor will counterpart with the Planning and Design Unit at 11

RDAHQ- the DHID within the MLGH and with the Regional Engineers at the participating RDA regional centres. Progress and performance reporting on the subcomponent will go through the Assistant Director Planning and Design who will report to the Coordination Committee (CC), through the Director. The full-time Technical Advisor will not have line management responsibilities. The Advisor will report to the Chief Executive of RDA, or an officer designated by him; to the Chief of DHID and to the Regional Engineers of Mongu and Mansa, or officers designated by them. 4.1.2 Subcomponent B - Support to RTSA The Road Safety Division within RTSA will manage this subcomponent with ultimate responsibility resting with the Director. Consulting companies will be employed under the direction of the Road Safety Division following standard government procurement procedures. Their terms of reference and contracts will define the scope of their responsibilities. Progress and performance monitoring on this subcomponent will go through the Deputy Director, Road Safety Division who will report to the CC through the Director, RTSA (see also section 6.1). 4.1.3 Subcomponent C-Support to Transport Sector Monitoring In order to ensure appropriate links to key GRZ policy makers and to benefit from existing expertise, the subcomponent will be anchored in the newly established policy think-tank: the Zambia Institute for Policy Analysis and Research (ZIPAR). The Central Statistics Office (CSO) will play a key role in developing the SAM, including the extension with the transport module, while the road maintenance information would be anchored in the Ministry of Communication and Transport (MCT). ZIPAR would be the anchor for developing the SAM, including the transport sector module and linked to models developed in the Ministry of Finance and National Planning (MoFNP). 4.2 Planning, Budgeting and Contract Procurement The RDA, through its Planning and Design Division, will be responsible for the overall planning of subcomponent A. RTSA, through its Road Safety Division, will take the responsibility for subcomponent B. ZIPAR will take responsibility for subcomponent C. Contracts will be procured following standard government procedures. Under the Zambia National Tender Board Act, the Zambia Public Procurement Authority (ZPPA) must approve all tenders above specified ceilings. 12

A written no objection from the Danish Embassy will have to be obtained for all shortlists for studies and contracts before issuing requests for proposals. A written no objection from the Danish Embassy will have to be obtained after completing the evaluation of tenders but before awarding the contracts. 5 FINANCIAL MANAGEMENT AND PROCUREMENT In general, the procedures for financial management and procurement will be as described in the Programme Document. These are summarised here, with particular reference to this component. 5.1 Budgeting RDA, RTSA and ZIPAR, based on the actual and forecast progress of their respective subcomponent activities, will prepare annual subcomponent work plans with budgets, following the normal government planning and budgeting cycle. These will be discussed with NRFA, who will prepare a consolidated RSPS 2 budget submission for approval by the RSPS2 Coordination Committee (CC) and by the Royal Danish Embassy before forwarding it to the Ministry of Finance and National Planning (MOFNP). 5.2 Flow of Funds Funds will be disbursed from the Danish Embassy to the NRFA via the MOFNP on a quarterly basis, or at such other interval as mutually agreed. The NRFA will be responsible for paying suppliers and service providers directly for the subcomponent activities according to the approved work plans. Subject to agreement with the NRFA and the Danish Embassy, the RDA, RTSA and ZIPAR will operate an imprest account for expenditures on the subcomponents and will be responsible for reporting on all expenditures to NRFA. RDA, RTSA and ZIPAR will prepare quarterly cash flow forecasts for forwarding to NRFA. These will be consolidated by NRFA with other component forecasts before forwarding to the Danish Embassy. The primary responsibility for cash flow management will be with NRFA. Requests for disbursements will originate from RDA, RTSA and ZIPAR who will forward these to NRFA. Quarterly, or at other agreed intervals, NRFA will request the disbursement of funds from the Danish Embassy via MOFNP. These procedures are described in the Programme Document. 13

5.3 Accounting RDA, RTSA, ZIPAR and NRFA will maintain accounting records for all RSPS 2 expenditure following procedures laid down in the GRZ Financial Regulations. NRFA will forward quarterly financial statements of account to the Danish Embassy. 5.4 Financial Monitoring and Reporting RDA, RSTA and ZIPAR will be responsible for financial monitoring and reporting of their respective subcomponent activities. All reports will be submitted on a quarterly basis to NRFA and the CC. NRFA will be responsible for the overall financial management of RSPS 2 including consolidating financial reports and cash forecasts from all components for the CC. 5.5 Procurement All procurement will be the responsibility of the Zambian authorities and will follow GRZ regulations. However, all procurement of contracts for works and studies will be subject to no objection from the Danish Embassy, following the procedure described in section 4.2 above. 5.6 Auditing Procedures All RSPS 2 expenditures will be subject to the normal GRZ internal auditing procedures. In addition, independent annual audits of the RSPS 2 accounts will be organised by NRFA under the direction of the CC. Spot checks of the financial records of particular components, subcomponents or individual activities may be requested by the CC or the Danish Embassy at any time. The NRFA will be responsible for collecting and making available the relevant records for this. 14

6 MONITORING, REPORTING, REVIEWS AND EVALUATION 6.1 Organisation of Monitoring System The core of this component will be the procurement of consulting services in addition to some procurement of equipment and payment for workshop venues and materials. The monitoring of the consultants will be undertaken by RDA, RTSA and ZIPAR through those delegated with the responsibility for managing particular subcomponent outputs. Evaluation reports of consultant performance and of the training programmes will be produced. In addition, RDA, RTSA and ZIPAR will prepare brief quarterly progress reports on the progress of their respective subcomponents for submission to the Coordination Committee. These will include: Overall progress against plans Progress with preparations for future activities Financial progress on individual contracts with consultants Overview of financial progress compared to component budget with future projected expenditure Major problems encountered List of study reports, etc. produced in the quarter NRFA will include details of the progress of the component in the Annual ROADSIP II Progress Report based on inputs from RDA, RTSA and ZIPAR. 6.2 Targets and Indicators The targets for this component are related to those of the FNDP, NTP, ROADSIP II, and the RTSA corporate plan, as articulated in their goals and objectives. For subcomponent A - institutional support to RDA, the linkage to national sector targets and indicators is not very clear since, despite clearly articulated objectives for improving management capacity in a number of areas, no national sector targets and indicators have been set for outcomes and impacts. Due to this lack of a clear link between objective and indicators, separate indicators are shown in Annex 2. For subcomponent B, support to RTSA, the targets and indicators (see Annex 2) are linked directly with the national targets and indicators set out in the road safety 15

action plan. Progress towards these targets will be monitored and compiled from internal monitoring data and reports used by RTSA. For subcomponent C, Social Accounting Matrix and Transport Indicators the aim is to improve the overall monitoring of the transport sector by establishing a database and by developing models for analysis. The targets are the outputs will be reflected in regular reporting. 6.3 Joint Sector Reviews In addition to the items mentioned in Section 8 of the programme document on sector reviews, the following items will be particularly relevant for this component: Review RDA s management with particular reference to the RSPS 2 components; Review the effectiveness of support to RTSA; Review the effectiveness of ZIPAR; Review developments in broader environmental planning; and Complementarity with other TA and capacity building activities in the sector. 6.4 Cross-cutting Issues The monitoring of crosscutting issues will fall within the overall monitoring of the component, in particular the monitoring of the content and quality of the capacity building activities, and the extent to which crosscutting issues are addressed. For example, under subcomponent A, the activities associated with capacity building of RDA staff, LRA staff, consultants and contractors in the management of crosscutting issues will subsequently be reflected in the quarterly reports. 6.5 Timing of Key Monitoring Instruments RDA, RTSA and ZIPAR, who will record the output and performance of the consulting inputs in quarterly reports, will monitor the outputs of the subcomponents. 7 ASSESSMENT OF KEY ASSUMPTIONS AND RISKS 7.1 Assumptions A major assumption underpinning this component s aim of integrating environmental and social management into the road sector planning, design and operations functions is the existence of adequate external incentives to do so. It is assumed that the Zambian Government continues to recognise the importance of 16

crosscutting issues and has performance management measures that provide the motivation for the road sector to manage the environmental and social risks and opportunities associated with its activities. Danida is one out of several donors supporting capacity creation within the road sector and the support of the different partners is to some extent inter-linked. It is an important assumption of RSPS 2 that partner programmes proceed more or less as scheduled and that there is steady progress towards more joint support in the sector. This is a reasonable assumption based on the high degree of donor coordination already established in the sector and the progress made in developing the Joint Assistance Strategy for Zambia 7.2 Risks Institutional changes in the roads sector could affect the institutional strengthening aspects of the RSPS 2. This includes the radical restructuring of the management of local road networks by the setting up of Local Road Authorities. There are numerous potential risks in this restructuring, including the possible lack of availability of technical staff at district level. However, the process-oriented approach of RSPS 2 should facilitate the adjustment of the programme to the pace of introduction of the new structures. Furthermore, the channelling of sector budget support to the LRAs combined with institutional capacity creation can be expected to impact positively on the functioning of the LRAs. The programme is dependent on the effectiveness of the authorities, charged with the management of natural resources and land use control, to manage the potentially long-term negative socio-economic consequences of the possible degradation of the natural resource base from improved accessibility. To mitigate such risk, ESMU will carry out strategic environmental assessments as needed (see output A5) and engage with authorities and other stakeholders in the programme area to raise awareness of the risk of indirect impacts and motivate actions to minimize them. The turnover of staff of the organisation easily undermines the sustainability of any capacity building programme. This concern is noted in the FNDP, which suggests that any improvement in capacity development and retention will be curtailed unless there are changes within the public sector as a whole. With the institutional reforms in the road sector, it is anticipated that some of these changes will contribute to the development of organisational cultures conducive for building institutional knowledge and memory. The use of predominately locally procured consultancy and contracting services, and the planned capacity building for these, will also contribute to the development of a local knowledge base available to the sector in the future. 17

8 COMPONENT IMPLEMENTATION PLAN Figure 8.1 below show the implementation plans for activities of the subcomponents. The activities plan is indicative; RDA, RTSA and ZIPAR will develop detailed annual programmes for the subcomponents. A special Subcomponent Description, which includes a detailed implementation plan, has been prepared for Subcomponent C. 18

Institutional Support, RSPS 2 June 2009 Component Activities Plan 2009 2010 2011 2012 A Institutional Support to RDA A.1 RDA environmental management staff training RDA senior mgt approve procedures manual * Responsibilities allocated within RDA and LRA * Prepare TOR for procurement of consulting services (if required) * Procure consulting services and engage consultants * Prepare and deliver training * Evaluate training programmes A.2 Environmental and Social Consultant training Develop consultant selection criteria and process * Consultants to be trained selected * Prepare TOR for procurement of consulting services (if required) * Procure consulting services * Prepare and deliver consultant training programme * Evaluate training programmes * A.3 Consulting Engineer and Contractor training Procure consulting services * Prepare materials for inclusion in training programmes * Conduct consulting engineers and contractors training Evaluate training programmes A.4 Effects and Impact Monitoring Pilot Roads Baseline studies for pilot roads completed (under Phase 1) Physical works completed on pilot roads * * * Prepare TOR for procurement of consulting services (if required) Procure consulting services and engage consultants Begin monitoring on pilot roads Selected Main Roads Baseline for the Mongu Senanga collected under ESIA's Physical works completed Mongu - Senanga Begin monitoring in areas where works are completed 19

Institutional Support, RSPS 2 June 2009 Component Activities Plan 2009 2010 2011 2012 National guidelines development A.5 LRA and accessibility management guidelines Prepare TOR for procurement of consulting services B Support to RTSA Procure and engage consultants B.1 Accident information system development Develop national accident information system * Procure equipment for HO and pilot admin centres * Install system at HO and pilot administrative centres * Train staff and pilot system Make revisions to the system in preparation for national roll out B.4 Road safety education campaigns Develop materials for national road safety education campaigns B.3 Road safety audits Carry out assignment Conduct education campaigns Conduct road safety audits Recommendations for Mongu - Sesheke road implemented C Support to Transport Sector Monitoring C1 Indicator data base C2 Performance Assessment Model C3 Social Accounting matrix Note: 2012 is partial year. *) Completed 20

Institutional Support, RSPS 2 June 2009 ANNEX 1: TERMS OF REFERENCE FOR THE TECHNICAL ADVISOR TO ROAD DEVELOPMENT AGENCY AND LOCAL ROAD AUTHORITIES 1 BACKGROUND The road sector is one of the priority sectors in the current Danida country strategy for Zambia. Danida has been involved in the sector through the repair and rehabilitation of major roads using project assistance since 1991. The first phase of a comprehensive Road Sector Programme Support (RSPS 1), which commenced in December 2002, included three components covering (i) rehabilitation of the main Lusaka to Mongu road, (ii) rehabilitation of high priority local roads along this main road, and (iii) institutional development. Phase I ended in October 2007. The proposed RSPS Phase 2 (RSPS 2) will contribute to, and form part of, Zambia s 10-year Road Sector Investment Programme Phase II (ROADSIP II). The main objective of ROADSIP II is to bring a core network of about 40,000 kilometres into maintainable condition by 2013. 2 RATIONALE FOR TECHNICAL ASSISTANCE As a result of the Joint Annual Review of RSPS 2, March 2009, the two Technical Advisor posts under RSPS2 were combined. The Technical Advisor will be based at RDA-HQ in Lusaka, responsible for provision of support to the RDA-HQ; the Ministry of Local Government & Housing; RDA Regional Offices and LRAs in those provinces and districts receiving support under the Programme. A further, and important, outcome of the 2009 Joint Annual Review was the expansion of support under RSPS 2 to Luapula Province and a strong recommendation for the use of Sector Budget Support (SBS) provision towards LRA activities. These Terms of Reference (ToR) are for the Technical Advisor, based at RDA-HQ in Lusaka, responsible for provision of support to RDA and the MLGH. Depending on a needs assessment, local or international, long- or short-term Consultants under the Programme, will assist the Technical Advisor. 3 OBJECTIVE The overall objective of the Consultant s assignment is to provide advice and technical assistance to the RDA, MLGH and LRAs in achieving the objectives, outputs and activities as stipulated in the Reformulated Road Sector Programme Support Phase 2. These outputs are fully described in the component descriptions. The aim of the technical assistance is primarily to assist in developing the planning, management and monitoring capacities of the RDA and MLGH in order to increase the capacity for effective management of the road network at national, provincial and district levels. 1