2012年-世界发展银行全球_Fiduciary_Systems_Assessment___Ethiopia_Health_MDG_Support_-_Program_for_Results_47页_1mb

FIDUCIARY SYSTEMS ASSESSMENT SUMMARY: ETHIOPIA HEALTH MDG SUPPORT - PROGRAM FOR RESULTS

I. Core Content

This document presents the findings of an integrated fiduciary systems assessment for the proposed Health Millennium Development Goals (MDG) Program for Results (PforR) operation in Ethiopia. The assessment focuses on the Federal Ministry of Health (FMOH) and a sample of regions and woredas that will implement the Health Sector Development Program IV (HSDP IV). The operation is aligned with Operational Policy/Bank Procedure (OP/BP) 9.00, and is supported by IDA funding and a grant from the Health Results Innovation Trust Fund (HRITF).

The PforR operation aims to disburse $100 million IDA funding and $20 million HRITF grant contingent on achieving specific key results under HSDP IV. The funds will primarily be used for procurement and in-kind transfers of health commodities and construction of health facilities, managed by PFSA and PMU respectively.

II. Main Findings and Risks

Key Fiduciary Risks

1. High Fiduciary Risk: The operation is classified as having "High before mitigation measures" due to the following:
   • PFSA is a critical entity for procurement and distribution, yet it faces several issues:
     • Lack of financial statements and external audit reports for the past five years.
     • Large unspent advances from MDG PF.
     • Use of less competitive procurement methods for 80% of its operations.
     • Limited transparency in tender notices and award decisions.
   • FMOH has:
     • Weak implementation capacity and slow disbursement of MDG PF funds.
     • Direct contracting for health center construction by PMU, which is not in line with federal directives.
     • Weak internal audit and internal controls.
     • Inadequate tracking and recording systems for procurement handled by UN agencies.
   • Complaint handling system in the health sector is also found to be ineffective.

Financial Management Issues

• Slow Utilization of MDG PF Funds: As of July 2012, cumulative income was $193 million, but cumulative spending was only $33 million (17%).
• Large Cash Balances: FMOH had over $50 million in cash and $100 million in advances, mostly to PFSA, UNOPS, and UNICEF.
• Procurement Oversight: While there has been improvement, data limitations hinder comprehensive analysis. PFSA’s procurement methods are not fully compliant with public procurement laws and lacks standardized bidding documents.
• PFSA’s Internal Controls: The agency is transitioning from a manual to an automated system, but internal audit and controls remain weak.
• Board Inactivity: PFSA’s Board of Directors has not met since 2007, which is a concern for oversight.

Procurement Weaknesses

• Dominant Use of Restricted Bidding: 80% of procurement is done through restricted bidding, which involves shortlisting suppliers from the FMHACA register and inviting them to bid.
• Lack of Transparency: Tender notices and award decisions are not publicly disclosed, and ICB advertisements are only published locally.
• Weak Tracking and Reporting: PFSA lacks systems to track timeliness and unit costs of procurement over time.
• PMU Procurement: The Project Management Unit (PMU) at FMOH directly allocates construction contracts based on fixed prices, without following competitive bidding procedures.

III. Institutional Framework

Ethiopia has a highly decentralized governance structure, with Federal, Regional, and Woreda levels of government. The FMOH is responsible for:

• National health policy formulation.
• Expanding health services.
• Supporting regional systems and mobilizing resources.

Regional Health Bureaus (RHBs) and City Administrations are responsible for:

• Delivering health services based on national policy.
• Ensuring adequate supply of medicines and health supplies.

Woreda Health Offices (WorHOs) manage:

• Primary health care units.
• Planning, financing, and monitoring health progress at the local level.

The Joint Consultative Forum (JCF) and Joint Core Coordinating Committee (JCCC) oversee the allocation and implementation of funds and ensure coordination among stakeholders.

IV. Key Recommendations

1. PFSA Transparency Improvements:

   • Launch a website to disclose procurement information regularly.
   • Introduce a price database tracking system.
   • Publish procurement plans, advertisements, award decisions, and standard bidding documents.
   • Conduct annual meetings with suppliers and open calls for prequalification and registration.

2. Strengthening Internal Controls:

   • Establish a Fiduciary Sub Committee under JCCC to monitor advances, reporting, audit, and budget execution on a monthly basis.

3. Audit and Reporting:

   • Conduct financial and procurement audits for MDG PF and share results with partners in a timely manner.
   • Introduce Value for Money (VFM) audits by OFAG annually and annual procurement audits by PPA.

4. Procurement Skill Development:

   • Provide procurement skill upgrading training for PFSA staff.

5. Amendments to JFA:

   • Amend the Joint Financing Arrangement (JFA) to align with PforR requirements.

V. Conclusion

The PFSA and FMOH are central to the implementation of the MDG PF and PforR operation. While some improvements have been made in public financial management (PFM) systems, significant fiduciary risks remain, particularly in procurement transparency, internal controls, and budget execution. The proposed mitigation measures, including the Disbursement Linked Indicator (DLI) and enhanced oversight, aim to address these issues and ensure that the program achieves its intended results with accountability, transparency, and efficiency.