Punjab Municipal Services Improvement Project

Introducing Performance Management in Municipal Service Delivery

In the small and medium towns and cities of the Punjab, a culture of performance management in local governments to improve municipal service delivery, is slowly taking root. The Tehsil Municipal Administrations (TMAs) willing to participate in the initiative, are beginning to show greater transparency and responsiveness to the needs of their constituents.

Devolution of powers to local governments (LGs) has globally proven to be an effective means of bringing government closer to the people it is meant to serve, thereby improving local governance and enhancing public accountability.  However, if the authorities devolved are not accompanied by commensurate administrative and financial capacity, little improvements can happen towards improving the quality of life of citizens through enhanced service provision.          

Background

In Pakistan, the big bang devolution of powers in 2001 created the district governments, tehsil municipal administrations, and the union administrations with the promulgation of the Local Government Ordinance (LGO). The newly created TMAs were made into body corporates and mandated with provision of all municipal services.  However, they were neither provided with the requisite skills in adequate numbers, nor the support to develop systems and human resources to deliver on the responsibilities and expectations invested in them.  Other inherent issues inhibiting TMAs’ capacity to grow into effective municipal service delivery institutions included excessive reliance on financial transfers from higher levels of government, continuing overlaps in responsibilities, need for provincial approvals for most administrative decisions, and yet lack of provincial support and oversight mechanisms.  The issues facing LGs did result in the launch of a number of capacity building initiatives.  However, most accomplished little in terms of sustainable capacity enhancements as they generally encompassed conventional, supply-driven trainings for LG staff.

The Project Concept

The World Bank funded Punjab Municipal Services Improvement Project (PMSIP) became effective in June 2006.  It aims to improve the viability and effectiveness of urban services provided by participating TMAs, and to make these improvements sustainable and replicable through the creation of performance-based management framework at the TMA and provincial levels.  TMAs selected against a stringent performance criteria, are provided capacity grants for institutional strengthening and development grants for infrastructure investments.  The project is being implemented through the Punjab Municipal Development Fund Company (PMDFC), a government-sponsored Company established in 1998 under a previous Bank initiative, as an apex organization under the Companies Ordinance.  The project thus represents a paradigm shift in the way public resources for urban development are being allocated by the Province of Punjab.

Project Approach

Since performance management is the core concept underlying the project, development of the performance monitoring framework and selection of performance indicators are of fundamental importance, says Shahnaz Arshad, the Task Leader of the project.  Each TMA agrees on a Performance Improvement Plan, with a specific set of targets and indicators to measure performance in conjunction with a capacity grant and, if requested, a development grant. 

The Capacity Grants  have to date included the establishment of a performance management system; action planning for improved service delivery; establishment of financial management system; setting up of citizens compliant cell & compliant tracking system; development of TMA website; performance monitoring & evaluation system; and on-the-job and classroom trainings of TMA staff in the systems established. 

Learning from the earlier largely unsuccessful LG capacity building experiences, PMSIP has focused its capacity building approach around providing demand driven, results oriented, on-the-job support and training to TMA staff, in skills required for dispensation of their mandates in an effective and efficient manner.  Moreover, TMA eligibility for subsequent capacity and development grants under PMSIP is linked to measurable and tangible improvements in performance against agreed indicators.  Complementing this approach is the project’s focus on building management systems, enabling the TMAs to institute self-sustaining and lasting improvements in their core business areas.  Incentives for improved performance are further strengthened through inculcating a greater client orientation by introducing greater public accountability and transparency, through the automated citizen complaint cells and tracking systems, participatory service delivery target-setting, and the development of TMA websites.

The Development Grants are financing rehabilitation or extension of municipal infrastructure and enhancement of services in the partner TMAs, based on priorities developed through a participatory investment planning process, culminating in an inclusive prioritization involving stakeholder consultations and workshops.  It confirms the service delivery need, optimal technical design, a sound development and management plan, and an agreement on the monitoring of performance indicators.  During the first project year, the partner TMAs have received intensive support for capacity building in planning to enable them to develop a more robust capital investment prioritization process. As the TMA capacity to plan, prioritize, and implement infrastructure investments grows, it is envisioned that the size and complexity of investments would also increase. 

The development grant requires a contribution by the TMA of 15% of the total investment cost. The TMA also needs to provide a service improvement plan and an assurance that it will be able to finance the Operations and Maintenance costs associated with the investment.  Project funds assist TMAs to improve their management of existing infrastructure through the capacity grants.   A development grant is available for infrastructure investments in water supply, sewerage, sanitation, solid waste management, roads, storm-water drains, street lighting, and community centers.  In essence, the project takes a multi-pronged, multi-level approach in tackling the management and capacity constraints towards improving municipal service delivery in the Punjab.

Implementing Mechanism:  The PMDFC as an apex body provides advisory, planning, design, and performance management services across partner TMAs, and also acts as an oversight, coordination, and monitoring agent on behalf of the Government of Punjab.  PMDFC teams work closely with the partner TMAs for instituting the multiple capacity development initiatives, and on the design and supervision of infrastructure improvement sub-projects. As an implementing mechanism, PMDFC is thus proving its merit as a one-window municipal development agency providing performance criteria-based funds, as well as demand-driven capacity building.

At the provincial level, PMSIP is also assisting the Local Government and Community Development Department (LG&CDD), as the parent department of all LGs, in operationalizing a TMA performance monitoring system covering all TMAs in Punjab, by replicating and scaling up the pioneering approach adopted under PMSIP for its partner TMAs.

The Cultural Heritage Component
 
Through this component under PMSIP, the World Bank has gotten engaged in the Cultural Heritage (CH) sector after a long hiatus.  Under two earlier projects of the 1990s that had CH components under them, substantial documentation work on historic buildings of the Walled City of Lahore (WCL) was undertaken; selected monuments were restored and put to adaptive reuse; and some neighborhoods upgraded with provision of municipal services.

More recently, there has been a growing recognition that CH assets of Pakistan have a rich economic potential that can contribute to growth and poverty reduction, if appropriately tapped for cultural tourism.  PMSIP’s cultural heritage component is designed to provide assistance to Government of Punjab’s Sustainable Development of the Walled City Lahore (SDWCL) unit for undertaking studies to recommend rationalization of institutional mandates for management of heritage assets; undertaking legal and technical studies to recommend appropriate amendments to the existing legislative frameworks; and implementing a pilot project to showcase methods and benefits of conservation of cultural assets and their productive re/use. 
 
The pilot project envisages the creation of a Heritage Trail that would lead visitors from the Delhi Gate to the Lahore Fort linking a variety of cultural assets comprising of monumental buildings, private residential buildings, traditional bazaars, and open spaces as a sequence of experiences in a historic built environment.  This historic Royal Route (Shahi Guzargah) is the route that the Mughal emperors followed to reach the royal fort palace, when returning from Delhi to Lahore.  They entered the WCL through the Delhi gate, bathed in the Shahi Hammam (Royal Bath), and prayed in the Wazir Khan Mosque enroute to the fort.  Over the years, many of the private buildings along the route have either fallen into disrepair or have been replaced, and the public spaces encroached upon.  The monuments however remain gems of architectural heritage, and primary visitor attractions.  In the medium term, and based on the lessons learnt through the pilot, a more comprehensive urban restoration and regeneration project for the WCL could be considered, to make it into a world class destination.

Impact

The participating TMAs are already showing signs of improved institutional and service delivery performance.  Capacity building activities funded under the capacity grants component have led to significant improvements towards the establishment of performance management systems in the 19 participating TMAs. These include baseline data collection and target setting for performance monitoring; staff trainings; operationalization of complaint tracking systems; launch of TMA websites; establishment of geographic information systems, including preparation of base and land use maps; launch of financial management systems; and completion of participatory planning exercises leading to consensus on prioritized sub-projects for infrastructure and service delivery improvements.

Moreover, 12 infrastructure development projects are under implementation, while another 14 are at various stages of design, preparation, and award. Initial monitoring data obtained from the project's robust central M&E system that is tracking TMA performance improvements, indicates that these investment sub-projects coupled with the institutional development initiatives, are already beginning to bring about tangible improvements in service delivery coverage and quality to the beneficiary communities.  Additionally, the setting up of systematic complaint registration and tracking systems, participatory investment planning, and the launching of TMA websites, is beginning to keep stakeholders informed and involved, and the TMAs more accessible and responsive.

Under the CH Component, the SDWCL unit has been set up and fully operationalized.  The Punjab Historic Areas Planning, Development, and Regulation Ordinance 2007 has been promulgated and notified, and the Punjab Historic Areas Authority is to be notified shortly.  Moreover detailed studies, surveys and the physical documentation of buildings along the Shahi Guzargah has been initiated in preparation for implementation of the pilot project. 

The initiative has also attracted the interest of the Aga Khan Trust for Culture (AKTC), which has since become a development partner in it with the Government of  Punjab and the World Bank.  A subsidiary of AKTC, the Aga Khan Cultural Services Program, has established an office in Lahore.  It is providing guidance and technical assistance to SDWCL unit on the detailed preparatory activities for the Shahi Guzargah pilot project. Fostering and strengthening such partnerships is also a critical determinant of GoPunjab's increased institutional effectiveness and capacity in managing the city's cultural assets in the medium to long term.

Challenges ahead

The process of improving municipal service delivery under PMSIP has only just begun.  For the improvements instituted to be sustainable, replicable, and effective in the longer term would require sustained political commitment and efforts at the provincial and local levels. The ongoing political transition in the country may test the resilience of the institutional arrangements that are currently delivering the project, but the globally proven concepts of decentralized service delivery that the project espouses, and the promise that it holds of accountable LGs and effective and efficient service delivery, will hopefully help overcome any such challenges.

Other major challenges include a severe scarcity of human resources to sustainably enhance the financial and technical viability of urban services being provided by TMAs. There is also a severe need for improving operations and maintenance (O&M) capacities, for existing and new infrastructure assets being created under PMSIP and other development initiatives. Finally, there is an urgent need for a greater coordination and synchronization of the various investment decisions currently being made in local government jurisdictions through multiple funding sources. If continued to be made in isolation or without coordination across various stakeholders, these run the risk of working to the detriment of each other, or duplicating each other, and thus wasting scarce public resources.