Public Disclosure Copy The World Bank Implementation Status & Results Report Third National Urban Water Sector Reform Project (P123513) Third National Urban Water Sector Reform Project (P123513) AFRICA | Nigeria | Water Global Practice | IBRD/IDA | Investment Project Financing | FY 2014 | Seq No: 4 | ARCHIVED on 10-Jun-2016 | ISR23974 | Implementing Agencies: Federal Ministry of Water Resources Key Dates Key Project Dates Bank Approval Date:18-Apr-2014 Effectiveness Date:12-Feb-2015 Planned Mid Term Review Date:-- Actual Mid-Term Review Date:-- Original Closing Date:30-Jun-2020 Revised Closing Date:30-Jun-2020 Project Development Objectives Project Development Objective (from Project Appraisal Document) The Project Development Objectives (PDO) are: a) to increase access to improved water supply service in selected States of Nigeria and improve the financial viability of existing water utilities in those States, and b) to increase the investment planning capacityof participating States. Has the Project Development Objective been changed since Board Approval of the Project Objective? No PHRPDODEL Components Name 1. Sector Reforms and Water Supply Investments:(Cost $215.00 M) 2. Water Sector Governance, Institutional Strengthening and Human Capital Development:(Cost $23.00 M) 3. Sector wide Improvement and Project Management at the Federal Level:(Cost $12.00 M) Overall Ratings Name Previous Rating Current Rating Progress towards achievement of PDO  Moderately Satisfactory  Moderately Satisfactory Overall Implementation Progress (IP)  Moderately Satisfactory  Moderately Unsatisfactory Overall Risk Rating  Substantial  Substantial 6/10/2016 Page 1 of 8 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Third National Urban Water Sector Reform Project (P123513) Implementation Status and Key Decisions This ISR accounts for the observations of a February 2016 mission, project developments since, and a May 2016 study tour to Brazil's and Colombia's water sector. Slow Implementation and Disbursements: The official project launch workshop was held in February 2016. Despite becoming effective in February 12, 2015, the project continues to suffer from significant delays and low disbursements (4.5%) and its progress is now rated Moderately Unsatisfactory. This results primarily from the fact that substantial works contracts under Component 1 are yet to be procured, due to (i) protracted delays in project start and launch of works in Rivers, and to (ii) lack of ready feasibility studies and designs, coupled with slow initial procurement processes in Bauchi and Ekiti. Progress on capacity-building activities under Components 2 and 3 remains modest, with key consultancies about to start. Small fast-track system rehabilitation investments are being implemented in Bauchi and Ekiti as a remedial measure to generate early service improvements, without awaiting for completion of feasibility study/detailed designs. . Significant investments are expected to start in Rivers by end of 2016. To date the Federal Ministry of Water Resources (FMWR), Bauchi State and Ekiti State are authorized to disburse project funds, and authorization for Rivers State is imminent. All States are making good progress towards meeting pending Legal Covenants. Weak Sector Reform Momentum. In the aftermath of the 2015 elections and political transitions, State governments are yet to engage or sustain the sector reforms identified and agreed at appraisal. This is of particular concern for the 3 Selected States, where the sustainability of planned investments is dependent on better operating capacity and performance of State utilities, to be achieved through effective corporatization reform. In May 2016 a South-South experience exchange study tour to Brazil and Colombia with 20 federal, state, and utility officials, helped create a new understanding of sector reform needs and opportunities in Nigeria. Stronger Federal leadership and capacity are nevertheless needed to rapidly remobilize, support and sustain States on urban water sector reform. State governments should recommit to the objectives and steps of urban water sector reform, and support the corporatization, budget and tariff needs of their State water agencies. Complementing SPIUs’ and Utilities' capacities. Ekiti SPIU, and to a lesser extent Bauchi SPIU, need to mobilize stronger capacity in technical and institutional areas, including through technical assistance consultants as a means to reduce long iterative cycles of procurement No Objections through better quality of initial submittals and higher responsiveness. The Federal PMU is also to recruit a senior engineer consultant to provide technical support and quality control on technical and procurement documents generated by the States. It is also confirmed that beyond effective corporatization reform and capacity-building investments, State water utilities will require significant assistance to improve their operation, maintenance and management performance. Short of PPPs, Water Operators Partnerships (WOP) are being considered to that effect. Restructuring opportunities: A technical restructuring of the project is under consideration which would aim at (i) strengthening implementation arrangements and operating capacities for the Selected States, (ii) creating stronger incentives for effective utility reform in Selected and Participating Staes, and (iii) assisting FWMR in fine-tuning and accellerating sector reform strategy. Risks 6/10/2016 Page 2 of 8 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Third National Urban Water Sector Reform Project (P123513) Systematic Operations Risk-rating Tool Risk Category Rating at Approval Previous Rating Current Rating Political and Governance  --  Substantial  Substantial Macroeconomic  --  Substantial  High Sector Strategies and Policies  --  Substantial  Substantial Technical Design of Project or Program  --  Moderate  Moderate Institutional Capacity for Implementation and Sustainability  --  Substantial  Substantial Fiduciary  --  Moderate  Moderate Environment and Social  --  Moderate  Moderate Stakeholders  --  Substantial  Substantial Other  --  Moderate  Moderate Overall  --  Substantial  Substantial Results Project Development Objective Indicators PHINDPDOTBL  Number of people in urban areas provided with access to Improved Water Sources under the project (Number, Core) Baseline Actual (Previous) Actual (Current) End Target Value 327500.00 327500.00 327500.00 1247500.00 Date 04-Mar-2014 07-Nov-2014 07-Nov-2014 31-Dec-2019 Comments Works have not substantially started. The local impacts of service improvements achieved through fast-track rehabilitation investments in Bauchi and Ekiti are not yet quantified in terms of increased access. PHINDPDOTBL  Medium-term sector investment plans completed for participating States (Number, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 9.00 Date 01-Mar-2014 07-Nov-2014 07-Nov-2014 31-Dec-2019 6/10/2016 Page 3 of 8 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Third National Urban Water Sector Reform Project (P123513) PHINDPDOTBL  Direct project beneficiaries (Number, Core) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 920000.00 Date 31-Oct-2012 07-Nov-2014 07-Nov-2014 31-Dec-2019 Comments Works have not substantially started. The local impacts of service improvements achieved through fast-track rehabilitation investments in Bauchi and Ekiti are not yet quantified in terms of beneficairies. PHINDPDOTBL  Female beneficiaries (Percentage, Core Supplement) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 50.00 PHINDPDOTBL  Percentage of operation and maintenance cost recovered in selected States. (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 5.00 5.00 5.00 80.00 Date 31-Oct-2012 07-Nov-2014 07-Nov-2014 31-Dec-2019 Overall Comments Intermediate Results Indicators 6/10/2016 Page 4 of 8 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Third National Urban Water Sector Reform Project (P123513) PHINDIRITBL  National Water Sector Financing Policy and Mechanism in place (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N N N Y Date 31-Oct-2012 07-Nov-2014 07-Nov-2014 31-Dec-2019 Comments The development of such instrument will be informed by knowledge gained in the Brazil and Colombia study tour. PHINDIRITBL  Piped household water connections that are benefiting from rehabilitation works undertaken by the project (Number, Core) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 92040.00 Date 31-Oct-2012 07-Nov-2014 07-Nov-2014 31-Dec-2019 Comments Substantial works have not yet started. PHINDIRITBL  Length of water pipes rehabilitated and expanded (Kilometers, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 843.00 Date 31-Oct-2012 07-Nov-2014 07-Nov-2014 31-Dec-2019 Comments Substantial works have not yet started. 6/10/2016 Page 5 of 8 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Third National Urban Water Sector Reform Project (P123513) PHINDIRITBL  Customer enumeration completed and database created (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N N N Y Date 31-Oct-2012 07-Nov-2014 07-Nov-2014 31-Dec-2019 Comments Activities under procurement. PHINDIRITBL  Tariff Studies with pro-poor policies completed (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N N N Y Date 31-Oct-2012 07-Nov-2014 07-Nov-2014 31-Dec-2019 Comments Activities being procured. PHINDIRITBL  Number of water utilities that the project is supporting (Number, Core) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 3.00 12.00 Date 31-Oct-2012 07-Nov-2014 07-Nov-2014 31-Dec-2019 PHINDIRITBL  Billing collection rate (Percentage, Custom) Baseline Actual (Previous) Actual (Current) End Target Value 0.00 0.00 0.00 65.00 Date 31-Oct-2012 07-Nov-2014 07-Nov-2014 31-Dec-2019 6/10/2016 Page 6 of 8 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Third National Urban Water Sector Reform Project (P123513) PHINDIRITBL  Sector Performance monitoring and benchmarking system in FMWR established and operational (Yes/No, Custom) Baseline Actual (Previous) Actual (Current) End Target Value N N N Y Date 31-Oct-2012 07-Nov-2014 07-Nov-2014 31-Dec-2019 Comments Scoping of activity underway, informed by Latin America study tour observations. Overall Comments Data on Financial Performance Disbursements (by loan) Project Loan/Credit/TF Status Currency Original Revised Cancelled Disbursed Undisbursed Disbursed P123513 IDA-54160 Effective XDR 161.60 161.60 0.00 7.11 154.49 4% Key Dates (by loan) Project Loan/Credit/TF Status Approval Date Signing Date Effectiveness Date Orig. Closing Date Rev. Closing Date P123513 IDA-54160 Effective 18-Apr-2014 07-Nov-2014 12-Feb-2015 30-Jun-2020 30-Jun-2020 Cumulative Disbursements 6/10/2016 Page 7 of 8 Public Disclosure Copy Public Disclosure Copy The World Bank Implementation Status & Results Report Third National Urban Water Sector Reform Project (P123513) Restructuring History There has been no restructuring to date. Related Project(s) There are no related projects. 6/10/2016 Page 8 of 8 Public Disclosure Copy