Public Disclosure Authorized Public Disclosure Authorized NEPAL Second Rural Water Supply and Sanitation Project Public Disclosure Authorized Report No. 114286 JUNE 16, 2017 Public Disclosure Authorized © 2017 International Bank for Reconstruction This work is a product of the staff of The World RIGHTS AND PERMISSIONS and Development / The World Bank Bank with external contributions. The findings, The material in this work is subject to copyright. 1818 H Street NW interpretations, and conclusions expressed in Because The World Bank encourages Washington DC 20433 this work do not necessarily reflect the views of dissemination of its knowledge, this work may be Telephone: 202-473-1000 The World Bank, its Board of Executive reproduced, in whole or in part, for Internet: www.worldbank.org Directors, or the governments they represent. noncommercial purposes as long as full attribution to this work is given. Attribution—Please cite the work as follows: The World Bank does not guarantee the World Bank. 2017. Project Performance accuracy of the data included in this work. The Any queries on rights and licenses, including Assessment Report: Nepal—Second Rural boundaries, colors, denominations, and other subsidiary rights, should be addressed to Water Supply and Sanitation Project. information shown on any map in this work do World Bank Publications, The World Bank Washington, DC: World Bank. not imply any judgment on the part of The Group, 1818 H Street NW, Washington, DC World Bank concerning the legal status of any 20433, USA; fax: 202-522-2625; e-mail: territory or the endorsement or acceptance of [email protected]. such boundaries. Report No: 114286 PROJECT PERFORMANCE ASSESSMENT REPORT NEPAL SECOND RURAL WATER SUPPLY AND SANITATION PROJECT LOAN/CREDIT NO. C3911; CH369 June 16, 2017 Financial, Private Sector, and Sustainable Development Independent Evaluation Group ii Currency Equivalents (annual averages) Currency Unit = Nepalese rupees (NPR) 2004 US$1.00 NPR 73.00 2005 US$1.00 NPR 72.00 2006 US$1.00 NPR 72.00 2007 US$1.00 NPR 70.00 2008 US$1.00 NPR 63.98 2009 US$1.00 NPR 77.47 2010 US$1.00 NPR 74.59 2011 US$1.00 NPR 71.44 2012 US$1.00 NPR 84.99 All dollar amounts are U.S. dollars unless otherwise indicated. Abbreviations and Acronyms ADB Asian Development Bank DFID U.K. Department for International Development ERR economic rate of return FINNIDA Finnish International Development Agency Fund Board Rural Water Supply and Sanitation Fund Development Board ICR Implementation Completion and Results Report IDA International Development Association IEG Independent Evaluation Group M&E monitoring and evaluation MIS management information system NPR Nepalese rupees PDO project development objectives PPAR Project Performance Assessment Report RWSS Rural Water Supply and Sanitation UNICEF United Nations International Children’s Fund VDC Village Development Committee VMW Village Maintenance Worker WSUC Water and Sanitation Users Committee WTSS Women’s Technical Support Services Fiscal Year Government: July 16–July 15 Director-General, Independent Evaluation: Caroline Heider Director, IEG Financial, Private Sector, Sustainable Development: José C. Carbajo Martínez Manager, IEG Sustainable Development: Midori Makino Task Manager: Arun Arya iii Contents Principal Ratings ...................................................................................................................... vi Key Staff Responsible.............................................................................................................. vi Preface.................................................................................................................................... viii Summary .................................................................................................................................. ix 1. Background and Context....................................................................................................... 1 Country Background ............................................................................................................. 1 Project Context...................................................................................................................... 1 2. Objectives, Design, and their Relevance .............................................................................. 2 Objectives ............................................................................................................................. 2 Relevance of Objectives ....................................................................................................... 2 Design ................................................................................................................................... 3 Components ...................................................................................................................... 3 Implementation Arrangements.......................................................................................... 3 Monitoring and Evaluation Design ................................................................................... 4 Relevance of Design ............................................................................................................. 5 Relevance of Project Design to Objectives ....................................................................... 5 Quality of Results Framework .......................................................................................... 5 3. Implementation ..................................................................................................................... 6 Planned versus Actual Expenditure by Component.............................................................. 6 Implementation Experience .................................................................................................. 6 Safeguards Compliance .................................................................................................... 7 Financial Management and Procurement.......................................................................... 8 4. Achievement of the Objectives ............................................................................................. 9 Objective 1: Improve Sector Institutional Performance and Mainstream Fund Board Approach ............................................................................................................................... 9 Improve Sector Institutional Performance ........................................................................ 9 Outputs .............................................................................................................................. 9 Outcomes ........................................................................................................................ 10 Mainstream Fund-Board Approach in the Government’s System .................................. 10 Outputs ............................................................................................................................ 10 This report was prepared by Arun Arya, task manager, with support from Madhu Sudan Gautam, consultant, who assessed the project in November–December, 2016. The report was peer-reviewed by Rasmus Heltberg and Victor Vergara; and panel-reviewed by Ridley Nelson, consultant. Carla Fabiola Chacaltana, Sushila Rai, and Romayne Pereira provided administrative support. iv Outcomes ........................................................................................................................ 11 Objective 2: Inclusive Water Supply and Sanitation User Groups ..................................... 12 Outputs ............................................................................................................................ 12 Outcomes ........................................................................................................................ 13 Objective 3: Sustainable Health, Hygiene, and Productivity Benefits ............................... 15 Outputs ............................................................................................................................ 15 Outcomes ........................................................................................................................ 15 5. Efficiency ............................................................................................................................ 16 6. Ratings ................................................................................................................................ 18 Outcome .............................................................................................................................. 18 Risk to Development Outcome ........................................................................................... 18 World Bank Performance ................................................................................................... 20 Quality at Entry ............................................................................................................... 20 Quality of Supervision .................................................................................................... 21 Borrower Performance ........................................................................................................ 21 Government Performance ............................................................................................... 21 Implementing Agency Performance ..............................................................................