I.   Basic Project Data

Type of Evaluation:	Final
Project Number:	BHU/97/CO1
Programme Title:	Geog Development Facilitating Activity
Executing Agency:	Ministry of Home Affairs
Govt. Cooperating Agencies:	Ministry of Planning/Planning Commission, Ministry of Finance
Sector:	Public Administration & Management
Sub-sector:	Local Governance
Project approval date:	n/a
Project start date:	1 June 1998
Project end date:	Not fixed (15 months implementation)
Evaluation date:	February-March 2001
Project Budget
UNCDF:	US$   457,930
UNDP:	175,545
Government of Bhutan:	(in kind) 86,785
Beneficiaries:	n/a
Total:	633,475
Actual Expenditures at Evaluation:	n/a

II.   Background

Bhutan is a small, poor country, with an area of 46, 500 square kilometers and a population of approximately 695, 000 people. Although it lies between two much larger countries –China to the North and India to the South –Bhutan has always remained an independent country. It is a landlocked, mountainous country with a high degree of isolation of many of its communities and larger settlements. Decentralization has been an important policy theme of the Royal Government for several decades. In 1982, the District Development Committees (DYT) were established and given the role of assisting in the development of the national Five-year Plan and providing district level implementation of many sectoral activities and programmes. Almost a decade later, the establishment of the Geog Development Committees (GYT) carried the decentralization process to the sub-district level. The Geog (or block) is the lowest unit of governance with areas and populations ranging widely from 50 square kilometers to over a 1000 square kilometers, and from 500 to 5, 000 people.

III.   The Project

The Geog Development Facilitating Activity (GDFA) is one of the three main components of a larger UNDP-funded project, entitled “Strengthening Capacities for Development Management and Decentralization ”(SCDMD) which ended in May 2000. The project was initially designed as a special pilot component to test a process of Geog- level micro-project financing, planning and implementation in two pilot Geog in six districts. Just prior to inception, the government requested that the pilot activities be expanded to cover ten Geogs in six districts, but keeping the originally proposed 15- month time frame. The project formally commenced on 1 June 1998 and is currently in its last stage;the second phase of micro-projects implementation.

Development Objective

The policies and practices of the Royal Government of Bhutan (RgoB) enable local governing bodies to take increasingly greater control over their own development decision making, resulting in a significant and positive impact on sustainable human development in Bhutan.

Immediate Objectives

The project has three immediate objectives:

1) The capacity of the RGoB to manage decentralized governance policy formulation and implementation is strengthened.

2) The capacities of local governing bodies are sufficiently strengthened to enable them to perform their functions in a more efficient and cost-effective manner by the end of the preparatory project period.

3) The viability, under operating conditions, of a self-governance development strategy for sustained improvement in delivery of public goods and services is established to supplement and complement the policies and programmes of the RGoB as envisaged in the 8th Five Year Plan.

Outputs

In order to achieve the immediate objectives, the following outputs have been defined:

• Output 1: An experimental financial facility:the GDFA will have been set up as a mechanism for inter-governmental fiscal transfers in support of devolution of responsibilities for development spending to the Geog authorities.

• Output 2: A procedure for decentralized, participatory planning at the Geog level, which draws on existing practices, and which will be institutionalised as the Geog-level component of the national planning system, has been developed and tested.

• Output 3: Capacity at Central, Dzongkhag, and Geog levels to:(i) support the management of the GDFA, (ii) extend the Geog Planning Process (GPP) and develop capacity in both local authorities and community organizations for inputs procurement and overall project implementation management, (iii) monitor and evaluate the field experimentation of the GDFA programme, has been enhanced.

• Policy Promotion: implicit in all the above was the objective to assist the RGoB in the development of its decentralization policy

To achieve the above objectives and outputs, and in keeping with its capacity building thrust, the project implementation arrangements were integrated within existing RGoB structures, rather than creating new structures to implement the project. Specifically, the Project Management Unit (PMU) was imbedded within the Ministry of Home Affairs (MoHA) , which was the Executing Agency. The financial facility was set up as an intergovernmental fiscal transfer system (IGFT) within the Ministry of Finance, channeling funds from the center down to the Geog to finance sub-projects at that level. The GYT (Geog level local representative structure) was responsible for managing the process of identifying and implementing sub-projects to meet Geog needs through the participatory Geog Planning Process (GPP) .

IV.   Evaluation Findings

Evaluation of results

Output 1: The GDFA guidelines, as envisaged, were not produced, and in the absence of a document that spelled out roles, responsibilities and reporting lines across a wider sphere and in more detail, managers were not always clear as to what was within their mandate. In addition, there has been a wide variation in the interpretations of GDFA guidelines and their application. Out of the 12 planned “local development projects ”, five have been completed and four are well on their way to completion. One Geog was unable to agree on a project and lost its funding. In the second phase, 15 projects were selected but none have commenced. If all sub-projects are completed, the target for this output would be exceeded (24 constructed for 12 planned) . Community contributions were weak and only one Geog approached the 10%minimum community contribution required by the GDFA. A financial facility was set up and appears to be working smoothly, but the project did not achieve an effective devolution of responsibilities for development spending to the Geog authorities, since accounting and monitoring tasks are still largely performed by the District Field Officers (DFOs) , and not the GYTs. Also, the financial facility has not yet been institutionalized in the mainstream government system and it is unclear to what extent the Government is willing to consider adopting it as part of its regular practice. Despite these caveats, the facility appears to be working smoothly even if not all procedures are being followed and those disbursing the funds and those receiving them appear satisfied with the timeliness of the disbursals and receipts.

Output 2: The design and testing of a Geog Planning Process (GPP) was completed. However, the GPP is yet to be institutionalized to its full extent. The range and level of participation varied widely amongst the Geogs. Women participants were, predictably, a small minority, due to the weight of tradition. Though it is often pointed out that the long distances between their home villages and the Geog headquarters posed a physical obstacle, it is unclear why this would be more so than for the men if not for traditional perspectives on gender roles. A planning information system has yet to be implemented. Teams of Dzongkhag staff were formally set up to support Geog planning and implementation and the GDF Financial Rules and Regulations were given to all Dzongkhags. In practice, however the teams rarely functioned as a multi-agency task force, and, from the outset, participation was uneven.

Output 3: GDFA and GPP training materials were developed, and extensive training was given to more than six Dzongkhag staff and to members of ten GYTs, including the conduct of study tours. There was no comprehensive, systematic, third party evaluation of the GPP and GDFA-supported micro-projects and no monitoring and evaluation system has been developed. There was neither systematic documentation of lessons learned in general, nor any follow-up steps determined for any next phase of the GDFA. Overall, however, capacity seems to have been enhanced at Central. Dzongkhag and Geog level for GDFA management, for GPP and micro-project implementation and management and for monitoring and evaluation of the GDFA programme. The results have not, however, reached a point where one can say that the Geogs now have the capacity to effectively and independently manage a participatory GPP. This is not surprising given the generally weak capacity at the Geog level, the uneven participation during GPP sessions and the high turnover (particularly among GYT members) .

Evaluation of Outcomes

Overall, the GDFA well achieved its basic objectives. It has established, tested, and developed a decentralized, self-governance strategy through:(i) a system of financial decentralization providing budgets to Geogs;(ii) a system of local participatory planning and implementation of micro-projects/public goods and services;(iii) capacity building at central, Dzongkhag and Geog levels using training and `learning-by-doing ’;and (iv) financing and implementing needed physical infrastructure/public goods and services. However, the project took substantially longer to achieve its objectives than estimated in the project design. Some objectives were only partially or not achieved, partly due to an expansion of the project from two Geogs to ten Geogs in six Dzongkhags. Other reasons included underestimating the complexity of such decentralization and capacity building projects, inadequate coordination and cooperation among ministries, competing demands on government staff responsible for the GDFA, and low capacity at the Geog, and to an extent, at the Dzongkhag levels.

Evaluation of Impact

Policy impacts were substantial. Although single, causal factors are difficult to isolate, the project undeniably contributed to the following:(i) Substantial and ongoing restructuring of the national, Dzongkhag and Geog levels of government towards a more enabling environment for decentralization;(ii) Strengthening of staffing at local levels, including the provision of salaries for the Gup 1 and funding for new positions; (iii) Endorsement of the GDFA Financial rules and Regulations by the Ministry of Finance (even if wider adoption of this model of inter-governmental fiscal transfer is still some ways away) ;and (iv) Devolving of the rural tax to the Dzongkhags;and last, but not least, the RGoB ’s proclaiming of the Ninth Plan to be Geog-based.

Evaluation of the Project Design

Overall, the design, scaling, expectations and timing of the GDFA were over ambitious. This was especially so with regard to the expansion of its coverage to six Dzongkhags and ten Geogs with two sets of micro-projects in each Geog. This spreading thin of the project was compounded by the difficult working context and the limited resources and staffing available. Given all these, too much capacity building was expected, with too much expected to happen and change, at too high a level of complexity, in too short a time. On the other hand spreading the GDFA sub-project allocations over ten Geogs over the approximately four years of the GDFA project meant that the GDFA project funding was a small amount relative to the total budget of the Dzongkhag (approximately one percent of total Dzongkhag budget in the case of two Dzongkhags for which data was available) . This may have marginalized the value of this funding resulting in the Dzongkhags paying inadequate attention to the GDFA project. 1 Geog head -the local representative elected every three years.

V.   Recommendations

V. Recommendations Appropriate Planning Unit:Continue with the emphasis on the Geog as the lowest level-planning unit. The Geog has the greatest potential to relate most directly to the intended beneficiaries. However, it is important to strengthen capacity at the Dzongkhag level such that, over an agreed and monitored time-period, the Dzongkhag can assume major responsibility for the GDFA and its Geog level activities.

Staffing and Skill Requirements: Ensure that there is staff with adequate seniority and capacity (and with adequate support staff) assigned to the GDFA. Ensure that they are given the time to focus on the project and not distracted by additional, competing responsibilities. Similarly, ensure that project activities are set within the regular activities of the Dzongkhag and that staff are able to give focused time to the project.

Designing, Scaling and Timing any Next Phase: Design the next phase in close collaboration with major stakeholders. Any next phase should continue to be considered as a learning and capacity building process and not primarily as a funding process for physical infrastructure. While significantly larger than the current project, it should remain modest in scale and expectations. Select few Dzongkhags with more Geogs per Dzongkhag. This will give a “critical mass, ”spurring more attention to the project by the Dzongkhag administration and lessons for how such an administration may be able to manage a full-scale decentralized programme. Consider six to eight Dzongkhags with four to six GDFA Geogs in each, spread across the country, funding two phases of sub- projects. A senior, experienced officer based at UNCDF Thimphu should be assigned to any new phase of the project, to motivate, coordinate and guide the project. Any new phase will need to put in place an effective system to ensure that the Facility can be managed adequately at the Dzongkhag and Geog levels. This may be a prerequisite to encourage other donors and the RGoB to accept the Facility as a potential model for wider use by them. This can be done through some combination of the following:further simplify the procedures (without compromising accountability and transparency) ; communicate the procedures through documentation that complements written text with visual illustrations such as cartoons, drawings and diagrams;training in how to follow and monitor procedures;closely monitor use.

Within a minimum floor amount allocated to all Geogs and a maximum ceiling amount, consider an allocation formula that provides funds in response to varying characteristics. At least three characteristics can be considered –population, accessibility, and size (e. g. percentage allocation per person or household, per distance from central vehicular road to Geog headquarter or to Geog boundary) .

VI.   Lessons Learned

• Any new project should recognize more explicitly that decentralization is a long-term, gradual, phased effort, be more modest in its objectives, and permit adequate time for its achievements

• The minimum required community contribution (10%of total sub-project costs) was raised in only one Geog. Three others raised minimal amounts and the remaining five did not raise any contributions. In order to avoid such non- compliance, each Geog should assess how much community contributions it can raise in any given year. Furthermore, it is important to:(i) Examine if there are Geogs that have exceptional circumstances that genuinely make contributions difficult;(ii) Emphasize the mandatory nature of the requirement for the minimum community contribution and make it a prerequisite for release of GDFA funds;and (iii) Institute an incentive for making contributions.

• In order to foster participation, it is important to effectively communicate on the need for adequate participation. It might also be worthwhile considering modest stipends for local government staff, in acknowledgement of the time and effort required to participate in the planning process. In any case, one should make clear that inadequate participation (making clear what constitutes inadequate participation) may result in a given local authority forfeiting the project funds. The GDFA management needs to be prepared to enforce this rule.

• A key set of capacities important for local development and decentralization projects was absent. This is the set of capacities variously termed as “development promotion ”, “community development ”, “social organization ”, and “animation ”. These are capacities, knowledge and skills in such fields as community and social group motivation, mobilization, social and group dynamics, meeting organization, facilitation, negotiation, consensus building, conflict management and resolution, and gender sensitivity. Building capacities in such fields and having persons with these skills and responsibilities would have helped address several problems faced by the project (such as inadequate participation, particularly among women, difficulty in identifying, selecting projects, low community contributions, and slow implementation) .

VII.   Members of the Evaluation Team

• Dr. Farokh Afshar, Team Leader, School of Rural Planning &Development, University of Guelph, Ontario, Canada.
• Karma Jimba, Bhutan Consultants and Research, Thimphu, Bhutan