An Evaluation of the World Bank's Trust Fund Portfolio

5.15 The Bank’s shareholders need to stand behind decisions of theBank to take on the trusteeship of each of these funds, with their largepotential positive or negative impacts. A review should therefore bemade of experience to date and that review should serve as the basisfor revisiting, with the Bank’s Board, the adequacy of the currentpolicy and framework in guiding acceptance and management of FIFsgoing forward. In addition, management should submit each new FIFproposal to the Board for approval. Management should also reportperiodically to the Board on the operations of the FIFs and theirimplications for aid effectiveness and the Bank’s own strategies andprograms.CHAPTER 5THE IMPACT OF TRUST FUNDS ON THE BANKThe Role of Trust Funds as a Supplement to the Bank’sBudget5.16 Trust fund resources used by the Bank in support of its workprogram have grown significantly in relation to the Bank’s netadministrative budget. As noted in chapter 2, between fiscal 2002–04and 2008–10, BETF disbursements increased from 14 to 23 percent oftotal Bank budget resources (that is, the total of Bank netadministrative budget and BETFs).5.17 Bank units draw heavily on BETFs to support a wide range ofprograms and activities. According to an internal World Bank report(World Bank forthcoming), in FY10 BETFs funded almost 20 percentof total supervision costs, 35 percent of total economic and sectorwork, and 53 percent of total nonlending technical assistance.Furthermore, BETFs pay for coordination and partnership work, andunder some circumstances provide operational support for thepreparation and supervision of projects (for example, for cofinancedoperations and in situations where there is no associated IBRD or IDAlending, as in Timor-Leste). Thus, in some cases, the use of BETFsand the Bank budget are fungible-- such as when they fund staffdesignated to work on the implementation of Bank projects. In othercases BETFs support activities of client countries such as when, forpractical reasons, the Bank manages a study for a country entity, orwhen the Bank manages a separate program of activities withparticipating countries through designated staff. So, while BETFsshould not be seen as fully fungible with Bank budget, there is aconsiderable degree of overlap and, therefore, BETF funding is tosome extent a complement to Bank budget.Bank units drawheavily onBETFs for awide range ofactivities insupport of theirprograms.BETFs fundedalmost half ofnetwork anchorexpenditures inFY2008–10.BETF USE BY BANK UNITS5.18 For network anchors, BETFs funded almost half of theirexpenditures during fiscal 2008–10, compared with just 16 percent inRegional VPUs, as shown in figure 5.2.71