MID TERM REVIEW REPORT (11th FYP) November, 2016 ELEVENTH FIVE YEAR PLAN (2013-2018) MID TERM REVIEW REPORT GROSS NATIONAL HAPPINESS COMMISSION ROYAL GOVERNMENT OF BHUTAN NOVEMBER 2016 Gross National Happiness Commission Page 1 MID TERM REVIEW REPORT (11th FYP) November, 2016 Gross National Happiness Commission Page 2 MID TERM REVIEW REPORT (11th FYP) November, 2016 Gross National Happiness Commission Page 3 MID TERM REVIEW REPORT (11th FYP) November, 2016 TABLE OF CONTENTS FOREWORD ..................................................................................................................................... 02 INTRODUCTION ............................................................................................................................ 05 METHODOLOGY AND APPROACH ......................................................................................... 06 AN OVERVIEW OF ELEVENTH PLAN MID-TERM ACHIEVEMENTS ............................. 06 OVERVIEW ................................................................................................................................... 06 STATUS OF THE 11th FYP OBJECTIVE ..................................................................................... 07 ECONOMIC PERFORMANCE ...................................................................................................... 09 SOCIAL DEVELOPMENT TRENDS ............................................................................................ 12 PLAN PERFORMANCE: CENTRAL SECTORS, AUTONOMOUS AGENCIES AND LOCAL GOVERNMENTS .............................................................................................................. 14 MINISTRIES ...................................................................................................................................... 20 AUTONOMOUS AGENCIES ........................................................................................................ 87 GENDER APPRIASAL OF 11th FYP MTR ................................................................................... 99 LOCAL GOVERNMENTS ............................................................................................................ 106 LESSONS AND FEEDBACKS ...................................................................................................... 218 ANNEXURE Annexure I – Schedule of the 11th FYP MTR of Central Agencies .............................................. 220 Annexure II– Schedule of the 11th FYP MTR of LGs................................................................... 221 Gross National Happiness Commission Page 4 MID TERM REVIEW REPORT (11th FYP) November, 2016 1. INTRODUCTION The 11th FYP represents a defining moment in the history of Bhutan as it is the second plan implemented under the reign of His Majesty the King of Bhutan. It is also the second Five Year Plan formulated and implemented by the Government elected under Bhutan’s Constitutional Democracy. Therefore, the 11thFYP provides the right platform to consolidate and built on the development gains of the past and forge innovative thinking and strategies towards achieving the long-term development objectives guided by the overarching goal of Gross National Happiness. With a view to promoting inclusive and broad based participation in the plan preparation process, the formulation of the 11th FYP began as early as August 2011. After several rounds of consultation with the stakeholders, the draft 11th FYP was presented to the new Cabinet on August 2013. Subsequently, with the incorporation of the directives of the Cabinet, the final draft 11th FYP was presented to the first session of the second Parliament on September 19, 2013 by the Hon’ble Finance Minister. Following the approval of the Plan by the Parliament, resource mobilization was initiated with the conduct of the 12th Round Table Meeting on 11th and 12th December 2013. The first year of the plan focused on the implementation of the 10th FYP spillover activities such as construction of schools and hospitals under the GoI assistance. The actual implementation of the plan started only in the second year of the 11th FYP. The purpose of this report is to present the consolidated outcome of the Mid Term Review (MTR) of the 11th Five Year Plan which was undertaken between August 2015 to May 2016 covering 10 Ministries, 20 local governments and four Thromdes (municipalities). The MTR was chaired by the Hon’ble Prime Minister. The meeting was attended by the Cabinet Ministers, members of the GNH Commission, local functionaries and the relevant officials of the agencies concerned. The objective of the mid-term review was to take stock of the progress of the 11th FYP programs; discuss and address implementation issues and; recommend mid-course corrections. Unlike in the past FYP MTRs, the review of the 11th Plan focused on the progress of key result areas of sectors and Dzongkhags which was done through assessment of Key Performance Indicators (KPIs). In addition, the MTR also reviewed the financial progress of all the implementing agencies. Gross National Happiness Commission Page 5 MID TERM REVIEW REPORT (11th FYP) November, 2016 The MTR schedules of Ministries, Agencies and Dzongkhags are presented under Annexure I. 2. METHODOLOGY AND APPROACH The progress towards 11th FYP was monitored by assessing the progress of Sector Key Result Areas (SKRAs) and Dzongkhag Key Result Areas (DKRAs) by measuring the progress of the Key Performance Indicators (KPIs). A total of 6,154 KPIs (417 KPIs of the Ministries, 5568 KIPs of the Local Governments and 169 KPIs Thromdes) were assessed during the review.1All the KPIs were assessed and accordingly categorized under the three groups: (i). ACHIEVED - indicating that the sectors and Dzongkhags have achieved the target; (ii). On TRACK – meaning that the progress towards the plan target are on track and that the targets would be achieved by end of 11th Plan; and (iii). At RISK - indicating that progress towards the plan target are low and that targets may not be achieved by the end of the 11th FYP, if appropriate interventions are not implemented. Such KPIs would require intervention from the Government to resolve the issues on an urgent basis. Aside from above, the MTR also reviewed the financial progress of the 11th FYP including the plan revision/realignment proposals submitted by the sectors. The contents of the report are primarily drawn from the progress and issues presented deliberated during the MTR meetings of central agencies and local governments. Additionally, information on fiscal and economic variables are sourced from Annual Financial Statements (2013-2014, 2014-2015), Annual Budget Report (2014-2015, 2015- 2016), State of the Nation (2014 & 2015), Financial reports from RMA and Statistical Yearbook of Bhutan. 3. AN OVERVIEW OF ELEVENTH PLAN MID-TERM ACHIEVEMENTS 3.1 OVERVIEW An evaluation of the major socio-economic indicators over the first half of the 11th FYP provides a picture of noteworthy and tangible achievements. Most of the planned developments activities were reported to be under implementation and important development targets were either achieved or are on track. Significant progress was noted in advancing social and human development conditions in the country. As can be seen from the details presented below, Bhutan remains firmly on track to achieve the objectives set in the 11th FYP. 1The total KPIs doesn’t include KPIs of Autonomous Agencies and Constitutional Bodies. Gross National Happiness Commission Page 6 MID TERM REVIEW REPORT (11th FYP) November, 2016 The following highlights some of the key achievements in socio-economic front in the 11th FYP. Bhutan’s per capita income has risen to USD 2,611 in 2014 from USD 1,968 in 2012 (NSB, 2015). The economy expanded from Nu.104.47 billion in FY 2012-13 to Nu. 125.18 billion in 2014-2015. Over the past two years, Bhutan has made major strides in human development. Bhutan’s HDI value has seen steady increase in last few years with HDI value assessed at over 0.605 in 2014 as compared to 0.589 and 0.582 in 2013 and 2012 respectively. Bhutan is currently in Medium Human Development countries category. These HDI gains have been realized largely on account of Bhutan’s relentless pursuit of pro-poor policies and programs focused at poverty reduction, increasing educational enrollments, reducing child mortality and maternal mortality and significant improvements in access to safe drinking water and sanitation facilities. 3.2 STATUS OF THE 11th FYP OBJECTIVE The 11th FYP was formulated with overarching objective of “Self-Reliance and Inclusive Green Socio-Economic Development”. ‘Self-Reliance’ defined as ability to meet all our national development needs as articulated through 5 Year Plans by 2020; “Inclusive” – reducing poverty and inequality by enhancing the standard of living and the quality of life of the most vulnerable sections of our society; and “Green” referring to Carbon neutral development. “Self-Reliance” Status: In 2013-2014 and 2014-2015, the coverage of current expenditure by domestic revenue was about 130% and 120 % respectively meeting the constitutional requirement of meeting the recurrent expenditure from the internal resources. In the first two years of the 11th FYP, percentage of domestic revenue financing the total expenditure has averaged at 68%. In FY 2014-2015, government incurred total expenditure of Nu. 36,475.848 million of which Nu. 25,141.030 million, representing 68.92% was met from internal revenue. About 27.29% of public expenditure