U.S. Position on the World Bank’s Program-for-Results (P4R)

January 24, 2012

The United States appreciates the work of the World Bank over the past eighteen months 

on the development of this instrument, which builds on the past experience of the Bank 

and other development actors, and supports its efforts to take the views of a variety of 

different stakeholders into account. The United States expects World Bank management 

to continue to solicit feedback from these stakeholders as it moves from design to 

implementation. 

The United States strongly supports the concept behind this new instrument: formally 

linking Bank disbursements to the achievement of development results that are tangible, 

transparent and verifiable. In the past, the link between lending and results at the World

Bank – and at other development institutions – has not always been clear-cut. The new 

Program-for-Results (P4R) instrument makes that link explicit (see World Bank link for 

more details on P4R)

1

. Disbursements occur in proportion to the degree of success in 

achieving results. This shift from the Bank’s existing instruments, which finance inputs 

or disburse for the enactment of broad policies, is an important opportunity to validate the 

promise of results-based lending. 

The United States also strongly endorses the objectives of supporting country-owned 

development programs and strengthening the institutional capacity of client countries. 

By leveraging World Bank assistance across an entire country program, P4R has the 

potential to deliver greater impact in this area than standalone investment lending 

operations or development policy lending. 

As any new instrument initially comes with risks, the United States also strongly supports 

management’s plan to roll P4R out slowly and with the incorporation of appropriate 

limits, evaluations, and oversight. Specifically, the United States supports the limit of 

commitments under P4R in the first two years of the program. The limit of 5 percent of 

annual IDA/IBRD commitments – which still equates to approximately $2 billion 

annually – is sufficient to allow us to test the implementation of the instrument, identify 

and correct problems, and then consider expansion, as appropriate. 

The United States also agrees that the exclusion of Category A activities from P4R 

financing is appropriate and welcomes the World Bank’s unequivocal, public statements 

in this regard. The significant risks that such activities present are best handled through 

Investment Lending operations and under the World Bank’s well-established safeguard 

policies. 

 1 The final version of the World Bank’s P4R paper, which is being modified to eliminate any 

confusion in the Operational Policy about the exclusion of Category A projects, will be posted on the 

World Bank’s P4R public website on or around February 6, 2012.
The continued oversight of World Bank lending under P4R by the Bank’s independent 

oversight mechanisms, specifically the Integrity Vice-Presidency, the Independent 

Evaluation Group, and the Inspection Panel is also appropriate.

In other areas, the United States believes that the limits that management proposed should 

have been stronger. For instance, with respect to excluded procurement contracts, the 

specified monetary amounts for activities above which contracts for works, goods, IT 

systems and services will be excluded from P4R are too high. The United States expects 

that in cases where financial management and procurement assessments uncover 

significant weaknesses, the amount eligible for procurement will be much lower.

The United States also has remaining questions regarding the implementation of P4R and 

looks forward to engaging closely with the World Bank as the initial P4R operations are 

brought to the Board. These issues include: 

• Key to the success of this instrument will be transparency and accountability in its 

operation. The ability of affected communities, the private sector, and other 

stakeholders, in a timely manner, to review and provide input not only on the 

individual program risk assessments and proposed gap-filling measures, but also 

on the proposed activities, and to be informed of results at the activity level, is 

critical and will help to build confidence in P4R. The disclosure of information 

on a country’s entire program, not just the associated World Bank financing, is a 

welcome component of P4R. 

• The United States expects the World Bank to be particularly attentive to the 

potential for any adverse impacts of P4R activities on Indigenous Peoples and 

other vulnerable groups, and that in these circumstances the World Bank will seek 

to mitigate potential risks adequately or determine not to move forward with the 

P4R investment.

• The use of disbursement-linked indicators (DLIs) is a key innovation in P4R, but 

we are concerned that DLIs could focus heavily on outputs, rather than outcomes. 

While the United States recognizes that the development and definition of the 

DLIs will occur through a dialogue between the World Bank and the client, we 

expect that P4R operations will, to the maximum extent possible, use DLIs that 

measure outcomes.

• The United States is disappointed that the final document does not mandate the 

use of independent monitors to verify the achievement of DLIs, although it allows

for their use. Verification of DLIs by independent, third-party monitors would 

further strengthen the transparency of the instrument, guard against the potential 

manipulation of results, and best achieve the stated objective of ensuring that a 

credible verification mechanism is in place. The United States expects that the 

use of third-party monitors will be the default option in P4R operations.
• The United States will also be closely reviewing the World Bank’s risk 

assessment process as described in the paper and draft Operational Policy and 

Bank Procedures. The lack of a clear standard to determine a borrower’s 

readiness for P4R and adapting assessments to specific country and program 

contexts continues to be a problematic approach that could lead to uneven 

application of the instrument across the World Bank as well as confusion among 

staff and clients.

 

• The issue of capacity building remains an important issue for implementation of 

P4R, particularly as strengthening the institutional capacity of clients is an 

objective. While the paper lays out a variety of different ways in which clients 

will be able to access technical assistance to support efforts at capacity building, 

additional thought should be given to how best to support the weakest borrowers 

who may have limited resources to expend on technical assistance. 

Finally, The United States strongly supports a review of the implementation of P4R by 

the Bank’s Independent Evaluation Group to complement management’s own planned 

review of implementation experience. The United States is pleased that Management 

plans to solicit feedback from countries, development partners, the private sector, other 

stakeholders and staff as part of the review process.