Document of The World Bank Report No: ICR 00001306 IMPLEMENTATION COMPLETION AND RESULTS REPORT (TF-055353) ON A MULTI DONOR TRUST FUND FOR ACEH AND NORTH SUMATRA GRANT IN THE AMOUNT OF US$28.50 MILLION TO THE REPUBLIC OF INDONESIA FOR A RECONSTRUCTION OF ACEH LAND ADMINISTRATION SYSTEM PROJECT May 24, 2010 Social Environment and Rural Development Unit Sustainable Development Department East Asia and Pacific Region CURRENCY EQUIVALENTS (Exchange Rate Effective 24 November 2009) Currency Unit = Indonesian Rupiah IDR 1,000 = US$ 0.106 US$1 = IDR 9,434 FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS ANRI Archives National Republic of Indonesia (National Archives) AWP Annual Work Program (for the respective year) Bappenas National Development Planning Agency (Badan Perencanaan Pembangunan Nasional) BPKP Financial and Development Supervisory Board (Badan Pengawasan Keuangan dan Pembangunan) BPN National Land Agency (Badan Pertanahan Nasional) BPN-kantah BPN's district land office BPN-kanwil BPN's provincial office BPN-pusat BPN's national/central office (in Jakarta) BRR Agency for Rehabilitation and Reconstruction (Badan Rehabilitasi dan Rekonstruksi) CAS Country Assistance Strategy CDA Community-Driven Adjudication CLM Community Land Mapping (or community land maps) CSO Civil Society Organization DIPA Approval for Release of Budget Funds (under National Budget System, Daftar Isian Pelaksanaan Anggaran) FIG International Federation of Surveyors GAM Free Aceh Movement (Gerakan Aceh Merdeka) GoI Government of Indonesia IBRD International Bank for Reconstruction and Development ICR Implementation Completion and Results Report IDLO International Development Law Organization IDR Indonesian Rupiah ISR Implementation Status Report JICA Japan International Cooperation Agency KDP Kecamatan Development Project LMPDP Land Management and Policy Development Project M&E Monitoring and Evaluation MDF Multi-Donor Trust Fund for Aceh and North Sumatra MoF Ministry of Finance MOU Memorandum of Understanding MTR Mid Term Review NOL No-Objection Letter NGO Non-Government Organization PDO Project Development Objective PIBA Project Implementation and Beneficiary Assessment PIU Project Implementation Unit PMU Project Management Unit PRS Project Results Summary QAE Quality at Entry RALAS Reconstruction of Aceh Land Administration System Project SPADA Support for Poor and Disadvantaged Areas Project TA Technical Assistance TTL Task Team Leader UN United Nations UNDP United Nations Development Program UPP Urban Poverty Program Vice President: James W. Adams, EAPVP Country Director: Joachim von Amsberg, EACIF Sector Manager: Sonia Hammam, EASIS Project Team Leader: Keith Clifford Bell, EASER ICR Team Leader: Keith Clifford Bell, EASER REPUBLIC OF INDONESIA RECONSTRUCTION OF ACEH LAND ADMINISTRATION SYSTEM PROJECT CONTENTS Data Sheet A. Basic Information .................................................................................................................... i B. Key Dates ................................................................................................................................ i C. Ratings Summary .................................................................................................................... i D. Sector and Theme Codes ........................................................................................................ii E. Bank Staff ...............................................................................................................................ii F. Results Framework Analysis...................................................................................................ii G. Ratings of Project Performance in ISRs ...............................................................................vii H. Restructuring .......................................................................................................................viii I. Disbursement Profile............................................................................................................viii 1. Project Context, Development Objectives and Design ........................................................... 1 2. Key Factors Affecting Implementation and Outcomes ........................................................... 4 3. Assessment of Outcomes....................................................................................................... 14 4. Assessment of Risk to Development Outcome ..................................................................... 23 5. Assessment of Bank and Borrower Performance.................................................................. 25 6. Lessons Learned.................................................................................................................... 28 7. Comments on Issues Raised by Grantee/Implementing Agencies/Donors ........................... 29 Annex 1. Project Costs and Financing ...................................................................................... 35 Annex 2. Project Outputs .......................................................................................................... 36 Annex 3. Economic and Financial Analysis.............................................................................. 42 Annex 4. Grant Preparation and Implementation Support/Supervision Processes.................... 43 Annex 5. Beneficiary Survey Results........................................................................................ 45 Annex 6. Stakeholder Workshop Report and Results ............................................................... 46 Annex 7. Summary of Grantee's Report and Comments on Draft ICR Report......................... 47 Annex 8. Comments of Co-financiers and Other Partners/Stakeholders .................................. 56 Annex 8. Comments of Co-financiers and Other Partners/Stakeholders .................................. 57 Annex 9. List of Supporting Documents................................................................................... 60 Annex 10. Meetings Conducted during the ICR Mission ........................................................ 61 MAP #35289 ............................................................................................................................. 62 A. Basic Information Reconstruction of Aceh Country: Indonesia Project Name: Land Administration System Project Project ID: P095883 L/C/TF Number(s): TF-55353 ICR Date: 05/25/2010 ICR Type: Core ICR MINISTRY OF Lending Instrument: ERL Grantee: FINANCE Original Total USD 28.5M Disbursed Amount: USD 14.8M Commitment: Revised Amount: USD 14.8M Environmental Category: B Implementing Agencies: Badan Pertanahan Nasional Cofinanciers and Other External Partners: B. Key Dates Revised / Actual Process Date Process Original Date Date(s) Concept Review: Effectiveness: 08/22/2005 08/22/2005 Appraisal: 05/12/2005 Restructuring(s): Approval: 06/24/2005 Mid-term Review: 06/29/2007 05/11/2007 Closing: 12/31/2008 06/30/2009 C. Ratings Summary C.1 Performance Rating by ICR Outcomes: Moderately Satisfactory Risk to Development Outcome: Moderate Bank Performance: Satisfactory Grantee Performance: Moderately Unsatisfactory C.2 Detailed Ratings of Bank and Borrower Performance (by ICR) Bank Ratings Borrower Ratings Moderately Quality at Entry: Satisfactory Government: Unsatisfactory Implementing Moderately Quality of Supervision: Satisfactory Agency/Agencies: Unsatisfactory Overall Bank Overall Borrower Moderately Satisfactory Performance: Performance: Unsatisfactory i C.3 Quality at Entry and Implementation Performance Indicators Implementation QAG Assessments Indicators Rating Performance (if any) Potential Problem Project Quality at Entry No None at any time (Yes/No): (QEA): Problem Project at any Quality of No None time (Yes/No): Supervision (QSA): DO rating before Moderately Closing/Inactive status: Unsatisfactory D. Sector and Theme Codes Original Actual Sector Code (as % of total Bank financing) Central government administration 100 100 Theme Code (as % of total Bank financing) Land administration and management 100 100 E. Bank Staff Positions At ICR At Approval Vice President: James W. Adams Jemal-ud-din Kassum Country Director: Joachim von Amsberg Andrew D. Steer Sector Manager: Sonia Hammam Rahul Raturi Project Team Leader: Keith Clifford Bell Keith Clifford Bell ICR Team Leader: Keith Clifford Bell ICR Primary Author: Maria Cecilia Zanetta F. Results Framework Analysis Project Development Objectives (from Project Appraisal Document) The specific objectives of the project are: (i) to recover and protect land ownership rights of people in the affected and surrounding areas; (ii) to rebuild the land administration system. Revised Project Development Objectives (as approved by original approving authority) ii (a) PDO Indicator(s) Original Target Formally Actual Value Values (from Revised Achieved at Indicator Baseline Value approval Target Completion or documents) Values Target Years Indicator 1 : A.1 Document recovery and imagery completed. All land records reconstructed and held in digital Value All land records damaged records quantitative or or destroyed managment Qualitative) system. Original target date 03/31/2006 Date achieved 06/22/2005 12/31/2008 Comments (incl. % achievement) Indicator 2 : A.2 Community-Driven Adjudication, Community Awareness and Participation CDA completed in all areas, as follows: - Priority 1 (100,000 parcels) Value Nil. These activities have by 12/31/06 quantitative or never been undertaken - Priority 2 Qualitative) before in Aceh. (200,000 parcels) by 12/31/06 - Priority 3 (300,000) by 12/31/07 Date achieved 06/22/2005 12/31/2008 Comments (incl. % achievement) A.3 Surveying and Mapping, Registration of Rights and issuance of Title Indicator 3 : Certificates CDA completed in all areas, as follows: - Priority 1 Estimated that up to Value (100,000 parcels) 60,000 land titles (40,000 quantitative or by 12/31/06 urban and 20,000 rural) Qualitative) - Priority 2 prior to tsunami. (200,000 parcels) by 12/31/06 - Priority 3 (300, 000 parcels) by iii 12/31/07 Date achieved 06/22/2005 12/31/2008 Comments (incl. % achievement) Newly constructed land offices fully operational by December 31, 2006. Indicator 4 : Renovated and structurally strengthened land offices fully operational by March 31, 2006 All civil works (renovations and constructions) completed. Original covenant Value dates were quantitative or nil newly constructed. renovations Qualitative) completed Mar 31 2006 and newly constructed offices operational by Dec 31 2006. Date achieved 06/22/2005 12/31/2008 Comments (incl. % achievement) Indicator 5 : Policies/regulations implemented. Issuance of Presidential Value Decree (Perpu) Required decrees not in quantitative or and MOF decree place. Qualitative) on waiver of fees and charges (due Oct 2005). Date achieved 06/22/2005 09/30/2009 Comments (incl. % achievement) (b) Intermediate Outcome Indicator(s) Original Target Actual Value Formally Values (from Achieved at Indicator Baseline Value Revised approval Completion or Target Values documents) Target Years Indicator 1 : No. of land parcels provided for public notification 50,000 (out of Value 100,000 for (quantitative Nil Priority 1 Areas) or Qualitative) 200,000 by Dec 31, 2006 iv 300,000 by Dec 31, 2007 Date achieved 06/22/2005 12/31/2008 Comments (incl. % achievement) Indicator 2 : No. of adjudication teams operational. Value 30 original target (quantitative nil operational 11/25/2005 or Qualitative) Date achieved 06/22/2005 12/31/2008 Comments (incl. % achievement) Computerization & Development of System for Records Management & Back- Indicator 3 : up System Value Manual system only. operational. (quantitative Records lost & damaged Original target or Qualitative) by tsunami date 06/30/2006 Date achieved 06/22/2006 12/31/2008 Comments (incl. % achievement) Indicator 4 : Project Management support - M&E System Procedures established. Original M&E Value target date (quantitative No M&E system in place. 06/30/2006 or Qualitative) Audits carried out. (No target date set in KPIs) Date achieved 06/22/2005 12/31/2008 Comments (incl. % achievement) G. Ratings of Project Performance in ISRs Actual Date ISR No. DO IP Disbursements Archived (USD millions) 1 12/21/2005 Moderately Satisfactory Moderately Satisfactory 3.00 2 06/26/2007 Unsatisfactory Unsatisfactory 11.70 Moderately Moderately 3 05/14/2008 11.70 Unsatisfactory Unsatisfactory 4 06/05/2008 Moderately Satisfactory Moderately Satisfactory 11.70 v 5 06/29/2008 Moderately Satisfactory Moderately Satisfactory 11.70 Moderately Moderately 6 12/25/2008 11.70 Unsatisfactory Unsatisfactory Moderately Moderately 7 06/22/2009 12.40 Unsatisfactory Unsatisfactory H. Restructuring (if any) Not Applicable I. Disbursement Profile vi 1. Project Context, Development Objectives and Design 1.1 Context at Appraisal The tsunami that struck Indonesia and several other countries in the Indian Ocean region on "Boxing Day," December 26, 2004, resulted in one of the worst natural disasters in recorded human history. Indonesia bore the major brunt of the disaster. It had devastating consequences for more than 1,000 communities along more than 800 kilometers of the northern coastal areas of the major island of Sumatra and smaller offshore islands in the provinces of Aceh and North Sumatra.: · Approximately, 130,000 persons were confirmed dead, and a further 37,000 were reported missing; · More than 500,000 people were displaced immediately after the disaster; · Almost 54,000 land parcels that were washed away or permanently inundated in the coastal zone2; and · Roughly 250,000 houses were either partially or completely damaged. 3 The damage to property rights and the land administration system was severe. The large-scale destruction and high death toll wiped out not only the physical reference points that used to define property rights and land boundaries (whether formally or through customary community recognition) but also actual human knowledge of these rights and boundaries. This created unprecedented confusion and ambiguity about who owned or had rights to what land. For the purposes of costing the work to be undertaken under RALAS, it was agreed that 300,000 in areas directly affected by the tsunami would need to be surveyed and titled. This estimate does not include land parcels that were previously titled and does not include land parcels permanently destroyed. These tsunami-affected parcels were divided into two categories: (a) Priority 1 ­ 100,000 parcels designated as settlement and housing; and (b) Priority 2 ­ 200,000 parcels designated as other. In addition, a further 300,000 land parcels, in areas adjacent to the tsunami-affected areas were also to be surveyed and titled under the project and these were designated as Priority 3. The reason for inclusion of Priority 3 parcels was that experience has shown that land titling usually leads to increased property values and development of a formal land market. As such, it was considered that RALAS did not want to create any land market distortion as an unintended consequence of the project. Furthermore, the destruction of, or damage to land books (Buku Tanah) and cadastral maps in several land offices of the National Land Agency (BPN) made the reconstruction of property rights even more difficult. In addition, six of BPN's nine land offices were either completely destroyed or structurally damaged. Loss in BPN human capacity was also severe, with 41 personnel killed, of which 30 percent were from Banda Aceh's BPN-kanwil office alone. 2 Because it would never be possible to determine the exact number of land parcels directly affected by the tsunami, the government and the Bank agreed on a rough target of 300,000 parcels to be surveyed, adjudicated and titled, which does not include the approximately 54,000 parcels permanently lost as a result of the tsunami. 3 Report of BRR (2005), Aceh and Nias One Year after the Tsunami: The Recovery Effort and Way Forward, December 14, 2005. 1 The widespread destruction resulted in significant uncertainty in land and property rights, with the risk of land grabbing being particularly high in urban areas with inherently weaker communal traditions. The need to re-establish land ownership was also identified early on as a critical precondition for rebuilding settlements and other reconstruction projects financed by the Government of Indonesia (GoI) and the international community. Thus, the need to recover and protect land rights emerged clearly as an urgent priority. The Reconstruction of Aceh Land Administration System Project (RALAS) was designed to tackle this challenging task. RALAS was the first of eleven projects totaling US$463.5 million, as of December 2009, financed under the Multi-Donor Fund for Aceh and Nias (MDF) with the Bank acting as the partner agency.4 RALAS was prepared under emergency conditions in the months following the tsunami. As such, project preparation was expedited and it is important to note some of the important differences to the usual World Bank project preparation, which included: (a) the format of the PAD was developed specifically to meet the requirements of the members of the Steering Committee for the MDF; (b) the Grant was endorsed by the MDF Steering Committee and approved by the Regional Vice-President of the World Bank and did not go to the Bank Board for approval; (c) safeguards approval was delegated to the designated specialist in the Bank's Jakarta Office, but followed Bank policies and procedures; (d) an economic and financial analysis was not undertaken for the project; (e) the project did not have the traditional results framework; (f) the period for project preparation was significantly shorter than usual Bank preparation, taking around 5 months; (g) funding for project preparation was attributed to the overall Aceh tsunami reconstruction effort, rather than a specific project preparation fund; (h) Bank staff and consultants worked much closer with government officials to complete project preparation as a matter of urgency; and (i) MDF required that the project have a full-time monitoring team, in Aceh, which required higher than normal Bank supervision costs (as detailed in Annex 3) It should also be noted that as RALAS was the first project prepared for the MDF, it provided considerable experience for subsequent MDF-funded projects. This is discussed further in section 1.2. 1.2 Original Project Development Objectives (PDO) and Key Indicators (as approved) The statement of the PDO in the PAD and the Grant Agreement were slightly different. A combination of the two statements was used as the working definition in aide-memoires and the ISR during project implementation, with the knowledge and agreement of the implementing agency and the Bank's supervision team. A formal revision of the PDO was not sought because the differences were not substantive and did not affect the objectives or activities. In the interest of transparency, the three versions are set out below: PAD version: "The proposed project is to improve land tenure security in Aceh after the devastation caused by the tsunami and the destruction of evidence of ownership. The specific The MDF was authorized by resolution of the World Bank Board of Directors in April 2005. It operates with a Secretariat managed by the Bank and with a Steering Committee comprised of donors, the Government of Indonesia, civil society representatives, and the World Bank as Trustee. In the case of RALAS, as well as in the case of another 10 projects, the Bank acts as the partner agency. As of December 31, 2009, a total of 22 projects totaling US$611.2 million have received financing under the MDF. It should be noted that originally MDF was known as the Multi Donor Trust Fund for Aceh and North Sumatra (MDTFANS) which was subsequently shortened to MDF 2 objectives of the proposed project are: (i) to recover and protect ownership land rights of the people in the affected and surrounding areas; and (ii) to rebuild land administration system." GA version: "The objective of the Project is to assist the Recipient in: (i) recovering and protecting ownership land rights of the Tsunami Affected People in Aceh; and (ii) rebuilding the land administration system in Aceh." Working version (used in ISRs, aide-memoires, and ICR): "The specific objectives of the project are: (i) to recover and protect land ownership rights of people in the affected and surrounding areas; (ii) to rebuild the land administration system." The text of the ICR sometimes refers to PDO 1 (recovering and protecting land rights) and PDO 2 (rebuilding the land administration system). The project did not have a traditional results framework with a hierarchy of impacts, outcomes, and outputs, but rather was approved on the basis of a "results summary" that set a series of performance indicators and targets that were related directly to the components and, in turn, to the two major elements of the PDO. During implementation, the Borrower and the Bank project teams treated five of the indicators as PDO-level, and the rest as intermediate ones. While these five could be interpreted as output indicators, given the nature of the project and the PDO it was reasonable to consider them outcome indicators with the standing of KPIs even though in the ICR they are categorized as intermediate indicators. 1.3 Revised PDO (as approved by original approving authority) and Key Indicators, and reasons/justification The PDOs remained unchanged throughout the life of the project. 1.4 Main Beneficiaries RALAS was intended to primarily benefit the people in the areas directly affected by the tsunami as well as the surroundings areas, with a special emphasis on more vulnerable groups such as widows and orphans, women in general and the poor. This was accomplished both directly through the land mapping, adjudication, and titling itself, and indirectly through the many other donor activities and reconstruction efforts that either required or were enhanced by having clear tenure rights in the affected areas. BPN also benefited directly from the project through the reconstruction of land administration institutions in Aceh, including recovery of land records, renovation and reconstruction of land offices, and capacity building and institutional strengthening. 3 1.5 Original Components Component A - Reconstruction of property rights and issuance of land titles (US$22.10 million) The objective of this component was to reconstruct the land administration records system in the tsunami-affected provinces and to reconstruct and protect the property rights of both formal and informal land holders. It was organized into four sub-components: Reconstruction of BPN's land records; Community-driven adjudication, community awareness and participation; Surveying and mapping, registration of rights and issuance of title certificates; and Policy, legal and regulatory support. Component B - Reconstruction of BPN institutions in Aceh (US$3.9 million) This component was aimed at supporting the reconstruction of BPN facilities and its human resources in Aceh. It was organized into three sub-components: Reconstruction of facilities and provision of equipment and furniture; Training and capacity building; and Computerization and development of back-up system. Component C: Project management (US$2.5 million) The objective of this component was to support BPN's Aceh provincial office (BPN-kanwil) to implement the project in an efficient and transparent way, including: Project management support; Monitoring and evaluation; and Technical assistance. 1.6 Revised Components The project components remained unchanged throughout the life of the project. 1.7 Other significant changes The project's closing date was extended from December 31, 2008 to June 30, 2009 to allow for the orderly completion and closing of the Annual Work Plan (AWP) 2008. 2. Key Factors Affecting Implementation and Outcomes 2.1 Project Preparation, Design and Quality at Entry Quality at Entry (QAE): This ICR deems the operation's overall QAE as Satisfactory. The project design effectively responded to the post-disaster needs, fully capitalizing on the know-how accumulated under previous IBRD land-management operations in Indonesia. Project preparation was streamlined (i.e., the Results Framework focused on outputs rather than outcomes; a financial and economic analysis was not conducted; and the project design did not explicitly incorporate the lessons learned in other operations), which was fully justified given the emergency nature of the project. 4 Moreover, it did not affect the project's implementation or its effectiveness in any significant way. The only significant weaknesses were: (a) to overestimate BPN's commitment at the central level for RALAS's innovative implementation strategy; and (b) to establish the project funding arrangements as "on budget", which meant that they would be subject to the usual GoI's annual budget preparation and approval processes. Specifically: Assessment of Quality at Entry ­ QAE Strengths Expediency: The need for reconstruction of property rights and the land administration system was proposed by GoI in January 2005. The Bank responded swiftly to the GoI's request for support. The first field mission took place in early February 2005, and the project was appraised in May and approved in June of the same year. RALAS was the first of nine reconstruction projects to be approved under the MDF in which the Bank acted as the partner agency. Relevancy: There was widespread agreement among all major stakeholders and the donor community, including the BPN, Aceh's provincial government, local and international non- government organizations (NGOs), and bilateral and multilateral agencies on the importance of focusing on land property rights. Securing land property rights was critical given the risk of large-scale land grabbing. Likewise, land with clear tenure rights was a key input in all reconstruction efforts. Consistency with Country Assistance Strategy (CAS) objectives: Although RALAS came about as an emergency response to the tsunami, its objectives were generally in line with the 2004-08 CAS (Report No. 27108- IND, 29 Oct. 2003), which focused on: (i) improving the investment climate; and (ii) making service delivery responsive to the poor. The CAS Progress Report FY2004-2008 (Report No. 36856-IND, 5 September 2006) formalized disaster risk management as a fourth area of development assistance in recognition of the large reconstruction program being administered by the Bank in Aceh and Nias. Emphasis on protecting pre-tsunami land rights: RALAS responded to the strategy adopted by GoI regarding rehabilitation and reconstruction efforts in Aceh, which strongly endorsed the protection and restoration of pre-tsunami land rights. Although it was tempting to see post- tsunami land as a white canvas to develop more efficient land patterns, this could have had a negative impact on groups with less voice in the reallocation process and weakened the newly established property rights. Encompassing legal perspective: The RALAS CDA Manual was a joint effort between the Bank, BPN and the Agency for Rehabilitation and Reconstruction (BRR), which was the government agency responsible for coordinating efforts among the various national and provincial agencies, as well as donors. Substantial efforts went into the preparation of the RALAS Manual, which took into consideration land property rights from multiple perspectives, i.e., agrarian law and other secular Indonesian laws and jurisprudence, Syariah law, and customary laws (adat)--to build a solid foundation for land law in post-tsunami Aceh. 5 Innovative bottom-up approach to land adjudication: The reconstruction of land property rights under RALAS was conceived as an innovative, bottom-up process, with a high level of community engagement. Under the so-called Community-Driven Adjudication (CDA) process, each landowner signed a statement of ownership that was subsequently endorsed by the neighbors and the village chief. In this way, a community-based agreement was the basic 5 The Mahkamah Sya'riah replaced religious courts in Aceh in 2003 by a presidential decree. It has jurisdiction over Muslims in the areas of marriage, divorce, inheritance, guardianship, and charitable trusts. Adat refers to a non-codified body of rules of behavior, enforced by social sanctions (IDLO, 2005). 5 mechanism for adjudicating land rights. This approach was critical in avoiding the natural delays associated with the traditional top-down approach, under which BPN officials would have been directly responsible for land adjudication. The CDA approach also helped to resolve land disputes at the village level. High level of civil society engagement and oversight: The RALAS' project design envisioned a high level of involvement on the part of NGOs and civil society organizations (CSOs). These entities were to be actively involved in community land mapping (CLM), a key input into the CDA process. In addition, NGOs and CSOs were also to be involved in project oversight to enhance coordination across the wide universe of actors involved in reconstruction efforts, particularly between BPN, BRR and housing providers. This participatory approach was also expected to enhance overall transparency during the project's implementation. As it will be later discussed, the high level of involvement of NGOs and CSOs was only achieved during project preparation and the very early months of implementation. Sensitivity to vulnerable population groups: Particular attention was paid to the land rights of women, including introducing for the first time the option of registering land under `joint titles. In addition, the RALAS Manual, in conjunction with the Syariah courts, gave detailed guidance on how to proceed in inheritance and guardianship cases, introducing safeguards against the risk of dispossession of widows, children and orphans by their guardians. Sound knowledge base on land administration in Indonesia: RALAS effectively built upon the know-how acquired during the preparation of Indonesia's Land Management and Policy Development Project (LMPDP), which had been approved just a few months earlier, on April 2004, and also the implementation of the Land Administration Project (LAP 1994-2001). Thus, it aligned the reconstruction efforts in Aceh with the more encompassing land administration strategy supported under the LMPDP. In this way, the reconstruction efforts under RALAS were seen as an opportunity to take Aceh's land administration system beyond the pre-tsunami level. Weaknesses Overly optimistic project outputs for the first year (2005): The project underestimated some of the fundamental challenges and failed to anticipate some of the administrative and procedural obstacles that slowed implementation, particularly in the first year. These included (a) the particularly difficult field conditions following the impact of the tsunami, (b) the chaotic conditions in Aceh with coordination of donor and NGO reconstruction efforts, (c) the challenges of deploying field staff to Aceh, (d) slow issuance of the MoF waiver on fees and charges (which took almost four months after project was approved), (e) procurement delays, (f) the requirement that RALAS Grant funds were "on budget" (i.e., part of the formal MoF budgetary process) that came under the purview of revised national budgeting procedures, (g) the overall magnitude of the task ahead, and (h) the particular difficulties at the outset of the project of issuing titles in the Priority 1 areas, which were the most severely affected by the tsunami and had suffered the highest human losses. Computerized land registration systems: Although there is no question regarding the relevance of computerized land records management and back-up systems, the project overestimated BPN's commitment to the development and implementation of these systems. Risk assessment: Four critical risks were identified at appraisal, including (a) weak capacity on the part of BPN; (b) weak capacity on the part of communities to carry out the CDA process; (c) lack of security due to the ongoing conflict in Aceh; and (d) potential for corruption. Effective mitigation measures were incorporated into the project design, including adopting a decentralized, participatory project implementation strategy; emphasizing training efforts; transferring additional BPN personnel from other parts of the country; and utilizing the 6 private sector for mapping and surveying activities. However, the risk of eroding commitment of BPN central management to the project was not foreseen. At appraisal, the project had the strong support of BPN central management. Unfortunately after July 2005 resulted in BPN moved away from its support for decentralized, participatory implementation of RALAS as well as civil society engagement and fluid cooperation with BRR and other line agencies. With the benefit of hindsight, it is now clear that these risks were overlooked. 2.2 Implementation Several factors made the implementation of RALAS particularly challenging. Some of these factors were external, such as the obliteration not only of much of the physical archives, but also the tragic loss of so many lives that collectively helped form the archive of individual and community memory regarding who owns what, where it is, what it is adjacent to, the location of boundaries etc. Other factors were internal, such as the uneven commitment of BPN management for the project's decentralized and participatory implementation strategy. These factors can be summarized as follows: Factors Affecting Project Implementation Devastating losses resulting from the tsunami: The damage to property rights and the land administration system as a result of the tsunami was particularly severe, as the water literally swept away people, land, landscapes, public and private land records, and local governments. The damage to property rights and the land administration system can be summarized as follows: 9 Loss of BPN staff: 41 BPN staff in Aceh Province, which included 30 percent of staff in Banda Aceh land office. 9 Offices and equipment: Six BPN land offices destroyed or severely damaged; destruction of office and survey equipment, including computers, to support urgent record recovery. 9 Damage to government land books (i.e., official land registers): Ten percent of land books lost; remaining 90 percent in need of urgent conservation and restoration. 9 Destruction of official land documents: About 80% of land documents were damaged by tsunami, including almost all cadastral maps, land parcel lists etc. 9 Damage and disappearance of property rights evidence: Destruction of much of the physical evidence of property boundaries and witness evidence held in the minds of those who perished. 9 300,000 land parcels directly affected: Including 170,000 urban and 130,000 rural parcels affected by the tsunami; 60,000 (40,000 urban and 20,000 rural) registered and 240,000 non-registered land parcels; 5 percent of titled land parcels were mortgaged, with mortgages registered by BPN. Post-conflict environment: In the wake of the tsunami, the GoI and Free Aceh Movement (GAM) agreed to recommence negotiations to end the conflict in Aceh, which had lasted 30 years and resulted in more than 15,000 deaths. A Memorandum of Understanding (MOU) was signed between the GoI and GAM on August 15, 2005 in Helsinki. While past accords had not been successful, the prospects for peace under the Helsinki accord have been encouraging: arms were handed over; Indonesian military forces gradually scaled back their presence in Aceh; former GAM combatants smoothly reintegrated into their original communities; and GAM leaders assumed decision making positions in local and provincial governments. As agreed under the MOU, a new law on the Governing of Aceh (LOGA) was 7 passed by the Indonesian House of Representatives in July 2006 and signed by the president in August 2006. The law took precedence over previous legislation on Aceh autonomy. It also included previsions for the decentralization of national offices to the provincial level. While most government agencies have decentralized some responsibilities to the provincial level, BPN remains highly centralized. The resistance to decentralization was fueled largely by issues that go beyond RALAS, such as the oil and gas concessions of energy-rich Aceh, which are currently under the jurisdiction of BPN­Jakarta. Factors Generally Subject to Government Control Clear overarching framework on property rights: GoI took decisive action in the aftermath of the tsunami, adopting a firm stand on protecting and restoring pre-tsunami land rights. In February 2005, BPN, on the advice of the World Bank, issued a decree freezing land transfers (i.e., sales) in Aceh to protect tsunami victims from being coerced by speculators and land grabbers. With the support of the Bank and other stakeholders, GoI also launched a high- profile public campaign on land issues to raise community awareness. In April 2005, the GoI unveiled a master plan for the reconstruction of the areas affected by the tsunami in Aceh and Nias, identifying the reconstruction of land rights as a key element. The GoI's unequivocal support for pre-tsunami property rights provided a solid foundation for subsequent land- related rehabilitation and reconstruction actions. Substantial delays in key legislation and budget allocations: Project start-up and implementation were slowed due to factors that were beyond the control of BPN, including: 9 Uneven flow of budgetary funds: As a result of the introduction of the new national budgeting system and procedures for the release of funds (Daftar Isian Pelaksanaan Anggaran ­DIPA), the project's cash flow was uneven and unpredictable. This, in turn, resulted in significant delays and interruptions in the deployment of BPN field teams. Every year, field teams were mobilized late in the fiscal year, and then demobilized again a few months later. This barely gave the field team's sufficient time to build up "production momentum." 9 Delays in the signing of the PerPu: The Presidential Decree (Peraturan Pengganti Undang-Undang (Government Presidential Decree (or PerPu) was a critical legal instrument because it covered land adjudication under the unique circumstances prevailing in Aceh. It was intended to address the issues that came out of submerged land areas and protection of bank mortgages. While PerPu was drafted in 2005, it was not signed until September 2007. This delay created uncertainty and ambiguity in several areas, including the legal liabilities of BPN personnel in the case of CLM activities conducted by NGOs. In any case, it delayed swift implementation of the project. Factors Generally Subject to Implementing Agency Control Uneven Support of BPN Management for Project Implementation: During project preparation, appraisal and immediately after effectiveness, BPN management demonstrated a strong commitment to the implementation of RALAS through active management engagement. However, as the many early implementation challenges were encountered and criticisms from CSOs grew, BPN management became withdrawn and less engaged. This had the following impacts: 9 Uneven support for the CDA approach on the part of BPN: The RALAS CDA Manual and supporting training was highly effective in providing guidelines to NGOs to proceed with CLM activities. Community land maps covering more than 200,000 parcels were prepared by NGOs working on housing and other reconstruction projects between late 2005 and mid-2006. While BPN district offices countersigned most of the CLMs, these 8 were not always utilized as an input by BPN field adjudication teams, resulting in duplicated efforts. 9 Limited support for computerization of record management system and the back-up system. This work did not progress even though BRR provided support. During implementation, the records of one field team during the 2006 AWP were lost when a base camp burned down. BPN's National Strategy for Land 2007-09 gives high priority to computerization of land records and secure archival. Although funding was available for design and implementation under both the RALAS grant and the LMPDP credit/loan, BPN did not take action. Lack of action was also an issue with the initial World Bank- funded Land Administration Project, 1994-2001. The risks for the safety and security of the land records from disaster and other occurrences remains very high 9 Lack of coordination with other stakeholders: After an intense period of engagement and cooperation with other stakeholders (February to July 2005), BPN stopped consulting with NGOs, housing providers and other CSOs, or coordinating its actions with BRR and BPN district staff. This lack of dialogue resulted in poor selection of priority villages, errors in the titling process, weak community education and other problems that could have been avoided or reduced. It is important to note that following the special performance audit of Badan Pengawasan Keuangan dan Pembangunan (BPKP - Financial and Development Supervisory Board) in late 2007, and direct intervention by both MoF and Bappenas, there was renewed cooperation and engagement between NGOs and BPN under the AWP 2008. During this time, the NGO Land Forum recommenced and the provincial Project Steering Committee (PSC), with CSO membership, was reactivated. 9 Revised RALAS Manual not issued. Based on the lessons learned from the AWP2005, the RALAS Manual was revised with inputs from BRR and the Bank team. Unfortunately, the revised Manual was not issued to field teams officially, under BPN Head decree, until 2008. This contributed to some of the quality control concerns in project implementation. Decentralized project implementation: The design of RALAS envisioned a decentralized implementation strategy, with BPN provincial authorities playing the main role in implementation. It also envisioned the establishment of a provincial PSC with broad stakeholder representation to facilitate overall coordination. Despite being a grant covenant, the PSC ceased to operate in late 2005 and was replaced by a central Steering Committee, in February 2006, comprised only of BPN staff. The central PSC constituted an unnecessary overhead and, rather than facilitating project implementation and coordination at the provincial level, it became a roadblock to effective project implementation as it centralized decision-making in Jakarta. Weak project management: Given the project's logistical complexity, sound management was a necessary condition for successful implementation. However, project management was weak throughout the life of the project, including in the areas of procurement and financial administration; planning and oversight of field work; M&E functions including quality control, monitoring, and reporting; and overall coordination. Despite the project's high implementation demands, BPN managers were not assigned to work full-time on the project and there was a high rotation of project directors. These weaknesses resulted in overall implementation delays, which translated into substantial backlogs in the titling outputs programmed under the AWPs 2005 and 2006. These backlogs raised serious concerns on the part of the Bank team, which in the September 2006 supervision mission, rated the project unsatisfactory. At MoF's request, a performance audit of RALAS was undertaken by BPKP. The audit confirmed the overall weaknesses in BPN's management and leadership. The audit noted that quality control of implementation was a key issue and it identified 90,000 parcels for which titles had not been issued (i.e., 34,378 and 58,233 parcels corresponding to the 9 AWPs 2005 and 2006, respectively), described some the underlying causes, and offered a set of recommendations to address them. The performance audit also confirmed that the project targets set for RALAS were realistic and achievable. As a result of the audit, in 2008 BPN set up four teams to verify and clear all backlogs, only a small percentage of cases were resolved, particularly those related to the AWP 2005. It was agreed that BPN would formally discard the backlog accumulated through AWP 2005, and that BPN would redo the surveying and adjudication work at its own expense and distribute title certificates to land owners. At the time of RALAS closure (June 2009), efforts to clear the backlogs generated by AWP 2006 were still ongoing. Throughout project implementation, supervision and quality control of field teams was limited, and there were very limited engagement by the project management at BPN-kanwill and the local BPN district offices. Field teams during the first AWPs did not consistently adhere to the RALAS manual, often adopting local, unapproved variants. This led to instances of poor quality work and was an issue reported by BPKP. Although a revised version of the RALAS Manual was prepared in 2006, it was not issued formally, under BPN Head decree until 2008. This also contributed to quality control problems. 2.3 Monitoring and Evaluation (M&E) Design, Implementation and Utilization Monitoring and Evaluation (M&E) Design i. M&E system: The Project Results Summary (PRS) included a series of indicators aimed at monitoring and assessing the achievement of the project's main outputs. In addition, Subcomponent C.2 supported the implementation of an M&E system focusing on the adjudication and surveying process. One of the objectives of this M&E system was to avoid corruption in the adjudication process. To this effect, a hotline operated by an independent operator was to be set up to receive community complaints and to report them to the Project Management Unit (PMU) and the PSC. However, while the project design included a number of M&E elements, a comprehensive system was not achieved during implementation. ii. Project Implementation and Beneficiary Assessment (PIBA): This assessment was commissioned by the World Bank and the MDF, in collaboration with BPN and BRR in mid- 2008. The PIBA was not part of the actual project design, especially as RALAS had been prepared under emergency conditions. The aim of PIBA was to assess BPN's implementation performance and beneficiaries' perceptions of RALAS. In turn, PIBA findings were to be used to improve the effectiveness and efficiency of the project. PIBA was also provided some basis to assess RALAS's overall impact, which was particularly useful given the lack of outcome and impact indicators in the operation's PRS, as set out in the PAD. Monitoring and Evaluation (M&E) Implementation i. M&E system: There were considerable delays in the implementation of the M&E system. Moreover, the M&E system was never conceived in a comprehensive manner; rather, it was the result of ad-hoc efforts such as the preparation of monthly reports based on the compilation of data received from base camps. Under the 2008 AWP, procedures were implemented for handling complaints, but these were only a minimal expression of what was anticipated at appraisal (for example, they were not independently administrated). ii. PIBA: The PIBA was prepared between August and December 2008. The PIBA research team conducted a total of 269 personal interviews (incl. 231 recipients of RALAS land titles and 38 non-recipients under a control group) in 37 randomly selected sites in eight districts 10 and the city of Banda Aceh. In addition, a total of 62 small focus group discussions were organized in the study areas with more than 382 participants. The PIBA research team also interviewed representatives of various stakeholder groups, including housing providers, NGOs, CSOs, local and provincial authorities and officials, as well as BPN's management in Banda Aceh, BPN officials at the district offices, and BRR officials. Monitoring and Evaluation (M&E) Utilization i. M&E System: The PRS indicators, particularly those related to CDA and titling, proved useful as a basic pulse-taking tool to assess progress toward implementation. The project's M&E system was used primarily as a mechanism for data compilation, with little or no subsequent analysis of the data. As a result, it did not contribute to eliminating or minimizing on-site technical errors or improving project management. The lack of a reliable M&E system also had a negative impact on the preparation and timely submission of progress reports. ii. PIBA: The PIBA report provided the opportunity to learn from RALAS's rich implementation experience and, as a result, to expand the knowledge base on land issues in rehabilitation and reconstruction efforts. It also allowed for a more in-depth assessment of the project's overall impact. The timing, however, did not allow for improving RALAS's implementation process based on PIBA's findings. 2.4 Safeguard and Fiduciary Compliance Environmental and Social Safeguards There was no involuntary resettlement or land acquisition undertaken by the project, and it complied with applicable environmental and social safeguards. The supervision of the project included a designated social and environmental safeguards specialist throughout the implementation period. RALAS was prepared under emergency conditions and responsibility for safeguards was assigned to the designated safeguards officer based in Jakarta. The project triggered two safeguards: (a) Environmental Assessment (OP/BP/GP 4.01); and (b) Involuntary Resettlement (OP/BP 4.12). The first of these safeguards was triggered as civil works would be undertaken in the construction of new land office buildings and renovation and rehabilitation of damaged land office buildings. Regarding environmental safeguards, the project had negligible potential adverse impact and works were required to follow standard Indonesian EIA regulations and procedures. Starting from 2007, in accordance with a new environmental decree, all renovation/construction required an environmental assessment plan (UKL­Upaya Kelola Lingkungan) and environmental monitoring plan (UPL­Upaya Pantauan Lingkungan). This decree did not exist at the time of project preparation; hence the PAD advises that EIA would follow normal government procedures. All buildings, newly constructed or renovated, were on existing government land and involved no involuntary resettlement as the land was not occupied. Although OP/BP 4.12 was triggered, no resettlement was undertaken by the project. Clearly in the reconstruction efforts of Aceh, there was a need for the BRR and other agencies to provide for those individuals whose land parcels had been permanently destroyed either through being washed away or submerged by the sea or rendered permanently inundated. However the needs of these people were addressed by other government programs that were not directly related to RALAS or necessary to achieve the project's objectives. 11 Although the ISRs indicate that additional safeguards were triggered during implementation, this was an error in entry of the project data in the ISR The sequence of ISRs incorrectly shows the triggering of, and satisfactory compliance with, : (a) Forestry (OP/BP 4.36); (b) Cultural Property (OPN 11.03); and (c) Indigeneous Peoples (OD 4.20). . Even though OP 4.12 does not apply to disputes between private parties in land titling projects, in accordance with good practices the project included a social safeguards framework to minimize and mitigate adverse social impacts, with particular emphasis on protecting poor and vulnerable groups such as orphans, widows, and women. These protections were an integral part of the CDA approach itself and were achieved through the implementation of the RALAS Manual and cooperation with the Syariah court and Dinas. The main problem faced by RALAS in this area was the capacity of BPN management to consistently implement the agreed processes, due to (a) weak BPN capacity; (b) at times insufficient engagement with the Syariah Court; and (c) the uneven engagement with the NGOs. However, overall, the goals and requirements of the framework were achieved. Financial Management Several challenges were faced in the financial management of RALAS, including: (a) delays in the approval of annual RALAS budget; (b) recurrent delays and incompleteness of financial monitoring reports and audit reports; (c) weak internal controls, which were exacerbated by the geographic dispersion of implementation activities; and (d) weak accounting staff capacity. Although some of these shortcomings were partially addressed from 2008 onward, the project's financial management continued to be weak until the end of the project. Procurement RALAS's procurement requirements were very diverse, as it included all the infrastructure and equipment needed for the operation of field adjudication teams, such as house and car rentals, furniture, boundary markers, finger printing equipment, computers and software, and survey equipment. It also included civil works for the rehabilitation and construction of government buildings. Persistent weaknesses in procurement were a challenge throughout the life of the project, negatively affecting its implementation. Ex-post reviews showed poor contract management practices as well as indications of potential collusive practices, such as similarities of bids, similarities of shareholders/addresses, and same person representing different firms in one or more contracts. The potentially collusive cases were submitted to the Bank's anti- corruption team for review, and the outcome is still pending at the time of ICR preparation. Compliance with DCA Covenants Compliance with the grant covenants was slow and uneven throughout the life of the project. At closing, however, all covenants had been fully or partially met, albeit with significant delays. The most notable covenant problem was in relation to the establishment and maintenance of a PIU with suitable staff, which was not complied during part of the project and had significant impacts on implementation progress and achievement of the PDOs. 2.5 Post-completion Operation/Next Phase 12 The BPN provincial authorities have expressed their intention to continue to utilize the RALAS methodology in their future titling activities. Without the project's financial support, however, the annual title production will decrease substantially, possibly to the pre-tsunami levels of approximately 12,000 titles per year, half of which were funded by government programs. BPN has also committed to re-working the backlogs from the 2005 and 2006 AWPs and to implement computerization of land records. The Bank was also advised that any civil works that had been commenced under the RALAS Grant but not completed would be finalized under GoI budget. However, as of the date of the ICR, there does not appear to be evidence of further progress on either the land records system or completion of the civil works. In addition, there seems to have been no further progress with finalizing the backlog of undistributed titles from the 2005 and 2006 work programs. Positive aspects of the project that are expected to continue to benefit land titling in the project area and Indonesia in general are the regulatory decree (PerPu) governing key aspects of titling policy and implementation, and the CDA approach to customary land titling, which helps ensure that the interests of local communities, individuals, and isolated and vulnerable people are protected, as well as enhancing the legitimacy, transparency, and sustainability of land titling decisions and rights. Indicators to measure future performance in land titling would include many of the same indicators that were used under the project, such as extent of area mapped, number of parcels adjudicated and titles issued, security of land titling documentation, and ownership by women. Additional indicators could include the incidence of conflicts over land ownership, the effectiveness of conflict resolution mechanisms, and increases in land ownership transactions. Long term impacts could be measured in terms of the affect of land title security on access to credit, household incomes and asset values, and household investments in productive activities or quality of life related to land or property ownership. While there clearly is potential for significant development impacts through follow-on projects in land management and titling, as the project approached its closing date the performance of the implementing agency did not justify approval of an extension. Performance improved markedly after the extension was denied, but since closing there has not been strong evidence of the government's commitment to completing unfinished activities or accelerating the pace of titling above pre-project levels, and it is unclear whether a follow-on project would pick up where RALAS ended (on a high note) or would languish as RALAS did for extended periods during implementation. Any further investments should be carried out at the national rather than local level, particularly in terms of computerized titling and land management systems. Overall, Aceh is now much better positioned with its land administration system then it was prior to the tsunami, should the government decide to further invest in systematic titling or continue with titling under its own programs. Overall public awareness is now at a much higher level, and people have a higher appreciation of the importance and value of an official title rather than mere reliance on occupation of the land as the evidence of possessory rights. A further important outcome is that the RALAS experience has provided invaluable experience and lessons in post-disaster and post-conflict management of land and property rights. UN Habitat has acknowledged that it has based its guidelines upon the RALAS Manual. The Bank has also drawn upon the RALAS experience for its response to disasters in other regions including Haiti in 2010. 13 3. Assessment of Outcomes 3.1 Relevance of Objectives, Design and Implementation The relevance of the RALAS project has been widely recognized. The project objectives were highly relevant throughout the project itself as well as during the broader recovery and reconstruction effort in Aceh. RALAS helped protect land rights in the chaos that followed the tsunami and later helped re-establish property rights and rebuild the foundations of land management in Aceh so that other reconstruction efforts could proceed on solid ground. Regardless of the degree to which targets were met, the design was also relevant. The regulatory measures enacted were appropriate and effective, and the CDA methodology proved not only a success in Aceh, but is being considered a model for replication in similar areas and under similar situations not only in Indonesia but in other countries as well. The actual implementation was relevant as it contributed to carrying out the design and in achieving the objectives, and when implemented as planned it succeeded in lending legitimacy, cost- effectiveness, and transparency to the process as well as creating the foundation for other reconstruction and investment efforts. However, the implementation arrangements themselves relied too heavily on the capacity and commitment of an agency whose capacity was not strong before the disaster and severely compromised after it. In the context of an emergency reconstruction project this was a risk that had to be taken, and it was important for titling to proceed even if some institutional aspects of the project were lagging. But in a longer-term approach greater emphasis should be placed on building institutional strength and information systems prior to, or in parallel with land titling itself. 3.2 Achievement of Project Development Objectives Achievement of the project's objectives was mixed. PDO 1 was substantially achieved because: (a) areas affected by the tsunami were effectively protected from land grabbing and land speculation, which was a serious concern following the disaster, (b) considerable progress was made toward reconstructing existing land ownership rights and documentation, and (c) formal titling of rights was increased almost fourfold, not including the 95,000 parcels with rights established or confirmed but not yet titled. However, the achievement of PDO 2 was more modest, as the reconstruction of Aceh's physical land administration facilities was incomplete and computerized back-up system for land records was not created. While the project fell well short of its quantitative targets for titling and did not create a computerized land record system, the community adjudication system developed under the project helped ensure that land disputes and ownership issues did not impede broader post-tsunami reconstruction efforts. Achievement in each of the two PDOs is described in more detail below. PDO 1 - To recover and protect land ownership rights of people in the areas affected by the tsunami and surrounding areas The achievement of this PDO is considered to be Moderately Unsatisfactory. Despite its deficiencies and challenging implementation, RALAS has made a substantial contribution toward the protection and reconstruction of land ownership rights in areas affected by the tsunami. RALAS's most valuable contributions include: helping design and disseminate a sound and consistent strategy focusing on the restoration of pre-tsunami land rights in the aftermath of the disaster; and supporting the adoption, training and implementation of the CDA approach, which helped avoid bottlenecks in the land adjudication process. Performance, however, was below expectations on two fronts: lower than 14 anticipated outputs under the systematic land titling program, and partial progress toward the reconstruction of BPN's land records. RALAS's achievements can be summarized as follows: a. Overall policy framework for land rights under rehabilitation and reconstruction: RALAS deserves much credit for having helped define and disseminate the GoI's land strategy that guided the reconstruction efforts of BPN, BRR, NGOs and the donor community in general. Its specific contributions with regard to the overall policy framework included: (a) providing critical input into the formulation of the policy and legal instruments underlying the GoI's post-tsunami land strategy, most notably PerPu; and (b) raising public awareness on land issues and putting forward a clear and consistent message to the public immediately after the tsunami (see detailed actions in Annex 2). These actions were effective in helping deter land grabbers and speculators. b. Community-driven adjudication (CDA) approach: RALAS was responsible for introducing the approach, delineating the guidelines under the RALAS Manual, and disseminating them among the donor community. The CDA approach also included guidelines on inheritance that were designed in conjunction with the Syariah Courts. As a result of the adoption and successful implementation of the CDA approach, land adjudication did not unduly delay the reconstruction process. Moreover, communities themselves, with the support of BPN, NGOs or both, have been able to reconstruct property rights with reasonable certainty, thus setting the foundations for strong post-tsunami land rights. While it is not possible to quantitatively demonstrate the long-term development impacts that resulted from the project's achievements (as opposed to its outputs related to document recovery, land titling, and reconstruction of facilities), there is strong evidence that important development outcomes were achieved: BPN formally adopted the RALAS-CDA Manual in June 2005, which gave legal status to the CDA approach for CLM;6 BRR, the government coordinating agency, prescribed the RALAS Manual as the standard approach for CLM. Provided that CLM was completed in accordance with the prescriptions under the RALAS Manual, communities could begin constructing houses and infrastructure before titles were formally issued by BPN. A total of 317,170 parcels were mapped using the CLM techniques outlined under the RALAS Manual. More than 120,000 houses have been built on parcels mapped using CLM techniques. Village-level conflict resolution with regard to inheritance under RALAS appears to have been very effective. c. Systematic land titling: RALAS systematic titling program was structured into three broad phases, as follows: Phase I - Establishing property rights using the CDA approach: This phase included: community agreement on land parcels and ownership, CLM activities, and families completing the required forms; Phase II - Confirming property rights: This phase included: officially survey of land parcels, review of the documents received by field adjudication teams, committee meetings, public notification, receipt and resolution of objections, and confirmation of status of the land parcels; and 6 Refer to BPN Decree No. 114-II-2005 (dated June 5, 2005) and BPN Decree No. 394.1-XVII-2008 (dated November 8, 2008). 15 Phase III - Securing property rights: This phase included: entering title details into the land book, confirmation and signature of records by district land offices, and finally distribution of title certificates to land holders. As shown in Table 1, a total of 222,628 titles were distributed to owners under RALAS's systematic land titling program, i.e., equivalent to 37 percent of the original project target (of the total target of 600,000). While the actual outputs under RALAS systematic land titling process are significantly below the targets defined at appraisal, they are still considerable in their magnitude. Specifically: Of the 222,628 titles distributed, 151,387 were for land parcels that were directly affected by the tsunami. This represents about 50 percent of the estimated 300,000 directly impacted land parcels. The titles distributed under RALAS are equivalent to over 18 years of the government's routine annual titling production in Aceh.7 Table 1. Titles completed under RALAS as a proportion of overall titling targets RALAS Systematic Titling Program Target Completed % of Target Property rights established 600,000 317,170 52.9 Property rights confirmed 600,000 272,912 45.5 Property rights secured 600,000 222,628 37.1 RALAS Systematic Titling Program Target Completed % of target Property rights established 600,000 317,170 52.9 Property rights confirmed 600,000 272,912 45.5 Property rights secured 600,000 222,628 37.1 300,000 Having the title in the hands of the land holder is, of course, the most desirable end-product of the titling process. However, completion of each of the three phases under RALAS's systematic titling program constitutes an incremental step toward permanently securing property rights. As shown on Table 1, property rights have been confirmed, i.e. formally surveyed and adjudicated, for an additional 50,000 parcels and identified, i.e. community land mapped, for roughly another 50,000 parcels. RALAS land titles were issued by BPN in accordance with the CDA procedures, which were given legal status by BPN Decrees issued in 2005 and 2008. Thus, titles provide registered land owners with official government confirmation of their ownership rights. Title recipients value the titles and understand their advantages. As one village chief put it, "the title is the soul of the land."8 PIBA 7 In 2004, for example, a total of 12,150 titles were formally issued in Aceh as a result of first-time land registration requested by owners and government-sponsored titling programs. 8 Interview conducted during ICR mission with Mr. Dan M. Hamad (Village Head, Papeun Village, Muara Tiga Sub-district, and Pidie District). 16 findings indicate that beneficiaries identified several advantages related to titles, including: increased land value; easier access to formal credit; reduced conflict with neighbors; and higher compensation in the case that the land is acquired for a public project (see Figure 1). These results suggest that the project also helped materialize the potential benefits associated with land security, including enhanced economic security, increased value of household and community assets, and enhanced general socio- economic welfare. Local authorities noted that RALAS's systematic land titling was fair and equitable and that the maps and parcel lists that were produced facilitate local development planning. Some of the negative opinions expressed by title recipients related to missing information on the land titles, higher future taxes, and the high cost of future transfers. However, taken together, the perceived advantages far outweigh the perceived disadvantages. Figure 1 - Advantages and disadvantages perceived by RALAS title recipients Increased land value Easier access to credit Reduced land conflicts Easier to give to children Higher com pensation if acquired Better investm ent Som e inform ation m issing Possibility of taxes Worry about future costs Difficult to transfer Kantah office is very far 0 50 100 150 200 Num ber of respondents Positive perceptions Negative perceptions Source: Based on responses from 231 interviews conducted under PIBA (2008). The real estate markets also indicate that economic agents place a monetary value to the titles issued under RALAS: PIBA interviews with real estate developers indicated that, at least in urban markets, land parcels with registered titles tend to sell 10 to 20 percent more than comparable parcels without formal title. While the rate of formal borrowing is still very small, PIBA found within the study sample that only about 2.5 percent of respondents reported having accessed credit from commercial banks prior to receiving RALAS land titles, while nearly 7 percent took bank loans after the receipt of titles.9 PIBA interviews with commercial banks indicated that BPN-issued land titles are requested for land-secured loans in amounts higher than IDR 25 million, while only a sale or transfer deed may be sufficient for smaller loans. d. Recovery of land records: Land records from the Banda Aceh land office suffered severe mud and water damaged as a result of the tsunami. While the majority of damaged records were restored, 9 The sample size was quite small (i.e., only 231 respondents), for which a substantial margin of error could be expected. Although reported here, it is really much too early after title issuance to assess the impact of mortgage take-up after titling under RALAS. 17 considerable work remains to be done in terms of organizing the storage and management of these hardcopy records, as well as converting the records into digital format. In mid-2005, damaged records were taken to Jakarta, where BPN and the National Archives (ANRI) worked on their conservation and recovery with financial and technical support from JICA, cleaning and drying them using a vacuum freeze-dry chamber. Recovered records were returned to Banda Aceh in late-2007 for verification, reconciliation, archiving and computerization to prevent future damages. Further progress stalled at that point, and BPN officials still have to reconcile and verify these records, and properly organize the archive. Lack of adequate physical space has been one of the factors delaying this task. PDO: To rebuild the land administration system The achievement of this PDO is considered to be Moderately Unsatisfactory. The rebuilding of the land administration system in Aceh has proceeded at a slower pace than anticipated. While there was substantial capacity building as a result of the training providing under RALAS and the implementation experience itself, progress in the physical reconstruction of BPN's land offices and the development of a computerized records management system was disappointing (for a detailed description of corresponding project outputs, see Annex 2). The limited progress in civil works was due to weak and delayed procurement, tied in to the annual budgetary cycle. Delays in civil works were not caused by any lack of access to contractors or materials. The lack of progress with the computerized records system was due to management not assigning it any priority. a. Training: The technical capacity built under RALAS was robust, from both training as well hands- on learning through the actual implementation experience. More than 620 BPN staff working at the various levels of government (i.e., field teams, provincial, district, local) received training under RALAS on systematic land titling techniques. While the main focus was on the application of the RALAS Manual and CDA techniques, BPN staff also received training on quality control and field monitoring, planning, procurement and financial management. The drastic improvement in BPN performance over the life of the project attests to the enhanced BPN's technical and institutional capacity. While only around 15,000 were distributed to owners under the AWP 2005, this number increased to roughly 100,000 under the AWPs 2006 and 2008, respectively. The capacity built under RALAS has had an impact beyond Aceh, as the majority of field personnel were drawn from other provinces and several of the project management staff was from BPN central level. b. Computerized records management and back-up systems: No significant progress was done in this area. As discussed under the QAE section, it might be more efficient to develop such systems at the central level to be able to capitalize on potential economies of scale, as the lack of such systems goes beyond Aceh and affects the entire country's land administration system. Unfortunately, there has been no demonstrated commitment at the central level to make progress on the computerization of land records. The performance of the project's substantive components is summarized below, while a more detailed description of the specific outputs under each component is provided in Annex 2: Performance of Individual Project Components Component A - Reconstruction of property rights and issuance of land titles (US$22.10 million) Expected The property rights of both formal and informal land holders have been protected outcome and reconstructed. Rating Moderately satisfactory 18 Strengths RALAS was a key input in the formulation and dissemination of the GoI's land strategy in post-tsunami Aceh, Damaged records were recovered and scanned, with the technical and financial support of JICA. The CDA approach was highly successful, resulting in ownership evidence being established for over 300,000 parcels as a result of CDA. Mechanisms were introduced to protect the land rights of women, orphans and children. Over 220,000 titles were distributed to owners under RALAS. This is equivalent to over 18 times the annual number of titles issued in Aceh before the tsunami. Weaknesses Recovered records still need further verification and archiving, as well as organization of scanned images in a secure, backed-up computerized land records management system. While the introduction of joint titling in Aceh under RALAS constituted an important innovation to further strength women's land rights, the implementation strategy was not fully successful in reaching out to women and communities in general to inform them of the advantages of joint titles (see Section 3.5). However, titling to women (including joint ownership) appears to have increased significantly over the course of the project and accounted for 45% of the nearly 100,000 titles distributed in the 2008 work program. The total titling outputs were substantially lower than anticipated (i.e., 37 percent). Component B - Reconstruction of BPN institutions in Aceh Expected BPN facilities in Aceh and its human capacity to be rebuilt. outcome Rating Moderately unsatisfactory Strengths Capacity building of BPN was substantial under RALAS, as part of both actual training and the actual implementation experience. Work has been completed in six BPN office buildings that were damaged by the tsunami. Three of them are operational. Weaknesses Reconstruction of two BPN office buildings planned under RALAS was never started due to procurement delays. One BPN building, the Banda Aceh city land office, was only partially completed (i.e., 50 percent progress) by the close of the project, and construction activity was interrupted and not yet been resumed. Three completed buildings still are not operational. No progress was made toward the development of computerized land management and back-up systems. 3.3 Efficiency Given the emergency nature of the project, economic and financial analyses were not conducted at appraisal. However, the project used slightly more than half its proceeds and accomplished about half its mapping and adjudication targets, less than 40 percent of its titling targets, half its civil works program, and the majority of document recovery, but did little if any of the 19 computerized land management system activities. On a component-by-component basis, the unit costs for these activities were also roughly in line with the initial cost estimates and assumptions. While the accomplishment of overall targets for civil works was disappointing, construction of the works that were carried out stayed within the budgets allocated and contracted. Expenses for project management were slightly less than half the allocation, reflecting the fact that the PMU was inactive for a period and did not carry out a 2007 work program as well as some other planned activities and investments. More than 75% of project financing was allocated to recovery of damaged titles and mapping, adjudication, documentation, registration, and distribution of new titles. Although the overall cost per title was slightly higher than planned, the marginal unit cost of these activities was consistent with the planned costs, and compares favorably with costs in similar projects such as LMPDP, which is also being implemented by BPN. Since the fees and charges for land titling and first-time registration were waived by the government as part of the project, the cost to poor beneficiaries of the project was minimized. A further efficiency of the project was through the reliance on CDA using NGO/CSO facilitators working with local communities. This enabled housing construction to proceed at an earlier time, with a high degree of confidence in property rights being identified, before official survey and adjudication was undertaken. Furthermore, the standardized documentation produced through CDA, in accordance with the RALAS Manual, provided adjudication teams with a good evidence basis upon which to undertake adjudication, especially in the absence of other records and evidence. A further efficiency of the CDA approach was to provide greater transparency and legitimacy in the communities, with less potential for conflict. 3.4 Justification of Overall Outcome Rating Rating: Moderate Unsatisfactory The overall outcome of the project is rated Moderately Unsatisfactory. The objectives of the project defined at the time of its approval were extremely relevant then and remain so even today, five years after the tsunami. Despite its challenging implementation and the low level of disbursements, RALAS made critical contributions toward the reconstruction and protection of pre-existing land ownership rights in tsunami-affected areas. From a policy standpoint, it provided support to the formulation and wide dissemination of the GoI's land-related rehabilitation and reconstruction policies, thus helping avoid large-scale land grabbing and speculation. By providing CDA training to over 700 local leaders, civil society and NGO representatives involved in the reconstruction process, RALAS helped ensure that community-led land adjudication processes were conducted to a standard that provided a strong legal basis for BPN to later issue land titles to landowners. Nevertheless, the project fell short in its attempt to fully harness the efforts of development workers--from NGOs, donors, and even some government-sponsored programs--because BPN often did not properly utilize the CLMs produced by these sources as an input to the systematic titling program. This failure, together with BPN's limited implementation capacity and centralized project management (that occurred in 2006) prevented the project from achieving the titling targets envisioned at appraisal. The number of titles distributed under the project, however, was substantial, equivalent to over 18 years of routine title production in the entire province of Aceh. In terms of reconstructing the Aceh land administration system, progress has been slower than anticipated in all fronts, except in capacity building. In summary, despite some significant shortcomings, RALAS has made a considerable contribution to the post-tsunami rehabilitation and reconstruction efforts in Aceh. 20 Though not formally stated as part of the PDO, a key higher level outcome or impact of the project was that achievement of the PDO would allow post-tsunami reconstruction to proceed without conflicts over land ownership or loss of those rights by the less empowered members of the population. In this respect the project was successful despite falling well short of its targets and suffering substantial implementation shortcomings. 3.5 Overarching Themes, Other Outcomes and Impacts (a) Poverty Impacts, Gender Aspects, and Social Development Poverty: Although poverty-based targeting was not part of the project design, data gathered by PIBA indicates that 78 percent of all the title recipients interviewed (and 88 percent in the case of female title recipients) qualified for subsidized rice rations, which is the poverty indicator used by PIBA. This suggests that RALAS had a substantial impact in strengthening property rights among the poor. Gender Aspects: The land rights of women were given special attention during project preparation, with joint titling being first being introduced by BPN in Aceh under RALAS. In 2006, BPN, together with the BRR and the provincial government, formulated a Joint Land Titling Policy, which was adopted for implementation. The field teams were instructed to explain the value of joint titling to communities at the socialization events and to offer this as an option for registering land jointly for couples who have acquired land jointly after marriage, or for siblings and other family members. Unfortunately, this strategy was not fully successfully implemented. Although field staff offered the choice of the joint title, the advantages were always not properly explained to recipients. Many obstacles were experienced regarding women's participation in the titling process, including (a) insufficient representation of women in field teams; (b) meeting places and times that were often inconvenient to women who had to care for family members; (c) presentations in Bahasa rather than in the local Acehnese language; and (d) no meetings were held exclusively for women. Partnering with an NGO to focus explicitly on protecting women's land rights could have helped to better meet the gender objectives of RALAS. Despite these weaknesses, women still benefited from the land titling process. Although overall, 28% of titles were distributed to women or joint owners, it is especially encouraging to note that under the final AWP, in 2008, a total of about 40% of land titles were issued in the name of women or about 45% to women and joint owners,). This field observation is consistent with inheritance practices in Aceh, by which daughters customarily inherit the house and the corresponding land, while sons inherit productive assets, such as plantations and animal stock. The proportion of joint titles is more disappointing: equivalent to 2 percent in the PIBA sample and 3.6 percent in the AWP 2008 (the M&E system did not track gender information under the AWPs for 2005 and 2006), This is consistent with the registration practices for married couples, in which land is overwhelmingly registered under the name of the husband even if it was acquired jointly. This indicates that RALAS did not succeed in fully capitalizing on the window of opportunity that opened under joint titling, primarily as a result of lack of gender sensitivity during the socialization activities. Social Development: Data gathered by PIBA revealed that most beneficiaries perceived that gaining formal titles strengthened their claims to customary adat land holdings. Another positive contribution of RALAS was in relation to the property rights of minors and heirs as well as widows. The project thoroughly addressed issues of inheritance and guardianship, working in close cooperation with the Syariah courts. The implementation strategy was well planned: UNDP 21 provided support to develop the corresponding guidelines and safeguards, including requiring that the property of under-age orphans be registered under their name; BPN provided training to Syariah judges, adjudication teams, and other stakeholders; and support was also provided in 2005 and 2006 for mobile courts to visit villages where titling was planned to facilitate completion of formalities in guardianship and inheritance cases. Safeguards were also included in the RALAS Manual to protect the inheritance rights of widows. The sound design of both the overall strategy and its implementation rendered very positive results: while the mobile Syariah Court verified over 1,900 inheritance agreements achieved under the RALAS process, only a handful of inheritance or guardianship disputes required resolution in the Syariah Court itself (Harper et. al., 2006). Now more than five years after the tsunami, the Tsunami Legacy Project,10 an international review of the lessons learned from the disaster, has identified that land and property rights were ignored by some enthusiastic NGO/CSOs. The International Federation of Red Cross and Red Crescent Societies (IFRC), which were engaged in reconstruction of houses and communities, among many other reconstruction activities, have reported on the tearing down of some of the early housing developments which ignored property rights. The IFRC also has advised that the four key sustainable outcomes of in terms of how aid funds have been beneficial in reconstruction have been the provision of (a) earthquake resistant housing; (b) water and sanitation; (c) education; and (d) women's property rights.11 IFRC described the initial reconstruction efforts in Aceh as being like the early "Klondike days," which saw a number of hasty, ill-advised projects undertaken as NGOs, responding partly to the implicit imperative to compete for funds and prestige, rushed to demonstrate to that they were taking action.12 Throughout these chaotic times, both BPN and the Bank task team expended considerable efforts to communicate the importance of respecting the land and property rights of land owners, and to not proceed with new housing and road construction, or spatial planning of communities, until existing rights had been confirmed. (b) Institutional Change/ Strengthening Despite the implementation difficulties, RALAS has provided a viable model for tackling land issues as part of post-disaster rehabilitation and reconstruction efforts. Some of the key elements were: (a) the development of a consistent policy framework that protected pre-disaster land rights; (b) the recognition of the various legal systems affecting land rights, including secular law, customary practices and, in the case of Aceh, Syariah law, and building upon them to reconstruct and protect land rights; (c) a specific focus on protecting the rights of the most vulnerable groups, including women and children, and widows and orphans in particular; (d) the demonstration of the CDA approach as a viable and effective strategy toward streamlined, albeit robust, land adjudication strategy, particularly in areas with strong community ties; and (e) a potential framework for collaborative approach incorporating 10 The Tsunami Legacy project, an international review of the lessons learnt from the disaster, has identified that land and property rights were ignored by some enthusiastic NGO/CSOs in their respective haste to build houses and plan new communities 11 Bob McKerrow, Head of IFRC in Indonesia, as cited in Aljazeera, 24, 2009, "101 East Interview" on the occasion of fifth anniversary of tsunami. 12 Bob McKerrow, head of IFRC in Indonesia, as cited in "The Melbourne Age", Dec. 26, 2009: ''You'd have an organization come in; they've got staff on the ground, they've got their home media there for a few days, and they just want to build some .houses. 'They don't care about land titles, and they build them in the wrong place. A number of developments were subsequently torn down in these circumstances, a lesson that it was worthwhile doing things properly, even if that meant taking a little longer." 22 NGOs and civil organizations. Although the collaborative approach was abandoned as RALAS implementation proceeded, it was very successful in the broader context of reconstruction efforts in Aceh in activities under the umbrella of BRR. The RALAS experience has also served to highlight some structural weaknesses, such as the vulnerability of land records and the need of back-up systems, as well as the limitations associated with BPN's overly centralized organization. The project's rich implementation experience offers BPN the possibility to design a sound strategy to reduce vulnerability and improve recovery from the impacts of future natural disasters, which unfortunately are almost certain to occur given Indonesia's location in an area highly prone to natural disasters. (c) Other Unintended Outcomes and Impacts (positive or negative) Prior to the tsunami, there was a relatively low level of awareness of land and property rights and the associated benefits from formal titles in Aceh. The RALAS project's systematic titling program introduced public awareness of titling and created a demand for formalized recognition of ownership. Unlike some of the other countries affected by the tsunami disaster, opportunities for land grabbing and land speculation were largely prevented with timely action by the government and BPN. It is to BPN's credit that a decree was issued in early 2005 preventing all transfers of land. In addition, the early engagement and consultation between BPN and CSOs/NGOs in the months after the tsunami, led to an increased understanding of the need for reconstruction to consider people's land ownership rights. While this direct engagement may have diminished over time, the work of the trained facilitators, information materials produced under the program and the work of the field teams served to continue to increase public awareness. The Bank is aware that UN-Habitat reviewed the CLM/CDA methodology developed and implemented as part of RALAS project and considered that the CLM/CDA approach provided a good model for post-disaster reconstruction of property rights and in strengthening tenure security generally. Subsequently, UN-Habitat has prepared a draft of implementation best practice guidelines drawing on the experiences of the RALAS CDA Manual. 3.6 Summary of Findings of Beneficiary Survey and/or Stakeholder Workshops A Project Implementation and Beneficiary Assessment (PIBA) were undertaken by the World Bank in mid-2008. Its findings and recommendations were shared with counterpart agencies and stakeholders in Banda Aceh and Jakarta, and at the joint World Bank­International Federation of Surveyors (FIG) Conference in Washington, DC. The assessment concluded that (a) the project design was relevant and appropriate, with the overall targets set being realistic and achievable (as confirmed by BPKP); (b) there is continuing demand for land titles on the part of the community; (c) the project played a critical role in preventing land grabbing and speculation following the tsunami, and (d) the project appears to have broader impacts not directly measured by the indicators, because the land adjudication and titling has been associated with increased land values and access to credit, improved inheritance rights, and reduced conflict over land (for a more detailed description of PIBA's main findings, see Annex 5). 4. Assessment of Risk to Development Outcome Rating: Moderate 23 Overall, the risk that development outcomes attained under RALAS will not be maintained is considered to be Moderate. While the risk to the outcomes already achieved is low, the risk to realizing some of the outcomes not yet achieved is significant (i.e., land titles already issued are secure, but the pace of titling is expected to fall off sharply after the project). Furthermore, in some cases there is significant likelihood that an intended output will not be achieved, but the likelihood that the shortcoming will have a serious impact on the underlying objective is moderate (i.e., completion of documentation imaging and computerized back-up versus actual risk to recovered documents, or likelihood of clearing title backlog versus threat to ownership rights for adjudicated land if titling not done). Below is a detailed assessment of the different factors that might undermine the sustainability of RALAS' achievements: Factors Affecting the Sustainability of RALAS' Achievements PDO 1 - To recover and protect land ownership rights of people in the areas affected by the tsunami and surrounding areas Potential for land grabbing and speculation ­ Negligible risk Five years after the tsunami, Aceh has recovered its stability and social, legal and government institutions are functioning normally. So, the risk of large-scale land grabbing and speculation is negligible at this point. Ownership rights under titles distributed under RALAS ­ Low risk The titles distributed under the RALAS project followed the procedures as per Manual, which had been formally adopted by BPN. Therefore, the title certificates produced and distributed provide the fullest protection of ownership rights under Indonesia's law. It would be important, however, for BPN to implement a public awareness campaign to educate the community on the benefits of formally registering and recording future transactions, and the specific process and procedures for doing so. A socialization campaign of this nature is essential to ensure sustainability of land administration established post-tsunami through RALAS. Ownership rights for CLM parcels for which titles have not yet been issued ­ Substantial risk Given BPN's inability to clear the backlogs from 2005 AWP, it has been agreed that BPN will formally discard them and redo the work in the corresponding areas at its own cost. Since the project is now formally closed, there is no mechanism to ensure that this will be completed. Recovery of damaged records ­ Moderate risk Most of the damaged records were recovered, but little progress has been made toward imaging the land records and creating a computerized system or back-up records. BPN officials are aware of the importance of this task, but no additional progress has been made since the project closed. In the meantime, however, the records remain vulnerable. PDO 2 ­ To rebuild the land administration system Technical and institutional capacity ­ Moderate risk The technical and institutional capacity built under RALAS is likely to be maintained, at least in the short run. However, it is expected this capacity will be gradually eroded over time in the absence of a systematic human resource development strategy. Physical facilities ­ Moderate risk Sustainability is high, of course, for the three facilities that have been completed and are now operational (BPN provincial building, BPN Aceh Barat district land office and BPN Aceh Besar district land office). The three new district offices (Kantah Aceh Barat Daya District, Kantah Nagan Raya District, Kantah Simelue District) which have been completed are still not operating due to the lack of furniture, office equipment and minor infrastructure work could be 24 made operational in the short term, as the budgetary resources needed are not substantial. There is also uncertainty regarding completion of the Banda Aceh City (kota) land office. Construction is at 50 percent, with no further work having been undertaken at the time of the ICR. Computerized land administration and back-up systems ­ Substantial No progress was done in this regard, so there are no sustainability issues to be discussed in the context of RALAS. However, it is important to point out that, unless such systems are implemented, land administration systems for Indonesia as a whole remain highly vulnerable. Although BPN has advised in its own report that these were achieved, there was no evidence provided to the project monitoring team. 5. Assessment of Bank and Borrower Performance 5.1 Bank Performance (a) Bank Performance in Ensuring Quality at Entry Rating: Satisfactory As discussed in detail in Section 2.1, the Bank responded swiftly and effectively to the GoI's request for support, putting forward an operation that was both relevant and innovative. RALAS's project design effectively built upon the recently approved LMPDP operation, adapting some of its key elements to the post-tsunami rehabilitation and reconstruction efforts in Aceh, most notably the CDA approach to land adjudication. The design of RALAS project was also particularly sensitive to the needs of vulnerable groups and introduced safeguards to protect their property rights in cases of inheritance and guardianship. RALAS also deserves recognition for introducing joint titling in the Aceh land administration system, in an effort to strengthen women's land rights. The various legal system affecting land ownership in Aceh were thoroughly examined and effectively incorporated into the project's overall strategy. The project was also conceived as a collaborative effort with a broad universe of stakeholders, including government agencies such as BRR, NGOs, community groups and other donors. This collaboration, which was very much alive during project preparation, resulted in a sound project design and broad support among stakeholders. In retrospect, the risk of uneven BPN support was not envisaged. (b) Quality of Supervision Rating: Satisfactory Throughout its implementation period, RALAS received intense supervision from the Bank. Initially the Bank TTL was based in Indonesia, from the time of preparation through the first year of implementation. From September 2006 onward, a Bank field monitoring team was established in Aceh (based in Banda Aceh). All of the supervision missions were conducted regularly and under very challenging circumstances. The supervision reports were clear and well structured, and included a mutually agreed action plan detailing agreed actions, which facilitated their subsequent tracking. The supervision missions were also followed by a Management Letter from the Bank to BPN's leadership emphasizing the key findings and requesting formal action when needed, along with the confirmed copy of the aide-memoire. In all of these activities, the Bank team demonstrated its ability to work with a broad universe of stakeholders, including BPN at various levels of government, other government agencies such as BRR, as well as NGOs and other donors. The Bank team acted decisively when serious implementation weaknesses were identified as a result of the backlogs in AWPs 2005 and 2006, requesting an external performance audit (by BPKP) to fully investigate the factors affecting project implementation and to assess the nature and magnitude of the backlog. The 25 Bank also monitored compliance with grant covenants, financial administration, and procurement over the life of the grant, and thoroughly addressed weaknesses as they were identified. The Bank's deployment of a field monitoring team was amply justified given the complexity of the project, the weak capacity of the implementing agency, and the early problems experienced under the AWPs 2005 and 2006. To avoid such problems under the AWP 2008, the Bank's field monitoring team worked closely with BPN officials at the national, provincial and district levels in the village selection process, undertook several field visits, and closely supervised implementation of the program. In addition, at the end of AWP 2008 activities, the Bank's field monitoring team conducted a random field survey to revalidate the results of the AWP 2008 reported by BPN during July and August 2009. The field revalidation survey covered 103 villages and examined 923 land titles produced and distributed to land holders in 13 districts of Aceh. This field survey included questions on the titling process, the number of joint titles issued, women's participation in the titling process, and general discussions with village heads on various aspects of the program. In general, the field survey confirmed the results reported by BPN. In retrospect, deploying the field monitoring team at the start of project implementation would probably have helped detect and correct some of the implementation weaknesses at an earlier stage. The Bank team succeeded in effectively managing supervision resources and in mobilizing additional resources to conduct the PIBA study as well as a gender study, "Gender Impacts of Land Titling Program in Post-Tsunami Aceh." BPN was an important partner in the preparation of the PIBA study, along with other stakeholders including BRR. The PIBA study was widely disseminated and was acknowledged in BPN's project completion report. BPN was also a key partner in the gender study, and the initial findings have been shared with both BPN and other stakeholders as part of the inclusive preparation process. BPN's project completion report also raises the importance of gender mainstreaming and the progress made under RALAS. At the time of the ICR preparation, the gender report was still being finalized. (c) Justification of Rating for Overall Bank Performance Rating: Satisfactory Overall Bank's performance is deemed Satisfactory for the reasons stated above, which explain the rationale for rating Bank performance satisfactory at both entry and during supervision. Another aspect of Bank performance that deserves explanation, particularly in light of the failure to fully achieve the project's objectives, is the handling of requests for project extension. The first extension of the project, for six months, was justified on the grounds that it allowed for the orderly completion of the 2008 AWP. The decision not to approve a second extension request by the GoI, for an additional two years, was based on various factors. First, the decision was made in May 2008, when project outputs were significantly lower than at the actual closing date. Second, many of the project's implementation weaknesses still remained unaddressed and the constructive engagement needed on the part of central BPN was missing. Third, the emergency and reconstruction phases of the tsunami- response effort had been completed and the PDO of securing and reconstructing property rights in affected areas had been largely achieved despite the lower titling outputs. Fourth, no significant ongoing progress was being made toward the PDO of reconstructing Aceh's land administration system: physical works were substantially delayed due to procurement weaknesses and no serious attempts were being made at developing the computerized records management and back-up systems. Fifth, some of the challenges faced in Aceh are common to all provincial land administration systems in Indonesia, so after the most critical post-tsunami needs had already been addressed, the urgency of continuing to focus specifically on Aceh was not considered as high (nor as effective and efficient as a possible system-wide approach). Thus, Bank management and the MDF, after extensive consultation with the GoI, made the decision to close the RALAS grant on June 30, 2009. 26 5.2 Borrower Performance (a) Government Performance Rating: Moderately Satisfactory As mentioned earlier, RALAS was fully aligned with the GoI's policy stand on land issues in the context of post-tsunami reconstruction efforts. The GoI strategy was clear in its objective of protecting and restoring the property rights held prior to the tsunami, strengthening those rights both in the affected areas and surrounding areas Subsequent government actions were fully consistent with these stated objectives, providing RALAS a solid foundation to build upon. Overall, the GoI was very supportive of RALAS, giving its full backing, particularly during preparation. It is also noteworthy that, at the instigation of the BRR Head, the President personally intervened to secure MoF's signoff for the waiver of fees and charges, which overcame the last obstacle that had been holding up effectiveness of the grant. When implementation problems arose, the GoI agreed to the Bank's request to have BPKP conduct a performance audit of the project. This audit was thorough and made a sound diagnosis of the magnitude of the backlogs and the underlying causes. The audit also offered a number of recommendations that proved to be critical in putting the project back on track in 2008. Despite the GoI's full support, there were some delays in the approval of budgets for the project and its implementation by MoF and, most importantly, the time slippages in issuing the Presidential Decree (PerPu) introduced uncertainties and anxiety in implementing the titling program as per agreed time schedules (b) Implementing Agency or Agencies Performance Rating: Moderately Unsatisfactory Although performance of the implementing agency improved substantially during the last 6-12 months of the project, and probably would have been considered moderately satisfactory if maintained at that level throughout the project, by the time the agency's performance improved it was too late to fully achieve the project's objectives or to even justify an extension of the closing date, and is therefore rated as moderately unsatisfactory. Despite this rating, the team feels that BPN could be a valuable partner or implementing agency in future projects if it maintains its current level of capacity and commitment, and avoids the shortcomings that affected implementation during much of the RALAS project. However, the successful implementation of any future project would dependent on that assignment of a full-time PIU and full-time project staff. This was a major weakness in the implementation of RALAS. Management support for the Project, particularly from central BPN, was at times uneven, especially during 2006-2008. Significant progress in project management was made at the provincial level from January 2008 onwards. The Project Implementation Unit (PIU) functioned sporadically until early 2006, after which program support came to a stand-still for more than a year, at least until January 2008. During this period, the lack of coordination seriously hampered the efficient and effective functioning of the field teams. Other PIU functions suffered as well, including the preparation of work plans, reporting, and financial management. Procurement was particularly problematic, and ex-post reviews detected not only poor contract management practices but also some potential collusive practices (the corresponding cases were submitted to the Bank's anti-corruption team and their final assessment is still pending). Although the project design allowed for the hiring of implementation experts to assist the PIU, the government's procurement system and delays in assigning annual budget precluded this. No AWP was submitted to the Bank for 2007 and, consequently, no systematic titling activities were conducted during that FY. Coordination with other stakeholders was rare during 2006 and 2007 and RALAS's governance mechanisms, including the provincial PSC and the Land Forum ceased to operate. Likewise, the project was implemented in an 27 increasingly centralized manner, which was inconsistent with the original project design. Land adjudication and titling procedures deviated from those in the RALAS Manual, which was not formally modified until November 2008. Bank supervision missions, the Bank monitoring team and even the BRR continued to raise these concerns from as early 2006. The PIU recovered gradually during the implementation of the AWP 2008 as evidenced by its improved reporting, financial management and contract management practices. Although project management also improved significantly, as shown by the successful implementation of the AWP 2008, this was only possible because the implementation period was extended by an additional 6 months. It is important to underscore that project support from BPN was greater at the provincial level, and especially under AWP 2008 very constructive in its engagement with the Bank and stakeholders. However, limited technical capacity and, more important, the extremely restricted decision-making authority were critical factors undermining provincial performance. This denotes the accuracy of the basic premise underlying the original decentralized project design: responsiveness of government officials is generally inversely correlated to the distance from constituencies. (c) Justification of Rating for Overall Borrower Performance Rating: Moderately Unsatisfactory Despite the GoI's moderately satisfactory performance, overall Borrower's Performance is deemed moderately unsatisfactory given the significant shortcomings in project management, including procurement performance. Indeed, the single greatest obstacle to satisfactory implementation progress and full achievement of the PDOs was lack of sustained commitment by the implementing agency, and continuous functioning, staffing, and effectiveness of the PIU. However it is noted that the provincial performance could be assessed as better than this overall rating. 6. Lessons Learned Lessons of General Application Aceh's experience in the aftermath of the tsunami illustrates both the critical importance of land rights in reconstruction and reconstruction efforts, as well as the vulnerability of land administration systems, particularly those relying on paper records. Countries need to have systems and policies for recovery in place prior to disasters in order to be able to respond quickly and effectively to natural disasters and other emergencies. In the case of Indonesia, which is particularly prone to natural disasters, earthquakes, floods, tsunamis, volcanoes, and forest fires, BPN should seriously consider developing and legally adopting a post-disaster strategy to guide rehabilitation and reconstruction efforts with regard to land. The rich experience of RALAS offers many valuable lessons in terms of both strengths and weaknesses to build upon. A clear commitment on the part of national authorities to protect property rights is critical in avoiding large-scale land grabbing and speculation. The GoI acted swiftly and firmly to protect pre-tsunami property rights, regardless of whether they were formally registered or not. Key measures were implemented and broadly disseminated, including the temporary freeze on land transactions, the unambiguous endorsement of pre-existing property rights under Aceh's Reconstruction Master Plan, the waiving of first-time registration fees and land taxes, and the formal adoption of the RALAS-CDA Manual, which included guidelines on land adjudication mechanisms. 28 The experience of using the CDA process in RALAS has demonstrated the effectiveness of community-based approaches for land adjudication. The CDA approach accelerated the land adjudication process and also facilitated the resolution of land disputes at the village level. Explicitly recognizing and building upon the multiple legal systems (i.e., secular, religious, and customary) that determine land rights is key to building post-emergency ownership rights that are strong and aligned with community practices. Moreover, customary land practices are often designed as safety nets to protect the most vulnerable groups, including women. Thus, it is of utmost importance not to undermine these safety nets when transitioning from customary rights to state-provided land tenure and administration systems. RALAS's project design exhibited a remarkable sensitivity toward protecting women's land rights as well as those of other vulnerable groups, such as widows, minors and orphans. However, the RALAS experience illustrates the importance of carefully designing an implementation strategy that takes into consideration women's specific needs, e.g., time and place of meetings, composition of field teams, and literacy, language and other social barriers affecting women's participation. Given that land with clear property rights is a basic input in reconstruction efforts, land agencies should try harnessing the efforts of the wide range of actors, including nongovernmental organizations, civil society organizations, and donors. A strong partnership with multiple stakeholders was achieved at the time of project preparation, which was a key factor contributing to RALAS's sound project design and its broad acceptance. However, BPN's reduced emphasis on collaboration during implementation during 2007, weakened the project's effectiveness. Reconstruction efforts can often open new opportunities. For example, BPN introduced the option of joint titling for the first time in Aceh under RALAS. An overly centralized project management is not conducive to the effective implementation of a project such as RALAS, in which logistically complex field activities and necessary civil society engagement are at the core of the project. The damage to land records as a result of the tsunami underscores the need to have back-up systems. A further reminder of this occurred during implementation when one of the field team base camps burned down and records were lost. This is particularly important in the case of Indonesia, where provincial and district land offices are the repositories for land records. The centralized budgetary system and the GOI requirement for RALAS to be implemented under the normal GOI annual budgetary system caused significant challenges throughout the entire project period. Project-Specific Lessons A Beneficiary Impact Assessment can be an excellent complement to the Results Framework of emergency projects, which, given the inherent time constraints at preparation, might not have robust impact and results indicators. Experiences from other projects show that borrowers are not always interested in carrying out such assessments. Thus, as in the case of RALAS, it is preferable that these assessments are externally financed and supervised to ensure that they are carried out and to avoid overtaxing the capacity of the implementing agency. 7. Comments on Issues Raised by Grantee/Implementing Agencies/Donors (a) Grantee/Implementing agencies A summary of the Grantee's report is at Annex 7. Also included in Annex 7 is the Grantee's comments on the ICR Report submitted to the Bank on May 17, 2010. 29 The following comments are made by the Bank on the Grantee's report: (a) Overall the report's sections on Background, Project Description and Project Implementation are generally consistent with the Bank's views. (b) The seven recommendations made by the Grantee are sound, including the recommendation regarding improvement to World Bank emergency response procedures. (c) Regarding the AWP 2007, the Grantee's report does not mention that it did not submit a proposed work plan for AWP 2007. (d) There are some differences in some of the KPIs reported, the majority of which are small in nature. The Bank has during the implementation period employed a full-time monitoring team based in Banda Aceh to validate and field check results where possible. (e) The Grantee's report advises that the target of 600,000 land parcels for CDA was too high. It also advises that 400,000 land parcels were affected by the tsunami. On the former issue, both the special performance undertaken by BPKP and also the independent evaluation of RALAS, though PIBA, advise that targets for RALAS both in terms of CDA and for titling were realistic, achievable and within BPN's capacity. The exact number of land parcels affected by the tsunami is not known, even to this day. RALAS was costed on the basis that 300,000 land parcels in tsunami-affected areas would be titled and a further 300,000 land parcels in surrounding areas would be titled. Both BPKP and PIBA acknowledged this also. (f) The Grantee's report includes ratings which are assigned by BPN and not the World Bank. (g) On KPIs, there are some differences in some indicators. Most of which are minor in nature. It is however noted that indicators for titling for AWP 2005 and 2006 are reported in terms of land parcels adjudicated, rather than the actual target of titles distributed to land owners. Hence, the report does not consider the backlog of work not completed in these two years. (h) The Grantee's report makes useful observations of the government budgetary system and cycle which made project implementation difficult for BPN. (i) The Grantee's report advises of the ongoing procurement delays experienced, some of which were due to the rigid government budget allocation approval process. Overall, these delays impeded project implementation, and this is especially acknowledged regarding civil works. The Bank does not agree that the Bank caused impediments to procurement through its restrictions or though delays in issuance of Bank issuance of no objection letters (NOL). The respective Aide Memoires for project supervision provide a consistent documentary record of the issues caused by weak and slow procurement by BPN. (j) Regarding disbursements, the Grantee's report expresses concerns in delays in the Bank's processing of requests for replenishing the Special Account during the period May-August 2009. It should be noted that the report acknowledges that the request dated June 3, 2009, could not be fulfilled as BPN did not submit the required documentation to substantiate their request. The Grantee also reports that other requests were only partially paid. The Bank had advised BPN from an early stage of project implementation, a cap of US$1.5 million was placed on the balance of the Special Account, the amount judged throughout the project period to be sufficient for three months disbursement. Applications submitted by BPN during the final months of the Grant and during the grace period were in excess of this amount and thus Bank's replenishment to the Special Account was limited to the agreed limit of US $1.5 million. There were also some delays in the Bank's processing for replenishment of the Special Account due to transition arrangements of moving the disbursement processing from the Bank's office in Jakarta to the Manila office during that period. 30 (k) The Grantee's report acknowledges that there were governance concerns under the project, including cases related to informal unauthorized payments. These are described by BPN as to be "presumed to be corruption". The Bank notes that BPN took some steps to address corruption including issuance of a circular letter to adjudication teams, land office staff and PIU staff, directing them not to accept thanksgiving money and tips. BPN also directed against collusive practices for bidders in procurement. (l) Overall, the Grantee has prepared an interesting and useful set of lessons learned from the project. Although there are some differences in how BPN has reported on the project from the views of BRR and also of the Bank, especially in terms of actual implementation and outcomes, the BPN report nonetheless conveys the important contribution that RALAS has made to Aceh's reconstruction, and the valuable lessons learned. The Bank very much appreciates the cooperation of BPN in reviewing the Draft ICR Report and submitting detailed thoughtful comments in a timely manner. The following responses are made to the Grantee's comments on the ICR report: (a) On the Generic Comments, (i) The Bank acknowledges that there were issues of consistency between the Grant Agreement and the PAD regarding the PDO and also indicators. These are explained in the Data Sheet, Section F, subsection (a) PDO Indicators ,and in Section 1, Subsection 1.2 , Original Project Development Objectives (PDO) and Key Indicators (as approved). The inconsistencies in the PDO were not substantive and did not affective the objectives or activities. Regarding the performance indicators, the project was prepared under emergency conditions and it did not have the traditional results framework, and was prepared on the basis of a "results summary". During implementation both the Borrower and the Bank treated five of the indicators as PDO- level, and the rest as intermediate indicators. (ii) Regarding "ISR", this term has been added to the Glossary. (b) On the Specific Comments, (i) The Bank acknowledges that the project did not have a formal MTR, and this has been corrected in the Data Sheet. As an emergency project, an MTR was not envisaged nor included in the Grant Agreement. However, it is also noted that the MDF undertook a MTR of its portfolio of projects, including RALAS. This has now been clarified in the ICR Report. (ii) Comments on ratings are noted. (iii) Comments on PDO and indicators are again noted. (iv) Comments on CLMs are noted. The primary purpose of the Footnote #1 is to report that CLM coverage did not fully align geographically with RALAS priority areas for titling. The Bank acknowledges that it was not always possible for BPN to use CLM, in those circumstances where CLM data was not properly collected. 31 (v) Regarding assessment of the Bank's performance, this is covered under Section 5.1, Bank Performance. (b) Co-financiers/Donors The MDF Secretariat has provided the following comments. These comments do not necessarily represent the views of donors or the MDF Steering Committee. RALAS was a very strategically important project for the MDF. As the ICR notes, it was the first project to be funded in the MDF and as such had a very high profile both within the World Bank and the MDF as well as in the wider reconstruction community. The project represented an important agenda for the Government of Indonesia relative to the overall reconstruction of Aceh and as a result the expectations were high. RALAS offers important opportunities for lessons learned. The ICR is very comprehensive in its coverage of what worked, what didn't work, and why. These lessons are important at the project level and for future work in land titling and access to land in Indonesia, but more importantly from the perspective of the MDF Secretariat, RALAS provides important lessons for work in post-disaster reconstruction more broadly, and particularly for post-disaster trust funds. The project has pro-actively contributed to the generation of lessons learned by commissioning two independent studies to look at project impacts: the PIBA and the Gender Study ("Study on Gender Impacts of Land Titling in Post-Tsunami Aceh, Indonesia"). These provide additional opportunities for learning from the RALAS experience that should be shared widely. They also have set a good precedent for other projects to follow in order to maximize the learning potential from strategic and innovative projects. Many important outcomes from the project remain after closure despite the fact that not all of the targets were met. The project left behind intangible benefits that went beyond the project development objective. Training and capacity building in community-driven adjudication will continue to have an impact in terms of government's delivery of land titling services. Perhaps most importantly, increased public awareness and understanding of land-titling procedures will impact demand for these services into the future, as well as the demand for transparent delivery of such services. The PIBA study found that beneficiaries who received their titles were highly satisfied. Some important lessons emerged that can inform project design in post-disaster situations in the future. One area where RALAS offers lessons is in terms of the importance of choosing an appropriate set of activities and what needs to be in place in order to implement effectively, especially when the implementing government agency's capacity is weak. One of the key lessons learned from the MDF's experience was that using existing mechanisms and approaches to get benefits flowing to communities quickly following the disaster was a successful strategy. KDP (Kecamatan Development Program) and UPP (Urban Poverty Program) already had instruments in place for channeling funds into communities following the tsunami using a community-driven approach. At design stage the opportunity for linking up with some of these existing instruments---for example to better facilitate CSO/NGO involvement in community mapping---might have been explored. Based on the experiences in implementing these projects, the Bank could develop basic design elements or modules to have ready to go on short notice in post-disaster settings to address common features such as civil society/NGO involvement in implementation. In the particular case of RALAS, the performance of CSOs in the community mapping was disappointing, but the budget mechanisms did not exist within BPN to allow CSOs to be easily involved in and paid through the project. KDP and SPADA (Support for Poor and Disadvantaged Areas Project) addressed this issue by providing a small amount of funds to be 32 administered off-budget in order to be able to easily support short term involvement of NGOs or individuals. The lack of flexibility in the project design for working in partnership with CSOs/NGOs, for example contributed to the criticisms of NGOs that RALAS did not take their views into account. Complaints handling is another example where government systems were not in place even at project end, and perhaps a module for implementing complaints handling rapidly and effectively in post- disaster settings could be an important contribution to future post-disaster trust funds. Another key lesson emerging from RALAS and other MDF projects as they begin to wind down is the need to plan for an exit strategy to ensure sustainability of investments after the projects end, even in post-disaster reconstruction contexts. Ensuring government systems are in place to sustain the investments made, whether these are physical outputs or local capacity that has been developed, should be explicitly addressed at design stage. In the case of RALAS, for example, if government co-financing for capital works had been included in the project design, turnover of unfinished construction works at the close of the project could have changed hands more easily. Unfortunately the project's significant contribution in restoring land records that were lost or destroyed in the tsunami has not been completed as planned because the digital back-up system for land data has not been put into place. This was a lost opportunity. The importance of capacity building at all the relevant levels of government is also emerging as an important lesson from various MDF-funded projects. In the case of RALAS, due to various implementation issues the project became more centralized at the national level over time. This limited the degree of coordination and capacity building with the Provincial government, resulting in a missed opportunity for extending the project's impact as now the Provincial government plays the key role in land titling. This is an important lesson for the National and Provincial governments for future land titling projects to allow the different levels of government to play their roles effectively in a coordinated fashion, particularly given the decentralized structure of government in Indonesia. One of the key challenges facing the MDF in implementation across the portfolio since the closure of BRR has been the issue of delays due to the regular government processes for channeling funds to projects. The MDF from its inception was committed to on-budget implementation but was not well prepared for the impact this would have on project implementation following the departure of BRR. The complexities of the planning and flows of on-budget funds are, however, a much bigger issue than a single project or the MDF's portfolio which needs to be addressed at high levels of the Government across the board, especially for future post-disaster trust funds. The importance of good relationship management at all levels is an important lesson from RALAS and the MDF experience. Bank management and project teams need to be able to work effectively at all levels of government in order to be able to address implementation challenges as they arise. The MDF's Mid Term Review (MTR) at project level conducted in late 2008 concluded that as implementation issues grew the relationship between RALAS's partners did not create the enabling conditions for jointly addressing problems. 13 RALAS's aims in terms of improving women's formal ownership of land titles contributed to the high expectations for the project. The project promoted joint titling as well as sole ownership by women. While targets were not fully met in this area, they were partially achieved. However, the sustainability of these gains is at risk unless they are incorporated into local law 13 The MDF's MTR was a review of all MDF-funded projects. 33 (Qanun). The World Bank task team for RALAS has commissioned a comprehensive Gender Study to look at gender dimensions and impacts in project implementation and results but it was not yet completed at the time of preparation of this ICR. The MDF Secretariat will encourage this study to be shared widely so that the lessons learned can have maximum benefit well beyond the MDF stakeholders, the project team and Aceh. (c) Other partners and stakeholders Former senior BRR14 have provided comments which are included at Annex 8. The comments were provided after the BRR had closed and they do not represent the official view of the former BRR. These comments are very candid, especially when considered from the perspective of the agency that was tasked with the enormous challenges of coordinating the reconstruction efforts. It is important to note that BRR has raised the issue that BPN-Kanwill's capacity may have been stretched during RALAS AWP 2006 period due to the implementation of a large land acquisition project. Clearly this had an impact on performance of RALAS. However, it is noted that the RALAS PIU in Banda Aceh was staffed by more than 70 personnel which is by far the largest staffing level seen in any land administration project in East Asia, as raised in several supervision Aide Memoires. It would seem that the level of resourcing was more than sufficient, but efficient management of the resources proved to be challenging. 14 BRR, the Agency for the Rehabilitation and Reconstruction of Aceh and Nias, coordinated and jointly implemented the recovery programme following the Aceh tsunami (2004) and the Nias earthquake (2005). The agency was established by the President of Indonesia in April 2005 and it undertook its coordination role over a four year period until its closure in early 2009. 34 Annex 1. Project Costs and Financing (a) Project Cost by Component (in USD Million equivalent) Actual / Latest Appraisal Estimate Percentage of Components Estimate (USD millions) Appraisal (USD millions) A. Reconstruction of property rights and issuance of land 22.10 11.67 52.8 titles B. Reconstruction of BPN 3.90 1.84 47.2 institutions in Aceh C. Project management 2.50 1.31 52.6 Total Baseline Cost 28.50 14.82 52.0 Physical contingencies 0.00 Price contingencies 0.00 Total Project Costs 28.50 14.82 52.0 Project Preparation Costs 0.00 Total Financing Required 28.50 14.82 52.0 (b) Financing Appraisal Actual/Latest Type of Co- Estimate Estimate Percentage Source of Funds financing (USD (USD of Appraisal millions) millions) MDF Trust Fund 28.5 14.82 52.0 Total 28.5 14.82 52.0 Note: Government financing of about $1.15 million for salaries were not included in the costs and financing as they were considered part of the ongoing institutional and administrative costs rather than incremental costs attributable to the project. 35 Annex 2. Project Outputs Major outputs from RALAS Over four years of implementation, the project undertook three Annual Work Programs (AWPs). AWP 2005 and AWP 2006 were extended until June 2007. AWP 2008 was completed in June 2009. BPN did not prepare an AWP 2007. Component A - Reconstruction of property rights and issuance of Land Titles (US$22.10 million) The objective of this component was to reconstruct the land administration records system in the tsunami-affected provinces and to recover the property rights of both formal and informal land holders. This component was organized into the following four sub-components: A.1 Reconstruction of BPN's land records Modest progress was made towards the reconstruction of land records that suffered mud and water damage as a result of the tsunami. Specifically: Conservation: Damaged records from the Banda Aceh office were taken to Jakarta where BPN and the National Archives (ANRI) worked on their conservation and recovery with financial and technical support from JICA. From February to November 2005, records were cleaned and dried using a vacuum freeze dry chamber. Recovery: From late 2005 to September 2007, records were scanned. Land records that were successfully recovered included: 42,966 land titles (including land books, parcel maps and survey plans); 284,000 registry land documents, and 210 cadastral maps. Reconciliation and archiving: Records were returned to BPN Banda Aceh provincial office in late-2007. District BPN officials are still to reconcile and verify these records, and them place them in archive. The lack of adequate physical space has been one of the factors delaying this task. A.2 Community-driven adjudication, community awareness and participation Significant progress was made under this sub-component: RALAS Community Driven Adjudication (CDA) Manual: In June 2005, a CDA manual was prepared, led by the World Bank in collaboration with the government, NGOs/CSOs and donors. The RALAS Manual and a recently revised version were formally adopted through BPN Decrees in July 2005 and November 2008, respectively. These decrees enabled BPN to legally issue titles in cases when land had been adjudicated using the CDA approach as defined under the RALAS Manual. The BRR also prescribed the RALAS Manual as the standard approach for community land mapping (CLM) activities to be undertaken in reconstruction areas. CDA training was provided to NGOs and other agencies involved in reconstruction. Provided that community land mapping was completed in accordance with the standards prescribed in the RALAS Manual, communities could initiate housing and infrastructure works before the titles were formally issued by the BPN. Substantial efforts were made in raising community and public awareness of land issues in general and RALAS in particular. These activities include (a) CDA training of 700 community-based, local facilitators; (b) publication of information brochures; (c) cooperation with BPN field teams and villages; (d) a land forum with NGOs and 36 community leaders; (e) media articles; (f) communication activities undertaken by NGOs and NGO facilitators; and (g) information dissemination through the Internet. During the project about 160 public meetings were convened in 125 villages to disseminate information on inheritance and custody. These meetings were facilitated either by RALAS field teams and/or at times by KDP personnel.15 At least six provincial level court officials and 50 judges from the Syariah courts were trained on resolution of inheritance and guardianship issues as specified under the RALAS Manual. Through its support to BPN, the project assisted in producing about 317,170 CLMs, as outlined in the Manual. The not a direct investment activity of the project, more than 120,000 new houses have been built on land parcels for which CLMs were produced and confirmed. Village-level conflict resolution with regard to inheritance under RALAS appears to have been very effective (e.g., support to Syariah Court judges and dissemination of information on inheritance and guardianship matters). A.3 Surveying and mapping, registration of rights and issuance of title certificates Modest progress was made under this component with about 37% of the project's total target for land title distribution achieved. However, CLM reached almost 53% of the project target, as this enabled property rights to be established to enable land owners to rebuild housing with confidence. Specific achievements under the RALAS systematic titling program (as summarized in Table 1) were: During the four years of RALAS implementation, BPN distributed a total of 222,628 title certificates to land owners (out of the three annual work programs implemented). This represents about 37% of the project's total target of 600,000 land titles distributed to land owners. When considering only those parcels affected by the tsunami that were formally registered (i.e., an estimated 60,000 parcels), the titles distributed under RALAS represent 3.7 times that number. In 2004, the year prior to RALAS, a total of 12,150 titles were issued by BPN in Aceh as a result of owner-requested, first-time land registration and government-sponsored titling programs. Thus, the titles distributed under RALAS are equivalent to over 18 years of routine annual titling production in Aceh. Approximately 68% of the parcels mapped and surveyed are in the districts affected by the tsunami. This represents about 63% of the estimated number of land parcels in those areas that were not washed away or permanently inundated, though as mentioned previously those initial estimates were general approximations. Approximately 28% of titles were distributed to women and joint owners. The project handled a total of 483 formal enquiries from landowners seeking clarification on the registration and certification of their land parcels. In general, all these clarifications 15 The Kecamatan Development Project (KDP) and its successor, the Program Nasional Pemberdayaan Masyarkat (National Program for Community Empowerment or PNPM), are part of a nationwide local development program for which the World Bank serves as the principal partner agency. PNPM and KDP have provided block grants to over 3,700 villages for community-led infrastructure reconstruction since 2000. 37 were requests for additional information and these were provided by respective field teams or local land offices. An ex-post review of formal complaints carried out by the Bank monitoring team did not reveal any requests for informal payments under the systematic land titling program. In addition, the project has also facilitated the resolution of land disputes at the local level (e.g., community level meetings and through community agreements). A.4 Policy, legal and regulatory support. Significant progress was made in the area of policy development. The project supported the passage and subsequent dissemination of the following: Ministry of Finance's Regulation PMK No. 104 was issued on Oct 28 2005, waiving all fees, charges and taxes for land registration to be retrospectively implemented with effect Jan 1, 2005. This included the exception of the initial registration and certification fee, which amounts to 5% of the assessed value of the land and buildings. Without this exception, the implementation of the RALAS systematic titling program would not have been possible, as it was a condition for Grant effectiveness. Guidelines on CDA under the RALAS Manual, including also clarification of inheritance and guardianship procedures in accordance with Syariah law. This Manual was formally adopted through BPN Decree No. 114-II, 2005 (On the Land Registration Manual in Post- Tsunami Areas), which was issued in July 2005, as well as the more recent BPN Decree No. 394.1-XVII-2008 that was issued on Nov 8, 2008. Guidelines on inheritance under the RALAS Manual were developed in conjunction with the Syariah courts, and included safeguards against the risk of dispossession of widows, children and orphans by their guardians. Government Presidential Decree (Peraturan Pengganti Undang- Undang ­ PerPu) was issued in September 2007. It is a wide-ranging regulation with main provisions focusing on: (a) land that was destroyed or lost by tsunami or earthquake; (b) land affected by tsunami or earthquake that still exists; (c) managing the property for which there is no claimant or owner at present; (d) specific procedures to cover land acquired for reconstruction and rehabilitation purposes; (e) prohibition on transfer of land parcels before the status is determined: (f) bank records as evidence of ownership, dealings with the accounts of deceased customers, decisions on mortgage and debt and the Bank's right to replacement documents for mortgaged land; (g) inheritance and guardianship; and (h) penalties for incorrect statements. Component B - Reconstruction of BPN Institutions in Aceh (US$1.84 million) This component was aimed at supporting the reconstruction of BPN facilities and its human resource base in Aceh. This component was organized into the following three sub- components: 38 B.1 Reconstruction of facilities and provision of equipment and furniture Modest progress was made towards the rehabilitation of both damaged and destroyed land offices and also in the replacement of equipment and furniture: Table 2.2 Renovations and new construction of BPN damage buildings to be financed under RALAS Location Description Started Completed Operational Renovations Banda Aceh Provincial office Aceh Barat District office (1) Aceh Singkil District office New constructions Aceh Besar District office Nagan Raya District office (2) Aceh Barat Daya District office (2) Simelue District office (2) Lhok Seumawe District office Banda Aceh District office (1) Records room. (2) BNP budget for infrastructure works, such as fences, park area and access roads, and furniture and office equipment still to be allocated. Renovation works were completed in the BPN provincial office and the Aceh Besar and Aceh Barat district land offices. Two of these three facilities are fully operational, while the third is partially operational. New construction works have been completed in four district land offices, but only one is fully operational at the time of the ICR. (Those buildings completed but not yet operational is due to the need for funding for some requirements (such as furniture, office equipment, pavement and landscaping) had not yet been included in BPN's budget. In addition, delays in procurement resulted in two district land offices not being renovated under the project. Finally, and of particular concern, the construction of the Banda Aceh city land office has only been about half completed and further progress stalled. This is the biggest local land office in Aceh and has a larger workload than other local offices. At the time of the ICR, no further progress had been made. B.2 Training and capacity building Significant progress was made in the area of training and capacity building. The following outputs were achieved: Over 620 BPN personnel were trained in the preparation of CLMs, systematic land titling procedures, CDA process, and in the production and management of digital records under the three AWPs, including: 9 Under the AWP 2005, approximately 200 staff were trained on RALAS Manual (on the job) and assigned to work at the ten base camps. 9 Under the AWP 2006, approximately 480 staff were trained on RALAS Manual and assigned to work at the 30 base camps. 9 Under AWP 2008, approx. 220 staff were trained on the substance of the work program, role and responsibilities of the PIU, field teams and district offices, revisions made to the Manual, etc. (Aug.-Sep 2008). It is to be noted that of the staff assigned to 39 work for AWP 2008, close to 75 percent were reassigned from AWP 2006 field teams. Thus, in 2008, only refresher training was provided. In Sep-Oct 2006, 70 staff from district and provincial offices was trained on quality control and field monitoring. There was also refresher training for 40 of them in 2008. A total of 30 staff received training on procurement guidelines and procedures (Nov 28-Dec 2, 2008) A total of 25 staff received training on financial management reporting (Dec 2-6, 2008). B.3 Computerization and development of back-up system There was no significant progress was made in this sub-component in the development of a computerized land records management system and back-up system. It is noted that although BRR provided some support for development in 2006, BPN did not progress the work. While field teams produced electronic maps and records as a routine part of their work for survey and adjudication, a comprehensive, functional, secure system, as intended under the project design, was not developed. The lack of progress in this area is of particular concern, as investment in such a system, would have enabled the provincial land administration system, and BPN, to be less prone to risk from a disaster or security breach. Component C: Project Management (US$2.5 million) The objective of this component was to support BPN's Aceh provincial office to implement the project in an efficient and transparent way, including: (a) project management support; (b) monitoring and evaluation; and (c) technical assistance. Apart from ongoing project support, the main output under this component was the project's M&E system: C.2 Monitoring and Evaluation (M&E) System Limited progress was made under this sub-component as follows: The M&E system ended up being the result of ad-hoc efforts, such as the preparation of monthly reports based on the simple compilation of data received from base camps. Under the 2008 AWP, procedures were implemented for complaints handling, but these were only a minimal expression of what was anticipated at appraisal. With regard to the complaints handling mechanisms, BPN did not adequately distinguish actual complaints from enquiries, such as seeking guidance as to how a title certificate could be obtained and on subsequent transactions. A review of the complaints under the 2008 AWP showed that most of them were non-corruption grievances or inquiries seeking additional information or clarification on a particular issue. There were no grievances raised on the subject of informal payments. Other outputs Project Implementation and Beneficiary Assessment (PIBA): This was not part of the original project design or M&E plan, but was undertaken by the World Bank in order to improve the assessment of project outcomes and impacts (final report dated March 2009). The findings and recommendations were shared with counterpart agencies and stakeholders in Banda Aceh and Jakarta in Indonesia and also at the joint World Bank-International Federation of Surveyors (FIG) Conference in Washington, DC. Study on Gender and Access to Land and Ownership Rights: Under an independent Trust Fund grant, the World Bank RALAS Task Team has undertaken an analytical study, involving extensive field research, entitled Gender Impacts of Land Titling Program in Post-Tsunami Aceh, Indonesia. This study has examined differentiated impacts of land titling in post-tsunami Aceh and women's access to land rights. The results of this study are 40 expected to be available only by June 2010 RALAS served to mobilize coordinated support on land issues from other donors and stakeholders: A number of partners collaborated to restore property rights, complementing the efforts being made under RALAS toward the rehabilitation of the land administration system and the clarification of property rights, including: 9 UNDP provided support in the critical early stages for training, supplying surveying equipment, and support for the website and internet communications of BPN. It also supported the training of more than 700 CDA facilitators (comprising of local leaders, NGO/CSO representatives), and funded the publication of information brochures on RALAS and property rights. In addition, support was provided for socialization of inheritance and guardianship procedures, through Syariah court officials, in 2006-07. 9 The European Commission provided pre-tsunami satellite imagery (and two technical advisor missions to build BPN capacity in imagery processing), to support community land mapping. This imagery was made available for all reconstruction projects through BPN. 9 The Japan International Cooperation Agency (JICA) provided a grant to recover damaged land records (including about 50,000 land titles). 9 Government of Australia provided some initial surveying equipment to BPN and supported community land mapping in up to 400 communities and trained 100 facilitators. 9 Oxfam supported research on gender, land, and property issues in Aceh and a published several reports. 9 Syariah courts worked with RALAS to provide "circuit courts" in the villages, to provide advice and deal with cases involving widows and under-age heirs. 41 Annex 3. Economic and Financial Analysis Given the emergency nature of the project, economic and financial analyses were not conducted at Appraisal. See Section 3.3 for general discussion of cost and efficiency aspects of the project. However, it is noted that RALAS was costed on the basis of US$ 36 per land parcel for surveying, adjudication and land registration (including special allowances needed to cover costs of mobilizing teams from outside of the province to support recovery and reconstruction operations). The actual average unit cost per title distributed as around US$ 53. This should not be taken as a negative reflection on project implementation efficiency. Response to disaster and reconstruction requires extraordinary commitments and investments due to the extenuating circumstances. 42 Annex 4. Grant Preparation and Implementation Support/Supervision Processes (a) Task Team members Responsibility / Names Title Unit Specialty Lending/Grant Preparation Supervision/ICR Akil Abduljalil M&E Consultant EACIF M&E Asih Sri Wohon Program Assistant EACIF Administration Benedicta R. Sembodo Program Assistant EACIF Administration Christina I. Donna Financial Management Analyst EAPFM Financial Management Christopher Grant Surveying and Mapping Consultant EASTS Surveying and Mapping Land Information David Mitchell Land Information Systems Consultant FAO System Dewi Pribadi Program Assistant EACIF Administration Senior Gender and Social Gillian Brown EASER Gender Development Specialist Guo Li Senior Agriculture Economist AFTAR Economic Analysis Safeguards and Isono Sadoko Safeguards Consultant EASIS NGO/CSO Engagement Keith Clifford Bell Senior Land Policy Specialist, TTL EASER Land Policy Kevin Nettle Land Registration Consultant EASTS Land Registration Project Implementation Lilik Hidayat Consultant, Project Monitoring EASIS Monitoring Maria Cecilia Zanetta Consultant, ICR Preparation LCSHE ICR Preparation Chief, Land Tenure and Paul Munro-Faure FAO Land Tenure Administration Service Peter Brandriss Portfolio Analyst EASSD Analyst R. Cynthia Dharmajaya Program Assistant EASER Administration Rizal H. Rivai Senior Procurement Specialist EAPPR Procurement Srinivas Shivakumar Project Implementation Consultant, Project Monitoring EASIS Mahalingam Monitoring Stephen Barr Surveying Consultant EASTS Surveying Land Administration and Suleiman Dabbas Land Administration Consultant EASTS Surveying Consultant, formerly Social Sulistiowati Nainggolan EASIS Social Development Development Specialist Sumaryo Soemardjo Procurement Consultant EASER Procurement Unggul Suprayitno Financial Management Specialist EAPFM Financial Management Wael Zakout Sector Manager ECSSG Manager Land Administration and Suleiman Dabbas Land Administration Consultant EASTS Surveying 43 Staff Time and Cost Staff Time and Cost (Bank budget only) Stage of Project Cycle USD Thousands No. of staff weeks (incl. travel and consultant costs) Lending FY05 20 (estimated) 100,000 (estimated) Total: 20 (estimated) 100,000 (estimated) Supervision/ICR FY06 55.32 291,755 FY07 47.75 289,402 FY08 96.80 230,005 FY09 39.57 287,516 FY10 3.08 62,952 Total: 242.52 1,161,630 44 Annex 5. Beneficiary Survey Results A Project Implementation and Beneficiary Assessment (PIBA) were commissioned in mid- 2008 by the World Bank and the MDF, in collaboration with BPN and BRR. The aim of PIBA was to assess: (a) BPN's implementation performance; and (b) how RALAS is perceived by beneficiaries. It was expected that PIBA would provide feedback that could be useful in improving the effectiveness and efficiency of the project. PIBA was also expected to provide a more solid foundation to assess RALAS's performance, which was particularly important given the lack of outcome and impact indicators in the operation's Result Framework. The PIBA was prepared between late-August 2008 and December 2008. The PIBA research team visited and conducted a total of 269 interviews (231 recipients of land titles under RALAS plus 38 non-recipients under the control group) in 37 randomly selected sites in 8 districts and Banda Aceh City. In addition, a total of 62 small focus group discussions were organized in the study areas with more than 382 participants. The PIBA research team also interviewed representatives of various stakeholder groups, including housing providers, NGOs, civil society groups, local government leaders and officials, as well as BPN management in Banda Aceh, BPN officials at the district offices, and BRR officials. Of the respondents randomly selected within the study areas, 50 percent were women, and of those, 23 percent were heads of households. While the scope of the project was limited to titling and rebuilding (and modernizing) the government's land administration system, the project has provided a focus for broader land issues and the attention of civil society, especially those organizations engaged in reconstruction of housing and communities. Some of the perceived implementation weaknesses included: (a) project management; (b) quality assurance of work largely due to lack of management oversight; (c) limited participation of women in socialization of the project implementation; and (iv) weak monitoring, lack of reliable data- bases and poor reporting standards. The project was also seriously affected by lack of expected technical assistance. The PIBA team reported that the modest implementation of the project was not a function of project design but rather it was due to weak project management at various levels, with the project management becoming virtually centralized at the BPN-central level sometime in early 2006. This latter issue was of particular relevance, as the project had been designed to be implemented through decentralized management. The preliminary findings of the assessment included: (a) confirmation that the project design was relevant and appropriate; (b) indicated continuing community demand for the land titles and that while the project's initial targets were estimates, given the current large demands for title certificates these targets are reasonable; and (c) confirm modest progress against project targets achieved. The team also reported broader impacts of the project including the prevention of large-scale land speculation and land grabbing as had been experienced in tsunami-affected countries like Thailand (Phi Phi Island). 45 Annex 6. Stakeholder Workshop Report and Results Not Applicable 46 Annex 7. Summary of Grantee's Report and Comments on Draft ICR Report The Grantee, BPN, the implementing agency for RALAS, provided a very comprehensive 60-page report for the completion of the project, which was submitted to the Bank in January 2010. Given the length of the report submitted, the Bank team prepared a summary version by extracting key sections from the complete report. This summary report is provided in this Annex, and the full report is in the project files. The summary has drawn from the BPN's own report the following sections: (a) Executive Summary; (b) from Chapter 4, the Overview of Project Implementation (section 4.1); and (c) Chapter 5, Lessons Learned and Recommendation. There has also been the need for some editing of grammar and spelling. Summary The Government of Indonesia had accomplished reconstruction of land administration system at tsunami-affected area in NAD through Reconstruction of Aceh Land Administration System (RALAS) program. It was funded by grant from Multi Donor Fund (MDF) Num. TF-055353-IND with amount of US$ 28.5 million. The grant was allocated to financed three components, i.e.: a) Reconstruction of Property Rights and Issuance of Land Titles; b) Reconstruction of BPN Institution in Aceh; and c) Project Management. RALAS had accomplished: a) restoration and digitizing of land documents from NAD regional land office and Banda Aceh local land office; It covered 18 tons of 42,966 land titles documents (including land books, parcel map, survey plan), 284,000 registry land documents, and 210 cadastral map sheets; b) CDA and reconstruction of rights to land (309,773 land parcels); c) land titles issuance of 234,225 land parcels; d) construction of six land office buildings and renovation of NAD regional land office building; and e) technical trainings for enhancing capacity of BPN's staffs. RALAS had contributed in issuance of reconstruction statutory decrees/regulations, i.e.: Emergency Act (Perpu) Num. 2/2007 regarding Handling of Land Issues in relation with Implementation of Rehabilitation and Reconstruction of NAD-Nias, Act Num. 48/2007 regarding establishment of Government Regulation Num. 2 Year 2007 to become act, and Government Regulation (GR) Num. 32/2007 regarding tax exemption for landowner in NAD. On the other hand, abovementioned physical results were followed by managerial aspect, either in RALAS management or land administration system. In managerial aspect, BPN had implemented good governance and anti-corruption program. In land administration system aspect, BPN had reconstructed institution through building renovation/construction, providence of furniture and working tools, installation of computer network and the service system, and training for land offices' staffs. In line with raised issue, BPN had implemented gender mainstreaming principle in this program. It resulted in land titles in which covered women and other vulnerable people rights to land. Land titles were issued in women name, couple, widow, and orphaned. BPN is delighted with this hence it is a very good lesson learned to be implemented in the future. Other success resulted was positive responses from community to this RALAS program. PIBA study reported that the community was very enthusiastic with transparent community-driven adjudication, and they perceived that certification would protect ownership to customary land. Besides, community leaders, imam meunasah, tuhapeut, geuchik, and camat responded to the program well. 47 Since limited time, there were also threats and difficulties occurred in the implementation, such as unprepared community and BPN staffs during emergency phase (initial response), unsynchronized coordination especially with NGOs and the World Bank, low readiness of RALAS management system, and no supporting system for emergency scenario, and of course damage of BPN office buildings. All problems were solved during the implementation therefore better outcomes were resulted. This becomes lesson learned for BPN, especially for other similar project in the future. RALAS experience give good lesson that BPN and other institutions should have disaster handling standard in which covers initial emergency response, problem identification and inventory, system and procedure determination, and procedure of reconstruction implementation. Finally, RALAS was part of GoI program to redevelop the NAD community after earthquake and tsunami. Therefore, it is hoped that the RALAS success is part of GoI success. Overview of the Assessment of Project Implementation Since commencement of RALAS on August 2005, and until the closing date on June 30, 2009, many results have been achieved, although there are some targets that could not be accomplished. The results can be measured with Key Performance Indicator (KPI) achievement. For component A, generally the achievement is below the target, especially for sub component A2 and A3. Only 309,773 land parcels were measured and mapped and only 234,225 land titles were issued compared to 600,000 land titles as targeted. On the other hand, in general the achievement of sub component A1 and A4 is as targeted. Achievement of component B and C in general is satisfactory. However, there is one sub component has low realization, i.e. sub component B3 Computerization and Development of Backup System. The detailed component achievement will be described on this chapter. As well as assessing the results/targets, it is necessary to consider the process in reaching the results/targets. This report provides some notes related to the project implementation. RALAS implementation in its first year was done without sufficient existing juridical data references. It is necessary to understand that the process of land boundaries remarking could not be well executed. This was because there were some challenges during the implementation. One major problem to be mentioned here was the lost of land parcel physical boundaries caused by the tsunami and the land clearing process. The other challenges are be detailed later in this report. BPN concludes that some matters should be improved. They are: support for certification officials; RALAS adjudication manual; the authority of adjudication team; time of AWP implementation; dissemination of information; inconsistency of various reconstruction guidelines; and procurement guidelines and consultant selection guidelines. These are detailed in the report. In regard to financial utilization, RALAS disbursement realization was conducted until October 7, 2009 using a Grant of US$ 14,824,990.69, or Rp 140,638,142.241. In percentage, this amount was 50.02% of the Grant Agreement allocation of US$ 28.5 million. Some notes should be made dealing with this issue. The first is disbursement realization was in line with physical targets. As explained before, the annual physical target was set below the target mentioned in PAD. Second, there were unpredicted disbursements in year 2009, beyond the PAD plan. They were used for the extended AWP 2008 implementation into year 2009. Major parts of disbursement, especially for third parties, occurred in 2009. Third, even though there was no adjudication in year 2007, there were disbursements since 2006 adjudication was extended until April 2007. Fourth, total realization is US$ 14,824,990.69 or 50.02%. This is in line with total realization of adjudication i.e. 309,773 parcels 48 (51.63% of 600,000 parcels as targeted). Five, unsmooth disbursement of fund occurred at the end of the project. The explanation will be described later in this report. For the gender mainstreaming, RALAS has considered this implementation in land titling reconstruction. The CDA Manual states the priority and protection of vulnerable people such as widows and orphans right in land. The manual also advises that participants of land adjudication are to propose that the land title be in the name of the wife name or joint owners. For monitoring purposes, the adjudication teams should collect and release gender data in their monthly reports. Dealing with the good governance and anti-corruption framework, RALAS has implemented several actions. The actions cover many aspects, i.e.: enhanced disclosure provisions; standardization of procurement and financial management processes and documents; development and monitoring of service standards for land management and administration institutions; partnerships with the civil society for independent oversight and feedback; robust complaint handling mechanisms with sanctions in place for corruption, collusion, and nepotism; and financial accountability through strengthened internal controls on project implementation and payment validation. One more thing should be mentioned is that RALAS is also the project for the reconstruction of the land administration system. The meaning of reconstruction of the land administration system is to restore it to initial condition before the tsunami disaster. This means that it is not correct to only measure the achievement of RALAS from number of titles issued, building constructed, or equipment procured. The success of RALAS will be accurately measured by comparing the land condition and its administration system before and after the project, instead of adjudication results. Alternatively if there should be any measurement of benefits acquired by victims of the disaster, in this case land titles issued, the adjudication results should be considered separately from the reconstruction results. Lessons Learned Learning from the lessons left by Aceh disaster, some notes have been kept in priority to develop a stable and reliable land administration system in Indonesia, as follows: 1. Disaster Emergency Response and Determination of Reconstruction Time We are aware that reconstruction and land rights protection are very important for post-disaster condition. However, lesson learned from NAD shows that they cannot be immediately implemented. 2005 RALAS adjudication experience shows that it was difficult for adjudication teams to meet the land owners since most of them were out of village. They were in refugee camps. Food, living site, and psychological healing were more important for them. As described in previous chapters, community and land owner have important role in reconstruction of land rights. Based on that experience, it is better to carry out land reconstruction after the victim's condition back to normal. It means that they have come back to their place (location of reconstruction) so that land boundary may be determined accurately, land ownership proofs may be acquired completely, and inheritance process can be done. However, during disaster emergency response, GoI still had to protect the tsunami victims from land grabbing and BPN still had to identify land parcels and their owners, mapped them, develop their database to support following reconstruction process. 49 2. Coordination between Related Parties After tsunami, many parties concerned to give help to the victims. The government, NGOs, and other institutions from foreign countries gave support with their respective capability. This was satisfactory because it showed extra ordinary empathy for the victims. On the other hand, weak coordination between involved institutions had raised problems. Following experiences gave important notes. As awarded, many NGOs and institutions support victims with houses, either in tsunami-affected location or new location. Right after the houses had been constructed and awarded to the victims, it was hoped that BPN issued their certificates or involved in RALAS program. For BPN, this became institutional obligation hence in principle there was no problem. However, RALAS program should follow the Grant Agreement. One thing regulated was that RALAS locations must be in tsunami-affected area hence other locations could not be covered. Another case, some NGOs did land measuring for CLM program. They came to BPN afterward to ask for land title issuance and recognition for their land measuring result. On the other hand, regulation stated that measuring for certificate issuance should be executed by BPN staffs or licensed surveyors hence certificate issuance could not be done legally. Both abovementioned cases showed that before reconstruction and help giving related to land, all institutions should have coordination with BPN. Or, BPN should proactively publicize related regulations. 3. The Importance of Computerized Data Base Aceh disaster awarded us the importance of non-physical land data archive besides the physical one. Tsunami had damaged many land data. Although most of them could be restored by support of JICA, they could not be returned back to their initial condition before tsunami. For RALAS in particular, the development of digital backup system had been done as required. All RALAS adjudication data had been stored in NAD Regional Office and local offices backup data system. Nowadays, all of them have been archived in BPN Head Office data base system. 4. The Importance of Planning and Initial Study As described in previous chapters, CDA target of 600,000 land parcels was too high. Based on prediction and experience, number of land parcels affected by tsunami was 400,000 only. Besides, the time schedule stated on PAD was too optimistic. First priority of CDA target was 100,000 land parcels and planned to be finished on December 31, 2005. It was unrealistic since traumatic condition in Aceh community. As described in chapter 4, the target for sub component A2 and A3 were not feasible. This is because: a. Limited effective timeframe for project implementation; b. Unavailability of resources; and c. Matters and problems raised in practice and operations. It may be concluded that it is important to perform initial study, problem identification and inventory, and initial data recording of reconstruction subject and object before implementation of reconstruction. It may result realistic but challenging target, time frame, and key performance indicator. 50 5. Procurement Procedure for Post-Disaster Condition As a supporting aspect, procurement of goods/work and service has important role, including in RALAS. In normal condition, procurement is not threatened by time and location. On the contrary, in after-disaster condition, procurement cannot be implemented using normal procedure since the normal procedure could not fulfill the needs. It also happened on RALAS procurement implementation in which used standard Presidential Decree Num. 80/2003 with its revisions (7 revisions) and standard guideline from the World Bank. For normal condition, schedule and other requirements can be implemented well. However, RALAS showed that the normal procurement procedure could not fulfill the need for rapid disaster handling hence to be modified in some aspects. To deal with above issue, GoI had revised the Presidential Decree (Keppres) Num. 80/2003 (regarding procurement regulation) many times, i.e.: a) Keppres Num. 61 year 2004 (1st revision) b) Perpres Num. 32 year 2005 (2nd revision) c) Perpres Num. 70 year 2005 (3rd revision) d) Perpres Num. 8 year 2006 (4th revision) e) Perpres Num. 79 year 2006 (5th revision) f) Perpres Num. 85 year 2006 (6th revision) g) Perpres Num. 95 year 2006 (7th revision) The third, fifth, and sixth revisions were responses to procurement problems raised in Aceh and Nias. From above lesson, it is suggested to the World Bank to create emergency version of the procurement guidelines and selection of consultant guidelines for future grant projects, which follows rigid guidelines. 6. Reconstruction Program for Nias During RALAS implementation, there were requests from people, NGOs, Nias local government, and the World Bank also, for a reconstruction program in Nias. BPN as the implementing agency was ready to fulfill it. During 2008 AWP preparation, program for Nias was prepared. It covered special manual based on local culture, preparation and selection of location/village, preparation of adjudication teams, and budget allocation. However, the Grant Agreement stated that the location was restricted to NAD only, excluding Nias. The World Bank stated formally that a reconstruction program in Nias might be carried out after a Grant amendment. Afterward, BPN had submitted request through GoI for amendment which included extension of implementation time, additional location (Nias), and some revision in KPI to become more realistic. However, until the closing date on June 30, 2009, the amendment was never agreed. Although the reconstruction for Nias cannot be implemented yet, it is hoped that it can be done in the future. 7. Gender Mainstreaming One important aspect in RALAS is recognition of women rights to land. Gender mainstreaming in many aspects, including in land ownership rights has become a whole world consideration. Previously, land titles were in men name only as the family head. Start from 206 AWP, land title in women, widows, orphans name was accepted. Revision of CDA Manual, LOC 2B system, land documents related to land title had support gender equity in land ownership. This has become an 51 important issue for BPN and has become a milestone for enforcement of gender mainstreaming around country. Recommendations Based on above lessons learned, the following recommendations are suggested: 1. BPN should have a disaster handling standard. It should cover: (a) Initial steps in restoring psychological condition related to land issues and land right warranty for the victims. (b) Socialization of BPN functions and roles in land right warranty for victims of disaster (has already been noted in the land book) (c) Socialization of all land transaction prohibition (status quo, right before disaster) to prevent illegal take-over. (d) Set up of reconstruction supporting instruments. (e) Formulation of manual/operational procedure for reconstruction. 2. It should be required that all institutions related to disaster handling in land administration to synergize their actions with BPN. Therefore, it is necessary to create: (a) Agreement and understanding on the scope of work for each institution to prevent overlaps of authority. (b) Meeting forums for all stakeholders. (c) Project coordination; includes target location, job division, and harmonization of implementation time. (d) Periodic land forums to synchronize work progress. 3. BPN should develop secure and reliable backup system and data base. To avoid loss of land documents because of disaster (flood, fire, etc), all land data should be stored in digital format or stored in BPN data base system. All RALAS adjudication data should be stored in backup system. The backup system in NAD needs to be connected to BPN Head Office so it may become the reference for the development of broader backup system in whole Indonesia. 4. BPN should create comprehensive and integrated plan before the implementation of similar program in the future. Before the declaration of PAD, it is required to perform identification and an inventory of objective conditions, compilation of needs, and identification of locations. It may result in more accurate and realistic KPI. Subsequently, AWP may be created faster and more accurately and program preparation will be better. If AWP approval from the World Bank is issued immediately, then field work could be implemented earlier. As a result, every AWP could be accomplished in the same year. Good planning would result in good location determination hence target achievement would l be better. 52 5. The World Bank should have standard procedures for disaster emergency handling. The procedures should cover: (a) More simple management system (such as shorter time for plan review procedure) (b) Shorter time for report review (c) Simplified NOL issuance procedure and time (d) Simplified procurement of goods/works and selection of consultant procedure and time Ideally, there is a need for greater awareness to be made of the World Bank's procurement guidelines and selection of consultants. However, in reality during the RALAS implementation until its closing date, all procurement of goods/works and selection of consultant were carried out using the standard guidelines, instead of considering the special conditions after disaster. As explained in preceding chapters, NCB and ICB procurement methods (especially for "prior review" category) need long periods of time for processing. It is hoped that for the future, the World Bank could provide special guidelines for procurement/selection in emergency conditions. 6. BPN should consider reconstruction/titling program for Nias. Dealing with requests for reconstruction/titling in Nias, BPN should create a related program. It should cover determination of location/village, estimation of number of parcels and adjudication teams, procurement plan, and other supporting matters. It should also mention the budget needed for implementation of all phases. It is hoped that such a program may be funded by the remaining MDF grant. If not, BPN needs to find another funding source, as it is important for the people of Nias to receive similar benefits to those received by the people of Aceh. 7. BPN should implement gender mainstreaming in certification programs around the country. The recognition of gender equity in RALAS could become pilot project for the future. This had been implemented in the LMPDP program. To increase gender equity awareness, BPN needs to carry out a national scale public relations campaign. The aim would be to ensure that people know that land title may be issued in the names of women, couples, or orphans. The campaign would lead to successful gender mainstreaming. 53 The following comments on the Draft ICR Report were submitted by BPN to the Bank on May 17, 2010: 54 55 56 Annex 8. Comments of Co-financiers and Other Partners/Stakeholders Former senior BRR have provided the following comments. These comments were provided after the BRR had closed and they do not represent the official view of the former BRR 1. Assessment of the operation's objective, design, implementation and operational experience AWP 2005: · The AWP 2005 was not prepared well. BPN did not adequately assess the requirements and capacity of the respective field teams. In addition, the field teams when mobilized were not well prepared, lacking sufficient orientation and training. · There was a difference of opinion as to who should be authorized to sign the title certificates. The RALAS Manual authorized land office people (who did not go to field), while "Peraturan Pemerintah" meaning a Government Regulation issued as an administrative order, rather than by an act of the National Assembly (PP-24) regulations mandated that team leaders would sign. This created a tension between district land offices and the field teams. The respective district land office heads did not trust the respective field team heads. In part this was due to weak field team capacity, but was also due to land office concerns about signing wrongly produced title certificates. · BPN did not supervise field teams and did not monitor the implementation and quality of the field teams' work. Also, there was evidence that some field teams did not even visit some of the areas they had claimed to have adjudicated. Because of this, the accuracy of all documents was questioned. Also, district land offices lacked sufficient human resources to undertake quality control in the field. · The appointed Project Manager was not technically qualified and hence was unable to understand some of technical problems, and solve them. This led to some wrongly produced land maps (cadastre) that did not match with ownership details and therefore those could not be titled. · Unit cost for title production were based on the standard approach to systematic titling which utilizes organic provincial/district capacity for field teams and is lower cost than the conditions in Aceh. However in Aceh almost all field team personnel were drawn from other provinces and hence additional costs were incurred to support and compensate field teams. Also, as there was no additional incentives for these external personnel to speed up production. · The RALAS Manual was not properly implemented. In fact, the field teams were not properly trained on the Manual and most field staff was not even aware of the Manual. · During 2005, there was no direct involvement of BRR in 2005 and it was only in the 2006-08 period, that BRR came into the picture. AWP 2006: · There was better preparation of the AWP, and also training was provided to the field teams. This led to better performance. · For this AWP, the majority of the villages already had prepared CLMs, and in some cases the field teams prepared CLMs. Therefore, there was better understanding of the issues. 57 · Although CLMs were prepared, the necessary juridical data for land parcels and ownership was not collected. This confused and delayed the next step in the titling process at the district land office level, viz., information on public land, land donated for religious purposes, land parcels under disputes were not identified in the CLM. Therefore, this was seen as not useful for long-term land administration in the district. · With regard to incomplete titling of land parcels, there was around one-third of all land parcels for which data were gathered, and adjudication undertaken but titles were not produced, BRR believes that under the circumstances, this was acceptable, provided the necessary information had been collected and recorded, that could be used to justify the titling that had been completed. AWP 2007: · It was noted that BPN did not prepare an AWP. AWP 2008: · BRR was not involved in preparing the program or in its management, so has no comments to make. (ii) Assessment of the outcome of the operation against the agreed objectives: · The concerns regarding BPN's implementation of AWP 2005, viz. poor quality field work, inaccuracy of data gathered, the backlog of non-completion of the titling process, created a reputational issue for BPN. It is noted that although several efforts were made to clear the backlog of incomplete work under AWP 2005, including a specific Working Group and Tim Penyelesaian Ajudikasi (TIPA, a team established to clear the backlog of 2005 work program), was established. This TiPA work was funded by BRR in 2006-07 periods. · In 2006, BRR also supported efforts to develop the back up and computerized system and improve administration work overall. But efforts were preliminary and there was no follow up by BPN. · The AWP 2006 was better implemented and titles were produced and distributed, when compared to AWP 2005. However, project management was still weak and there was no quality control of field team implementation and development of the computerized backup system did not progress. · It is also noted that during AWP 2006, BPN kanwil was tasked with the implementation of another major project, i.e., land acquisition for public purposes (value: IDR 500 billion). Therefore, BPN kanwil office was overloaded and too busy. Greater priority was assigned to the land acquisition project, so RALAS implementation for AWP 2006 was not adequately over sighted. (iii) Evaluation of the Borrower's own performance during the preparation and implementation of the operation: · Throughout the entire period of RALAS implementation, leadership and project management remained weak. · BPN never engaged adequately with other stakeholders particularly INGOs and, NGOs. This may be attributed to BPN's lack of confidence. Also, BPN was very defensive of any criticism from stakeholders. · BPN did not coordinate well with other agencies on co-financing. 58 (iv) Evaluation of the Bank, any co-financiers, or other partners during the preparation and implementation of the operation, including the effectiveness of their relationships with special emphasis on lesson learned: · The Bank had over-estimated BPN's ground level capacity to manage the project locally. · BRR understood the reasons for the Bank and MDF being a tough financing partner as the RALAS used public money and was subject to the scrutiny of MDF and its many donor members. Also, RALAS had a very high public profile given its important linkage to reconstruction of housing and communities. (v) Description of the proposed arrangements for future operation of the project: · The project manual, or standard operating procedures, should be well developed and then disseminated to all stakeholders and staff, before the first AWP is prepared. The manual should include all policies and regulations and it should be consistent with national and provincial laws. · BPN's (or partner) capacity should be assessed in fully and candidly before the funding is declared effective. · Full-time project staff for implementation and management should be compulsory and no part time approach agreed. It is noted that the RALAS Grant required this, but BPN did not conform. 59 Annex 9. List of Supporting Documents Bell, K.C, (2010), Case Study: Indonesia - Reconstruction of Aceh Land Administration System Project, unpublished World Bank paper, Washington D.C. Bell, K. C. (2006), World Bank Support for Land Administration and Management: Responding to the Challenges of the Millennium Development Goals, Paper presented at the XXIII International Federation of Surveyors (FIG) Congress, 8-13 October 2006, Munich. Badan Pengawasan Keuangan Dan Pembangunan - BBKP (2007), Review Report of Reconstruction of Aceh Land Administration System (RALAS) 2005 and 2006, Report No. LAP- 133A /PW.01/2/2007, 30 July 2007, Banda Aceh. Baden Rehabilitasi dan Rekonstruksi - BRR (2005), Aceh and Nias One Year after the Tsunami: The Recovery Effort and Way Forward, A Joint Report of The BRR and International Partners, December 2005, Aceh. Bruce, J., Giovarelli, R., Rolfes, L. Bledsoe, D. and Mitchell, R. (2006), Land law reform: achieving development policy objectives, Law, Justice and Development Series, the World Bank, Washington, DC. Deininger, K. (2003), Land policies for growth and poverty reduction, A World Bank Policy Research Report, The World Bank and Oxford University Press, Washington, DC, Oxford. Grant, C. (2006), RALAS Project: Surveying and Adjudication, Report from World Bank consultant. Harper, Fitzpatrick, D. and Clark (2006), Land Inheritance and Guardianship Law in Aceh, International Development Law Organization - IDLO, Rome. Multi Donor Fund for Aceh and Nias (MDF): Mid-term Review. Volume Two: Project Annexes. Annex D: PPR--Reconstruction of Aceh Land Administration. August 2009. World Bank (2009), Case Study: Indonesia - Reconstruction of Aceh Land Administration System Project, Washington D.C. World Bank (2009), Study on Gender Impacts of Land Titling in Post-Tsunami Aceh, Indonesia (Draft Dec 1, 2009) World Bank (2009), Indonesia: Reconstruction of Aceh Land Administration System (RALAS) Project ­ Project Implementation and Beneficiary Assessment, Multi-Donor Trust Fund for Aceh and Nias and World Bank; March 2009, Banda Aceh. World Bank (2008), Investing in Indonesia's Institutions ­ Country Partnership Strategy 2009-2012, Report No. 44845- IND, 22 July 2008, Washington, DC. World Bank (2006), Indonesia ­ Country Assistance Strategy Progress Report 2004-2008, Report No. 36856- IND, 5 September 2006, Washington, DC. World Bank (2005-2009), Documents in Project's Electronic File, including DCA, Amendments, Aide Memoirs, Back-to-Office Reports, Project Status Reports, Project Financial Assessments, and Project Procurement Assessments; IRIS, Washington, D.C. World Bank (2005), Indonesia ­ Reconstruction of Aceh Land Administration System Project, Project Appraisal Report, Report No: 32716-ID, 22 June 2005, Washington, DC. World Bank (2004), Indonesia: Land Management and Policy Development Project, Report No. 28178-IND, 31 March 2004, Washington, DC. World Bank (2003), Indonesia ­ Country Assistance Strategy 2004-2008, Report No.27108- IND, 29 October 2003, Washington, DC. 60 Annex 10. Meetings Conducted during the ICR Mission BPN ­ National Office @ Jakarta Mr. Arief Setiabudi Canny (RALAS, Project Director) Mr. Ronnie Kusuma Yudistira (BPN-Jakarta) Mr. Deni Santo (BPN-Jakarta) Mr. Pelopor Yanto (Director BPN Foreign Assistance, Former RALAS, Project Manager) BPN - Provincial Office @ Banda Aceh Mr. Teuku Murdani (Head of BPN Kanwil office in Aceh), Mr. Nurul Bahari (RALAS, Project Manager) Mr. Maswar , S.H. (Administration, BPN Kanwil Office in Aceh) Mr. Heri Mulianto (M&E, BPN Kanwil Office in Aceh) Mr. Aswin Saragih (Procurement, BPN Kanwill Office in Aceh) Mr. Arfath Satya (Procurement, BPN Kanwill Office in Aceh) Ms. Nurul Asmiath (Staff, BPN Kanwill Office in Aceh) BPN ­ District Offices Mr. Yasril, S.H. (Head of Banda Aceh Land Office) Mr. M. Jamil, S.H. (Surveying, Pidie Land Office) Aceh Provincial Government Mr. Sayed Mustafa (Assistant Governor, Aceh Provincial Government) Village Heads Mr. Dan M. Hamad (Village Head, Papeun Village, Muara Tiga Sub-district, Pidie District) Mr. Maimva, S.E.(Village Head, Lancang Village, Kembang Tanjong Sub-district, Pidie District) (Village Head, Gampong Pie, Meuraxa Sub-district, Banda Aceh District) BRR ­ Banda Aceh Ms. Erna Heryani (Director, Land Administration and Mapping, BRR) Steering Committee Ms. Ria Fitri (Member of the RALAS Steering Committee; Agrarian Law Expert) NGOs and other IFIs Mr. Herman Soesangobeng (Former Asian Development Bank staff member, Emergency Housing Project) Ms. Jane Dunlop (Former OXFAM staff member) Mr. Hadi Syahrizal (Staff member, Islamic Relief) Aceh ­ Nias Recovery Program ­ Multi-donor Fund Mr. Safriza Sofyan (Deputy Coordinator, Banda Aceh) Bank Staff Mr. Keith Bell (Senior Land Policy Specialist, TTL) Ms. Sonia Hammam (Sector Manager) Mr. Isono Sadoko (Safeguards Consultant) Mr. Unggul Suprayitno (SeniorFinancial Management Specialist) Mr. Rizal H. Rivai (Senior Procurement Specialist) Mr. Srinivas Shivakumar Mahalingam (Project Monitoring Consultant, Banda Aceh) Mr. Lilik Hidayat (Project Monitoring Consultant, Banda Aceh) Ms. Shalawati (researcher - ex-PIBA team, support to Bank Project Monitoring Team in Aceh) 61 MAP #35289 ` 62 63