GLOBAL LESSONS: DESIGNING CDD OPERATIONS

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GLOBAL LESSONS DESIGNING CDD OPERATIONS

• Samantha de Silva
• HDNSP
• April 2005

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OVERVIEW Direct Financing of Community
Sub-Projects
FUNDING AGENCY (Central Government Agency, Social
Fund, NGO, Local Government, etc)
Other Characteristics Community Contribution
(Labor, Materials, Cash) Community Participation
(throughout project cycle)
Financing Agreement (Contract) Disbursement
Procurement
Materials Contractors Skilled Labor Technical
Assistance
COMMUNITY GROUP (Project Management Committee)
Materials Services
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Subproject Cycle

• Preparation
• Funding Agency
• Informs stakeholders
• Facilitates communities
• Assesses capacity of communities
• Develops simple technical designs
• Appraises subproject (Desk/Field)
• Community
• Elects Project Management Committee
• Prepares/submits subproject application and budget

• Approval and Launch
• Funding Agency
• Trains community
• Prepares financing agreement
• Hands over first check at launch
• Community
• Mobilizes community contribution
• Plans launch ceremony
• Signs Financial Agreement

• Completion
• Funding Agency
• Conducts completion assessment
• Provides completion certificate
• Community
• Takes over operation and maintenance of asset

• Implementation
• Funding Agency
• Provides technical support
• Oversees implementation/financial management
• Community
• Procures materials and services
• Supervises construction
• Manages labor contribution
• Prepares progress reports
• Manages funds

• Monitoring and Evaluation
• Funding Agency
• Releases funds
• Conducts participatory technical/financial audits
• Beneficiary assessments
• Community
• Develops own indicators/ME plan
• Provides day-to-day oversight
• Conducts audits

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Key Design Elements

• Base arrangements on past community experience
• Info campaign to inform all stakeholders of
  rules of the game
• Develop targeting strategy consistent with PDO
• Develop simple, standard designs with input from
  communities/sectoral agencies
• Design simple training packages for communities

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Key Documents

• Development Credit Agreement (DCA)
• Project Appraisal Document (PAD)
• Operational Manual (OM)
• Community Manual
• Financing Agreement (FA and Community)
• Ensure consistency across documents.

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Community Contributions

• Community must establish who should contribute,
  when, how and where the contribution will be
  given.
• FA must help community value contributions
  accurately.
• Community must track contributions.

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Disbursement Arrangements

• How should Funding Agency disburse to
  communities?
• Output or Lump-sum method for financing based on
  physical progress
• Ensure that adequate funds flow smoothly to
  communities
• Disburse to communities in tranches
• Cost savings accrue to community
• Facilitate communitys access to formal banking
  system

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Procurement Arrangements

• Develop/update Unit Cost Database
• Encourage communities to use Local Shopping (3
  Quotations) but use Direct Purchase as long as
  items are within rates in Unit Cost Database
• Use Local Competitive Bidding or Direct
  Contracting for hiring of contractors.
• Establish wage rates for hiring skilled labor
• Provide active support to communities on prices
  and quality
• Build incentives for efficiency of procure-ment

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Monitoring and Evaluation

• Conduct systematic post review
• Set up MIS early in the project (track process,
  input, output and outcome indicators)
• Conduct financial audits together with technical
  and social audits.
• Keep in mind the PAD as well as the ICR!

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Operation and Maintenance

• Address issues to do with maintenance and
  recurrent costs early on, verify during
  appraisal
• Include plan to cover maintenance and recurrent
  costs
• Provide training on technical aspects as well as
  fundraising techniques
• Conduct post completion visits/training

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Completion

• Emphasize completion of subprojects on a timely
  basis
• Account for all subproject related funds
• Submit final completion report
• Issue Completion Certificate