Power Sector Reforms Approx. $5.5m 6 years so far Reduce the high cost of electricity by introducing sector regulation and a competitive tender process for Luganville electricity concession (increase diversity of service providers). Work with World Bank (under Trust Fund) to advocate and establish the utility regulator. Provided TA and funding for establishment and development of new department of energy to take lead on policy development (similar to situation in telecoms). Undertook scoping mission on Luganville concession and Sarakata fund which led to tender of Luganville concession. Provided grant for TA to support GoV in the tender of Luganville concession. Provide advice to GoV on outcome of tender and support GoV officials on the outcome of the tender. Introduction of competitive tendering (new in the power sector). Introduction of a regulator intended to monitor prices and dilute the price impact of monopoly concessions. Mixed. Competitive tender in Luganville resulted in a new concession holder and new market entrant. Prices have been reduced by 4.7% across the board following tariff reviews and 49% reduction for low-income consumers. New department of energy created (first time a dedicated policy area for energy in government) but staffing of new department not forthcoming. AusAID support (funding and policy/advocacy) has seen greater engagement of World Bank in a sector which has improved diversity of advice and access to technical support. Reforms remain the subject of ongoing legal challenges. Ministry policy position somewhat uncertain.
Customs and Revenue Support (Under MFEM) Support increased revenue collection through greater compliance in VAT and customs collection. Brought in TA through the Pacific Financial Technical Advisory Centre. Improvements in revenue collection and greater in collections. Government VAT collections up 15% on same period in 2011, directly attributed by government to the support of the TA (despite a drop in overall economic activity over the same period). Major Projects Unit 9 months (Under MFEM grant) Ensure delivery of significant projects. No support provided yet but planned to provide grant to increase capacity and operational costs. Establish a system to manage major infrastructure investments that could give GoV and donors confidence in the effective use of public monies. Unit has been established formally and steps now underway to support ongoing management. Tourism Campaign $600,000 grant 2 years Help boost tourism numbers through support to develop an advertising campaign which was used in Australian and NZ. Provided grant funding and one long term TA to manage the project. Assisted the institution with working through GoV systems to meet its obligations in administering the funds, procurement of a major international advertising company using GoV contract. Established a new brand for Tourism Vanuatu and a new website and office for the Tourism Office. Anecdotal evidence suggests project did help minimise drop in tourist numbers due to economic crisis but broader issues affecting tourism now more of a binding constraint. Financial Inclusion / Access to Finance NBV Support $500,000 grant for satellite and $860,000 grant for below 2 years Increase the range of products in rural areas and increase financial literacy Speed up transactions in rural areas and improve business environment. Development and implementation of Financial Inclusion Strategy. Provided grant funding. Make banking more accessible, provide more opportunities to start up small business, and enable greater access to loans and schemes in rural areas. Roll out a program of products and activities by the Bank to implement their financial inclusion strategy across the country. Over 7000 new rural bank accounts established as a result of this support. Roll out of mobile banking in 2012. Operational costs of NBV reduced helping manage the bottom line of this well performing SOE.
i-Government (See above, funding via MFEM grant) Increase the effectiveness of in improving cost and time efficiency in government operations and increase data security. Used MFEM grant to support initiative to integrated i-Gov network, and establish VOIP network over entire i-Gov system. Reduce cost of telecommunications within entire GoV system ($4m per year). Enables utilisation of video conference calling in most provincial HQ countrywide. Government is progressing towards full access to provincial offices at no cost due to savings. Without GfG support government would have a $30m debt for a national asset (the $30m loan for the government network) that it could not use effectively. Now it is a national asset. Urban Development Program (including PPTA) Approx. $1m 12 months Increased attention on urbanisation issues and investments for functioning urban centres. Grant to ADB for preparation and physical infrastructures in Port Vila Increased infrastructure investments in urban areas resulting in greater attention on urban issues Development of design documents and policy engagement on conditions for project commencement already leading to good reform outcomes (staffing in MIPU, establishment of VPMU). Significantly increased government engagement on urban development issues.
Aviation Approx. $1.8m 4 years so far Improve operational performance of Air Vanuatu; ensure safe operation of the 3 AVL airports; improve outer island air safety. Support to CAAV, AVL and Air Vanuatu in TA provision (audit, operational issues, safety). High levels of policy and operational advocacy with all levels of government. Some small catalytic investments (lights on Tanna; Bauerfield runway repair). Air Vanuatu management remains fragile but program engagement with them and others (including the board) has helped them to manage soundly. AVL management stability and capacity a concern looking forward. Support to and engagement with CAAV should also help strengthen their capacity and standing. Development and imminent passing of first ever national standards for outer island airstrips opens way for major investment and maintenance programs for the first time and should see improved safety (and possible rationalisation of airfields) in the next couple of years. Scoping of engineering works required for AVL airstrips will also enable subsequent critical investments to roll out. Annex 11: GfG’s Phase II: First-Year Commitment and Pipeline Budget (Data and analysis provided by GfG, November 2012) Topic of intervention or involvement What is the intended purpose and rationale? What will GfG do? What, from an institutional perspective will the intervention set out to achieve? What is the expected outcome?
Program Management and Operations Up to $4m over four years ($700,000 for the 1st year – 12/13) To enable effective program operation and responsive, high quality policy and programming advice to GoV and AusAID. In addition to core staff and office/program running costs, the funds will be used to engage two full time in-house advisers (PFM and Economic Advisers) in addition to the current infrastructure adviser. Core staff and advisers are the front line of policy and programming support to GoV under the program and are responsible for both direct engagement as well as sourcing additional resources as required. GFG staff/adviser engagement will aim to achieve demonstrable policy and institutional development results through high quality, responsive and flexible advice. Also to support AusAID’s broader program in economics and public financial management. A well-managed program delivering demonstrable results in line with GFG Phase 2 design, Partnership for Development, relevant national and sector level policy objectives of the GoV and the GFG design. Consistent positive feedback from GoV on contribution of program.
Support to Ministry of Finance and Economic Management $2.25m over four years (No funds in 1st year – 12/13 as existing Phase 1 grants rolled over will be sufficient) To strengthen budget processes, improve public financial management systems, revenue/tax system; procurement; strengthen transparency and accountability and improve management of Government Business Enterprises. Provide core funding support to assist MFEM agencies (DoFT, VNSO, Tender Board Secretariat, Dept. of Customs & Revenue) to procure technical assistance, goods and services in support of operational and reform oriented activities. To ensure MFEM remains a strong institution and agencies such as DoFT, Customs and Revenue, Tender Board Secretariat and VNSO perform at or above their corporate objectives. To support the agencies to develop/implement new reforms which improve revenue flows and expenditure management. That MFEM improves its outreach to the line agencies and the public in order to improve quality of public expenditure and accountability/transparency of PFM and budget management. Ongoing improvements in administration of public finances including improved budgeting (target setting, forecasting, expenditure management); improved regulations (adoption rates, compliance); improved financial reporting (including public accessibility); strengthened expenditure and financial controls; FMIS maintenance and useability upgrades (including line agency training). Medium-term fiscal framework developed together with PMO. Finance units of line ministries and provincial offices are strengthened – including internal audit functions. Procurement reforms are approved and implemented across whole of government. Increasing percentage of government expenditure through Central Tender Board processes. Improved/streamlined revenue and customs regulations and more compliance resulting in increased revenue collection Improved data collection, compilation and dissemination to stakeholders throughout Vanuatu, including government.
Support to Telecommunication Sector $2.73m over four years ($1.5m in 1st year – 12/13) Support the consolidation of the telecom regulator office as a competent and well regarded institution within government, industry and consumers. To ensure the telecommunications sector fosters genuine competition in key market segments driving lower costs and improved access and quality of telecommunications services Provide core funding to the Telecommunications Regulator Office via the World Bank Trust Fund to help consolidate telecommunication regulation in Vanuatu. This support will also support some activities in the OGCIO and ensure the GoV can still access World Bank expertise. Better regulation and effective regulator driving reduction in prices and increasing good quality access throughout Vanuatu Reduced costs of telecommunication services (phone and data) Increased access to telecommunication services throughout Vanuatu (phone and data) Competitive private sector provision in all key market segments in the sector High quality and well regarded policy and technical advice to the GoV as requested.
Support for Implementation of Trade Policy Framework $270,000 already allocated from 1st year - 12/13 flexible fund Ministry of Trade, Commerce, Industry and Tourism (MTCIT) able to effectively implement Vanuatu’s Trade Policy Framework (TPF) Provide grant funding to MTCIT for the recruitment of technical/activity assistance to support the implementation of the Trade Policy Framework and its implementation matrix. Participate as the donor facilitator in the implementation of the Trade Policy Framework Establish within GoV the TPF as the guiding trade policy and the NTDC as the principal and planning body. GoV able to successfully engage in trade negotiations and have the required policy and implementation expertise to take advantage of trade agreements. GoV trade related planning and implementation activities planned and coordinated effectively via the MTCIT/TPF/NTDC framework. Support to Office of the (OAG) $250,000 already allocated from 1st year – 12/13 flexible fund OAG has the capacity to undertake its audit mandate. Provide Senior Audit TA and grant to OAG to assist in HR reform, capacity building and ability to outsource tasks/activities as required. Increased number and quality of audits being produced. Effective and proactive secretariat support to the PAC/parliament. Increased internal staff capacity to undertake audits and support development of national audit policy and legislation. All government audits up to date (including backlog). Public accounts committee meeting regularly as benchmarked against previous years. Increased number of ad hoc audits (including of development projects) being undertaken under the coordination of the OAG. Increased public awareness of OAG audits and functions. Knowledge, Analysis, Research Briefing $1,050,000 ($300,000 in 1st yr) To enable the program to generate, publicise and disseminate analytical products that support GFG result areas Commission specific research activities including providing specific grants to research institutions to undertake the research analysis. Working closely with the PMO and VNSO to increase the quality and usefulness of analysis and research to influencing government policy making Increased availability of and informed research products that demonstrably influence policy formulation and implementation. Increase demand at political level for good quality and timely research and analysis.
Support to Aviation Sector $500,000. 12-13 only To assist the Vanuatu Government design and install lighting equipment for three airstrips in Vanuatu (Pekoa, Bauerfield & Whitegrass) Procure consultancy services to design and project manage installation of the lighting equipment Improved airstrip safety. Access to Tanna for night flights increasing night landing options (safety) and tourism opportunities Unallocated (Flexibility) funding $8.4m over four years $1.2m in 1st year – 12/13 To provide ability to support expansion or deepening of activities in support of achievement of result areas. Using in-house and external resources, GFG will work closely with GoV and other partners to identify, develop and support initiatives which will deliver tangible results against the program’s result areas. To respond quickly, flexibly and effectively to emerging GoV initiative and reforms which align with the GFG result areas. Measurable progress against all key result areas.