An Evaluation of the World Bank's Trust Fund Portfolio

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CHAPTER 4MANAGEMENT AND ACCOUNTABILITYCOUNTRY-SPECIFIC TRUST FUNDS4.19 Country-specific trust funds are those in which the donor haspreselected the recipient country or countries. The great majority ofthe trust funds reviewed in the case study country programs were ofthis type, as were 11 of the 36 trust funds in the random sample.Donors create country-specific funds when they want to:Provide significant aid to a country—more than IDA provides,for example—but their bilateral program is limited in staffingand skills.Avoid providing direct budget support to a particulargovernment. 17Respond to emergencies and disasters.4.20 Some countries, such as Ethiopia and Indonesia, receive largeamounts in this way and others, including Benin and Rwanda, receivevirtually no country-specific funds. Donors and recipients aregenerally satisfied with the Bank’s administration of these funds.They mentioned the following key benefits:They can provide substantial additional funding to thecountry.The Bank takes responsibility for donor coordination, so thegovernment has to deal with only one interlocutor.Donors can piggy-back on Bank technical and policy expertise.Recipients use a uniform set of procedures and forms.The Bankgenerally seeksto integrate trustfund businessprocesses withthose of itsother work, andhasaccomplishedthis for fundsthat cofinanceIDA/IBRDoperations.4.21 The available data systems have heretofore not permitted theBank to systematically manage—or even to track—these trust funds atthe regional 18 and corporate levels. This has created a gap inaccountability 19 because the Bank cannot account to shareholders forhow the cumulative allocation of country-specific trust funds affectsthe overall distribution of resources and, in particular, whether itoffsets or reinforces the performance-based allocation pattern of IDAresources.Business Processes4.22 The Bank’s general policy is to integrate trust fund businessprocesses with those for mainstream Bank work. 20 Trust funds thatcofinance IDA/IBRD operations, which account for roughly half ofrecipient-executed trust funds in dollar terms, are supposed to beprepared and supervised using the Bank’s processes and standards.The evaluation’s country studies and interviews with managersconfirm that this is the case. For the other half of RETF activities—thatis, those not cofinancing IDA/IBRD projects— the business processes56
for preparation, supervision, and reporting vary across Regions andtrust funds. These differences arise from three causes: donors’expectation to receive dedicated reporting; the organization of basicdata about trust funds around individual financial accounts ratherthan the operations being supported; and the decentralization ofmobilization and approval of trust funds to the VPU (or even lower)level.CHAPTER 4MANAGEMENT AND ACCOUNTABILITY4.23 The Bank and its individual VPUs have created an extensivesuite of policies, handbooks, guidance notes, Web sites, databases,and templates intended to help staff initiate, manage, and report ontrust funds. Numerous units (listed in appendix H) haveresponsibility for some aspect of trust fund management or oversight.And each VPU continually tries to upgrade its own internalprocedures and techniques for obtaining and managing trust funds,as illustrated in box 4.1.4.24 Such improvements are commendable, but they seek processsolutions to what is primarily a structural problem. Full integrationwould imply that business processes and results frameworks for agiven activity are the same, irrespective of the source of funds. Theconsiderable effort and investment still required to move towardintegration reveals the extent to which trust-funded activities remainstructurally separate from the Bank’s mainstream accountabilityframework.The effort andinvestmentrequired tomove toward“integration”reveals theextent to whichtrust-fundedactivities remainstructurallyseparate fromthe Bank’smainstreamaccountabilityframework.Box 4.1 One Region’s Efforts to Integrate Trust Funds“With regard to the integration of trust fund planning and management into VPUbusiness processes for managing lending, AAA, and budget resources, includingstaffing and skill mix, this Region has made good progress over the past year.In FY05, the region established a group to handle trust fund matters centrally for theRegion. This group…is responsible for trust fund strategy development, review, andsubmission of proposals, training, and monitoring.All CMUs [country management units] have tasked one of their Operations Officersto monitor and coordinate the trust funds, and each SMU [sector management unit]has a dedicated Operations Officer carrying out the same function. These staff alsocoordinate regularly with the Regional Trust Fund Team.Training has been provided to these staff where necessary. All units are able toquickly access information on regional procedures, policy and quality guidelines, aswell as links to the various Bank web sites at the regional web site, which providesrelevant information regarding the trust funds. A goal of FY11 is to update theRegional Trust Fund Web page.”Source: FY10 trust fund portfolio review for a Bank Region.57
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The World Bank GroupWORKING FOR A W
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©2011 The Independent Evaluation G
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CONTENTSAllocation of Trust Fund Re
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CONTENTSFigure 5.3 All Networks, Es
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AcknowledgmentsThis report was prep
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SummaryAs development challenges ex
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SUMMARYchannels? In addition, the B
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SUMMARYinnovative development finan
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SUMMARYdonor funds in line with rec
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Management ResponseIntroductionMana
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MANAGEMENT RESPONSEplay at the leve
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MANAGEMENT RESPONSEattention needs
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MANAGEMENT ACTION RECORDMajor Monit
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Chairperson’s Summary:Informal Me
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1. The Role of Trust Funds in theGl
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CHAPTER 1THE ROLE OF TRUST FUNDS IN
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Page 37 and 38: CHAPTER 1THE ROLE OF TRUST FUNDS IN
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Page 42 and 43: CHAPTER 2THE WORLD BANK’S TRUST F
Page 56 and 57: CHAPTER 3THE RELEVANCE AND EFFECTIV
Page 80 and 81: CHAPTER 4MANAGEMENT AND ACCOUNTABIL
Page 96 and 97: CHAPTER 5THE IMPACT OF TRUST FUNDS
Page 109 and 110: 6. Findings and Recommendations6.1
Page 111 and 112: CHAPTER 6FINDINGS AND RECOMMENDATIO
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Page 115 and 116: the evaluation, namely operational
Page 117 and 118: Appendix A: Methodology NoteCalcula
Page 119 and 120: Appendix B: Trust Fund Use in the E
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Page 125 and 126: APPENDIX C: LIST OF INDIVIDUALS CON
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Appendix E: Trust-Funded FinancialI
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APPENDIX E: FINANCIAL INTERMEDIARY
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APPENDIX E: FINANCIAL INTERMEDIARY
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Appendix F: Reliance on Donor Funds
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APPENDIX F: RELIANCE ON DONOR FUNDS
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Appendix G: World Bank Operational
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Appendix H: Organizational Aspects
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Appendix I: Trust Fund Support for
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ENDNOTES3. Over fiscal 2002-10, the
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ENDNOTES31. Cited in a 2008 indepen
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SELECTED BIBLIOGRAPHYKharas, H. 200
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SELECTED BIBLIOGRAPHY____. 2010l.
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An Evaluation of the World Bank's Trust Fund Portfolio

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