PAD - LGED

strengthen governance in the rural road sub-sector and prevent and mitigate corruption at the
project level.
4. The Bank’s strategy for improving governance in Bangladesh, laid out in its 2011-2014
Country Assistance Strategy, focuses on developing accountability mechanisms in public sector
operations, especially through increased transparency. The Bank seeks to align with Government
priorities in developing the means of accountability, especially strengthening of public financial
management, support for local government, use of information and communication technology
(ICT) and the adoption of a Right to Information (RTI) regime. In particular, the Bank is
working with the Government to improve budgeting practices among line agencies in
conjunction with enhanced accountability mechanisms. It is working to increase the role and
quality of oversight of public finances by the Parliamentary Accounts Committee, improve
capacity of the Comptroller and Auditor General’s Office, and promote greater public
understanding of public financial management to build more informed demand and ability to
hold Government accountable. The Bank’s strategy also focuses on improving public service
delivery, a key component which is fostering greater accountability to recipients of services
including through a strengthened role for local government. The Bank supports the
Government’s efforts to establish functioning RTI regime, including building capacity in all
agencies to provide information more fully and efficiently. The Bank also continues to
emphasize the importance of building demand for good governance among civil society. This, in
turn, requires engaging with the civil society and monitoring the performance of the public
sector.
LGED and Good Governance Practices
5. Worldwide, the transport sector is associated with governance risks, including fraud and
corruption. Some of the key evidences of these risks include low competition in bidding
processes, unsatisfactory quality of works, and large cost and time overruns. By their very
essence, transport infrastructure projects also have direct impacts on local communities due to
land acquisition and construction activities in inhabited areas, which require careful
management.
7. Following some incidences of inappropriate bidding practices in LGED as identified in
post reviews as well as allegations of poor quality and unfinished road works, LGED and the
Bank jointly carried out the ORA of LGED in 2009. The ORA assessed fiduciary and operational
risks in LGED's management of projects, assets and other resources, and in LGED’s oversight
function. The study highlighted a gap between LGED’s advocacy of project management tools,
systems and processes and weaknesses in planning, contract management and overall oversight
of fiduciary activities, reporting back from field to HQ, and lack of monitoring. Although
information and communication systems are relatively progressive in LGED compared to other
government departments, the use of many different systems, lack of integration, unsustainable
funding of personnel through donor-funded projects and inadequate internal controls make it
difficult for LGED to gather and consolidate reliable information and do not facilitate reporting
and control. LGED prepared a Fiduciary and Operational Risk Management Improvement Plan
(FORMIP) that (i) prioritizes options which are realistic and available to effectively minimize
(and where possible, eliminate) the major operational risks identified, and (ii) identifies options
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