Technical Risk Assessment Table A4.1: Technical risks and mitigation strategies Issue Approach Impact Probability Risk General Difficulties of coordination, and management of performance based allocations (particularly flow of funds to implementing units) Selection of issues that both MoF and line ministries have an incentive to solve as the basis for program design; Reinforcement of collective incentives through the choice of DLIs; Bank support for timely recruitment of PCT Ongoing Bank support across sectors to facilitate dialogue Moderate Moderate Moderate Challenges in recruiting, training and deploying national staff to provide ongoing public sector management capacity development and support Bank supports DNT to develop ToRs, identify and recruit high-quality international TA for training and ongoing QA of national staff Staff identified within public sector institutions centrally and provincially (deployment issue) Moderate Moderate Moderate Incentives insufficient or poorly targeted to offset potential shifts required in formal/informal benefits of existing institutional arrangements Annual review of performance allocations, and capacity development Annual discussion of supporting interventions in sector dialogue Substantial Moderate Substantial Medicines Supply Chain Funding constraints for medicines purchase impact on tracer medicines availability (DLI# 1 and 4) Two availability indicators focus on medicines with different financing streams DLI medicines (HIV and maternal and reproductive health) are high-priorities for both GoM and health partners (particularly, US Government and GFATM) DLI pricing commensurate with level of government control Sector level performance based allocations support gap-filling purchase of low cost essential primary health care medicines (which are often neglected by vertical funding sources). Allocations of up to US$ 9.6 million are available over the period of the Program, representing approximately 20% of costs for medicines included in primary health Moderate Moderate Moderate
care kits. Improved forecasting, stock position visibility and reduced losses may mitigate against short-term funding variability Changes in physical or accountability structure of the supply chain alter relevance of approach/indicators Indicators relevant to short term Pharmaceutical Logistics Strategic Plan proposals. Flexibility of approach can support implementation of supply chain reform proposals Low Moderate Moderate Associated development partner investments focusing on procurement, infrastructure, and last-mile delivery do not materialize Extensive preparation phase dialogue with primary supply chain partners to agree focus of support. Availability DLIs most at risk, and priced accordingly. Moderate Low Moderate Quality of medicines purchased using Program funds is poor A protocol for sampling, quarantining, testing (in laboratories meeting international standards (e.g. ISO 17025)), releasing or withdrawing consignments of medicines purchased with Program funds to be agreed and incorporated in the Program Operations Manual (completion of which will be a condition of effectiveness). Moderate Low Moderate Education sector Difficulties in engaging, training and retaining community members sufficient for effective and representative school councils DLIs focus: on council composition and activity and; role of SDEJTs in providing supportive supervision Bank support to MinEd and SDEJTs to ensure capacity development and performance based allocation well defined, targeted and reviewed on annual basis for adjustment if required High Moderate Substantial Lack of cooperation and support of school director for effective school council management engagement Supervision by SDEJTs, and targeting of performance based allocations Moderate Moderate Moderate Implementation challenges in implementation of program classification at district level Coalition between MoF, Ministry of Health, Ministry of Education and Public works to overcome challenges at various levels Moderate Moderate Moderate Economic Assessment Rationale for Public Sector Delivery - Health and Education Public Sector Service Provision Education and health services in Mozambique are both overwhelmingly financed and provided through the public sector, with significant external donor assistance in both sectors. In both instances, sector administrative structures are mapped to the political structure of government, with central, provincial, municipal and district entities. An on-going, although
DLIs Economic Benefits Direct (PFM service delivery systems) Indirect (service delivery) Education Sector – School Based Management of Complete Primary Schools DLI #3: Proportion of school-councils that comply with defined standards for transparency and accountability (school councils elected according to revised criteria, approved school development plan, and displayed information on resources allocated, planned, and applied) Increased transparency of the budget. Possibly increases in the level of execution Better application of internal control mechanisms resulting in reduction in the misuse of funds. De-concentration of competences and actual decentralization to the service provider units – the schools. Better services provided by the schools. Effective performance of school councils leading to better availability of school resources. Monitoring of teachers and student attendance in the classroom. Better learning outcomes to be substantiated by examination results. DLI# 7: Proportion of complete primary schools receive funds on or before February 28 Improved budget execution rate. Timely availability of schools materials DLI #8: Revised budget classification by sub-sector, configured, and applied Increased transparency of the budget. Possibly increases in the level of execution. Better application of internal control mechanisms resulting in reduction in the misuse of funds. Effective performance of school councils leading to better availability of school resources. Monitoring of teachers and student attendance in the classroom. Better learning outcomes to be substantiated by examination results. Educated and productive human resource entering the labor market of the country. DLI #9: Proportion of schools visited for supervision by SDEJTs Better application of internal control mechanisms. Reduction in the misuse of funds.