Papua New Guinea: Supporting Public Financial Management

Sovereign Project | 41510-012 Status: Closed


The technical assistance (TA) is intended to help strengthen PFM in PNG by enhancing oversight of statutory authorities, improving project evaluation and prioritization, strengthening procurement arrangements, enhancing transparency and monitoring of subnational service delivery, and supporting the development of domestic bond markets.

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Project Name Supporting Public Financial Management
Project Number 41510-012
Country Papua New Guinea
Project Status Closed
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 7427-PNG: Supporting Public Financial Management
Japan Special Fund US$ 1.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Sector / Subsector

Public sector management - Public expenditure and fiscal management

Gender Equity and Mainstreaming
Description The technical assistance (TA) is intended to help strengthen PFM in PNG by enhancing oversight of statutory authorities, improving project evaluation and prioritization, strengthening procurement arrangements, enhancing transparency and monitoring of subnational service delivery, and supporting the development of domestic bond markets.
Project Rationale and Linkage to Country/Regional Strategy The 2008-2009 mid-term review of the PNG Country Strategy and Program 2006-2010 confirmed that PFM would remain one of the Program's key focal areas. PFM is also central to the Government's strategies, particularly through the Public Sector Reform Program, which underpins the Medium-term Development Strategy (MTDS), by seeking to create the conditions and capacity for government to deliver its development objectives, institutions and systems. PFM reform efforts are focused through the Public Expenditure Review and Rationalization (PERR) process, which is a joint Government-donor program coordinated by the multi-agency PERR implementation committee. Moreover, initiatives to enhance aid effectiveness are set out in the 2008 PNG Commitment on Aid Effectiveness , which localizes the 2005 Paris Declaration on Aid Effectiveness. Among other things, Government and development partners have committed to strengthen public procurement systems, taking into account such recommendations as Country Procurement Assessment Reports (CPAR). Finally, government functions are increasingly being devolved to statutory authorities, particularly in sectors such as transport, where ADB is active. ADB has provided support previously to PFM through TA 4947-PNG: Support for PERR , which reviewed and recommended improvements to statutory authority arrangements. The proposed TA will, inter alia, support implementation of some of those improved arrangements.
Impact A more efficient and effective government administration.
Project Outcome
Description of Outcome Better governance through improved transparency, accountability, and efficiency in managing and using public resources
Progress Toward Outcome
Implementation Progress
Description of Project Outputs

The following planned TA outputs are proposed to be delivered in the period to June 2011:

(i) Strengthened Oversight of Statutory Authorities. The proposed TA will work with the Treasury-led inter-agency working group to (a) identify and seek the participation in the exercise of 10 pilot statutory authorities; (b) review available information and information systems; (c) agree key performance indicators (KPIs) and identify any additional information requirements; (d) work with agencies to design and establish the enhanced monitoring process; and (e) identify requirements and approaches for extending the enhanced monitoring process.

(ii) Improved Project Evaluation and Prioritization. The proposed TA will work with the Treasury and DNPM to (a) prepare guidance materials for economic and financial analysis of investment projects; (b) develop 3 case studies of project analysis, which are relevant to the PNG setting; and (c) conduct 4 workshops on project analysis and project financing approaches.

(iii) Improved Procurement Practices. The proposed TA will support ADB's efforts, in conjunction with Government and other development partners, to prepare an updated CPAR (or similar assessment) which will identify improvements in procurement policies and practices. The TA will also support ADB's contributions to coordinated efforts to strengthen procurement arrangements and practices. ADB's COSO will participate in this process.

(iv) Enhanced Subnational Service Delivery Monitoring. Based on the outcome of an exisiting ADB-supported pilot study of service delivery, it is proposed that the TA will support upscaling of this pilot. This will involve refining the survey instrument and methodology, and extending the survey to 10 selected districts. Districts will be selected in areas where ADB has active engagement, for instance, the Highlands provinces. District sample selection will also take into consideration the income grouping of provinces in which the district belongs. This would be in line with the NEFC's income classification of provinces based on their revenue generating capacity. Working with the NEFC, the purpose of the surveys will be to track the services that were actually delivered against the recorded expenditures and assist with diagnosis of service delivery problems.

(v) Kina-denominated Bond Issue. The proposed TA will work with the Treasury and the Bank of PNG to identify in depth the issues requiring resolution prior to any proposed issuance of an ADB-backed Kina-denominated bond. This would include consideration of institutional, regulatory, taxation and legal arrangements. A detailed roadmap towards a local currency bond issue will be prepared and agreed.

Oversight of statutory authorities strengthened

Project evaluation and prioritization improved

Procurement practices improved

Subnational service delivery monitoring enhanced

Road map for domestic bond market development prepared

Status of Implementation Progress (Outputs, Activities, and Issues) PDP Australia Pty Ltd, AUS (COSO41-454), ADB Consultant for this Project conducted a workshop entitled "Treasury Training Program". The two sessions workshop was held on 28 September 01 October and 04 October 07 October in Crowne Plaza Hotel, Port Moresby, Papua New Guinea.
Geographical Location Papua New Guinea
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design
During Project Implementation
Business Opportunities
Consulting Services International consultants (29 person-months) and national consultants (12 person-months) will be engaged with expertise in economic and financial analysis, statutory authority governance, procurement, and bond market development. ADB will engage an international consulting firm using the quality and cost-based selection (QCBS) method (80:20) and through simplified technical proposals in accordance with the Guidelines on the Use of Consultants (2007, as amended from time to time).
Responsible ADB Officer Hayden Everett
Responsible ADB Department Pacific Department
Responsible ADB Division Urban, Social Development & Public Management Division, PARD
Executing Agencies
Department of Treasury
Vulupindi Haus P.O. Box 542
Waigani, Papua New Guinea
Concept Clearance 11 May 2009
Fact Finding 02 Mar 2009 to 06 Mar 2009
Approval 10 Dec 2009
Last Review Mission -
PDS Creation Date 16 Apr 2009
Last PDS Update 16 Feb 2011

TA 7427-PNG

Approval Signing Date Effectivity Date Closing
Original Revised Actual
10 Dec 2009 08 Jan 2010 08 Jan 2010 31 Dec 2012 - -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
1,000,000.00 0.00 100,000.00 0.00 0.00 0.00 1,100,000.00 10 Dec 2009 840,335.13
Title Document Type Document Date
Supporting Public Financial Management TA Completion Reports Feb 2012
Supporting Public Financial Management Consultants' Reports May 2011
Supporting Public Financial Management Technical Assistance Reports Dec 2009

Safeguard Documents

See also: Safeguards

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Evaluation Documents

See also: Independent Evaluation

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Related Publications

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