Madagascar - The Second Social Fund (Second FID) Project

59750 No. 57 October 2000 Madagascar: The Social Fund II (FID II) Project The Social Fund II project ( 1996-1999) was intended to provide supplemental financing to the Fonds d’Intervention pour le Developpement ( FID) which had been active in the provinces of Anantanarivo and Toliary since 1993. FID acquired the capacity to develop infrastructure sub-projects, income-generating activities and training sub-projects – this experience provided the foundation for the expansion of project activities to all six provinces in Madagascar under FID II. The project components include : (i) construction and rehabilitation of basic infrastructure, including schools, health centers, water supply, small irrigation systems, rural roads, small bridges, as well as reforestation and protection of the environment; (ii) income generating activities ( this was later dropped as being incompatible with the country’s financial sector policies ); and (iii) private sector support programs, including training programs for small enterprises and consulting firms, and development of community groups and local NGOs. The project was implemented more rapidly than had been estimated and closed an entire year before the original schedule. Impact on the ground A sample survey carried out in end-December 1997 indicated the following impacts : • In twelve of fifteen rehabilitated schools, the number of students increased, in many cases by 25-50 %. • In seven of the ten health centers surveyed, visits had increased. • The number of beneficiaries of water supply systems increases in all five cases in the sample. • In five of six irrigation projects, the irrigated area increased. Double cropping was enabled in four of these cases. • The number of vendors increased in six of eight market projects. • All nine road projects assessed provided improved access to isolated areas. End-of project impact • By the end of the project, 6.1 million person days of temporary employment had been created ( 121% of target ) and 1,546 permanent jobs had been created (  55% of target). • Working with NGOs ( 309 contracts ) and community groups, 450 schools and 185 health centers were rehabilitated. • Nine hundred and sixty-seven km of rural roads were rehabilitated. • Eleven thousand one hundred and seventy one ha were irrigated. • Fifty-five training courses had been provided for employees of engineering firms, small/medium contractors and loan program promoters. Since the project’s inception, 226 managers and technicians from more than 100 contracting firms, and 374 persons from some 80 engineering firms have been trained. • The 1,796 contracts with small and medium enterprises have, along with contracts from other sources, enabled many firms to acquire construction and office equipment. • Development at the community and local government levels was encouraged. By August 1999, 25% of projects were being implemented with some involvement of communes, consistent with the government’s decentralization policy. Lessons learned • Projects designed and managed outside of government can recruit more competent staff and get better results, but they cannot be completely isolated from political influence. One way to minimize government influence is by building partnerships with communities and local governments, giving them more influence at all stages. • Direct beneficiary involvement in implementation tends to enhance the influence of beneficiary communities. • A clear commitment to maintenance and developing a maintenance strategy is essential in this type of program to improve the likelihood of sustainability. Using consultants to follow up and animate communities on maintenance issues helps. • It is important that the project’s activities are in line with the strategies of sector ministries, not only at the national level but within the decentralized structure. • A simpler structure to oversee non-governmental organizations like FID might help to minimize infighting and political interference. The strategy for wide representation from a broad spectrum of groups sometimes led to stalemates and indecision. • Training programs for engineering firms and small and medium contractors improve their competence. Training should be expanded to include technicians from local governments, and sociologists and other employees of consulting firms dealing with community development. • It is important for low income groups in rural areas to have access to credit to enhance their income-earning potential. It is preferable, however, for small loan programs to be integrated within existing financial policies, markets and institutions. This article has been largely excerpted from the project’s Implementation Completion Report. For more information, please contact Eileen Murray : Emurray@worldbank.org