Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) Mongolia Multi-Sectoral Technical Assistance Project (P119825) EAST ASIA AND PACIFIC | Mongolia | Macro Economics & Fiscal Management Global Practice | IBRD/IDA | Technical Assistance Loan | FY 2010 | Seq No: 8 | ARCHIVED on 18-Dec-2015 | ISR21574 | Implementing Agencies: Ministry of Finance, Bank of Mongolia, Financial Regulatory Commission, Ministry of Finance Key Dates Key Project Dates Bank Approval Date:28-Jun-2010 Effectiveness Date:17-Mar-2011 Planned Mid Term Review Date:31-Dec-2012 Actual Mid-Term Review Date:15-Jan-2013 Original Closing Date:31-Dec-2014 Revised Closing Date:30-Jun-2016 Project Development Objectives Project Development Objective (from Project Appraisal Document) To support the Recipient’s efforts to enhance its capacity for policy making, regulation, and implementation in the fiscal, social,and financial sectors. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name Enhancing capacity for Fiscal Management:(Cost $4.12 M) Supporting Government efforts to better protect the poor:(Cost $3.20 M) Enhancing capacity for maintaining financial sector stability:(Cost $3.43 M) Project management:(Cost $0.73 M) Strengthening Capacity and Improving Transparency of the Government Procurement Agency:(Cost $0.30 M) Supporting Pensions Reform:(Cost $0.30 M) Improving Public Financial Management Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO  Moderately Satisfactory  Moderately Satisfactory 12/19/2015 Page 1 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) Overall Implementation Progress (IP)  Moderately Satisfactory  Moderately Satisfactory Overall Risk Rating  Moderate  Moderate Implementation Status and Key Decisions Overall project implementation towards project development outcomes is making steady progress. Despite the steady progress in most of the PDO indicators, the mission rated the overall progress towards project development outcomes as moderately satisfactory, reflecting the budget credibility that needs to be further improved to restore prudent macro-economic management. 1. The first project development objective indicator aims to enhance the credibility of the budget through realistic revenue projections and expenditure planning. Credibility of the budget still remains weak in 2015, with a revenue shortage reaching 16 percent of the budget. The revenue projections of the 2016 budget, however, seem more realistic compared with previous years, and the deviation of the budget revenues are expected to be contained within 10 percent of the original budget – the target value of the Component A1 PDO indicator – unless there are unexpected external shocks particularly to the prices of copper and coal next year. 2. The second project development objective indicator that aims to adopt laws on accounting and auditing was successfully achieved in 2015. The laws on accounting and auditing were approved on June 18, 2015 and will become effective in 2016. The follow-up work to support the implementation of the laws are under way with the support of the MSTAP. 3. The third PDO indicator is to prepare a poor household database on the basis of the Proxy Means Tested Survey (PMT). This PDO indicator has made good progress. PMT based Integrated Household Information Database (ISDB) was established and endorsed by government to be used across government programs in various sectors as of December 2014. Since then, there have been some initial efforts and plans to make use of the Integrated Household Database, for instance for targeted medical health insurance, free textbooks for children from poor households and free legal advocacy services for the poor etc. In social welfare sector, the database that is being used for only one welfare program – the Food Stamp Program, is going to be used for targeting of the Child Money Program, starting from January 2016. 4. The fourth PDO indicator aims to adopt a new law on Deposit Insurance Corporation and to help the DIC become fully operational. This PDO indicator has also made good progress. The new DIC law was enacted in 2013 and the agency is now operational. The MSTAP continues to support activities to strengthen its operational and financial capacity. Project disbursement is making steady progress in 2015. Overall disbursement of the project picked up to 78.3 percent in October 2015, from 65.9 percent one year ago. Aggregate commitments increased to 85.7 percent of the MSTAP budget in October 2015, from 73.5 percent at the end of 2014, with US$1.7 million left uncommitted out of a total of US$12 million. By the end of 2015, the client expects that the total disbursement will reach 82 percent. Given the current progress, the client is considering the extension of the closing date and submitted a revised implementation plan. Following the recommendations of the June Aide Memoire, the Project Steering Committee reviewed the implementation progress of all components on August 10, and concluded that a one-year extension may be needed to complete the on-going activities. The revised implementation plan was discussed with the Bank mission during the supervision missions in October and November. Risks Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance  --  High  High 12/19/2015 Page 2 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) Macroeconomic  --  High  High Sector Strategies and Policies  --  Moderate  Moderate Technical Design of Project or Program  --  Moderate  Moderate Institutional Capacity for Implementation and Sustainability  --  Low  Low Fiduciary  --  Low  Low Environment and Social  --  Low  Low Stakeholders  --  Moderate  Moderate Other  --  --  -- Overall  --  Moderate  Moderate Results Project Development Objective Indicators PHINDPDOTBL  Credibility of the executive budget strengthened through realistic revenue projection and expenditure planning. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The 2015 budget expenditure outturn is Deviations of expected to be around expenditure The 2015 budget 10-15% of original Deviations of expenditure outturn and expenditure outturn budget respectively. The outturn and revenue revenue outturn and revenue outturn revenue shortage is outturn from original from original Value from original budget is expected to be greater budget were 28% and 22% budget are expected to be around than the last ISR, due to of original budget reduced to less 9% of original budget a sharp decline in the respectively in 2011. than 10% of respectively. global commodity prices original budget that translates into a respectively. sharp drop in mineral revenues. Date 31-Jan-2012 22-Jun-2015 30-Nov-2015 30-Jun-2016 PHINDPDOTBL  The Government shall have submitted to the Parliament for passing the draft laws on accounting and auditing that would create thelegal environment for ensuring that Mongolia's accounting and auditing (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Achieved. Draft laws Achieved. Draft laws submitted to the submitted to the Parliament and Parliament and approved by Parliament Draft laws Adherence to international Value supported in in its plenary session submitted to standards uneven Parliament for approval held on June 18, 2015. the Parliament. at the final hearing on The revised laws June 18, 2015 become effective January 1, 2016. 12/19/2015 Page 3 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) Date 01-Jan-2011 01-Apr-2015 27-Nov-2015 30-Jun-2016 PHINDPDOTBL  MPDSP has prepared a poor households database, on the basis of the Proxy Means Test survey. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Achieved. The second Achieved. The second round of PMT survey round of PMT survey data collection was data collection was completed in Dec completed in Dec 2013, 2013, and the and the database database became became available in Apr available in Apr 2014. 2014. Furthermore, as of Dec Furthermore, as of Dec 2014 the database was 2014 the database was endorsed by the endorsed by the Database Value No database government to be used government to be used completed across government across government programs in various programs in various sectors. The database sectors. The database – – which is currently which is currently being being used only for the used only for the Food Food Stamp Program – Stamp Program – now now can be used for can be used for targeting of other targeting of other government programs government programs and subsidies for the and subsidies for the poor. poor. Date 01-Jan-2011 23-Jun-2015 30-Nov-2015 -- PHINDPDOTBL  New deposit insurance agency is fully operational. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target The new Limited Bank Deposit Deposit Insurance Law was The agency (the Insurance enacted in 2013 and Deposit Insurance Corporation is a New Law on Deposit DICOM has been Corporation) is full-fledged Insurance Corporation established according to operational and pillar of the Value enacted and is about to the law. IT system for continuous to financial sector have its implementation development for the strenghten its safety net, with started deposit insurance and regulatory and financial proper capacity building capacity institutional engagements through structure and trainings are in progress. financial 12/19/2015 Page 4 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) capacity, deposit payout capabilities, and clear mandates and responsibilities. Date 30-Apr-2013 22-Jun-2015 24-Nov-2015 30-Jun-2016 Overall Comments Intermediate Results Indicators PHINDIRITBL  Strengthened fiscal planning and management capacity through improving budget planning mechanism (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target On-going. The BPIS system has been configured fully for the local budget planning process in 2015 and it is planned to deliver end-user training for 19 aimags and UB city excluding 2 pilot aimags in November 2015. As a result of this training, all local budget governors will use the system for their local No on-line web-based The BPIS budget planning process Budget Planning becomes in 2016. Technical Information System existed functional and problems that were for budget preparation and is used for identified during the different char of accounts budget Value -- piloting process had are used for budget planning both been resolved and now planning (Fiscal, budget at the central the system is under real- planning system) and and local time testing. Interfacing execution (GFMIS) government the system with Fiscal systems level. system (the currently used non-web-based system) has been completed and interfacing with the GFMIS (the treasury information system) is under way. Entry of 2016 budget data of local government started in August 2015 and the system is under a support stage for the 2016 local budget planning process 12/19/2015 Page 5 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) (budget proposal entry, submission, revision, control and approval). The BPIS system is planned to be fully used for the central government budget in 2017, after a real-time testing stage in 2016. Date 01-Jan-2012 15-Jun-2015 30-Nov-2015 30-Jun-2016 PHINDIRITBL  Strengthened legal framework for prudent natural resource revenue management. (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target On-going. The law on SWF has been drafted over the previous two years and was submitted to the New legal Cabinet in October framework for 2014, with the support of prudent natural No legal framework for the MSTAP. To reflect resource prudent natural resource the recommendations of Value -- revenue revenue management the parliament working management is exited. group, the law was adopted and returned to the ready for government and implementation. resubmitted the Parliament in June 2015. The draft SWF law is currently under discussion of the Parliament. Date 01-Jun-2011 30-Jun-2014 27-Nov-2015 30-Jun-2016 PHINDIRITBL  Fiscal transfer formula for local government financing improved to increase predictability of resources and to reduce horizontal inequities between local governments and facilities (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target A proposal on Partially Achieved. Government improving the LDF resolutions to transfer formula was • An improved financing improve the presented to the mechanism of special transparency Finance Minister and purpose transfer for and horizontal the President Office, primary health care equalities of the Value No fiscal transfer formula with weights of 4 services is planned to be central indicators (40% on used in 2016. The MOF government population, 20% on and the MOH has been budget geographical discussing the proposed transfers to remoteness, 20% on changes in the financial local development index, formula on primary governments 12/19/2015 Page 6 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) and 20% on tax health care services and are issued and mobilization initiatives). reached an agreement implemented. President office in November. The MOF proposed higher and the MOH plan to weights on population issue a joint decree by and asked the MOF to the end of 2015 on the revisit the estimation introduction of the on horizontal allocation revised financing of LDF budgets across formula into the 2016 aimags. Further budget allocation. discussion will be made based on • An initial study on revisited estimated by education financing the MoF. mechanism began in October by one MSTAP The MOF is working consultant. A national with the MoH to finalize consultant was hired for the financing formula nine months on October based on the proposal 1, 2015 to improve the made by the MSTAP methodologies in consultants, aiming to financing mechanism of put it into use from pre-school and general 2016. education programs. • An improved LDF transfer formula was presented to the President Office in 2015. Currently, discussion is under way on the weights of key parameters of the transfer formula, particularly on the size of population. Date 01-Jan-2011 22-Jun-2015 09-Dec-2015 30-Jun-2016 PHINDIRITBL  Improve the templates used for financial reporting in accordance with IFRS and create a consolidated database system for allowing electronic filing of financial statements by firms (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Achieved. IFRS- Achieved. IFRS- complied accounting complied accounting guidelines for entities guidelines for entities along with the revised along with the revised chart of accounts Existing template chart of accounts Regular obtained approval by the ineffective due to obtained approval by financial Minister of Finance on modifications to IFRS. the Minister of Finance statement e- Value December 23, 2014 Lack of capacity and on December 23, 2014 filing to MOF (order #249). The e- inefficiency of the current (order #249). The through e- balance system for software - eBalance newly developed e- balance system electronic submission of balance system for financial statements was electronic submission upgraded and of financial statements implemented 2013 Q1. is now fully operational. Data conversion for 12/19/2015 Page 7 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) years 2002-2012 was done in December 2014. The upgraded e-balance system is now fully operational with access to past years data to perform analytics. Date 01-Jan-2011 23-Jun-2015 27-Nov-2015 30-Jun-2016 PHINDIRITBL  Capacity enhancement for setting and enforcing international financial reporting standards (IFRS) (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Ongoing. Capacity of financial statement preparers, Accounting Standards Committee, and other regulators enhanced through IFRS and IFRS for SME trainings for Enhanced Lack of capacity for both approximately 800 capacity for regulators and preparers of Value Partially achieved accounting professionals Accounting financial statements with nationwide from 2012- Standards regards to IFRS. 2015, preparation of a Committee 108 page IFRS manual, and an enhanced e- balance system used by regulators for the collection and analysis of financial reporting data. Date 01-Jan-2011 23-Jun-2015 30-Nov-2015 30-Jun-2016 PHINDIRITBL  MoPDSP and GOSWS have created an adequate IT infrastructure for designated users on the basis of the PMT database for poor households and citizens or targeting purposes for social programs, assist (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Partially achieve with a Multi –sector Mostly achieved. good progress. database is Development of Welfare Development of operational, Administration and Welfare Administration sharing and Information System and Information retrieval of data (WAIS) has been System (WAIS) has enabled for all No web based software completed with specific Value been completed with users including available modules on registration, specific modules on a number of reporting, administration registration, reporting Ministries and and accounting. The and administration of departments whole system will welfare benefits and using ISDB to officially roll out from services. Remaining determine early 2016. model on accounting eligibility of 12/19/2015 Page 8 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) will be developed by social Oct 2015 and the programs, whole system will services and officially roll out from benefits. 2016. Date 01-Jan-2011 23-Jun-2015 30-Nov-2015 30-Jun-2016 PHINDIRITBL  Percentage of staff trained in the Ministry of Population Development and Social Protection, General Office for Social Welfare Service and local governments (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Partially achieved, with Partially achieved, with a Training a good progress. A good progress. A series delivered to a series of capacity of capacity building significant building training events training events were portion of social were organized organized including two workers and including two national unknown due to govt national trainings on GOSWS staff, Value trainings on social work restructuring in 2012 social work services and and long term services and WAIS/ISDB institutional WAIS/ISDB implementation training implementation nationwide. 92% if the capacity build nationwide. 92% if the field staff have been beyond the field staff have been trained. project life trained. Date 01-Jul-2012 23-Jun-2015 30-Nov-2015 30-Jun-2016 PHINDIRITBL  Accounting standards introduced (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Due to the fact that not all banks were prepared to fully implement IFRS, banks will start In progress, the new complying with the new accounting documents accounting standards are being finalized and starting January 2016. A introduced by BOM. IFRS for banks national consultant, who The BOM continues to introduced and No IRFS in place for is responsible for Value work with support from applied to financial sector renewing the standard, accounting Mongolian conducted a series of experts/consultants on banks training for supervisors finalizing the IFRS between July- arrangements before September 2015 to their full deployment. improve their understanding of the new standards. 12/19/2015 Page 9 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) Date -- 23-Jun-2015 24-Nov-2015 30-Jun-2016 PHINDIRITBL  Bespoke Macro-prudential policy framework developed (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target In progress. The BOM is working on, and In progress. The BOM planning to commence started its work on Formal macro- work on, a host of new reviewing laws and prudential regulatory and regulations on prudential supervision supervisory initiatives, ratio in the Mongolian policy adopted including strengthning banking system. Draft and applied, Value -- prudential standards regulation and manual overall for banks' capital, non- on risk-based prudential performing loans, and supervision has been supervision loan loss provisioning, developed, leading to an standards also advanving improvement in the upgraded conslidated and risk Supervision department. based supervision. Date -- 23-Jun-2015 24-Nov-2015 30-Jun-2016 PHINDIRITBL  State Bank successfully restructured (privatized, merged with another bank) (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target In progress. The process to privatize the State Bank has officially started, with the target Not achieved. No date for sometime in specific actions by the 2016: It has been government to start the included in the list of State Bank actual sales process state-owned financial restructured have taken place, institutions that will be and privatized Value -- although State Bank is privatized in 2016 and on in an active tentatively slated for was approved by the and committed sale at an unspecified Parliament on process of future point, on the November 13, 2015. privatization basis of its "improved The government value". estimates the State Bank privatization proceedings to be MNT75 billion, which is reflected in the 2015 12/19/2015 Page 10 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) budget. Date -- 23-Jun-2015 24-Nov-2015 30-Jun-2016 PHINDIRITBL  Transparency on procurement process managed by the GPA will be enhanced according to the revised Public Procurement Law (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Information on bidding Information on bidding and contracts posted and contracts posted on Information on on Government Limited disclosure of Government website. bidding and website. 100% of information on contract 100% of Procurement contracts Value Procurement Plans, awardees, and contract Plans, Invitation for Bids posted on Invitation for Bids & cost. & Contract Awards are government Contract Awards are posted on the website posted on the procurement website. procurement website. Date 01-Jan-2011 29-May-2015 09-Dec-2015 30-Jun-2016 PHINDIRITBL  A strategy paper, policy options and main concept driving the pension reform agenda have been submitted to the Government , and an implementation plan has been developed (Text, Custom) Baseline Actual (Previous) Actual (Current) End Target Achieved. White Paper Achieved. White Paper Define pension (Policy Framework) on (Policy Framework) on reform policy Pension Reform has Pension Reform has concepts to Despite the govt intention been supported by the been supported by the establish to move to a multitier Cabinet and endorsed Cabinet and endorsed sustainable Value pension system, the actual by the Parliament as of by the Parliament as of multi-pillar strategy has not been June 11, 2015. With June 11, 2015. With pension system defined yet. approval of this overall approval of this overall that provides framework, respective framework, respective an adequate legislative changes will legislative changes benefit to the follow. under preparation. elderly Date 01-Jun-2013 23-Jun-2015 30-Nov-2015 30-Jun-2016 Overall Comments Data on Financial Performance 12/19/2015 Page 11 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P119825 IDA-47770 Effective USD 12.00 12.00 0.00 10.39 1.59 87% P119825 TF-99122 Closed USD 0.50 0.25 0.25 0.25 0.00 100% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P119825 IDA-47770 Effective 28-Jun-2010 04-Aug-2010 17-Mar-2011 31-Dec-2014 30-Jun-2016 P119825 TF-99122 Closed 31-Mar-2011 13-Apr-2011 13-Apr-2011 31-May-2012 31-May-2012 Cumulative Disbursements Restructuring History Level Approved on 27-Mar-2012 ,Level Approved on 17-Apr-2013 ,Level 2 Approved on 04-Oct-2013 ,Level 2 Approved on 10-Dec-2014 Related Project(s) 12/19/2015 Page 12 of 13 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Mongolia Multi-Sectoral Technical Assistance Project (P119825) There are no related projects. 12/19/2015 Page 13 of 13 Public Disclosure Copy