Project Administration Manual Project Number: 51107-002 Loan and Grant Number(s): {LXXXX; GXXXX; TAXXXX} October 2018 Sri Lanka: Health System Enhancement Project ABBREVIATIONS ADB Asian Development Bank AGD Auditor General’s Department APFS audited project financial statements ATR action taken report BCCM behavior change communication and community mobilization CBSL Central Bank of Sri Lanka CIGAS computerized integrated government accounting system DMF design and monitoring framework EARF environment assessment and review framework EGM effective gender mainstreaming EMP environment management plan EMR electronic medical record ERD Department of External Resources ERTU education, training and research unit ESP essential service package FHB Family Health Bureau FHC field health center FMA financial management assessment GAP gender action plan GBV gender-based violence GOSL Government of Sri Lanka HCWM healthcare waste management HIT health information technology HPB Health Promotion Bureau HRH human resources for health HSEP Health System Enhancement Project IEC information, education and communication IHR International Health Regulations MIS management information system MOFMM Ministry of Finance and Mass Media MOH medical officer of health MOHNIM Ministry of Health, Nutrition and Indigenous Medicine MOMCH medical officer maternal and child health NCD noncommunicable disease OCB open competitive bidding PBS patient based system PCC project coordination committee PCR project completion report PDHS provincial director health services PFM public financial management PHC primary health care PHI public health inspector PHM public health midwife PHN patient healthcare number PIU project implementation unit PMCU primary medical care unit PMU project management unit POE point of entry PPER project performance evaluation report PPTA project preparatory technical assistance PSC project steering committee QCBS quality- and cost-based selection RDHS regional director of health services SOE statement of expenditure TOT training of trainers CONTENTS I. PROJECT DESCRIPTION 1 II. IMPLEMENTATION PLANS 5 A. Project Readiness Activities 5 B. Overall Project Implementation Plan 6 III. PROJECT MANAGEMENT ARRANGEMENTS 15 A. Project Implementation Organizations: Roles and Responsibilities 15 B. Key Persons Involved in Implementation 16 C. Project Organization Structure 17 IV. COSTS AND FINANCING 20 A. Cost Estimates Preparation and Revisions 20 B. Key Assumptions 20 C. Detailed Cost Estimates by Expenditure Category 21 D. Allocation and Withdrawal of Loan Proceeds 22 E. Detailed Cost Estimates by Financier 23 F. Detailed Cost Estimates by Outputs and/or Components 24 E. Detailed Cost Estimates by Year 25 F. Contract and Disbursement S-Curve 26 I. Fund Flow Diagram 27 V. FINANCIAL MANAGEMENT 29 A. Financial Management Assessment 29 B. Disbursement 34 C. Accounting 35 D. Auditing and Public Disclosure 35 VI. PROCUREMENT AND CONSULTING SERVICES 37 A. Advance Contracting 37 B. Retroactive Financing 37 C. Procurement of Goods, Works, and Consulting Services 37 D. Procurement Plan 40 VII. SAFEGUARDS 85 VIII. GENDER AND SOCIAL DIMENSIONS 86 IX. PERFORMANCE MONITORING, EVALUATION, REPORTING, AND COMMUNICATION 90 A. Project Design and Monitoring Framework 91 B. Monitoring 94 C. Evaluation 95 D. Reporting 95 X. ANTICORRUPTION POLICY 96 XI. ACCOUNTABILITY MECHANISM 97 XII. RECORD OF CHANGES TO THE PROJECT ADMINISTRATION MANUAL 97 ANNEXES 1. PROJECT DESCRIPTION 98 2. TERMS OF REFERENCE FOR PROJECT MANAGEMENT STAFF 105 3. GUIDELINES FOR PRIMARY HEALTH CARE INNOVATION FUND 119 4. CIVIL WORKS FOR PRIMARY HEALTH CARE FACILITIES 133 5. CLIMATE CHANGE AND DISASTER RISK RESILIENCE 143 6. EQUIPMENT REQUIREMENT AND DISTRIBUTION 145 7. GRIEVANCE REDRESS MECHANISM 151 8. VEHICLE FLEET ANALYSIS AND REQUIREMENT 154 9. HEALTH INFORMATION TECHNOLOGY SYSTEMS 158 10. BEHAVIOR CHANGE AND COMMUNITY MOBILIZATION STRATEGY 162 11. INDICATIVE HUMAN RESOURCE DEVELOPMENT PLAN 165 12. HUMAN RESOURCE FOR HEALTH FOR STRENGTHENING PRIMARY HEALTH CARE 171 Project Administration Manual Purpose and Process 1. The project administration manual (PAM) describes the essential administrative and management requirements to implement the project on time, within budget, and in accordance with the policies and procedures of the Government of Sri Lanka and the Asian Development Bank (ADB). The PAM should include references to all available templates and instructions either through linkages to relevant URLs or directly incorporated in the PAM. The Ministry of Health, Nutrition and Indigenous Medicine (MOHNIM) as executing agency and four provincial councils of Central, North Central, Sabaragamuwa, and Uva provinces as implementing agencies are wholly responsible for the implementation of ADB-financed projects, as agreed jointly between the borrower and ADB, and in accordance with the policies and procedures of the Government and ADB. ADB staff is responsible for supporting implementation including compliance by MOHNIM and Provincial Councils of the four provinces (Central, North Central, Sabaragamuwa, and Uva provinces) of their obligations and responsibilities for project implementation in accordance with ADB’s policies and procedures. 2. At loan negotiations, the borrower and ADB shall agree to the PAM and ensure consistency with the loan and grant agreements. Such agreement shall be reflected in the minutes of the loan negotiations. In the event of any discrepancy or contradiction between the PAM and the loan and grant agreements, the provisions of the loan and grant agreements shall prevail. 3. After ADB Board approval of the project's report and recommendations of the President (RRP), changes in implementation arrangements are subject to agreement and approval pursuant to relevant government and ADB administrative procedures (including the Project Administration Instructions) and upon such approval, they will be subsequently incorporated in the PAM. Health System Enhancement Project (RRP SRI 51107) I. PROJECT DESCRIPTION 1. The Health System Enhancement Project (HSEP) will be the first ADB-financed health operation in Sri Lanka after a gap of 20 years. This reentry project will be for $60 million (comprising $37.5 million in concessionary loan and $12.5 million grant, and $10 million equivalent from the Government of Sri Lanka in counterpart funds). It will be delivered through a project investment modality and is expected to be effective from 1 December 2018 and will complete on 30 November 2023. 2. The proposed project will improve efficiency, equity, and responsiveness of the primary health care (PHC) system based on the concept of providing universal access and continuum of care to quality essential health services. 3. The project pursues an equity perspective in planning and delivering of essential primary health services. It expects to further inform and operationalize government PHC reform initiatives to reduce bypassing of PHC facilities by providing more comprehensive services, including for NCDs, develop a referral system, and functionally integrating preventive and curative services. Furthermore, the project will target underserved communities’ access to PHC, and address selected gaps in core public health surveillance in line with the international health regulations (IHR). 4. The project is targeting all nine districts in four provinces of Central, North Central, Sabaragamuwa, and Uva with a special focus on the geographically, socially, and economically- deprived populations. The beneficiary population of the project is approximately 7 million which is 33% of the Sri Lanka population (21 million) while the target population within the four provinces, is estimated to be approximately 2.4 million. 5. Impact and Outcome. The expected project impact is to contribute to the Government development objective1 of ensuring a healthier nation with a more comprehensive PHC system. The project outcome is to improve efficiency, equity, and responsiveness of the PHC system. 6. Key indicators for monitoring. The project outcomes are assessed by observing a (i) 20% increase in outpatient utilization at PHC; (ii) 20% increase in patient satisfaction, knowledge and attitudes on utilization; (iii) 90% of notified notifiable diseases investigated within the stipulated time in the medical officer of health areas in the target provinces; and (iv) cluster system reform implemented and evaluated in all nine clusters. 7. Outputs. The project outputs are (i) PHC enhanced in Central, North Central, Sabaragamuwa, and Uva provinces; (ii) health information system and disease surveillance capacity strengthened; and (iii) policy development, capacity building, and project management supported. 1. Output 1: Primary health care enhanced in Central, North Central, Sabaragamuwa, and Uva provinces. 8. This output intends to strengthen PHC services in the targeted 4 provinces of Central, North Central, Sabaragamuwa, and Uva with a special focus on the socially, economically and geographically disadvantaged populations. The PHC services are defined as primary health care 1 Government of Sri Lanka, MOHNIM. 2016. Sri Lanka National Health Policy 2016–2025. Colombo. 2 services that are provided via curative facilities (Primary Medical Care Units and the Divisional Hospitals), and via the preventive health network led by the Medical Officers of Health. 9. Output 1 will support four sets of activities: (i) development of primary medical care services; (ii) development of primary preventive care services; (iii) public