ISLAMABAD – The World Bank has approved $50 million to strengthen public sector performance in the province of Sindh through improved revenue generation and expenditure management.
The Sindh Public Sector Management Reform Project will contribute to improved collection of Sales Tax on Services, improved credibility of budget execution and increased timeliness of contract execution.
“Over the last few years, the Government of Sindh has made commendable efforts to raise revenue to meet development expenditure targets.
But the revenues generated at the provincial level remain insufficient to support social and development expenditures needed for economic growth in the province”, said Rachid Benmessaoud, World Bank Country Director for Pakistan.
“The Project will support institutional development of the Sindh Revenue Board with enhanced staffing, increased automation, and improved auditing practices; and improved management for monitoring, evaluation and increased transparency.
The Project consists of two complementary components: (i) A Public Sector Management Reforms component, with results-based financing linked to incentives to meet Disbursement Linked Indicators (DLIs) ($40 million), and (ii) Technical Assistance to support activities for achieving DLIs ($10 million).
Results-based financing will disburse against agreed eligible expenditure programs in four reform areas: increasing tax revenue mobilisation; enhancing performance of public financial management systems; strengthening public procurement performance; and improving management of the development portfolio.
Meanwhile, technical assistance will be used to support all four eligible Public Sector Management Reforms areas.
“Improving and strengthening upstream government systems are expected to ultimately lead to better public policies and services, benefitting Sindh’s citizens”, said Zubair Khurshid Bhatti, Senior Public Sector Management Specialist.
“The project will enhance the effectiveness of government departments, particularly the officials of the departments of Finance and Planning and Development and the Sindh Revenue Board.
Overall the province will reap efficiency gains from improved tax collection, budget and procurement management.
ICT-based proactive beneficiary feedback innovations for improved monitoring of development projects will also be mainstreamed.
The credit is financed from the International Development Association (IDA), the World Bank Group’s grant and low-interest arm.
It will be on standard IDA terms, with a maturity of 25 years, including a grace period of 5 years.