Trimester Report

Government of Nepal

Trimester Report

Rural Access Programme (RAP) Phase 3

16 July – 15 November 2016

December 2016

Trimester Report 16 July – 15 November 2016 Table of Contents

1. Summary ...... iii

2. Introduction ...... 1

3. Activities and Progress ...... 1 3.1. Local Road Component ...... 1 3.1.1. Planning ...... 1 3.1.2. Maintenance ...... 1 3.1.3. RAP3 TA to GoN Road Improvement Projects ...... 2 3.1.4. New Construction ...... 3 3.1.5. Procurement ...... 4 3.2. RAP3 CONNECT ...... 4 3.2.1. Progress for the period includes ...... 5 3.2.2. Micro, Small and Medium Enterprises (MSME) ...... 5 3.2.3. Enabling Environment (EE) ...... 6 3.2.4. Challenges ...... 6 3.2.5. Risks ...... 6 3.3. Safeguard Management ...... 6 3.3.1. Social Mobilisation...... 6 3.3.2. Social Safeguards ...... 7 3.3.3. Work Accident Insurance ...... 7 3.3.4. RBG Saving and Credit Scheme ...... 7 3.3.5. Public Audit ...... 8 3.3.6. Environmental Management and Monitoring ...... 8 3.3.7. Disaster Resilience...... 8 3.3.8. EIA Study of Gamgadhi Chankheli Darma District Road ...... 9 3.4. Capacity Development and Institutional Development ...... 9 3.4.1. Training ...... 9 3.4.2. Planning and Reviews ...... 10 3.4.3. Policy Related Support ...... 11 3.5. Performance Management and Verification ...... 13 3.5.1. Quality Management ...... 13 3.5.2. Financial Management ...... 14 3.5.3. Monitoring and Evaluation ...... 15 3.5.4. The RAP3 PMV Review Recommendations and Actions ...... 15 3.5.5. Programme Logical Framework ...... 15 3.5.6. Risk Management ...... 16

4. Programme Reviews ...... 17 4.1. Progress Against Last Year‟s Annual Review ...... 17 4.2. Annual Review Recommendations 2016 ...... 17

Annex 1 – RAP3 Programme Overview ...... 20

Annex 2 – District Maps and Road Corridor Monitoring Sheets ...... 26

Trimester Report 16 July – 15 November 2016 Annex 3 – Innovations ...... 38

Annex 4 – Central Contracts Procured ...... 39

Annex 5 – Social and Economic Development Programme (2013-16) ...... 44

Annex 6 – Annual CPD Programme ...... 46

Annex 7 - Progress Status on MEL’s PMV Review Recommendations ...... 47

Annex 8 – Risk Management ...... 48

Annex 10 – GoN FIRST Trimester Progress Report 2073/74 ...... 52

Annex 11 – RAP3 Logical Framework ...... 55

Annex 12 - Acronyms and Abbreviations ...... 61

DOCUMENT CONTROL

Document revisions and Details Signature and Date authorisation

Version December 2016

Summary of revisions made

Revisions prepared by

Revisions checked by

Version authorised by Michael Green

Cover photographs of ongoing bioengineering works in DOTI and a Road Maintenance Group (RMG) conducting routine maintenance in Dailekh.

Trimester Report 16 July – 15 November 2016 1. SUMMARY

Contract Details Contract start date 13 May 2013 Contract end date 31 March 2017 Time left to expected completion date 10.87% Contract amount (GBP) 31.5 million

Cumulative Progress of RAP3 to Date = 88.5%

Measures physical progress of Outputs 1, 2 and 3 Time elapsed to date = 90.1%

Financial Monitoring Programme budget = UK£ 31.6 m Invoiced up to Oct 2016 = UK£ 28.21 m

Financial progress = 89.3% Quality Management Project Management and Verification (PMV) Number Action Taken Field verifications conducted in March – June 16 41 Disseminated recommendations of the verifier Total field verifications conducted to Date to the concerned field teams for 326 improvements. Reportable incident/risk event this Trimester Number Key issues / Actions required Audits conducted in March - June 2016 8 Audit targeted at key issues/risks include Total Audits conducted to Date public audit, LRN implementation and 91 safeguards, internal financial management and district level communication Key issues: Key issues include replenishment of medicines in First Aid Kits, training on handling and management, need for greater level of DDC/DTO staff involvement in preparing ARAMP, budget source for public audit, RBG work measurement and bill payments procedures and documentation, regular physical verification of tools and materials site stores. All issues will be followed up in further audits and system revisions.

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Trimester Report 16 July – 15 November 2016

Trimester targets and results Last Trimester Last Trimester % target Next Trimester Component Item Cumulative to date March 2017 target target achievement achieved target Outcome Indicator 2: Employment days created 250,000 days 358,616 days 143.45% 350,000 days 3,214,562 days 3,791,000 days Short-term job created Km of DRCN under RMG maintenance 2,000km 2,171km 108% 2,000km 2,171km 2,000km Output 1 (LRN): New road – 2.5m wide track opening 0km 1.12km 112% 0.5km 90.65km 75km Improved rural transport New road – 3.5m wide track opening 1km 1.21km 121% 8.0km 72.39km 75km infrastructure New road – 4.5m fully widened roads 1km 1.94km 194% 10.0km 61.55km 75km Completed road length ------75km Road infrastructure investment incorporating % Standard 2% 1.2% 60% 10% 69.2% 90% DRR, road safety and environment % Progress 100% on GoN 75% of ARAMP July targets achieved by May 0% 100% 100% 100% ARAMP FY 2072-73 July target Output 2 (SED): Number of beneficiaries receiving SED 18,160hh Local economic supported growth Economic Infrastructure benefitting SED results in the left column are derived during 2 years of implementation, which 48,811hh households is then replaced by CONNECT implementation pilot in June 2016. Number of private sector services providers 806 BSPs (BSPs)

Number of households/individuals engaged in CONNECT n.a. 1,978 n.a. n.a. 1,978 n.a. pilots and intervention per year (Jun-16 onward) No of districts with policy reform paper on n.a. n.a. 40% n.a. 0 5 reservation of seats Third party investment leveraged to MSME n.a. 13,741 n.a. n.a. 13,741 n.a. pilot and enabling environment Number of training days 500 days 1,486 days 297% 1,200 13,673 days 7,250 days Output 3 % of annual Social Audit findings showing Didn‟t measure for this year 82% 40% (CB/PH): district level RAP3 satisfaction ratings Strengthened institutional CIM scores demonstrate continual Positive increase in capacity to Improvement towards SWAp compliance. CI score August 2016 Continual sustainably CI score ref of 2015 Pilot districts: 7.10 Measured in August/Sept, once in a year Improvement manage rural Pilot districts: 7.03 Core districts: 6.09 Scores from 2016 transport Core districts: 5.71 Average: 6.52 (max=10) infrastructure Average: 6.27

Trimester Report 16 July – 15 November 2016 Major Events in the last Trimester The DFID Annual Review for 2016 was finalised in November and gave RAP a Programme Score of A and a risk rating of Moderate The Review concluded that RAP3 continues to deliver significant results and has met most output targets for the year. It stated that in response to the last Annual Review and external review the Social and Economic Development component has been completely restructured (now called RAP3 CONNECT) with a much improved approach and ambition. Based on the continued good progress, DFID negotiated a cost extension and with IMC bringing the end date of the contract to June 2019 and the Implementation year in line with GON‟s fiscal year. (July ) This will be reached by extending the current Implementation Year from February to July 2017 by means of an extra Trimesterly Report (April – July 2017). Since the previous Trimester and the next Trimester will continue to follow Implementation Year 3 (IY3) this report continues to track progress against targets set up to March 2017. After that date the Trimester reports will track progress against Extension targets up to 2019. Activities carried out last Trimester Local Road Network Component This Trimester has been largely taken up with Monsoon and Festival period impeding implementation output RMGs road maintenance (routine and light recurrent interventions) together with small- scale emergency works have continued DOLIDAR‟s RMG road maintenance guideline was printed in bulk and issued to all 75 Districts in Nepal Briefing meetings held in the 4 maintenance core Districts to introduce DDC‟s to the SMG piloting initiative due to start this year. Candidate roads identified and estimates of procurement supplies performed. Very little activity in New Construction due to the season. Some bio-engineering works continued into early monsoon and several of the SBG rock-drill groups continued throughout New Construction cost estimates reviewed in the light of actual performance New Construction programmes revisited in terms of available recovery measures and new target completion dates set TA support for construction supervision of GON funded road improvement works in 4 districts. Completed in DOT and on-going in JHA, MOR and PAR. Issues encountered with the asphalt quality in MOR for which technical support continues IEE reports for road improvement works in DOT continue (MOR & JHA completed) TA support to DDCs through resident DTA teams continued Construction supervision of contractor‟s work of Desigade Mahabu road project, Dailekh 19 of the 20 DTMP preparation of non-RAP3 districts finalised. Sarlahi district DTMP preparation is still pending the final workshop Procurements continued for supplies for the coming season‟s new construction activities (Gabions, Wires, Geotextile, Boots and Tools) Tidy-up and close the few pending RAP3 Specific Maintenance contracts in PILOT districts

Trimester Report 16 July – 15 November 2016 RAP3 CONNECT Component DD reports for partners received from CONNECT auditors TR Upadhyay & Co and submitted to DFID along with sample contract Contracts / MOUs executed with 11 partners and partner orientation workshops of DD commitments and working modalities completed, including with 1 new private sector partner from Jumla 5 MOUs with DDCs signed to develop a software solution to support an online DDC SED database Facilitated DFID AR field visit team meetings with 4 MSME partners, visits to 3 partner sites and interactions with downstream suppliers 25 staff recruited into 7 MSME partners (#3, 4, 5, 6, 7, 8 and 9). District Manager for Jumla appointed and District Officer in Doti transferred to Safeguards team, realigning resources based on field level needs Community engagements to recruit long-term downstream suppliers on-going at MSME partners Safeguard Management TA support to RBGs on social mobilisation, group saving and credit and workers‟ and work site safety in new construction districts Environmental Management Plan implementation of new road construction corridors ongoing Road Building Group saving and credit continued EIA study report of Gamgadhi-Chankheli-Darma road project (MUG HUM link road) submitted through MOFALD for MOPE‟s approval Capacity Building and Policy Harmonisation Implementation of CB&PH plan at central and district levels on going CIM reviewed and ASP of all RAP3 districts for 2016-17 prepared CPD programme in all districts and centre on going DTMP preparation for all 75 districts completed GIS support to DoLIDAR to digitise LRN data on going (draft prepared) Intern, graduate and CTEVT programmes on going Support to prepare GoN infrastructure guidelines for restructured local bodies on going Financial Management Financial audit conducted by externally hired auditors for IY2 in August 2016 External audit picked up 132 observation points of which 127 are resolved and actions are on-going for the remaining DLIs unit rates proposed after reconciliation of invoiced value against actual costs incurred Technical Assistance and Performance Management and Verification Field verification and audit programme as planned Testing and verification of online financial reporting system using RAPID software module Run radio programme “Bikashko Baato” through local FM stations Implementation of MEL‟s RAP3 PMV review findings Monthly reporting system on safeguard management sub-component designed and established in new construction districts Preparation of logical framework for the programme extension period SMT monthly review and Trimester progress reporting

Trimester Report 16 July – 15 November 2016

Activities for the next Trimester The coming Trimester between July and October 2016 falls under the slack construction season for new construction works. But RMG road maintenance works in pilot and core maintenance districts will be continued as usual. RAP3 component wise main activities to be undertaken during the period are listed as per the following. The main activities in the next Trimester reporting period of RAP3 will include: Local Road Network Component Supervision of remaining contractor works on Deshigade – Mahabu DRCN road in DAI (anticipate completion) TA support for construction supervision of GON funded road improvement remaining works in 3 districts Continue to investigate and resolve issue of substandard pavement works on GoN funded Improvement project in MOR Remobilise RBG/SBGs to full force in New Construction works Continue survey works on „entry sections‟ (previous DDC construction) where not meeting NRRS on current RAP3 new construction roads Follow-up and monitor bulk central goods procurement deliveries for current construction season (Gabions, Wires, Geotextile, Boots and Tools) Worker selection on sub-networks in JUM, ACH, DOT and DAI for SMG pilots Draft ARAMP in 8 CORE districts Prepare to launch direct-funded RMGs on the limited trafficable DRCN in KAL, BAJ & MUG Routine and recurrent maintenance by RMGs in 10 maintenance districts Completion of few remaining specific and periodic maintenance of IY2 carry over Conduct LRN „Graduate Workshop‟ and LRN Training for new Nov 2016 intake of Engineering Interns TA support to DDCs through resident DTA teams in 4 core maintenance districts and light touch TA support through help desks to be operated from the centre to pilot districts RAP3 CONNECT Component Signing of agreements with downstream suppliers across partnerships Activating satellite collection centres Setting up value chain financing modality and contracts for MSME #5 downstream suppliers with Prabhu Bank Limited. Preparing for RMBA boot camps and student consultant placements Negotiating partnerships with district based colleges to establish satellite incubation centres and convene Entrepreneurship student clubs Drafting and circulating of DCCI policy reform papers Appoint and convene women leaders and MSME champions in 5 districts Rural business boot camps delivered Sahajpur organic ginger processing facility operationalized. Safeguards Component TA support to RBGs on social mobilisation, group saving and credit, workers‟ and work site safety in new construction districts Implementation of Environmental Management Plans of new road construction corridors Replenish First Aid medicines to RBGs Support to RBGs on group saving and credit schemes continued

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Trimester Report 16 July – 15 November 2016 Capacity Building and Policy Harmonisation Implementation of CB&PH plan at central and district level ASP implementation at central and local level CPD programme in all districts and centre GIS support to DoLIDAR to digitise LRN data finalised and publication Intern, graduate and CTEVT programmes on going Translation of RMG guideline Support to prepare GoN infrastructure guideline for restructured local bodies ICE affiliation process for eligible engineers in RAP Financial Management Actions to resolve remaining audit observation points Internal financial audit on DDF to expedite DLIs unit rates proposed after reconciliation of invoiced value against actual costs incurred Technical Assistance and Performance Management and Verification Update programme management manual Field verification and audit programme as planned Run radio programme “Bikashko Baato” through local FM stations Finalisation of Logical Frame for programme extension period with MEL and start reporting based on the revised logical framework SMT monthly review and Trimester progress reporting Steering Committee meeting

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Trimester Report 16 July – 15 November 2016

2. INTRODUCTION

This report covers the progress of RAP3 over the third Trimester of FY 2073-74, 16th July to 15th November 2016. It provides data and information relating to progress of RAP3 over the last Trimester.

A Summary reviews the physical and financial progress of RAP at the end of the last Trimester. This shows cumulative physical progress at 88.5%, time elapsed at 89.13% and financial progress at 89.3%, all nicely grouped. The summary also lists activities carried out last Trimester and those planned for the next Trimester.

The Summary is followed by four narrative sections backed up by 11 Annexes.

1. Section 1 provides the summary, 2. Section 2 provides introduction, 3. Section 3 deals with activities and progress of RAP3 components, while 4. Section 4 looks at progress on the DFID Annual Review recommendations.

3. ACTIVITIES AND PROGRESS

RAP3 has a four components, these being 1) Local Road, 2) RAP3 CONNECT, 3) Safeguard Management and 4) Capacity Building and institutional development. These are backed up by a performance management and verification (PMV) system that supports the “results based” modality of the RAP3 programme. Major activities and progress of the reporting period on these components are briefly presented below.

3.1. LOCAL ROAD COMPONENT

3.1.1. Planning DTMP Preparation (non-RAP3 Districts): RAP3 has continued to support DoLIDAR in the preparation of DTMPs in 20 remaining (all non-RAP3) districts which will complete planning coverage of all 75 districts of Nepal. Nineteen of the 20 have been finalised. Sarlahi district DTMP draft is prepared and waited for approval.

GoN Improvements: RAP3 have advised DoLIDAR on likely budget carry-over necessary in the next GoN financial year to complete the outstanding works in MOR, JHA and PAR.

3.1.2. Maintenance

Significant effort has been made to either complete or terminate Specific and Periodic maintenance works contracts carried over from previous years‟ plans, particularly in PILOT Districts. This has now been substantially achieved.

RAP3 has continued to implement the highly successful Road Maintenance Group (RMG) approach in its 10 „maintenance districts‟ covering around 2,100 km of trafficable DRCN.

RAP3 had a number of discussions with DoLIDAR (including at the last Steering Committee) regarding its necessary and gradual exit from the Pilot Districts and a phased plan to help DDCs take over the initiative. GoN are expected to start funding a significant proportion of RMGs in the

Trimester Report 16 July – 15 November 2016 PILOT districts after the present monsoon whilst RAP3 will continue to supervise through a lean DTA team supported by central TMO „help-desk‟.

The CORE maintenance Districts (ACH, DAI, DOT and JUM) have started preparations for the launch of Special Maintenance Groups (SMGs) by identifying suitable sub-networks on the DRCN. Generally these will be selected following the ARAMP road prioritisation procedure. Indicative work requirements will be based on current ARAMP survey data which will be updated following the 2016 monsoon.

Following recommendations in the 2015 „LRN Review‟, RAP3 has been capturing monthly „road open‟ data from RMG feed-back in its Maintenance Districts. This data reports the situation on each of the DRCN‟s under RMG maintenance and the first point at which a road becomes blocked and the reasons on a daily basis.

3.1.3. RAP3 TA to GoN Road Improvement Projects

RAP3 DTAs continued providing construction supervision and TA support in road improvement projects implemented by DDCs utilising GoN funds in Jhapa, Morang, Parbat, and Doti districts. GoN had allocated NRs 200 million to the programme. Except for Doti, road improvement works of other districts are not completed by the end of current GoN FY and are expected to complete in December 2016.

Whilst the implementation of these projects was well planned with contracts signed and initial advance payments made ahead of the 2015 monsoon in preparedness for a swift start immediately after, the delays caused by prolonged transport strikes and fuel shortage have been extreme and unrecoverable. Morang, Jhapa and Parbat contracts are currently underway but paused due to monsoon. Justified Extension of Time awards are under review and will be confirmed shortly. Realistically it is expected to take at least until the end of December to complete these contracts bearing in mind the need to remobilise post-monsoon and the effects Dasain and Tihar festivals. The following table shows the current progress situation as at the end of June 2016.

Table 3.1: Work Progress of Road Improvement Corridors

GoN funds are freeze at the end of the GoN financial year (mid-July) and need appropriation of funds to complete remaining works in the next GoN financial year. It is learnt that MOFALD and DOLIDAR have made provision for additional funds to deal with over runs.

Trimester Report 16 July – 15 November 2016 A number of significant quality defects have arisen in the asphalt concrete work recently performed by the Contractor on the Khorsane – Kerabari road in Morang. RAP3 have engaged the services of a pavement expert to investigate the issue.

3.1.4. New Construction

The New Construction programme is focussed in 4 remote mid-western hill Districts where there is otherwise little or no significant existing road network to improve or maintain. A small 4 km section of previously part-completed RAP2 road is being built in DAI (Desigade Mahabu Road). As this is being funded out of the general RAP3 LRN ARAMP YR-1 contribution and is being built by a Contractor rather than by RBGs, it is discussed separately.

All 7 roads under construction have progressed at full swing with heavy emphasis on retaining structures particularly in hair-pin bends. Trained rock-drill teams comprising SBGs, are now operational in all 4 Districts and the Programme has engaged a 2nd roving field-based Rock Drill Mechanic / „Operator Trainer. The initiative is helping considerably in accelerating progress at hard-rock bottlenecks („critical sections‟).

Initial monsoon this year in the region seems to have been unusually severe so far. Whereas last year there was very little rain with resulting food shortage / crisis, this year rains seem to have been at record levels with damage not only to the works but also houses and agricultural land (particularly in Humla). The majority of RBG teams were stood down during July when conditions became too wet and personal agricultural demands became workers‟ preference. Nominal teams have remained in place to perform „preventative maintenance‟ on the partially complete roadworks to minimise any rainfall damage.

With the reduction in supervision tasks during monsoon our teams‟ attention has switched to planning review. All construction designs and cost estimates are under review so that these can be tuned to design changes made so far and the actual nature (hardness) of excavated materials and availability of quarried stones for structures. This information will lead to a more accurate prediction of the total anticipated cost of each road and is expected to be available during August. The current progress at the end of Oct 2016 is presented in Table 3.2 below.

Table 3.2: Work Progress of New Construction Corridors

Amount in NRs '000 Physical Progress Total Construction Total spend Financial Planned Phased construction (km) Category of work % Remarks District Road corridor length cost up to Oct- progress date of 2.5m 3.5m 4.5m full (Per km spend) (km) estimate 16 (%) Structure Earth work completion wide wide width Maure-Toli-Chhatara 16.22 309,934 196,038 63.25 15.87 12.36 12.27 58.6 64.4 Mar-18 12,086.19 BAJ Maure-Kailashmandu- Badimalika 11.15 190,367 122,334 64.26 10.73 9.17 7.09 57.5 66.8 Mar-18 10,971.66

Sallisalla-Darma 14.40 277,154 164,997 59.53 13.31 11.74 8.97 51.6 71.8 Apr-18 11,458.13 HUM Galfagad-Shreenagar 12.16 229,161 98,397 42.94 10.75 5.62 5.42 34.4 50.8 Sep-18 8,091.86 Sannighat-Sipkhana 17.73 328,106 228,962 69.78 17.21 17.21 14.8 78.2 69.4 Dec-17 12,913.82 KAL Jarkot-Ramanakot 5.93 197,029 55,492 28.16 5.22 1.98 1.84 28.5 26.1 Mar-19 9,357.84

MUG Gamgadhi-Dhulachaur 19.95 366,720 220,768 60.20 17.56 14.3 11.15 41.0 69.6 Feb-18 11,066.07 Total 97.54 1,898,472 1,086,988 57.26 90.65 72.38 61.54 52.80 62.80 11,144.02

Desigade Mahabu Road (DAI): By the end of the Trimester physical progress has been 85% and financial progress is 63.5%. Though, original completion date was 1 January 2016 but due April-15 earthquake, border blockage and strike, contract period was extended up to 26 May 2016, which has also expired and contractor has been working under liquidated damages.

Trimester Report 16 July – 15 November 2016 Major critical sections are completed and the road is opened for 4WD vehicles. District monitoring team comprising DDC and DTO officials, political party representatives and Members of Parliament of Dailekh and Kalikot visited the road section on-drive. The team appreciated the RAP3 effort to connect two districts by a road. However, still contractor has to do some widening works at few critical sections to attain the design width, complete bioengineering and other ancillary works and also needs to rebuild a few gabion walls damage by heavy rain fall in the west.

3.1.5. Procurement

Generally this construction season‟s goods supply contracts have been fulfilled before the onset of monsoon. A remaining portion of Gabion and weaving wire deliveries are still on route to Humla largely due to a suspension ordered to the supply contract while certain production quality issues were investigated and resolved at the supplier‟s Biratnagar factory.

Goods supply requirements for next construction season have been derived and cross-checked with a view to launching invitation for bids toward the end of July. In a number of cases this will be the final procurement cycle for the more advanced roads.

RAP3‟s policy in terms of value for money is to avoid procuring in the run-up to the mid-July end of GoN financial year when last minute procurement demands have been shown to cause a hike in prices. Inviting bids during the otherwise slack monsoon period has been shown to yield more competitive bidding. Deliveries of this round of procurements are due before December with the inclusion of bonus and liquidated damages clauses to encourage timely performance.

A summary of all centrally procured contracts is included in Annex 4.

3.2. RAP3 CONNECT The fundamental review of the SED component and subsequent redesign of the component has resulted in the emergence of the RAP3 CONNECT programme. This is a conceptual departure from the original social and economic development programme that provided direct support to beneficiary communities on income generation activities and economic infrastructure construction such as trail bridges. The SED component implementation results against targets of first 2 years are presented in the Annex 6 of this report. RAP3 CONNECT focusses on private sector business development and partnering with businessmen and academics in selected agro-based products. The RAP3 CONNECT programme is a pilot designed to explore the potential for commercialisation ultimately benefitting small farmers in project districts through trickle down effects. Following approval by DFID-N in June 2016 RAP3 CONNECT will continue till the end of the programme extension to June 2019. Hence, this programme is an input based unlike to the result based programme of other components of RAP3.

RAP3 CONNECT has focused its programme and activities for private sector development in DAI, JUM, ACH, DOT and BAJ, five programme core districts. Key milestones outlined in the July 2016 report for August – November 2016 have been achieved: GoN tripartite agreements in 5 districts have been amended to include CONNECT 16 collaboration and partnership agreements including MSME, EE and DDC partners Inception Phase completed

Trimester Report 16 July – 15 November 2016 Figure 3.1: RAP3 CONNECT progress 100% 80% 69% 60% 40% 20% 0% Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17

Planned Achieved

Third Party Investment Leveraged Improved efficiency and scaled up markets

100% 100% 80% 80% 77% 60% 60% 60%

40% 40%

20% 20%

0% 0%

Planned Achieved Planned Achieved

Time elapsed: 75%

3.2.1. Progress for the period includes CONNECT programme inception phase was completed in the last Trimester delivering projected progress against work plan targets as below: 77% of activities under Third Party Investment Leveraged; and 60% of activities under Improved Efficiency and Scaled up markets are delivered. CONNECT has achieved 74% of programme work plan as of 30 November 2016. There have been delays in some work areas and early delivery in others, which on balance, enabled delivery of overall programme progress on time. Progress highlights include

3.2.2. Micro, Small and Medium Enterprises (MSME) MSME # 2 Unilever Hamri Didis (UNL): 100 women from 5 RAP districts successfully completed the training requirements and were appointed as Unilever Hamri Didi Direct Sales Agents.

MSME # 3 Belpata Dairy Production Cooperative (BDP): Negotiated with Nimbus Probiotic Tech Industries Private Limited to invest in a 2-week pilot in Belpata Dairy Cooperative to select high performing downstream suppliers owning 2+ cattle to test the feasibility of high yielding cattle feed pellets as an alternative input to increase milk yield, fat content and SNF (solids – not – fats).

MSME # 5 Organic Mountain Flavour Private Limited (OMF): (i) Negotiations for sanction of NRs 20 million towards working capital from CONNECT nodal banking partner Prabhu Bank

Trimester Report 16 July – 15 November 2016 Limited, dispensing with guarantee requirements have been concluded; and (ii) Organic Mountain Flavor Private Limited has doubled its 2016 – 17 export order book compared to the previous financial year, securing higher prices per kilogram of dry ginger slices with contracts to supply 105MT. 28MT will be exported directly to Martin Bauer in Germany, making it the first time the European market is directly sourcing Nepali ginger from country of origin.

3.2.3. Enabling Environment (EE) EE # 1 Idea Studio Nepal: Idea Studio Nepal received 227 applications from the Mid- and Far-West of Nepal with RAP3 CONNECT support of which 211 were from RAP3 CONNECT core districts i.e. a 95% increase compared to the previous year. Of these, 10 applicants made the short list and seven businesses from three CONNECT districts attended the incubation at Kathmandu University School of Management, a significant improvement compared to the zero incubatees from the Mid and Far West in the previous year. On successful completion of incubation seven incubatees pitched their businesses to potential investors on the nationwide Idea Studio TV show aired on Avenues TV and Nepal TV.

3.2.4. Challenges Across partnerships downstream suppliers are taking time to accept the CONNECT approach which encourages co-investment and a shift to minimal / nil cash support. We are facing some push back and demand for cash support along traditional grant and subsidy models.

3.2.5. Risks MSME partners on boarding other development finance without consulting with the CONNECT team could potentially result in inefficiencies and duplication. Implementation delays connected with time taken for training green teams (interns and fresh graduates within MSMEs) to deliver partner work plans.

3.3. SAFEGUARD MANAGEMENT

3.3.1. Social Mobilisation Regular updates, refresher training and regular interaction with RBG and SBG members on construction methods, group work, quantity measurement, payment modality, work safety, use of safety equipment and first aid kits organised have continued during construction. Such training has helped RBGs and SBGs to better understand the system of working and increased efficiency of local labourers in construction works. The total number of RBGs formed and engaged in construction works remained at 293 in all RAP3 new construction road corridors. In addition, 71 SBGs were mobilised during the progress-reporting period. There are around 6,732 people working for road construction on performance based wage payment system. This means that poor people working for construction works have already started benefiting from RAP3. The total paid out as wages has reached NRs 630.8 million from the start of construction works, some NRs 94,000 per worker (GBP 700). Likewise, refresher training and regular interaction with RMG members on routine and recurrent road maintenance methods, work safety, use of safety equipment, first aid kits and payment modality have been undertaken in the 10 maintenance districts. A total of 1,637 people are working for road maintenance works on 100 days/km year of fixed inputs in road maintenance districts, representing 128 days of employment per person. This compares well with the 100 day standard adopted by Indian employment programmes.

Trimester Report 16 July – 15 November 2016 3.3.2. Social Safeguards Health, Safety and Welfare – A guideline on First Aid Kits detailing roles and responsibilities of staff and labour groups, procurement procedures, delivery and replenishment of medicines has been prepared and issued to districts for implementation. Use of basic protective wear such as steel toe gumboots, goggles, hard hats, gloves, dust masks and hi-viz vests to RBGs, RMGs are being monitored and verified at the field level.

Despite these health and safety measures, the number of fatalities on RAP3 has reached eight. Out of these only one case was at a work site. The other seven deaths were off-worksites and involved a fire at an SBG camp site and a log rolling down a hill. Raising community awareness about Health & Safety is now a priority innovation for RAP3. This will be over and above the CPD training that supports each of RAP‟s district teams and their DTO colleagues.

3.3.3. Work Accident Insurance RAP3 has practised internal insurance system for treatment and loss of damages of workers‟ accidents at work in new construction districts. RAP provides medical treatment facilities and compensates loss of damages within 3 weeks from the date of accident. The internal insurance policy prepared in reference with the provisions and arrangements of professional insurance companies is swift and the labourers are paid against loss of accidents with no formalities and administrative hassles. But the value of compensation against losses due to accidents are comparatively very less and sufficient to cover cost for funerals and other rituals only. The current value of total compensation to the loss of life to the bereaved family is NPR 180,000 which is not comparable with compensation figures usually paid by GoN on loss of accidents. Hence, the programme has planned to revisit its internal insurance policy to match with the prevailing practise of the market.

3.3.4. RBG Saving and Credit Scheme Road Building Group (RBG) members engaged in new road construction works have established and run group saving and credit schemes since the beginning of their involvement with the programme. RAP3 requires Box1: Group saving and credit scheme in Bajura RBG members putting 10% of The Maha Laxmi Road Building Group (RBG) of Toli-7, Bimali in Bajura, was their wage income in group formed three years back from 20 households, one representative from each hh. saving schemes to support The group consists of 14 males and 6 females and is engaged in road loans to group members at rate construction works. The group members started saving of the part of their wage of interest set by the group incomes from the beginning, which has now reached at NPR 500,000 including members. All RBG members interests on loan disbursed on terms and conditions fixed by themselves for investments on livelihood support activities within the group members. The total have entered into the group amount of loan disbursed is NPR. 482,265 of which more than 80% is invested saving and credit scheme and on productive sector- business, goat raising, cattle raising and vegetable the total amount of saving has farming. The group has fixed 24% interest rate on lending, which is significantly reached at NRs 59.95 million less than the rate of lending charged by village money lenders. The group has maintained very good book keeping and introduced loan monitoring system (GBP 460,000 or GBP 85 per within their group. Mr Dal Bahadur Saud (one of the group members) worker). 61% of total lending is mentioned that their average income from sales of vegetable has remained at used for in productive purposes NPR 75,000 per year. The group members are aware of the sustainability issue by the groups versus 39% for they may face in post RAP3 period and the members have been devising plans to cope with the perceived post-RAP3 scenario as well. consumption. Use and recovery of loans is ensured through peer monitoring. Hence, default on investment is rare and no cases of embezzlement of funds has been reported. RAP3 has continued to support book-keeping by each group through social mobilisers and will continue to the end of the construction programme. A sample of one of the

Trimester Report 16 July – 15 November 2016 good examples of group saving and credit scheme operated by RBG in Bajura is presented in Box 1. RBG saving and credit scenario of new construction districts and use of loans are presented in figures below.

Figure 3.2: Scenario of RBG Saving and Credit Figure 3.3: Use of loans

3.3.5. Public Audit Public audit is a regular event in RAP3, which is organized twice a year at LRUC level and after each payment at RBG level. The event to be organized by LRUC at project sites is participated by direct beneficiaries, local stakeholders, DDC officials and project staff. In the audit work bill payments details are presented and discussed on issues related to wage payments and other construction related matters. This is not just an opportunity for a financial scrutiny, but for a general audit of how programme activities are proceeded under RAP3. RAP3 staff and LRUCs respond on issues and clarify misunderstanding, if any in the meeting. In total, 20 public audit events were carried out at LRUC level within this Trimester in all new road construction corridors, where 4,580 participants attended events on different dates and places. Table 3.3: Number of Public Audit Conducted In New Construction Districts

Public Audit Participants S.N. District conducted Male Female 1 Bajura 5 641 418 2 Humla 5 477 225 3 Kalikot 6 1106 630 4 Mugu 4 674 409 Total 20 2898 1682

In maintenance districts RMG level audits were also held as planned during the reporting period. 3.3.6. Environmental Management and Monitoring Site specific Environmental Management Plans for new construction road corridors prepared by DTAs are reviewed and finalised by the RAP3 Environmental Specialist. EMPs are being implemented by consultants‟ and NGOs‟ staff, supervised by RAP3 district teams, with guidance and supervision by environmental and technical specialists of TMO. Implementation of mitigation measures are ensured through regular follow up visits and field verification by technical and environmental specialists. In addition, RAP3‟s team of auditors includes the intermittent inputs of social and environmental specialists to check and verify implementation status of all safeguard measures at the field level. 3.3.7. Disaster Resilience

Trimester Report 16 July – 15 November 2016 Climate resilience measures are taken into account in rural infrastructure works through design, construction and maintenance phases.

Design – Engineering design standards fixed for district roads are adhered to strictly during engineering surveys and design of new road construction and improvement projects. These provide for flexible structures, side drains on sections with higher longitudinal gradients, stone pitching for road surface and side drains where soil conditions are prone to erosion and outward sloping cross-falls to avoid concentration of water flows into point discharges. They also provide for the use of stone lined causeways for waterway crossings to avoid blockages in pipes, installing sub-soil drains at structures to reduce the likelihood of the build-up of pore water pressures, which can exacerbate failures, and bioengineering works in geologically unstable sections, which are prone to landslides and erosion by rainfall. Design proposals aimed at addressing climate change effects are included in construction cost estimates.

Construction – Design proposals aimed to address climate change effects are being implemented after field assessments during construction phase, which are tracked through progress reporting to and field verifications from TMO on a regular basis.

Maintenance - Resilience Audit is embedded to Rapid Road Condition Survey of DRCN and climate change induced effects are taken into account in the ARAMP for implementation. However, in view of the budget constraints these activities are confined to emergency and RMGs‟ routine and recurrent road maintenance works.

In addition, detailed design standards incorporating resilience and climate change adaptation features have been submitted to the technical committee of DoLIDAR for formal approval and adoption by GON. Design of DTO office buildings for Doti and Kalikot have been completed incorporating earthquake resilience features and design works of DTO office building for Mugu is on-going.

3.3.8. EIA Study of Gamgadhi Chankheli Darma District Road In addition to safeguard management measures on the programme work activities, RAP3 continued working on the EIA study of the proposed MUG HUM link road. During the reporting period, the EIA study report submitted to MOPE through MOFALD for review and approval was presented to the review committee formed representing officials from ministries and departments and independent experts by MOPE. Upon receipt of comments from the review committee members, the EIA report is finalised incorporating comments and submitted for approval. The EIA study is expected to be approved from MOPE during the next Trimester.

3.4. CAPACITY DEVELOPMENT AND INSTITUTIONAL DEVELOPMENT

The capacity building and policy harmonisation (CB/PH) intervention of RAP 3 aims to improve the capacity of government institutions, mainly the DOLIDAR, DDC and DTO and the private sector consultants working in the Local Road Network (LRN) sector. It is anticipated that such interventions will enable the government as well as the private sector to manage the sector in a sustainable manner after the programme phases out. The support programme is implemented through central and district annual support plans and continuing professional development programmes. In the last Trimester, following major activities were carried out.

3.4.1. Training

Trimester Report 16 July – 15 November 2016 In this Trimester, some training and orientation activities have been carried out at the district and field level under Continuing Professional Development (CPD) and Annual Support Plan (ASP) programme.

The total number of training days generated during this Trimester is 1,486 days.

The CPD programme aimed at providing proper orientation/training to the stakeholders who are directly related to the programmes outcome. The training programme has been built around the annual LRN Engineering course modules. These training include LRN planning and detailed design, quality control, implementation and procurement procedure of LRN, bio-engineering, orientation to local political parties and RBGs on road construction and orientation to contractors. District Team Leaders/engineers were mainly the resource persons to conduct training to DTO staff, Support Consultants, RAP3 engineers and IoWs. Training activities usually take place before the commencement of the project cycle activities and during the works when it is deemed necessary. The overarching aim of these training is create a sustainable environment so that the RAP efforts will have lasting impact. The CPD activities have generated 579 training days from 14 districts in this Trimester.

In addition, several training events were carried out in the districts under the provision of ASP and Health and Safety Plan. Such training ranges from RBG/RMG refresher in Achham and Dadeldhura, to more sophisticated Auto CAD and SW Road software training in Humla and Total Station Handling training in Sankhuwasabha and Sindhupalchowk districts.. Similarly, training on Rapid Condition Survey was provided to the staff of DDC and DTO in Sankhuwasabha. Likewise, training on GIS mapping and SAP software was provided to the DDC/DTO staff in Kalikot and Jhapa district. An orientation on RMG Guidelines was provided to the DDC/DTO staff of Bajura district. Details on month-wise training types and days is provided in Table 2.4 below.

Table 3.4: Training Days - Summary Trimester Category July August September October Total A. Continual Professional Development 1. Orientation to UC/Contractors 0 0 0 0 0 2. Orientation to Political Parties 0 41 0 0 41 3. LRN Implementation (planning, design, rapid 126 53 157 11 347 condition survey, emergency maintenance) 4. Quality Control 0 23 0 0 23 5. RMG/RBG Orientation 0 0 0 132 132 5. Procurement 0 36 0 0 36 Sub Total of A 126 153 157 143 579 B. Training under ASP and Health & Safety 505 187 149 66 907 Total 631 340 306 209 1,486

3.4.2. Planning and Reviews Annual Support Plans (ASPs): ASPs are used to support CB/PH activities. There are district level and central level ASPs. Each district level ASP identifies support activities required for implementing DOLIDAR‟s LRN SWAp procedures in the district, in particular improving the capacity of the DDC and DTOs staff to deliver GON‟s sector wide objective to district citizens. CIM results are used as the main basis of preparing the ASPs. The central level ASPs consider both building organisational capacity and policy development required for Local Road Network Sector. All ASPs were prepared and approved by DDC and RAP3 in August and September.

Trimester Report 16 July – 15 November 2016 District Annual Progress Review: Annual progress review of all RAP3 districts was conducted at the district level in July 2016. The review meeting was participated by all RAP3 stakeholders in the respective districts, which included officials of DDC and DTO and other line agencies, representatives of the political parties, NGO federation, Chamber of Commerce and Industry, Transport Organisation, News media, Local Road User Committees and RAP TA Team. The review meeting mainly dealt with the progress status and ways to improve on the progress and coordination among the stakeholders. It is worth noting that the stakeholders have acknowledged the work of RAP3 and asked for more assistance.

Review of Continual Improvement Matrices (CIM): Continual Improvement Matrices (CIM) provide the overall framework for capacity building for RAP3. The CIM is used to assess performance and capacity against a number of key elements covering a full range of technical, quality and financial management necessary for the introduction of an LRN SWAp in GON central and DTO district offices. It also acts as a basis for preparation of district and central level ASPs.

In the last Trimester, CIM of all districts and centre was reviewed. The results presented in Table 2.5 below show that the districts and DOLIDAR have made improvement this year as compared to last year in their implementation capacity. The average score of the districts has increased to 6.52 from 6.27 whereas the score for DOLIDAR increased to 5.94 from 5.30. It should be noted that the score of Sindhupalchowk district has decreased this year due to the adverse effects faced by the DDC after the massive earthquake of last year whereas in case of Achham, the reduction was the result of difference in the rating system – the assessors considered RAP3 programme only last year whereas the whole DDC system was considered during the assessment this year.

Table 3.5: District and Central Level CI Scores S.N. Total CI CI score (yr) S.N. Core district CI score (yr) Pilot District score 2015 2016 2015 2016 1 Jhapa 10 7.36 7.82 1 Dailekh 7.64 7.67 2 Morang 10 8.45 8.23 2 Doti 4.81 5.52 3 Sankhuwasabha 10 6.82 6.99 3 Achham 6.64 6.45 4 Sindhupalchowk 10 6.03 5.86 4 Bajura 4.20 5.19 5 Parbat 10 6.57 6.47 5 Jumla 7.10 7.50 6 Dadeldhura 10 6.93 7.21 6 Humla 5.61 5.79 7 Kalikot 5.55 5.68 Average of 6 pilot districts 10 7.03 7.10 8 Mugu 4.11 4.95 Average of 8 core districts 5.71 6.09 Average of all 14 districts 6.27 6.52 DOLIDAR – Central department 5.30 5.94

3.4.3. Policy Related Support RAP has led the way in boosting the capacity of the LRN sector at both the central policy level and the district implementation level by working at both levels at the same time to promote two way feedback between districts and the centre. Consolidating these LRN initiatives will be one of the prime objectives of the Policy Harmonisation component of the Extension to assist GON with its LRN SWAp ambitions. GIS Based Local Road Inventory - RAP3 has provided support to DOLIDAR to digitise all DTMP data and upload onto the website. At present, data collected from the districts are being verified/checked. All data have been entered onto the website and GIS maps have been prepared. All individual district level GIS based LRN inventory has been linked into a single database. The LRN Record and GIS mapping has been expanded now to include bridge

Trimester Report 16 July – 15 November 2016 inventory as well. At present DOLIDAR‟s approval is awaited for final publication. Upon completion of this task, DOLIDAR with the support of RAP3 will publish a nation-wide Local Road Statistics, which will help the GoN for preparing more reliable plans and development programmes.

Support to Prepare Draft GoN Infrastructure Guidelines for Restructured Local Bodies - In view of the current state restructuring process, MoFALD has been tasked to develop a new Local Infrastructure Development Guidelines. RAP3 has been providing support to Technical Division of MoFALD to prepare the draft report. The working group has been tasked to define the jurisdiction of the provinces, municipal councils and village councils (in area of infrastructure sector) and redefining the local road networks in the context of state restructuring. Preliminary draft report is being prepared, however, it seems that the finalisation process would take a couple of more months.

Bikasko Bato – a local FM radio station programme, broadcasted 16 episodes during this Trimester. Areas covered on these episodes include issues on health, hygiene and sanitation, importance of education, food and nutrition and the importance of road access for income generation and market development. Radio discussions held on changes brought about by various people action groups like women groups, who campaign against drinking, gambling and environmental protection. The RAP3 extended contract with Antenna Foundation Nepal for one year to run the programme in August 2016. The AFN will prepare more RAP3 activity focussed radio programmes and run through local FM stations. During the reporting period 3 day training was organised in Nepalgunj to enhance capacity of local FM radio journalists providing tools and techniques for quality interviews, case study development and report writing skills. The training was participated by 15 local FM station partners‟ representatives of 8 districts and 2 staff from Nepalgunj and Kathmandu office by AFN in Sept 2016. Extension Initiatives  Through the new DTMP RAP has led the way in simplifying the DRCN network to something more manageable for the DTOs, given their staffing, capacity and funding limitations.  DTMPS have been prepared for 75 districts by RAP and are used by GON and other donor projects for 5 year district investment planning.  In combination the DTMPs will allow GON to prepare precise estimates of existing road assets, the cost of maintaining them, the final length of DRCN that needs to be constructed and the costs of linking up VDC centres not yet connected to the LRN – a National LRN investment plan to be prepared as part of the RAP Extension.  RAP will need to consolidate support to DOLIDAR to complete its GIS mapping of DRCN based on existing DTMPs.  Once reviewed by RAP3, GON should then take up funding of DTMP preparation nationwide, the cost of which has been reduced from GBP35, 000 each to about GBP 6,000.  What needs to be pushed is the Annual Road Asset Management Plans (ARAMP) that guide annual investment priorities in the light of the DTMPs. Both will need to be reviewed in the light of experience in using DTMP and ARAMPs by RAP and its sister LRN projects.

Trimester Report 16 July – 15 November 2016  The Extension will continue to provide support to DOLIDAR to prepare its annual LRN Inventory which includes roads which are not part of the DRCN.  New LRN standards prepared by DOLIDAR with RAP support have taken into account climate change and DRR issues and require an audit by a climate change expert during the Extension.  Work norms for the seven infrastructure sectors making up DOLIDAR‟s portfolio will probably need to be reviewed towards the end of the Extension, especially if there are further moves towards labour based, equipment assisted implementation.  RMG guidelines will need to be translated into Nepali together with pocket editions for the field and printed in sufficient numbers for nationwide distribution. Led by GON with matching funding from RAP and other donors if possible.  Preparation of an advanced LRN course for RAP3 engineers and translations into Nepali as part of GON led sector wide training supported by matching fund from RAP3.  The extension will continue to support NEC with its long term ambition to introduce Professional Engineer status following the IEA conference in early June 2016 in Kuala Lumpur, Malaysia.  Promotion of ICE (UK) chartered membership and internationally recognised chartered engineering status pioneered by RAP for its Graduates and RAP Engineers to help attract and keep first class engineers against the rebuilding opportunities closer to Kathmandu than remote Karnali.  Pilot Exit will be in place from the start of the Extension and mark a major step towards the sustainability of RAPs work on Policy Harmonisation.  This financial year GON will provide NRS 20 million to assist RAP with payment of RMG programme in the pilot districts from October 2016 while RAP will provide top up funding.  From July 2017 GON proposes to fund the RMG programme in all 10 RAP districts with RAP providing light touch TA in the form of a Help Desk for all districts.  RAP is to pilot Schedule of Rates contracts to try and speed up procurement and lengthen the working season for maintenance.

3.5. PERFORMANCE MANAGEMENT AND VERIFICATION The MEL‟s review of RAP3 PMV concluded that RAP3 performance management and verification processes and practices meet many of key criteria and are robust. Hence, the present PMV system will continue and incorporate improvements in areas as suggested by the review. The RAP3 PMV system includes the following.

3.5.1. Quality Management Technical Procedures – RAP3 technical procedures, including 1) LRN on-the-job training materials in Nepali. 2) First Aid Kit medicine management, based on audit findings, 3) SBG engagement in new construction districts 4) store management and 5) RMG guidelines were reviewed and updated during the reporting period.

Field Verification – Reports on field verification works performed by District Technical Teams and by visiting technical specialist teams reached 41 during the reporting period. These verifications covered works carried out under LRN and SED components of the programme. Field

Trimester Report 16 July – 15 November 2016 verification reports form the basis for continual improvement planning within the programme to improve work quality by identifying substandard works and activities at the field level.

Internal Audit – During the reporting period, five scheduled technical audits concentrating on 1) Public audit at LRUC and RBG level in KAL and SIN, 2) Programme Implementation in BAJ and MUG, and 3) District Level Communication with GoN agencies and other programme stakeholders in MUG. In addition 3 non-scheduled audits on internal financial management in MOR and field verification on issues raised in direct beneficiary feedback study conducted by MEL in MUG and BAJ. The audits focussed on procedural guidelines of RAP3 to identify issues requiring mitigation through the programme‟s Continuous Improvement Action Plan (CIAP).

Continual Improvement – The approach defined in BP039 Continual Improvement has been incorporated in the new Internal Audit Guidelines and is now being applied in TMO‟s monthly Management Reviews. Continual improvement actions of the reporting period is presented in the table below.

Table 3.6: Continual Improvement Actions against issues raised by internal audit

3.5.2. Financial Management The Financial Management (FM) part of RAPID is fully operational in all districts and in Kathmandu. Component wise expenditure details are compiled using FM module. Three modules, including 1) Work Sheet, 2) Cash Book and 3) Contract Management are operational. Reconciliation between actual cost and invoiced value - The reconciliation between actual cost spend and invoiced value was done at the end of October 2016 for actual cost and invoiced value and the difference, i.e. cost spend but yet to be invoiced to DFID is 122,103. RAP3 component level invoiced and spend figures are presented in the table below. Table 3.7: Invoice Versus Spend

Trimester Report 16 July – 15 November 2016 Component-wise Reconciliation between DFID Invoiced Value and Actual Expenditure/ Cost of Work Done to 31st October 2016

INVOICE Value from Inception to 31st October 16 Actual Spend/Cost of Work Done Difference Cumulative Invoice for Invoice vs. Spend/Cost of Component Inception to 31st October 2016 RAP3 Work Done Output 1 LRN 16,283,401.9 16,240,709.6 42,692.3 Output 2 SED/ Connect/ Safeguard 5,626,130.5 5,626,130.5 - Output 3 CBID 1,564,351.9 1,564,351.9 - PMV 427,473.0 427,473.0 - Other 206,019.8 206,019.8 - TA 3,976,877.1 4,141,672.3 - 164,795.2 Total 28,084,254.20 28,206,357.05 - 122,102.85 Projection and Invoice Figures - The total invoice amount projected for the last Trimester was GBP 2,376,508, whereas the amount actually invoiced to DFID is 2,675,156. As a result GBP 298,648 was invoiced more than projected. This was based on the revised projection of 16 Sept 2016. The projection for the next Trimester is GBP 2,940,293. DLI targets and progress - Out of 7 DLI targets, the progress under employment days, road maintenance and new construction 4.5KM wide DLIs exceeded in the last Trimester. But achievements under new construction 3.5KM wide and training days DLIs remained less than targets. There is no difference in the target and achievement of audit and SMT report DLIs.

3.5.3. Monitoring and Evaluation The M&E system reporting formats are regularly updated to track programme logical framework indicators and milestones and to make it more output focused, simpler to read and more informative. Some refinements were made incorporating recommendations of MEL PMV review findings. Further refinements are expected during the next Trimester incorporating logical framework milestone targets, value for money indicators and safeguards management component of the programme.

3.5.4. The RAP3 PMV Review Recommendations and Actions RAP‟s Monitoring, Evaluation and Learning (MEL) review of PMV concluded that RAP3 performance management and verification processes and practices meet many (some 75%) of the criteria under each dimension and are robust. The MEL‟s review identified 5 dimensions: 1) PMV System Design and Management, 2) Data Collection, 3) Data Processing and Reporting, 4) Data Quality Checks and 5) Feedback. The review concluded that there are examples of good practice across each of the 5 dimensions identified. The review also stated that RAP3 has put considerable effort into building its management systems and ensuring the quality of delivery as well as staying on target. The review recommendations for improvement to strengthen the RAP3 PMV system include a wide range of areas. Out of 17 recommendations 14 are completed, 2 are repeated 1 is related with MEL component of RAP3. Details of status of each recommendation in presented in the Annex 7.

3.5.5. Programme Logical Framework The RAP3 LogFrame is in the process of revision to capture results, outputs and outcomes fixed for the extension period and changes made on social economic development by CONNECT related activities. Impacts, outcomes and output indicators are agreed and the milestone targets are to be determined. The revised LF is expected to be finalised in the next Trimester. Hence,

Trimester Report 16 July – 15 November 2016 programme implementation target and progress for the reporting Trimester is compiled and interpreted based on the existing programme LogFrame.

3.5.6. Risk Management Risks encountered by the programme during the reporting period and likely to happen in future are dealt in the following categories. Effort made to mitigate risks are also presented in detail in in Annex 8 of this report. During the reporting period, RAP3 programme risk areas included: A. External context – Natural disaster, political disruption and interference and delays in visa extension of expatriates; B. Implementation – Remoteness related issues resulting in slow implementation and delays in VAT refund to the partners by GoN agency could lead to cost and time overruns and non- cooperation of programme stakeholders. Likewise increase in district daily wage rates and budget shortfall to cover expenses of RMG road maintenance works could effect on programme results; C. Safeguards – Injury and death of workers on- and off- work sites; D. Operational – Dependence on donor support for road maintenance, shrinkage of DRCN due to formation of new municipalities, related transfer of road section ownership and poor performance of design and supervision consultants, continued undue pressure and threat to inflate wage earning rates by LRUC and RBG members; E. Fiduciary – Risk of collusion in bidding on projects implemented through DDF, potential of inaccurate financial forecasting due to poor planning and budgeting; and district daily wage rate increases which may need to be capped as they were in RAP2. F. Reputational – Local perceptions of an early exit of the SED programme (e.g. DDC Kalikot letter) and other unfinished works due to budget shortfall.

Programme risk matrix is reviewed, updated and presented in the Trimester report. The gist of programme risk matrix is presented in the figure below. In addition, we continue to maintain our risk events register and general risk matrix, which shows the latest status of each risk category experienced by the programme. RAP3 continues to work in close coordination with the DFID/GIZ Risk Management Office (RMO) in using RMO‟s guidelines and SITREPs for which RAP3 district staff are major contributors. Figure 3.4. : RAP3 Risk Matrix

Trimester Report 16 July – 15 November 2016 4. PROGRAMME REVIEWS

Programme performance reviews are jointly conducted annually by DFID and GoN. On behalf of GoN, DoLIDAR officials also participate in the annual review process led by DFID-N. Progress against last year‟s annual review recommendations exclusively related to IMC and jointly related to RAP3 partners (OPM and MEL) and recommendations of this year‟s review is presented as per the following.

4.1. PROGRESS AGAINST LAST YEAR’S ANNUAL REVIEW The last year‟s Annual Review was conducted in September 2015 and the report was circulated in October 2015. The review made 29 recommendations in total with 15 related to IMC-RAP3. Out of 15 recommendations, 10 recommendations were exclusively related to IMC-RAP3 leaving 5 others to be implemented in collaboration with OPM and MEL. Actions on 12 recommendations are complete and the actions on remaining 3 recommendations are underway and progress status of these recommendations is as below: Table 4.1: Progress Status of Remaining Recommendations AR Sept 2015

Recommendation in AR Sept 2015 Progress by October 2016 DFID to work with partners to identify if and Underway: The new RAP CONNECT programme includes a how the programme could play a more component to work with the district GoN to map and coordinate catalytic function in helping the district plan “social economic activities”. Work is also continuing with KEP to and integrate the various development and explore ways to bring together different cash for work GoN interventions programmes in Karnali (e.g. through a MIS) IMC worldwide to work with GoN to push for implementation of LRN review recommendations on refining DTMP and Underway: DTMPs of 75 districts completed successfully. This ARAMP processes/methodologies prepares basis for refinements in DTMPs/ARAMPs and develop /prioritisation/implementation quality and evidence for GoN led National DRCN Investment Plan. technical qualities of RAP3 LRN works IMC to work with KEPTA and review targeting approach including proposing a simple Underway: Initial thinking explored but ideas need to be graduation model for improving skills and synchronised with KEPTA extension plans. awareness of RBG and RMG members families

4.2. ANNUAL REVIEW RECOMMENDATIONS 2016 The programme AR conducted Sept 2016 has come up with a total of 15 recommendations for the next year. The proposed implementation time line for each recommendation with current status and responsibility amongst RAP3 partners (IMC, ITAD and OPM) is presented in the following table. Progress against recommendations related to IMC will continue reporting through next Trimester. Table 4.2: Progress Status on AR Recommendations Sept 2016 Ref Responsibility and Recommendation Time line # current status 1 IMC to disseminate RAP3‟s good practices and achievements Dec 2016 IMC and ITAD; through communication pieces and workshops in coordination onwards ITAD to take a lead to with DFID and GoN (to publicise successes and help engage disseminate on RAP3‟s other Local Road Network programmes) good practises and achievements 2 IMC to implement the exit plan for pilot districts as concluded Aug 2017 IMC; in LRN sustainability approach and begin to put in place an Actions started. To action plan for handing over the core district maintenance to expedite the process the GoN (e.g. can we use and access the Road Fund). This after SC meeting should include the funding and people resources to manage decision scheduled on

Trimester Report 16 July – 15 November 2016 Ref Responsibility and Recommendation Time line # current status RMGs, being specific in terms where each district is today and 28 Nov 2016 what is required over the next 3 years and include a specific policy/influencing strategy. 3 IMC to ensure a cost management plan is in place to actively Dec 2016 IMC; manage the cost of the extension period. This should include As of above working with DFID, RAP Co-ordinator and GoN officials to prepare for and deliver a steering committee which formally agrees to “cap” costs for the extension period (and mitigate the cost overrun risk) 4 IMC to develop and implement a matrix to document and track Nov 2016 IMC; progress against main recommendations from the reviews onwards Action initiated conducted including MEL‟s independent reviews, MEL‟s independent verification of LRN;s major results, Crown Agent‟s Fiduciary Risk Assessment, RAP3 Performance Management and Verification audits (technical audit and verifications, independent financial audit etc.) and IAD DFID internal Audit. DFID to update RAP3 delivery plan every Trimester accordingly. 5 DFID and IMC to review the revised “open book” output based Early 2017 DFID and IMC; payment approach in year 1 of the extension period To initiate 6 IMC to shift the implementation year to align with the GoN Jun 2017 IMC; fiscal year 7 As the new CONNECT approach is designed to test new IMC; approaches and take greater risks, the IMC team will need to On-going ensure they actively manage and flag risks as well as ensure the team is actively learning and being bold to stop what is not working and scale / replicate what is. 8 Linking with the new overall RAP3 logframe being developed May 2016 IMC and ITAD; and contract extension, IMC to work with MEL to consolidate Action initiated “capacity building to GoN” and develop a mini LF which captures the key activities, innovation, safeguards and results 9 IMC and MEL to develop and implement a work plan in Nov 2016 IMC and ITAD; agreement with DFID and GoN (MoFALD and DoLIDAR in onwards Initial thinking explored particular) for enhancing LRN sector coordination ideas to proceed with 10 In the next period, KEPTA will not be focusing on policy DFID to verify KEPTA; influencing and will instead be focusing on capacity Mar 2017 development to support the implementation of KEP. However, it is recommended that KEPTA strengthen the working relationship with KRDU to ensure that all KEPTA activities are grounded within MoFALD and that all knowledge products developed for and with the Government of Nepal are fit for purpose 11 In the next phase, KEPTA will be focusing primarily on building Mar 2017 KEPTA; institutional capacity within KRDU and within the implementation districts. The programme would benefit from developing and implementing a targeted system of tracking- on an ongoing basis- capacity enhancement and institutional reform within KEP (similar to the Capacity Improvement Matrix). Ongoing monitoring can allow the team to adapt and trouble-shoot as needed 12 Given the increased focus on sustainability the RAP3 Aug 2017 ITAD; Extension, it will be important to identify how the MEL team can positively contribute to key policy goals (e.g. GoN taking on the funding and management of RMGs). 13 Given the investment in the RCA report and subsequent “Mid Dissemination ITAD; Line Report”, it will be important for DFID and the MEL team to plan due by ensure that the findings and key insights are shared widely and Jan 2017 genuinely used. This should include exploring in detail cross cutting themes such as gender and conflict. 14 MEL team to lead a process engaging all partners to finalise Dec 2016 ITAD; the updates the logframe for the extension period

Trimester Report 16 July – 15 November 2016 Ref Responsibility and Recommendation Time line # current status 15 Whilst there have been examples of improvements in VfM, Jan 2017 ITAD and IMC; understanding and measuring VfM as a routine process is still To be followed by IMC not sufficiently developed. Post the finalization of the logframe after finalisation of led by the MEL team, all partners will work with DFID to define indicators by ITAD a robust measurable VfM framework which can be monitored routinely

Trimester Report 16 July – 15 November 2016 ANNEX 1 – RAP3 PROGRAMME OVERVIEW

WHY UKAID IS REQUIRED As identified in the DFID Business Case for RAP3, high levels of chronic poverty make Nepal the 15th poorest country in the world, and one of the most unequal. Economic growth is hampered by geography and lack of investment, with Nepal having the lowest road access in South Asia. Moreover those roads that have been built in the last 16 years have not been maintained and in 2013 only 45 % of roads built were still motorable, representing a loss of more than one billion US$ to the country and its development partners. The poor in Nepal are also highly vulnerable to natural, economic, social and political shocks that trap them on or near the poverty line. In Nepal all of these indicators are worse in the mid and Far Western regions. The government‟s capacity is limited to address these issues, so DFID support is required to develop government and private sector capacity to stimulate economic growth in the poorest area of Nepal.

COMPONENTS  RAP3 Implementation £31.5m –The DFID Business Case for RAP3 states that RAP will increase the economic opportunities available to the poorest and most vulnerable people in seven of the remotest Districts in Nepal1. It will do this by providing employment for the poor maintaining and upgrading existing roads and constructing rural roads and economic infrastructure where these are lacking. It will also develop agricultural and other small businesses to put in place the foundations for sustainable economic development in the area. This Implementation Plan is for the RAP3 Implementation contract under IMC.  Rural Employment Guarantee Programme Support £3.6m – This component will improve the effectiveness of the Government‟s Karnali Employment Program (KEP) in the Mid-West of Nepal. Technical assistance will be provided in two pilot districts and at the national level. Support will focus on improving targeting and awareness, wage payment systems, registration, planning and monitoring, transparency, capacity and coordination with local government. The TA will also ensure that lessons learned from RAP pilots inform the roll out of a National Employment Guarantee Scheme, part of Nepal‟s wider social protection framework.  Results, Evaluation and Policy support, £1.35m – To provide DFID with assurances that implementation is being delivered effectively DFID will contract a third party to undertake continuous monitoring of the programme including financial and administrative arrangements overseen by DFIDN. DFIDN will also undertake an independent evaluation. This component will also ensure that separate studies can be conducted to capture lessons on specific issues specified by the RAP Steering Committee and used to inform the design of future donor and government programmes.

LESSONS LEARNED FROM RAP2: Labour-based works programmes are effective in reaching the poorest, lifting people directly out of poverty, and simple targeting is effective at reaching the poorest. Direct targeting of women is necessary to ensure they benefit. RAP has had to enforce quotas to ensure women do not lose out.

1 An eighth district Doti was added later and in 2016 so was Dadeldhura

Trimester Report 16 July – 15 November 2016 Savings groups, literacy training and income generation training schemes are all effective in giving workers access to increased economic opportunities but support needs to be extended to include traders and agricultural input suppliers if production is to be scale up significantly and sustainably. Government Support for maintenance is available if the systems and incentives are in place to support its allocation and implementation but institutional development is required not just for government but also for the private sector and community groups. Climate change and disaster resilience can be integrated into RAP relatively easily, improving infrastructure and increasing the awareness of communities. Delivering safely and securely is possible as long as „safe and effective development‟ approaches are used to resolve disputes over resources quickly. Third party anti-corruption measures that provide oversight at all levels of implementation do improve accountability, but do not replace the need for improved government and private sector led and owned anti-corruption measures.

LONGER TERM STRATEGY This phase of RAP continues to focus on delivery but with support to build government and private sector capacity so that subsequent stages can rely less on direct DFID implementation. It recognises that the required institutional changes to make this happen will take time and in the current context may not be possible to make sustainable. For these reasons a four year implementation period was recommended, after which Nepal‟s political direction and approach to Federalism may be clearer and a new phase of support can be designed which can reflect the new context and political scenario. The four year implementation period was extend to 2019 following negotiations between DFID and IMC in 2016. Theory of Change – RAP‟s theory of change relies on a simple core narrative as shown below: RAP3 Theory of Change Context The rural poor in Nepal lack access to capital and markets to invest in economic activities, locking them in chronic poverty Inputs RAP will provide employment, transport infrastructure and income training Outputs RAP inputs generate savings that can be invested in cash crop production combined with increased access to markets provided by improved infrastructure Outcome Increased investment and private sector income generation Impact Increased growth and poverty reduction in RAP Districts

CHALLENGES For RAP3 the biggest challenges are likely to be bridging the gap between being results driven and the operating realities on the ground in some of the remotest and most difficult terrain in Nepal. This translates into a battle to combat high costs and slippages in delivery timescales in a climate which will certainly be hostile to the pressures of a results based programme. However, RAP2 operated in nine of the RAP3 districts and the IMC central and district teams therefore have practical experience of these challenges of delivering the programme on the ground and tried and tested coping mechanisms. Three years after the start of RAP3 the 2016 Annual review observed that The Review concluded that RAP3 continues to deliver significant results and has met most output targets for the year.

Trimester Report 16 July – 15 November 2016 BUDGET The 2013 move by the British Government to fix its aid budget at 0.7% of GDP doubled DFID N‟s budget for that financial year which allowed a speeding up of disbursement for the first year of RAP3 up to the end of September 2014. Comparing RAP3‟s budget of GBP31.5 million for 14 districts to RAP2‟s budget of GB33 million for just 7 districts, shows the average allocation per district is half that of RAP2. This suggests that RAP3 has plenty of scope for spending additional budget in tackling poverty in the west of Nepal. The 2016 Extension budget is an additional GBP15.775 million.

DISTRICTS District Transport Master Plans (DTMPs) were prepared for all RAP3 districts by the RTI Pilot. These identify the District Road Core Network (DRCN) on which RAP3 funds will be spent. There are now 9 core districts in the west of the country which will receive both road related activities and CONNECT activities. Four of these have little or no existing LRN networks so Humla, Mugu, Kalikot and Bajura have new road construction. The remaining four districts of Jumla, Achham, Dadeldhura, Doti and Dailekh, together with a further 5 former RTI Pilot districts will receive funds for maintenance and upgrading of existing LRN networks if warranted by their DTMPs. The RAP3 Steering Committee of November 2016 agreed to upgrade Dadeldhura from a Pilot district to core district on the grounds that the district is next to and has poverty levels similar to those of the other core districts.

PROGRAMME INPUTS Programme inputs vary between core districts, core and pilot districts and central government and the private sector. For easy reference programme inputs are shown below in detail.  Core districts of Humla, Mugu, Bajura and Kalikot with new road construction (and CONNECT inputs in Bajura), capacity building, annual support plans, training and TA.  Core districts of Jumla, Doti, Achham, and Dailekh with maintenance, upgrading and CONNECT inputs economic infrastructure, capacity building, annual support plans, training private sector capacity building and TA.

Trimester Report 16 July – 15 November 2016  Pilot districts with maintenance and upgrading plus capacity building, annual support plans, training, private sector capacity building and TA. but no CONNECT activities  Central GON based on the action plan of the Nepal Road Sector Assessment Study (NRSAS) which was launched 24the January 2014, plus annual support plans, capacity building, training, policy harmonisation and TA.  The private sector including annual support plan, capacity building, training, NRSAS, Nepal Engineering Council (NEC) and TA

ASSET MANAGEMENT In the last fifteen years an estimated 51,000 km of LRN has been built. By 2011 55% of this was not usable because of a lack of maintenance, the equivalent of US$1 billion worth of lost investments. By the end of 2012, RAP2‟s RTI Maintenance Pilot had assisted GON to revise the District Transport Master Plans (DTMP). These guide LRN investment and identify the minimum network required to link VDC and District headquarters – the so called District Road Core Network (DRCN). The new policy is to put maintenance of existing assets first, upgrade existing assets to all weather status with bridges and put new construction last. DTMPs for RAP3 districts were conducted in the first half of 2013 by the RTI Pilot. DTMPs for the entire country were completed in 2016 and will guide short, medium and long term investment by donors and GON in the future.

WORKING WITH GOVERNMENT An important theme of RAP3 is working with GON at both the central and district levels where it has offices embedded in GON institutions and TA staff ready to assist with the business of government and build capacity using annual support plans. These are reviewed each year and their impact measured in terms of an ISO9004 style Continual Improvement Matrix (CIM) designed to measure progress towards LRN SWAp compliance.

SECTOR WIDE APPROACH RAP3 is the first of a new generation of Local Road Network (LRN) projects that are a part of a Government of Nepal (GON) sector wide approach (SWAp). The intention is to introduce a new model of development cooperation to promote greater harmonisation of donor and government activities in the sub sector. This will be achieved by GON and its development partners adopting a single, Government-led, RTI policy with common approaches to RTI development. This is to be matched by improving governance and capacity building at local and central levels of government to allow progressively greater reliance to be placed on government procedures for implementing future RTI investments. Outsourcing to the private sector is a key part of building capacity and technical harmonisation in the sector, with the role of GON officials shifting away from technical implementation to planning and overall management. The framework for this is the 5 year DTMP and the annual ARAMP which, following their adoption as national policy, will be followed by all new LRN projects in all 75 districts

PROGRAMMEINPUTS PROGRAMMEINPUTS

Trimester Report 16 July – 15 November 2016

Central Government and Private Sector Inputs

Core District Inputs

Trimester Report 16 July – 15 November 2016

Pilot District Inputs

Trimester Report 16 July – 15 November 2016

ANNEX 2 – DISTRICT MAPS AND ROAD CORRIDOR MONITORING SHEETS

Trimester Report 16 July – 15 November 2016

Total DRCN = 373.24 Km

Total DRCN = 269.56 Km

Trimester Report 16 July – 15 November 2016

Total DRCN = 220.50 Km

Trimester Report 16 July – 15 November 2016

Total DRCN = 291.92 Km

Trimester Report 16 July – 15 November 2016

Total DRCN = 256.20 Km

Total DRCN = 605.24 Km

Trimester Report 16 July – 15 November 2016

ANNEX 3 – INNOVATIONS

Innovation Initiatives not in original TOR Remarks 1 Annual LRN Engineering Competency Test All RAP engineers must pass this test each year to stay in RAP 2 CPD Programme for RAP and GON engineers LRN Training ahead of main steps in project annual cycle Prepared guideline on RMG road maintenance for LRN projects 3 Road Maintenance Groups (RMG) introduced and enacted by DoLIDAR Now linked to annual district planning budget cycle in Oct/Nov 4 ARAMP piloting and March Nineteen DTMPs prepared and the last one (Sarlahi) waited for 5 Twenty DTMPs to be prepared for SNRTP approval 6 DTMP Review Updating DTMPs based on first round experience (75 districts) 7 DOLIDAR GIS database updating to track DTMP plans and implementation tracking nation wide DTMP 8 LRN Road Safety assessments linked to Linked to annual road condition survey in pilot districts maintenance 9 Capacity Building Continual Improvement Measures GON capacity to deliver RTI SWAp objectives Matrix Procurement and financial management training delivered via 10 Private sector training in project management SCAEF/NCAN training centre 11 CDP development for Engineering profession NEC/NEA/ICE joint CPD development initiative Engineering technicians from CTEVT and fresh engineering 12 Introduce Intern and Graduate Programme graduates engaged to provide hands-on experience in programme activities 13 Development of linkages with ASCAP Initiatives for applied research on benefits in LRN sector 14 Development of RAP Integrated Database Real time reporting on LF results and financial management Full disclosure of DTMP, ARAMP, procurement, works progress 15 District web pages introduced CPD and news from each of the RAP districts 16 Review of market linkage approach to IG DFID review of SED market based approach to IG 17 Risk based audit programme Audits focussed on risk assessment and key issues arising Briefing notes on how to deal with supply chain, child labour 18 Collaboration with MEL on lesson learning issues, working with the local press/TV media 19 Communications / anti-corruption strategy Weekly half hour FM programme about development issues linked to weekly radio programme in core including free phone whistle blower facility. districts Outline of programme management approach and various tools 20 Performance management and verification use to maintain transparency, governance, dissemination and strategy reporting. Possible use of KEPTA work cards to prevent child labour in 21 Collaboration with KEPTA RMG and RBG in RAP, Village Transport Master Plan Linked to earthquake recovery by engineering profession and 22 NEC collaboration on Professional Engineer private sector initiatives and IEA Introduce VfM monitoring indicators in RAP3 implementation 23 Value for money (VfM) indicators activities 24 SED replaced after redesign of component Private sector partnership approach introduced with third party and now called RAP3-Connect, investment leverage on agricultural commercialisation 25 Support to RAP3 engineers to get ICE Train up a group of assessors to feed in to the NEC initiative and chartered status explore alternatives while NEC route is developed. RMGs made a GON budget line with RAP3 providing TA to 26 Pilot RMGs funded by GON DTOs in Pilot Districts to 2019 followed by handover to DTO staff Scoping study on raising community awareness about health 27 Safetyknot scoping study and safety and prevention of injuries. To feed into RECAP initiative to improve quality control in the 28 Business Case for a national laboratory LRN sector Key Issues:

Trimester Report 16 July – 15 November 2016 ANNEX 4 – CENTRAL CONTRACTS PROCURED Date: As of 23rd November 2016

REVISED Total Remarks / Key Paid to date Ref Name of the Contract District Value excl. VAT issues or actions (NRs.) (NRs.) required Procurement in 2013 Stage 1 Survey, Design and IEE of Gamgadhi-Dhaina-Dulachaur District RAP3/2013/001 Mugu 1,343,081.21 1,343,081.21 Contract Terminated Road RAP3/2013/002 Stage 1 Survey, Design and IEE of Sallisalla-Darma District Road Humla 1,300,000.00 1,298,080.00 Completed RAP3/2013/003 Stage 1 Survey, Design and IEE of Galfagad-Kalika District Road Humla 1,240,000.00 1,240,000.00 Completed Stage 1 Survey, Design and IEE of Maure-Kailashmandu and Maure-Toli- RAP3/2013/004 Bajura 1,370,813.80 1,370,813.80 Contract Terminated Chhatra District Roads Stage 1 Survey, Design and IEE of Sanighat-Phukot-Syuna-Shipkhana RAP3/2013/005 Kalikot 2,005,672.11 2,001,082.11 Completed District Road Consultancy Services for Stage 2 Survey, Design and Construction RAP3/2013/006 Mugu 32,983,416.24 26,872,538.55 Supervision of Gamgadhi-Dhaina-Dulachaur District Road Consultancy Services for Stage 2 Survey, Design and Construction RAP3/2013/007 Humla 35,310,064.15 27,462,262.40 Supervision of Sallisalla-Darma and Galfagad-Kalika District Roads Consultancy Services for Stage 2 Survey, Design and Construction RAP3/2013/008 Supervision of Maure-Kailashmandu and Maure-Toli-Chhatra District Bajura 31,453,968.75 9,849,108.96 Contract Terminated Roads Consultancy Services for Stage 2 Survey, Design and Construction RAP3/2013/009 Kalikot 38,241,096.00 30,146,434.14 Supervision of Sanighat-Phukot-Syuna-Shipkhana District Road Consultancy Services for Local Road Asset Management Support in Jumla RAP3/2013/010 Jumla 36,031,540.63 25,795,912.16 Completed district Consultancy Services for Local Road Asset Management Support in RAP3/2013/011 Achham 28,622,125.00 19,552,321.24 Completed Achham district Consultancy Services for Local Road Asset Management Support in RAP3/2013/012 Morang 25,344,921.00 10,900,100.87 Contract Terminated Morang district Consultancy Services for Local Road Asset Management Support in Doti RAP3/2013/013 Doti 34,289,611.60 28,563,240.96 Completed district Consultancy Services for Local Road Asset Management Support in RAP3/2013/014 Dailekh 34,090,707.34 27,097,447.71 Completed Dailekh district Consultancy Services for Local Road Asset Management Support in RAP3/2013/015 Dadeldhura 33,991,453.68 26,900,024.37 Completed Dadeldhura district

Trimester Report 16 July – 15 November 2016 Consultancy Services for Local Road Asset Management Support in Jhapa RAP3/2013/016 Jhapa 22,543,500.00 12,545,981.70 Contract Terminated district Consultancy Services for Local Road Asset Management Support in RAP3/2013/017 Parbat 25,135,000.00 13,565,303.00 Contract Terminated Parbat district Consultancy Services for Local Road Asset Management Support in RAP3/2013/018 Sindhupalchok 20,689,000.00 9,273,216.09 Contract Terminated Sindhupalchowk district Consultancy Services for Local Road Asset Management Support in Contract RAP3/2013/019 Sankhuwas'a 25,135,000.00 12,230,929.54 Sankhuwasabha district Terminated. Consultancy Services for Survey, Design and IEE for Road Improvement Jhapa, Morang and RAP3/2013/020 3,077,387.50 3,077,387.50 Completed Works in Jhapa, Morang and Sankhuwasabha districts Sankhuwas'a Parbat, Consultancy Services for Survey, Design and IEE for Road Improvement RAP3/2013/021 Sinddhupalchok, 4,856,262.50 4,856,262.00 Completed Works in Parbat, Sinddhupalchowk, Dailekh and Jumla districts Dailekh and Jumla Consultancy Services for Survey, Design and IEE for Road Improvement Dadeldhura, Doti and RAP3/2013/022 4,024,631.25 3,760,908.00 Works in Dadeldhura, Doti and Achham districts Achham RAP3/2013/023 Supply of Construction Tools and Safety Equipment to Nepalgunj Nepalgunj 5,084,300.00 5,077,090.41 Completed. Supply of Construction Tools and Safety Equipment to Bajura and Humla RAP3/2013/024 Bajura and Humla 9,755,907.68 9,437,122.25 Completed. districts Supply of Construction Tools and Safety Equipment to Mugu and Kalikot RAP3/2013/025 Mugu and Kalikot 5,151,111.25 5,125,740.51 Completed. districts Procurement in 2014 New Constuction RAP3/2014/001 Supply of Gum Boots 8,149,100.00 8,067,609.00 Completed. Districts New Constuction RAP3/2014/002 Supply of Survey Gears ( Auto Levels/ Total Stations) 1,749,000.00 1,749,000.00 Completed. Districts RAP3/2014/003 Cancelled Cancelled Cancelled Cancelled Cancelled RAP3/2014/004 Supply of Machine Fabricated Gabion Boxes for Kalikot District Kalikot 13,664,376.00 13,552,639.19 Completed RAP3/2014/005 Supply of Machine Fabricated Gabion Boxes for Bajura District Bajura 37,320,807.68 37,232,636.04 Completed RAP3/2014/006 Cancelled Cancelled Cancelled Cancelled Cancelled RAP3/2014/007 Retrofitting TMO, Kathmandu 362,170.99 362,170.99 Completed RAP3/2014/008 Supply of Machine Fabricated Gabion Boxes for Mugu District Mugu 26,669,614.00 26,521,741.95 Completed RAP3/2014/009 Supply of Machine Fabricated Gabion Boxes for Humla District Humla 30,575,163.00 30,181,735.29 Completed New Constuction RAP3/2014/010 Supply of geotextile to RAP3 districts 3,464,775.00 3,393,900.02 Completed Districts New Constuction RAP3/2014/011 Supply of Construction Tools to RAP3 districts 3,811,237.00 3,776,744.18 Completed Districts

Trimester Report 16 July – 15 November 2016 New Constuction RAP3/2014/012 Supply of Wheel Barrows to RAP3 districts 5,404,000.00 4,980,300.00 Completed Districts RAP3/2014/013 Desigade- Mahabu District Road Dailekha Dailekh 22,619,231.25 13,369,858.47 Preparation of DTMPs for DoLIDAR in 2014/2015 Dhanusha, mahottari, Dhanusha, Mahottari, RAP3/2014/014_01 2,348,144.00 1,715,534.44 Sarlahi and udaypur districts. Sarlahi and udayapur Preparation of DTMPs for DoLIDAR in 2014/2015 Bara, Parsa, Rauthat Bara, Parsa, Rauthat RAP3/2014/014_02 2,499,160.00 2,222,471.75 Completed and Gorkha districts. and Gorkha Preparation of DTMPs for DoLIDAR in 2014/2015 Nuwakot, Rasuwa and Nuwakot, Rasuwa and RAP3/2014/014_03 1,339,290.00 1,161,677.83 Completed Tanahun districts. Tanahun Preparation of DTMPs for DoLIDAR in 2014/2015 Rupandehi, Gulmi and Rupandehi, Gulmi and RAP3/2014/014_04 1,776,764.00 1,599,090.00 Completed Baglung districts. Baglung Preparation of DTMPs for DoLIDAR in 2014/2015 Argakhanchi, Pyuthan Arghakhanchi, Pyuthan RAP3/2014/014_05 2,038,440.00 1,834,595.98 Completed and Salyan districts. and Salyan Preparation of DTMPs for DoLIDAR in 2014/2015 Banke, Dang and Banke, Dang and RAP3/2014/014_06 1,755,750.00 1,509,945.00 Completed Kanchanpur districts. Kanchanpur Procurement in 2015 Services to Conduct Training on Procurement and Contract Managemnt RAP3/2015/001 Kathmandu 1,374,119.55 1,374,119.55 Completed for DDC and DTO Staff Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_1 Sindhupalchok 647,506.90 647,350.39 Completed Packages for Earthquake Victims at Sindhupalchowk Districts Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_2 Sindhupalchok 406,800.00 395,952.00 Completed Packages for Earthquake Victims at Sindhupalchowk Districts (Cluster #3) Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_3 Sindhupalchok 22,600.00 22,000.00 Completed Packages for Earthquake Victims at Sindhupalchowk Districts (Cluster #3) Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_4 Sindhupalchok 57,291.00 57,291.00 Completed Packages for Earthquake Victims at Sindhupalchowk Districts (Cluster #3) Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_5 Sindhupalchok 379,680.00 379,680.00 Completed Packages for Earthquake Victims at Sindhupalchowk Districts (Cluster #3) Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_6 Sindhupalchok 56,500.00 - Contract Terminated Packages for Earthquake Victims at Sindhupalchowk Districts Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_7 Sindhupalchok 35,256.00 24,238.50 Completed Packages for Earthquake Victims at Sindhupalchowk Districts Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_8 Sindhupalchok 36,725.00 28,250.00 Completed Packages for Earthquake Victims at Sindhupalchowk Districts Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_9 Sindhupalchok 308,490.00 308,490.00 Completed Packages for Earthquake Victims at Sindhupalchowk Districts (Cluster #2)

Trimester Report 16 July – 15 November 2016 Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_10 Sindhupalchok 57,291.00 57,291.00 Completed Packages for Earthquake Victims at Sindhupalchowk Districts Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_A Sindhupalchok 115,640.00 115,640.00 Completed Packages for Earthquake Victims at Sindhupalchowk Districts Emergency Improvement of Access Road to Provide Rescue and Relief RAP3/2015/002_B Sindhupalchok 111,136.00 111,136.00 Completed Packages for Earthquake Victims at Sindhupalchowk Districts RAP3/2015/003 Supply of Rock breacking Feather and Wedge 262,500.00 258,037.50 Completed RAP3/2015/004 Supply of Sare parts of Rock Drills Pionjar 120 Kathmandu 1,569,054.63 1,569,054.63 Completed Supply of Heavey Coated Machine Fabricated Gabion Boxes for Bajura RAP3/2015/005 Bajura 21,136,719.00 8,336,336.72 District Supply of Heavey Coated Machine Fabricated Gabion Boxes for Kalikot RAP3/2015/006 Kalikot 30,065,885.00 18,554,441.85 District Supply of Heavey Coated Machine Fabricated Gabion Boxes and GI wires RAP3/2015/007 Mugu 10,899,077.68 10,759,242.72 Completed for Mugu District Supply of Heavey Coated Machine Fabricated Gabion Boxes for Humla RAP3/2015/008 Humla 18,669,368.00 16,240,236.13 District RAP3/2015/009 Cancelled Cancelled Cancelled Cancelled Cancelled RAP3/2015/010 Supply of Geotextiles to Kalikot districts Kalikot 259,600.00 259,600.00 Completed RAP3/2015/011 Cancelled Cancelled Cancelled Cancelled Cancelled RAP3/2015/012 Supply of Geo textile to Bajura and Kalikot districts Kalikot & Bajura 2,814,186.95 2,814,186.95 Completed RAP3/2015/013 Supply of Geo textile to Humla and Mugu districts Humla and Mugu 2,104,555.38 2,104,555.37 Completed* RAP3/2015/014 Supply of Geo textile to Bajura districts Bajura 253,700.00 253,700.00 Completed RAP3/2015/015 Transportation of Stock from Nepalgunj to Humla-Sealed Quotation Humla Cancelled RAP3/2015/016 Transportation of Stock from Nepalgunj to Mugu-Direct Procurement Mugu 95,332.50 Completed RAP3/2015/017 Transportation of Stock from Nepalgunj to Humla-Direct Humla 259,651.61 Completed RAP3/2015/018 Supply of Construction Tools to RAP districts RAP districts 5,423,020.00 5,245,166.86 Completed RAP3/2015/019 Suply of Safety Gumboots to RAP3 districts RAP districts 2,444,400.00 2,436,260.40 Completed RAP3/2015/020 Supply of Wheel Barrow and Spare parts for Bajura Districts Bajura 819,790.00 819,790.00 Comnpleted Procurement in 2016 RAP3/2016/001 Transportation of Stock from Nepalgunj to Piplang ,Humla Piplang ,Humla 264,191.48 267,887.40 Completed RAP3/2016/002 Transportation of Stock from Nepalgunj to Shreenagar Humla Shreenagar ,Humla 215,520.00 220,896.00 Completed RAP3/2016/003 Supply of HDPE Pipe to Humla District Humla Cancelled

Trimester Report 16 July – 15 November 2016 RAP3/2016/004 Supply of geotextile to Kalikot and Bajura Kalikot and Bajura 314,244.00 314,244.00 Completed RAP3/2016/005 Supply and delivery of HDPE Pipe to Bajura District Bajura 115,486.40 RAP3/2016/006 Supply and delivery of First Aid Materils ( for Bajura district) to Nepalgunj Bajura 263,561.20 141,240.00 Completed RAP3/2016/007 Supply and delivery of First Aid Materils ( for Mugu district) to Nepalgunj Mugu 114,855.00 114,855.00 Completed RAP3/2016/008 Supply and delivery of bag and register to Humla and Mugu Humla and Mugu 121,930.00 RAP3/2016/009 Supply of First Aid Kit for Kalikot district Kalikot 265,050.00 265,143.00 Completed RAP3/2016/010 Supply of HDPE Pipe to Kalikot District Kalikot 248,035.00 248,035.00 Completed RAP3/2016/011 Supply of HDPE Pipe to Mugu District Mugu 47,400.00 RAP3/2016/012 Supply and Delivery of rock breaking fether and wedge to RAP3 districts RAP3 district 265,050.00 265,050.00 Completed RAP3/2016/014 Supply of Geotextile to Mugu and Humla Districts Mugu and Humla 2,113,196.05 RAP3/2016/015 Supply of Geotextile to Kalikot and Bajura District Kalikot & Bajura 2,471,323.77 - RAP3/2016/016 Supply of Heavy Coated GI wires for MUGU and Humla Districts Kalikot & Bajura 30,993,191.71 3,099,319.00 Supply of Heavy coated Machine Fabricated Gabion Boxes for and GI RAP3/2016/017 Mugu & Humla 10,094,724.02 10,094,724.02 Completed Wires for Bajura and Kalikot District RAP3/2016/018 Supply of Safety Gum Boots to RAP-3 New consruction districts Kalikot & Bajura 4,196,205.00 - RAP3/2016/019 Supply and Delivery of Construction Tools to RAP 3 Districts RAP3 district 1,391,563.70 RAP3/2016/020 Supply of Geotextile to Bajura District for Maure-Kailashmandu Road Bajura 221,100.00 RAP3/2016/021 Supply of Geotextile to Bajura District for Maure-Kailashmandu Road Bajura 221,100.00 RAP3/2016/023 Supply of First Aid Kit for Kalikot district RAP 3 Districts 1,985,879.00

Trimester Report 16 July – 15 November 2016

ANNEX 5 – SOCIAL AND ECONOMIC DEVELOPMENT PROGRAMME (2013-16)

RAP3 SED programme component was implemented in IY1 and IY2 and replaced by RAP3 CONNECT in IY3 after a fundamental review of the SED component in 2015 by DFID. Results of SED implementation are presented in the following tables.

Table A5.1: Economic Infrastructure targets and achievements

Trimester Report 16 July – 15 November 2016

Table A5.2: Year 2 SED-Group, Scheme and Household Targets with Progress per Subcomponent per District

68%

99%

82%

84%

52%

91%

43%

99%

97%

99%

95%

96%

99%

98%

99%

127%

132%

100%

% 68%

99%

100%

Progress

127%

Progress

hh hh

Actual

28,291

36,124

15,166

13,787

855

476

520

485

232

522

494

898

3,517

9,336

2,197

1,286

3,005

9,322

4,455

2,181

5,471

5,404

2,574

1,143

2,752

28,548

9,336

19,732

57,616

28,548

9,336

19,732

Target

Target Target

Target

28,291

29,174

10,632

13,356

12,142

996

230

160

515

800

3,517

1,055

1,380

1,000

1,417

1,242

2,959

6,833

1,634

2,010

5,488

5,296

1,515

1,200

2,656

29,431

10,632

18,219

58,282

29,431

10,632

18,219

247

283

107

159

278

238

122

Qty

Actual

703

1,256

2,053 2,053

94 94 703

1,256

282

283

177

100

165

105

280

309

240

133

Qty

Target

830

1,351

TOTAL, 8-DISTRICTS TOTAL,

2,275 2,275

94 94 830

1,351

94%

96%

85%

86%

100%

94%

99%

96%

Progress

Progress 100%

Progress

Qty

Actual

123

191

324 324

10 10

123

191

20 32

Qty

Target

182

233

DAILEKH

425 425

10 10

182

233

(weightsas perbudget)

91%

94%

25%

64%

47%

85%

158%

162%

100%

91% 94%

158%

135%

Progress

Qty

Actual

135

181 181

9 9 37 37

135

Qty

Target

KALIKOT

161

207 207

9 9

37 37

161

(weightsas perbudget)

0% 0%

76%

74%

64%

154%

100%

159%

100%

76%

154%

106%

Progress

100%

Progress

Qty Qty

Qty

Actual

178 178

11 11

81 81

86 86

Qty

Target

JUMLA

106

214 214

97 106

(weightsas perbudget)

95%

25%

83%

85%

82%

85%

95%

99%

100%

95%

Progress

31 42

Qty

Actual

181

240 240

12 12

47 47

181

Qty

Qty Qty

Qty

Target

MUGU

164

224 224

164

(weightsas perbudget)

65%

94%

95%

67%

25%

83%

89%

85%

100%

65%

84%

94%

95%

Progress

Progress Progress

Progress

Qty

Actual

116 116

9 9

12 12

95 95

27 11

Qty

Target

HUMLA

106

127 127

9 9

106

(weightsas perbudget)

95%

98%

65%

86%

100%

95% 99%

98%

Progress

100%

Progress

Qty

Actual

192

243 243

12 12 39 39

192

Qty

Target

185

BAJURA

235 235

185

(weightsas perbudget)

8-District SED Progress - IY1 & IY2, Reported on June 2016 June on Reported IY2, & - IY1 Progress SED 8-District

0% 97%

77%

130%

100%

136%

100%

97%

130%

107%

Progress

100%

Progress

Qty

- -

Actual

146

197

359 359

16 16

146

197

Qty

Target

146

200

ACHHAM

362 362

146 200

(weightsas perbudget)

96%

61%

98%

85%

87%

48%

89%

98%

95%

92%

97%

96%

98%

100%

96%

82%

61%

98%

Progress

67 10

Qty

Actual

218

179

412 412

15 15

218

179

Qty

Target

Target Target

Target

270

197

DOTI

482 482

15 15

270

197

(weightsas perbudget)

25%

10%

25%

50%

10%

25%

15%

100%

200%

100%

coeff.

Benef. Benef.

Benef. Benef. Benef. Benef. Benef.

Component

EI & IG Progress IG & EI Trail Bridge Progress Bridge Trail

WinrockProgress RET

SEDTotal

Summary

TBTrail Bridges Helvetas/DDC

EI RETEI Winrock

IG and IG Helvetas/PracticalEI Action

Trail Bridge Progress Bridge Trail

RET WinrockRET Progress

EI EI & Progress IG

TB: TrailBridge TB: BSP

TB: TrailBridge TB: (incl.inspection-not-yet-done TB)

EI4.9:Completed scheme RET monitoring

EI4.8BusinessSupport RET to SP

EI4.7:Community Service RET

EI4.6:IG-related scheme RET

EI4.5: IW Mill scheme EI4.5: Mill IW

EI4.4: Mud & Rocket& Mud EI4.4:IC communityStove

EI4.3: Metal IC EI4.3:communityStoveMetal

EI4.2: SolarEI4.2: communityHS

EI4.1: Micro-HydroPowerEI4.1:scheme Rehab

EI5.2:Completed EIScheme Monitoring

EI5.1:SupportEI Business to Service Providers

EI3: ProcessingEI3: scheme Market &

EI2: IrrigationEI2: Scheme

EI1: TrailEI1:and Local Bridge scheme

IG6: Ex-IG GroupEx-IGIG6:Monitoring

IG5: RBG Capacity RBG IG5:Building

IG4.2: EmployableIG4.2: Skills Marginalised for HH

IG4.1: Off-Farm IG for Marginalised for IG Off-Farm IG4.1: Groups

IG 3: SupportBusinessIG to 3: IG Service Providers

IG2: Market SystemMarket Coordination IG2: (corridor)

IG1.6: Goat Group Goat IG1.6:

IG1.5: NTFP Group NTFP IG1.5:

IG1.4: Fruit Group Fruit IG1.4:

IG1.3: Spice IG1.3:Group IG1.2: Seed IG1.2:Group Vegetable IG1.1: Group

Trimester Report 16 July – 15 November 2016 ANNEX 6 – ANNUAL CPD PROGRAMME

Actual for each district

New Construction Districts (4) CPD Course Date Persons Groups/Dist Days Training Days Remarks 1 Orientation of Local Parties Jan-16 10 1 1 10 Political Parties Implementation (LRN Engineering Course 2 Feb-16 Modules 4A, 4B, 4D, 4E, 4F) 10 1 1 10 DTO/SC/RAP staff in districts Quality Control (LRN Engineering Course 3 Module 4C - Combine with Implementation Feb-16 for 2 days training for all modules) 10 1 1 10 DTO/SC/RAP staff in districts Bio Engineering (Part of LRN Engineering 4 May-16 Course Module 2E) 10 1 2 20 DTO/SC/RAP staff in districts 5 New road construction Sep-16 20 15 1 300 300 RBG Members ARAMP (LRN Engineering Course Modules 6 Nov-16 1A, 1B, 1C, 1D, 1E, 1F) 10 1 1 10 DTO/SC/RAP staff in districts Detailed Design (LRN Engineering Course 7 Dec-16 Modules 2A, 2B, 2C, 2D, 2E (repeat 2E)) 10 1 1 10 DTO/SC/RAP staff in districts 370

Annual Review Course Date Nos Groups/Dist Days Training Days Remarks 1 District Review Jul-15 50 1 2 100 DDC/ Parties/RAP/Public 100 TOTALS 470 1880 Actual for each district Maintenance Districts (10) CPD Course Date Persons Groups/Dist Days Training Days Remarks 1 Orientation of Local Parties Jan-16 10 1 1 10 Political Parties Procurement (LRN Engineering Course 2 Jan-16 Modules 3A, 3B, 3C, 3D, 3E, 3F) 10 1 1 10 DTO/SC/RAP staff in districts 3 Orientation User Groups/contractors Feb-16 20 6 1 120 User Groups in Core Districts Implementation (LRN Engineering Course 4 Feb-16 Modules 4A, 4B, 4D, 4E, 4F, 4G) 10 1 1 10 DTO/SC/RAP staff in districts Quality Control (LRN Engineering Course 5 Module 4C - Combine with Implementation Feb-16 for 2 days training for all modules) 10 1 1 10 DTO/SC/RAP staff in districts Bio Engineering (Part of LRN Engineering 6 May-16 Course Module 2E) 10 1 2 20 DTO/SC/RAP staff in districts Emergency Maintenance (Parts of LRN 7 Sep-16 Engineering Course Modules 1D and 2D) 10 1 1 10 DTO/SC/RAP staff in districts Rapid Survey (LRN Engineering Course 8 Sep-16 Module 1D) 10 1 1 10 DTO/SC/RAP staff in districts 9 RMG Nov-16 5 20 1 100 100 RMG Members ARAMP (LRN Engineering Course Modules 10 Nov-16 1A, 1B, 1C, 1E, 1F) 10 1 1 10 DTO/SC/RAP staff in districts Detailed Design (LRN Engineering Course 11 Dec-16 Modules 2A, 2B, 2C, 2D, 2E (repeat 2E)) 10 1 1 10 DTO/SC/RAP staff in districts 320

Annual Review Course Date Nos Groups/Dist Days Training Days Remarks 1 District Review Jul-16 50 1 2 100 DDC/ Parties/RAP/Public 100

TOTALS 420 4200 Grand Total 6080

Trimester Report 16 July – 15 November 2016 ANNEX 7 - PROGRESS STATUS ON MEL’S PMV REVIEW RECOMMENDATIONS

The progress on MEL‟s PMV review recommendations is shown as below (green = completed or complied).

Ref Recommendation Current progress status # 1 RAP3, MEL and DFID to review the RAP3 theory of change, agree Completed: Key information key information needs throughout the TOC, responsibilities for needs to be agreed soon. collecting, analysing, reporting as well as feedback and learning processes 2 RAP3 to update PMV strategy to reflect current purpose and structure Completed during extension by end of 2016 proposal submission 3 DFID and RAP3 to agree common interpretation of the word „control‟ Completed: Addressed in Risk in relation to risk management management matrix 4 RAP3 team to investigate feasibility and benefits of ongoing Completed RAP3 provided professional development for internal audit professional training to its auditors 5 RAP3 to monitor the implementation of mandatory field visits and the Completed: Adopted and extent that they contribute to improved field oversight and activities to remain continue performance improvements 6 RAP3 to develop concise clear steps for minimising double- Completed: Reporting process counting/explaining current steps and assumptions; data collection confined thru DTLs only and aggregation steps 7 RAP3 to fully implement risk based auditing Complied 8 RAP3 to develop and implement ongoing professional development Complied: A dedicated programme for internal auditors professional team working 9 In addition to the planned verification activities by MEL (verifying MEL‟s responsibility quality of roads and if they meet technical specification), MEL also undertake data verification of employment day data, assuming that employment days remain a DLI for expansion phase 10 RAP3 to develop concise clear steps for minimising double- Complied (As of 6 above) counting/explaining current steps and assumptions; data aggregation and reporting 11 RAP3 to fully implement the risk based auditing approach including Complied (As of 7 above) the analysis of documents to identify risks to guide the internal audit schedule (this may also provide a dual purpose of identifying common themes or patterns for other learning purposes, and not solely to drive risk management) 12 RAP3 and DFID to assess alternatives for simplifying reporting and Complied: Implementation invoicing cycles. This may include: year aligned with GoN FY. Assessing the feasibility of re-aligning the RAP3 implementation year to that of DFID‟s financial year; Invoicing system is revisited in Moving to monthly invoicing and Trimester reporting of actual line with recommendations results. Within a quarter, months 1,2 and 3 invoices could be and implementation started based on estimated results and the month 4 invoice follows a Trimester report of actual quarterly results and a calculation and reconciliation of payments for the period 13 RAP3 to document its data checking procedures for DLIs and LFI Complied data, and then again review the challenges to data quality and the effectiveness of current risk mitigation strategies 14 As part of its risk based auditing approach, develop a regular data Complied quality check audit based on assessed risk areas or districts 15 If there are corrections to be made, RAP3 should update the district Complied level monthly reports as well 16 RAP3 to ensure that feedback is provided and recorded as part of Complied public and social audit 17 RAP3 to record which audit the CIAP decisions are linked to Complied

Trimester Report 16 July – 15 November 2016 ANNEX 8 – RISK MANAGEMENT

Risk Management Programme Risk Matrix

Risk Area/Description Mitigation Measures Residual Impact

A. External Context (Ext) Gross Risk Net Risk

Natural disaster – earthquake, off-season Rehabilitation of damaged structures heavy rainfall and snow during post-disaster phase No mitigation measure possible Almost Likelihood Almost Likelihood: Impact: Major Impact: Major certain : certain Reoccurrence of political shocks (similar to 2015 blockade by neighbouring countries) that paralyses staff movement, transport of goods Reassess and reorganise resources to Constrained field activities and supplies and prevent programme response the changing situations progress Likelihood: Possible Impact: Major Likelihood: Possible Impact: Major DTMP preparation works of additional 20 Except one (Sarlahi) out of 20 districts districts delayed. Efforts to expedite DTMP preparation DTMP finalised. works on DDC support are being made Almost through DoLIDAR. Almost Likelihood: Impact: Moderate Likelihood: Impact: Moderate certain certain Delays in visa extension of expatriates from Sept-16 from GoN department has increased risks continue working for them Waiting for visas extension approval Continuous follow up and additional

request from DFID in underway

Almost Almost Likelihood: Impact: Moderate Likelihood: Impact: Moderate certain certain 48

Trimester Report 16 July – 15 November 2016 Political interference – Compulsory donation, Briefed on working principles of the Not negotiable but districts are aware intimidation and threats and influence on programme including BOGs that RAP cannot pay donations to RAP3 decisions RMO in coordination with UN security political parties. staff to initiate dialogue with political party leaders. DDC‟s accept that RAP funds go Non-compliance of ARAMP priorities in DRCN through this procedure even if GON planning process and implementation by Efforts are being made through funds do not. DDCs DoLIDAR to strictly follow the document Almost in annual planning, budget and Almost Likelihood: Impact: Moderate Likelihood: Impact: Minor certain programming by DDCs certain

B. Implementation (Imp) Gross Risk Net Risk

Remoteness related issues result in delays Off-season bulk procurement of tools Realistic results set and achieved while which lead to cost and time overruns, missed and materials ahead of the DLI financial disbursement targets are hit physical results and poor financial forecasting construction season to ensure with accuracy (+/-5%) stipulated by DFID and performance availability

Expedite construction works engaging

more RBGs/SBGs

For RAP 70% of costs go in wage

payments to the poor so increased wages lead to increased benefits

Likelihood: Possible Impact: Moderate De-rate results by 10-20% to account Likelihood: Possible Impact: Minor for risks; Delay on VAT refund to the RAP3 partners Parties with good track record may be raised risks in participating procurement Despite continuous follow up and less interested in participating programme process by reliable parties in future repeated requests VAT refund process procurement processes has been very slowed Likelihood: Possible Impact: Moderate Likelihood: Possible Impact: Moderate

Budget shortfall to cover expenses of RMG Request made to GoN for road maintenance works from DFID supplementary funding to cover budget shortfall Action decision from GoN waited GoN allocation not adequate to cover shortfalls and efforts continued for Almost additional funding Likelihood: Impact: Major Likelihood: Possible Impact: Moderate certain Increased district wage rates during Action on decision of RAP3 Steering programme implementation period and Options are being worked out to deal with Committee meeting to be prevailed additional funding requirements post programme extension scenario Almost Likelihood: Impact: Moderate Likelihood: Likely Impact: Moderate certain Private sector partnership on RAP3-Connect Long list of pilots developed and not materialised ensure wide choice of partnerships

Adopt standard screening and

selection criteria of partners

Ensure comprehensive due diligence completed prior to engage partners Provisions of regular monitoring and Likelihood: Possible Impact: Moderate evaluation of performance status Likelihood: Possible Impact: Minor

C. Safeguards (Safe) Gross Risk Net Risk

In spite of mitigation measures, Risk of injury and deaths of workers on- and Provisions for protective safety gears, first aid kits and insurance system in accidents remain likely off-work sites place.

Launch enforcement measures using safety gears & awareness raising programme at group & community Likelihood: Likely Impact: Moderate Likelihood: Likely Impact: Minor levels Women and disadvantaged excluded from Regular monitoring and reporting programme activities Ensured engagement of women and disadvantaged in programme activities Likelihood: Likely Impact: Moderate Likelihood: Possible Impact: Minor

D. Operational (Op) Gross Risk Net Risk

Risk of dependence on donor‟s (DFID) GON has also allocated NRs 20m for GoN fund able to cover routine and support for road maintenance and upgrading RMG in Pilot districts starting October recurrent road maintenance needs of and lack of use of GoN funds. 2016. RAP providing Light Touch TA. DRCN. GON to fund all RAP RMG starting Likelihood: Likely Impact: Major Likelihood: Likely Impact: Moderate 2017. Shrinkage of DRCN under RAP maintenance The formation of new municipalities Municipalities unable to fund ex DRCN (RMG) due to formation of new municipalities means that the length of the RAP maintenance but DRCN shrinkage to lessen the milestone target of the DRCN will shrink as they take over mitigated by new links to unconnected programme. responsibility for maintenance of VDCs existing DRCN links. Likelihood: Almost Impact: Minor Reformulate DTMP to support GON Likelihood: Almost Impact: Minor 49

Trimester Report 16 July – 15 November 2016 certain expansion programme of DRCN to certain unconnected VDCs. Continued undue pressure and threat of All party cadres meeting in the Situation had improved in general. LRUC members to inflate daily wage rates of presence of visiting minister organised However, personal grumblings still RBG to DTA in Humla in HQ and seek help to resolve the persist Likelihood: Likely Impact: Major situation Likelihood: Likely Impact: Moderate RAP3-Connect private sector partners fail to Bell-weather indicators in place to alert Ensure periodical milestones are met deliver on contractual commitments of risks through regular supervision, monitoring Close supervision and monitoring of and reporting Likelihood: Possible Impact: Moderate works by the RAP3 team Likelihood: Unlikely Impact: Minor General poor performance of Design and Engaged fresh engineering graduates Support Consultants to support DTAs and replace under – Direct control by RAP improves performing consultants. performance in Pilot districts and Bajura. In the Pilot districts except for Dadeldhura, technicians are directly hired by RAP to replace support Likelihood: Likely Impact: Major Likelihood: Unlikely Impact: Moderate consultants‟ services.

E. Fiduciary (Fid) Gross Risk Net Risk

More normal levels of risk secured for Risk of collusion in bidding during Adoption of e-bidding procurement RAP funding. procurement of goods and works based on GON e-bidding procedures

and establishment of internal scoring

criteria and regular audits. Likelihood: Possible Impact: Moderate Likelihood: Possible Impact: Moderate Potential of inaccurate financial forecasting Payment for results (P4R) of RAP3 Able to hit financial forecasts within +/- due to poor planning and budgeting contract provisions promotes 5% accuracy stipulated by DFID achievement of targets Trimesterly progress reviews enable Likelihood: Possible Impact: Moderate Likelihood: Possible Impact: Minor adjustments to financial forecasts Sensitize to DFID and IMC anti- RAP3-Connect private sector partners abuse corruption standards and zero- programme funds and support tolerance policy Review situation by RAP3 Likelihood: Possible Impact: Severe management Likelihood: Rare Impact: Moderate

F. Reputational (Fid) Gross Risk Net Risk

RAP3 programme expansion seen to be slow Priority given to design by May/June or delayed and Amendment # 6 financial by July Delays to implementation of Expansion 2016 HUM MUG road contract awarded by Likelihood: Unlikely Impact: Severe Likelihood: Rare Impact: Moderate October 2016 Other similar programme able to step Repositioned role of RAP serving all Exit from social and economic development other SED projects and promoting their (SED) programme component in such as DFID‟s CDP Continue social mobilisation works in results not credited to RAP Likelihood: Possible Impact: Minor new construction road corridors Likelihood: Unlikely Impact: Minor Perception that RAP3 programme is not „pro- Representation of poor in: poor‟ Special Maintenance Groups (SMGs) Ensure representation of poor through in maintenance districts; and field supervision and monitoring Road Building Groups in new Likelihood: Possible Impact: Minor construction road corridors Likelihood: Unlikely Impact: Minor

Note: RAP3 maintains a separate risk event register.

Trimester Report 16 July – 15 November 2016 ANNEX 9 – INTERNAL AUDIT SCHEDULE

Trimester Report 16 July – 15 November 2016 ANNEX 10 – GON FIRST TRIMESTER PROGRESS REPORT 2073/74

1 Fiscal Year: 2073/74 8 Expenditure amount and percentage of the current year till this period: NRs. 360.73m. (66.8%) Budget Format No. 6.04.05 2 Budget Sub-Heading no.:`

3 Ministry: MoFALD 9 Expenditure amount and percentage from starting NPC (M&E) Format No. 2 to this period out of total estimated/project cost: Page No. 1/2 4 Name of Programme: Rural Access Programme 3 (NRs. 4493.48m /NRs.5040m)/ (89.15%) 10 Physical progress percentage of project from 5 Name of Programme Chief: Mohan Raj Chapagain starting to this period: 88.5%

6 Budget of this period (NRs.): 11 The implemented project period (May 2013 to Feb (a) Internal (Nepal Govt., Organization, People's 2016) in percentage out of total project period participation: NA (May 2013 to March 2017): 89.3% (b) Foreign (Grant): NRs. 180.00 million 12 Reimbursement status 7 Expenditure amount and percentage of this period (a) Amount to be reimbursed: NA (a) Internal (Nepal Govt., Organization, People's (b) Amount submitted for reimbursement: NA participation: NA (b) Foreign (Grant): NRs. 360.732 million (200.4%) (c) Amount yet to be reimbursed: NA

2 Currency exchange rate 1 GBP = NPR 160.00

Trimester Report 16 July – 15 November 2016 Progress of current Annual Target First Trimester Target First Trimester FY till the reporting (NRs) (NRs) Progress (NRs)

period (NRs)

SN Plan and Activities Remarks

Unit

output and and output

(%) (%)

on indicator on

Budget Budget Budget

Weight Weight

million) million)

Major

Quantity Quantity Quantity Quantity

(Spent in (Spent in (Spent

(in million) (in million) (in

Weightage Weightage Weightage achievements based based achievements 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 Activities under programme budget Programme cost on three components, Core districts: A. Local Road Network Asset Management See HUM,MUG,KAL,BAJ,DOT,DAI,ACH,JU 360.73 360.73 M B. CONNECT (SED) and 100 540 40 180 below (200%) (67%) Pilot districts: DAD,PAR,SIN,SAN, C. Capacity Building & Policy Harmonization MOR,JHA in core and non-core districts CONNECT: JUM,BAJ, DAI,DOT,ACH Grand Total Cost 100 540 180 360.73 360.73 Prepared third year Programme Implementation Plan (started from Feb 2016)

LRN

• Construction work is in progress in four districts (Humla, Mugu, Kalikot and Bajura) o 2.5m track opening 1.12km in this Trimester reaches to 90.65km out of 97.5km in total. o 3.5m widening 1.21km in this Trimester reaches to 72.39km out of 97.5km in total Column no. 14, o 4.5m widening & structure 1.94km in this Trimester reaches to 61.55km out of 97.5km in total Major output • DRCN maintenance works through RMG of 2171km in 10 districts on-going. and achievements SED (CONNECT) • SED programme component re-designed and SED is converted to CONNECT. CONNECT activities are being implemented since June 2016. based on indicator is CB/PH presented here • ASPs for this year (Oct 2016 to Sept 2017) prepared and implementation started in all districts. • Continual Professional Development (CPD) plan is in progress as per plan • Continue providing support to DOLIDAR to enhance its MIS capacity

Others • 358,616 employment days generated in this period. • Out of additional 20 DTMP preparation except Sarlahi district finalised. • EIA study report of HUM MUG link road prepared and submitted to MOPE for approval through MOFALD.

Trimester Report 16 July – 15 November 2016 • Field verification and risk based audit programme is continued under quality management. • RAP3 programme implementation period extended till June 2019.

Annex 1- Breakdown of budget as per components

Rural Access Programme (RAP3) First Trimester Progress Status FY 2073/74

Annual Target First Trimester Physical Financial (NRs in million) SN Component Unit Budget Remarks Quantity (NRs in million) Target Progress % Target Progress % A LRN

1 New Construction 293.9 70.00 155.79 222.55

1.1 2.5m Track opening Km 2 0.50 1.12 224.00

1.2 3.5m Widening Km 10 2.00 1.21 60.50

1.3 4.5m widening and structure Km 10 2.00 1.94 97.00

2 Maintenance Km

Routine/Recurrent (through 2.1 Km 2,000 187.0 2,000.00 2,171.00 108.55 90.00 187.68 208.53 RMG) B CONNECT (SED) Financial progress is invoiced amount Number of HH benefitted 1 No - 45.1 - - 15.00 11.63 77.52 (increased) from SED programme C CBPH 14.0 5.00 5.63 112.66

1 Training Days 3,000 1,000.00 1,486.00 148.60

Programme total 540 180.00 360.73 200.40

D TA + Management Cost 80.87

Total 540 180.00 441.60 245.33

Trimester Report 16 July – 15 November 2016 Some glimpse of programme activities

Road improvement works in Morang RBG engaged in rock breaking works in Mugu Interaction meeting with entrepreneurs in Doti

RMG refresher training participants in Dadeldhura LRUC level Public Audit in Kalikot Interaction of AR visiting team with RMG members in Dadeldhura

Trimester Report 16 July – 15 November 2016 ANNEX 11 – RAP3 LOGICAL FRAMEWORK PROJECT Rural Access Programme Phase3 NAME Indicator Target Baseline: May-13 May-14 May-15 May-16 Oct-16 Mar-17 Assumptions IMPACT Impact Indicator 1

Number of HH lifted out of Planned poverty as a result of RAP3 Achieved

Impact indicator 2 Number of HH with Planned improved standard of living (SOLI) as a result of RAP3 Achieved OUTCOME Outcome Indicator 1 Political Number of people Planned 0 0.26m 1.5m 1.75m 2.0m instability does benefitting from new roads not increase and maintenance Limited preserving the length of exogenous Improved incomes trafficable DRCN over the Achieved 0 0.26m 2.8m 2.8m 2.8m shocks to the and resilience base line. economy through employment, Outcome Indicator 2 Limited shocks sustainable due to climatic a. Number of short term access to markets and other jobs created Planned 0 250,000 1,570,000 2,998,000 3,791,000 and improved natural (50days+pa/HH)* access to disasters. economic b. Derived from a. 50 -100 = 3,201 opportunities in employment days created Achieved 258,000 100> = 1,568 2,733,625 3,214,562 the influence area by RAP b. 1,503,289 of RAP Outcome Indicator 3 (RBG/RMG/other and LRN/KEP) Number of households with Planned 0hh 0hh 5,000hh 10,000hh 15,000hh increased annual income of NRS 10,000 in of RAP Achieved 0hh 0hh 6,500hh 8,200 8,200 *short term jobs and total employment days created are at the outcome level as a proxy to capture perceived benefits of job creation for which we currently do have reliable and measureable indicators OUTPUT 1 Output Indicator 1.1 Assumptions Improved rural Km of DRCN road benefitting from annual asset management programme Labour based

Trimester Report 16 July – 15 November 2016 PROJECT Rural Access Programme Phase3 NAME Indicator Target Baseline: May-13 May-14 May-15 May-16 Oct-16 Mar-17 Assumptions transport Planned 0 240 2,000 2,000 maintenance infrastructure a) under maintenance approach to Achieved 0 240 1,986 2,163 2,171 climate Planned 0 0 0 resistant roads is accepted by b) 12*small bridges - the community depends on expansion Achieved 0 0 and other stakeholders. c) new roads (cumulative) Planned 0 40 75 75 75 Limited impact 2.5m wide track opening of extreme Achieved 0 57 76 88 90.65 climatic Planned 0 0 40 60 75 conditions 3.5m wide track opening affecting road Achieved 27 68 72.39 access. Positive 4.5m (full width +remaining Planned 0 0 0 40 75 response from structures Achieved 18 58 61.55 transport Planned 0 0 0 0 markets to Complete including side lowered drains and bio-engineering Achieved transport costs. d) Standalone indicator of journey reliability - Number Indicator and duration of road closures in previous year Output Indicator 1.2 % of new road infrastructure Planned 0 0 25 70 90 investment incorporating required a) DRR b) road safety c) environmental Achieved 0 0 25 68 69.2 standards IMPACT Output Indicator 1.3 WEIGHTING (%) Planned 0 9 50 75 % of RAP ARAMP July Achieved 9 30 83 100 30% target achieved by May Source: Risk Rating

Trimester Report 16 July – 15 November 2016 PROJECT Rural Access Programme Phase3 NAME Indicator Target Baseline: May-13 May-14 May-15 May-16 Oct-16 Mar-17 Assumptions RAP baseline and programme monitoring reports and third party verification. Low Inputs (£) DFID (£) GoN (£) Others (£) DFID Share (£) Inputs (HR) DFID (FTEs) OUTPUT 2 Output Indicator 2.1 10,000 15,000 20,000 20,000 a. 7,000 a. 10,500 a. 15,000 Number of beneficiaries receiving SED support that b. 8,000 b. 11,500 b. 20,000 improves a) livelihoods b) Planned 0 c. 3,500 c. 8,000 c. 20,000 skills c) market linkage d) household energy (gender d. 4,500 d. 7,000 d. 9,000 and DAG disaggregated) 40% women 40% women 40% women 20% DAG 20% DAG 20% DAG 10,000 16,905 18,403 18,160 Local economies a. 7,000 a. 16,905 a. 17,721 have significant b. 8,000 b. 14,276 b. 15,003 latent capacity Local economic that can be Achieved 0 c. 2,000 c. 5,200 c. 5,515 growth stimulated by d. 4,500 d. 3,777 d. 5,819 inputs on skills, assets and 30% women 45% women 45% women infrastructure. 20% DAG 20% DAG 20% DAG Output Indicator 2.2

Number of households 2,000 (8) 21,000 (304) 32,000 (533) 34,000 (communities or schemes) a. 2,000 (8) a. 15,000 (90) a. 20,000 (100) benefiting from SED linked infrastructure investment a) Planned 0 b. 0 b. 6,000 (162) b. 8,500 (350) trail bridges b) renewable c. 0 c. 1,000 (50) c. 1,500 (75) energy c) irrigation d) processing & marketing d. 0 d. 1,000 (2) d. 5,000 (8) Achieved 0 2,000 (8) 17,780 48,579 (535) 48,811

Trimester Report 16 July – 15 November 2016 PROJECT Rural Access Programme Phase3 NAME Indicator Target Baseline: May-13 May-14 May-15 May-16 Oct-16 Mar-17 Assumptions a. 2,000 (8) a. 12,073 (43) a. 36,124 (94) 48,811

b. 0 b. 3,517 (283) b. 5,819 (313)

c. 0 c. 1,318 (48) c. 2,181 (77)

d. 0 d. 972 (4) d. 4,455 (51)

IMPACT Output Indicator 2.3 WEIGHTING (%) Planned 0 200 600 900 1,000 Number of private sector Achieved 0 200 540 806 806 service providers engaged 20% by SED in SED clusters Source: Risk Rating

RAP baseline and programme monitoring reports and third party verification. Medium Inputs (£) DFID (£) GoN (£) Others (£) Inputs (HR) DFID (FTEs) OUTPUT 3 Output Indicator 3.1 Assumptions Planned 0 500 2,400 5,500 7,250 Project is able Number of training days for to engage a) government b) private c) effectively with other stakeholders Achieved 0 200 6,238 11,986 13,673 the local Strengthened administration. institutional capacity to Output Indicator 3.2 sustainably % of Annual Social Audit Planned 0 25 30 40 manage rural findings conducted at transport District level showing Influence of infrastructure The status will be satisfactory rating derived in Sept at RMG at the Achieved 0 30 82 82 increasing year on year. district annual VDC level can Target is to increase % review be achieved each year. through multi Output Indicator 3.3 stakeholder IMPACT engagement at WEIGHTING (%) a) Central government b) Planned TBD ++ the local level. district government and c) Pilot Dist: 6.22 Pilot Dist: 6.22 Pilot Dist: 6.73 Pilot Dist: 7.03 Pilot Dist: 7.10 private sector CIM scores Core Dist: 3.08 Core Dist: 3.08 Core Dist: 5.09 Core Dist: 5.71 Core Dist: 6.09 15% Achieved demonstrate continual All Dist: 4.45 All Dist: 4.45 All Dist: 5.77 All Dist: 6.21 All Dist: 6.52 improvement towards (Measured in Central GoN: 4.5 Central GoN: 5.3 Central GoN: 59

Trimester Report 16 July – 15 November 2016 PROJECT Rural Access Programme Phase3 NAME Indicator Target Baseline: May-13 May-14 May-15 May-16 Oct-16 Mar-17 Assumptions SWAp compliance. Aug/Sept 2013) Private Sector: 4.8 5.94 (provisional)

DFID (£) Source: Risk Rating Inputs (£) RAP baseline and programme monitoring reports and third party verification. Medium/High Inputs (HR) DFID (FTEs) GoN (£) Others (£) Note: Impact weightage of 3 outputs related to RAP3 implementation is 65% for 87.5% of the total programme fund and remaining 35% is supposedly dealt by KEPTA and MEL of the programme.

The above Log Frame is the exisiting one, which will be replaced by the new one by DFID and RAP3 after numerical targets are agreed in the next Trimester in line with the IMC RAP3 Extension.

Trimester Report 16 July – 15 November 2016

ANNEX 12 - ACRONYMS AND ABBREVIATIONS

AAMP Annual Asset Management Plan ADB Asian Development Bank AFSP Agriculture and Food Security Project AMS Asset Management System ARAMP Annual Road Asset Management Plan ARMP Annual Road Maintenance Plan ASP Annual Support Plan CFUG Community Forest User Group CIM Continual Improvement Matrix CMO Community Monitoring Officer COST Construction Sector Transparency Initiative DADO District Agricultural Development Office DAG Disadvantaged Group DAME District Asset Management Engineer DDC District Development Committee DDF District Development Fund DFID Department for International Development (UK Aid) DFO District Forestry Office DIPECHO Disaster Preparedness European Commission Humanitarian Aid Organisation DLI Disbursement Linked Indicator DLSO District Livestock Officer DOLIDAR Department of Local Infrastructure Development and Agricultural Roads DOR Department of Roads DRCN District Road Core Network DRILP Decentralised Rural Infrastructure and Livelihoods Programme DRR Disaster Risk Reduction DRSP District Road Support Programme DTL District Team Leader DTMP District Transport Master Plan DTO District Technical Office EE Enabling Environment EI Economic Infrastructure

Trimester Report 16 July – 15 November 2016 EU European Union ERDRR Earthquake Recovery and Disaster Risk Reduction Project FCGO Financial Comptroller General Office FRA Fiduciary Risk Assessment FRRAP Fiduciary Risk Reduction Action Plan GAFSP Global Agricultural Food Security Programme GBP Great Britain Pound GIZ Gesellschaft fur Internationale Zusammanarbeit (used to be GTZ)) GON Government of Nepal hh Households HIMALI High Mountain Agribusiness and Livelihoods Improvement HTN DFID How To Note HQ Head Quarters HVAP High Value Agriculture Project IATA International Association for Transparency and Accountability ICS Improved Cooking System IDE International Development Enterprise IDSS Integrated decision Support System IG Income Generating IFAD International Fund for Agricultural Development ILO International Labour Organisation IMC International Management Consulting IRI Interim Results indicator ISAP Institutional Strengthening Action Plan ISO International Standards Organisation KISAN Knowledge Based Integrated Sustainable Agriculture and Nutrition Project KEP Karnali Employment Project LAPA Local Adaptation Plan of Action LB Labour Based LBES Labour Based Equipment Supported LBFAR Local Body Financial Administration Regulations LGCDP Local Government and Community Development Programme LINK Linking Smallholders with Local Institutions and Markets LRCC Local Road Coordination Committee

Trimester Report 16 July – 15 November 2016 LRN Local Road Network LRP Local Resource Person LRBP Local Road Bridge Programme LB Labour Based LBES Labour Based Equipment Supported LBFA Local Bodies Fiscal Commission LSAR Light Search and Rescue M&E Monitoring and Evaluation MCPM Minimum Conditions Performance Measure MEL Monitoring Evaluation and Learning MF Managed Fund MOFALD Ministry of Federal Affairs and Local Development MSME Micro, Small and Medium Enterprise MUS Multiple Use System NEA Nepal Engineers‟ Association NEC Nepal Engineering Council NGO Non-Governmental Organisation NRs Nepali Rupee NRRC Nepal Risk Reduction Consortium NRSAS Nepal Road Sector Assessment Study NTFP Non Timber Forest Products OJT On the Job Training P4R Programme for Results PA Practical Action PCP Project Control Plan PDO Programme Development Objective PEFA Public Expenditure and Financial Accountability PFM Public Financial Management PMCA Participatory Market Chain Analysis PMM Programme Management Manual PMV Performance Management and Verification PR Programme Results Qty Quantity RAIDP Rural Access and Improvement and Decentralisation Project

Trimester Report 16 July – 15 November 2016 RAP Rural Access Programme RBG Road Building Group RBN Roads Board of Nepal RIA Road Influence Area RMG Road Maintenance Group RMO Risk Management Office RMUC Road Maintenance User Committee RRRSDP Rural Reconstruction and Rehabilitation Sector Development Project RTI Rural Transport Infrastructure SAME Sub Asset Management Engineer SBG Special Building Group SDC Swiss Agency for Development and Cooperation SED Socio- Economic Development SEDO Socio- Economic Development Officer SHS Solar Home System SRN Strategic Road Network SWAp Sector Wide Approach TA Technical Assistance TOR Terms of Reference UC User Committee UK United Kingdom UKaid UK Aid UNRA Uganda National Roads Authority USAID US Agency for International Development VDC Village Development Committee WB World Bank