Indonesia : Aligning Asian Development Bank and Country Systems for Improved Project Performance
The proposed TA is innovative in its approach to improve project performance through (i) promoting the use of CSS at the agency level as the pilot after conducting equivalence and acceptability assessment, and propose gaps filling measure, (ii) initiating the use of the new risk based approach to adopt country procurement systems, and (iii) improving alignment between ADB and government business processes for project preparation and start up.
Southeast Asia Department
Request for information
- Public sector management
|Project Name||Aligning Asian Development Bank and Country Systems for Improved Project Performance|
|Country / Economy||Indonesia
|Project Type / Modality of Assistance||Technical Assistance
|Source of Funding / Amount||
|Strategic Agendas||Inclusive economic growth
|Drivers of Change||Governance and capacity development
|Sector / Subsector||
Public sector management / Decentralization - Public administration
|Description||The proposed TA is innovative in its approach to improve project performance through (i) promoting the use of CSS at the agency level as the pilot after conducting equivalence and acceptability assessment, and propose gaps filling measure, (ii) initiating the use of the new risk based approach to adopt country procurement systems, and (iii) improving alignment between ADB and government business processes for project preparation and start up.|
|Project Rationale and Linkage to Country/Regional Strategy||Improving coordination and harmonization of ADB and government project preparation and implementation processes and procedures will improve project readiness and quality at entry, enhance performance during administration, and increase development effectiveness of ADB projects. Safeguards and procurement present two of the greatest challenges for project preparation and implementation. The use of country systems for safeguards and procurement harmonization for ADB-financed projects provides a strategic measure to achieve smoother and more expedient project preparation and implementation. Greater alignment of ADB and government project procedures and cycles will improve preparation efficiency and the timely ability to meet project readiness criteria as well as accelerate project approvals and start-up activities, leading to improved implementation and greater development impact.|
Greater efficiency and effectiveness in preparing and implementing ADB-financed infrastructure projects in Indonesia
|Description of Outcome||
Increased alignment of ADB and government systems procedures to prepare and implement projects
|Progress Toward Outcome||The TA is closed as of 30 September 2018. Concluding Workshop of the TA has been conducted to show and discuss the achievements, lessons, overall benefits of the TA with participants from various government institutions and development partners. The workshop is chaired by Director of Multilateral Funding Bappenas.|
|Description of Project Outputs||
Country Safeguard Systems
Improved Project Readiness and Start-up
|Status of Implementation Progress (Outputs, Activities, and Issues)||
Output 1: Safeguards. All activities under this output have been completed and endorsed by Bappenas and PLN: (i) equivalence assessments; (ii) acceptability assessments; and (iii) final gap-filling measures/action plan. The TA conducted seven stakeholder consultations in four cities from November 2017 to mid-January 2018 jointly organized with PLN and supported by BAPPENAS; additional assessment on acceptability particularly and finalizing background report for PLN use of CSS. The Mission from HQ was in Jakarta from June 25-29 to meet with KLH, BPN, PLN and Bappenas to confirm the findings and finalize the action plan. The wrap meeting was organized by Bappenas on June 29. Two days consultation with CSOs/NGOs and interests groups was conducted chaired by Bappenas on July 6 and 9, to share and discuss the draft final findings and action plan after addressing all relevant stakeholder comments including from CSOs/NGOs. The documents for discussion was shared with invitees and participants on June 22 and during the consultations. Summary consultations prepared and disclosed on ADB website.
Output 2: Procurement. The output has been mostly achieved: (i) country procurement risk assessment was completed. ADB will provide additional assistance to update the assessment following ADB and Government's new procurement frameworks; (ii) NCB master bidding document was endorsed by ADB and used in ADB-financed project in Ministry of Education and Culture and BPKP; (iii) draft standard bidding documents (SBD) of procurement of works (small and large contract) and procurement of design and build contract for international competitive bidding (ICB) for the country have been completed. ADB will provide additional assistance to update the SBD following ADB and Government's new procurement frameworks; and (iv) national e-procurement system (SPSE) for international consulting services and selection was completed and has been applied to support the implementation of ADB-financed projects in Ministry of Public Works and Housing (MPWH). The system will be adopted by the Government for its international bidding process.
Output 3: Readiness Criteria. The targeted performance of output 3 was achieved in Q2-2018. The key deliverable, project preparation manual for GoI and ADB project proponents, was launched in the Country Portfolio Review Meeting (CPRM) in April 2018. The manual covers recommendations for optimizing ADB and Government procedures and project processing and start-up schedules.
Output 4: Capacity development. This output is integrated as a part of the major aspects in the project (project readiness, procurement, and safeguard).
|Summary of Environmental and Social Aspects|
|Stakeholder Communication, Participation, and Consultation|
|During Project Design||Project design and objective were agreed upon amongst the respective stakeholders during consultation and coordination meetings led by the National Development Planning Agency (Bappenas).|
|During Project Implementation||Coordination meetings, Focus groups discussion, workshops have been conducted with the participating agencies, KLH, BPN and Bappenas during the preparation of initial background assessment. After that since November 2017 up to now, there have been series of consultations organized and conducted, including with CSOs/NGOs|
The following consultancy services are recruited to support the TA:
1. Safeguard Specialist (National Expert)
2. Resettlement and Social Development Specialist
3. Environment/AMDAL Safeguard Specialist
4. Legal Land and Resettlement Specialist
5. Legal Environment Specialist
6. Public Procurement Specialist
7. Project Information System Developer
8. System Architecture & Analysis Consultant
9. System Integration Developer
10. National Project Management Specialist
11. Public Infrastructure Specialist
1. e-Procurement Specialist
2. International Project Management Specialist
|Responsible ADB Officer||Aman-Wooster, Syarifah|
|Responsible ADB Department||Southeast Asia Department|
|Responsible ADB Division||Indonesia Resident Mission (IRM)|
National Development Planning Agency (BAPPENAS)
|Concept Clearance||06 Nov 2013|
|Fact Finding||07 Oct 2013 to 06 Nov 2013|
|Approval||10 Dec 2013|
|Last Review Mission||-|
|Last PDS Update||28 Sep 2018|
|Approval||Signing Date||Effectivity Date||Closing|
|10 Dec 2013||19 Jun 2014||19 Jun 2014||30 Jun 2016||30 Sep 2018||31 May 2019|
|Financing Plan/TA Utilization||Cumulative Disbursements|
|1,500,000.00||0.00||100,000.00||0.00||0.00||0.00||1,600,000.00||17 Jun 2022||1,405,732.65|
Project Data Sheets (PDS) contain summary information on the project or program. Because the PDS is a work in progress, some information may not be included in its initial version but will be added as it becomes available. Information about proposed projects is tentative and indicative.
The Access to Information Policy (AIP) recognizes that transparency and accountability are essential to development effectiveness. It establishes the disclosure requirements for documents and information ADB produces or requires to be produced.
The Accountability Mechanism provides a forum where people adversely affected by ADB-assisted projects can voice and seek solutions to their problems and report alleged noncompliance of ADB's operational policies and procedures.
In preparing any country program or strategy, financing any project, or by making any designation of, or reference to, a particular territory or geographic area in this document, the Asian Development Bank does not intend to make any judgments as to the legal or other status of any territory or area.
Safeguard Documents See also: Safeguards
Safeguard documents provided at the time of project/facility approval may also be found in the list of linked documents provided with the Report and Recommendation of the President.
None currently available.
Evaluation Documents See also: Independent Evaluation
None currently available.
None currently available.
The Access to Information Policy (AIP) establishes the disclosure requirements for documents and information ADB produces or requires to be produced in its operations to facilitate stakeholder participation in ADB's decision-making. For more information, refer to the Safeguard Policy Statement, Operations Manual F1, and Operations Manual L3.
Requests for information may also be directed to the InfoUnit.
Frequently Asked Questions
What is Country Safeguard System (CSS)?
Country Safeguard System (CSS) means a country’s legal and institutional framework, consisting of its national, subnational, or sectoral implementing institutions and relevant laws, regulations, rules and procedures that pertain to the policy areas of environmental and social safeguards. Therefore, under ADB’s Safeguard Policy Statement 2009 (SPS), the use of CSS for an ADB financed project can be at the national, subnational, sector, or agency level.
What is CSS in the context of ADB proposal in Indonesia?
In the context of the ADB proposal in Indonesia, the term “CSS” specifically refers to the “agency level” use of environmental and social safeguard by the state electricity agency PLN for future ADB financed projects.
What is the background of the CSS assessment?
At the Government of Indonesia’s request, ADB in 2015-16 undertook a background study of the Country Safeguards Systems. This draft study highlighted the importance of strategic use of CSS by meeting the requirements of the SPS and complying with Indonesia's environmental and involuntary resettlement legislation.
The draft background study suggests that, while Indonesia’s legal and regulatory framework for environmental protection and involuntary resettlement is considered generally comparable with ADB SPS 2009, the capacity of government agencies to apply the framework varies quite significantly.
The draft background study was then used in a detailed assessment of PLN’s capacity in implementing CSS in its operation. This assessment process is still ongoing, and it includes the recent consultations series with stakeholder from BAPPENAS, local government, sector agencies, development partners, PLN offices at central and regional level, and civil societies.
Why does the CSS assessment only cover PLN, and no other agencies?
Energy sector, particularly electricity, is a priority of the Indonesian government, as explained in the National Medium-Term Development Plan (Rencana Pembangunan Jangka Menengah Nasional, RPJMN). Meanwhile for 50 years of its operation in Indonesia, ADB has financed 23 energy projects totaling $3.91 billion in the country, and PLN is our main counterpart. Also, PLN already has at least a safeguard arrangement and related technical guidance in place. The government therefore selected PLN to be the agency for this pilot initiate.
What are the benefits of applying CSS?
The proposed use of CSS for PLN directly supports the internationally accepted goals of country ownership and harmonization. It will eliminate the need for PT PLN to produce two sets of documents to satisfy the requirements of: (i) the Indonesian legal system, and (ii) ADB’s SPS. The use of PLN’s CSS would therefore lower the transaction cost of complying with ADB environment and involuntary resettlement safeguards.
Moreover, with continuing oversight and support from ADB, the proposed use of CSS will strengthen PLN’s capacity to identify and address environmental and social impacts.
We are also confident that this initiative will have a positive demonstration effect, inspiring and incentivizing other government agencies and state-owned enterprises to strengthen their safeguard-related capacity as well, towards the same end.
How was the CSS assessment being financed?
The CSS assessment is financed by an ADB technical assistance (TA) on “Aligning ADB and County System for Improved Project Performance” (TA-8548). This $1.5 million grant TA aims to increase alignment of ADB and government systems and procedures to prepare and implement projects, and one of its outputs is a review of the CSS.
The TA was led by BAPPENAS with the support of Ministry of Environment and Forestry, and the National Land Agency (Badan Pertanahan Nasional, BPN). Four sector agencies participated during the preparation of the background study. The commencement of the TA and its implementation was delayed due to 2014 presidential election and subsequent restructuring of related agencies.
The technical assistance to finance this assessment was approved in 2013, but why was it only in 2017 that the first consultation was conducted?
Between 2014 until mid-2016, the first phase of consultation process was conducted with key stakeholders (relevant ministries, sector agencies and development partners). Through this consultation process, the first draft and second draft of the background reports completed and available for wider consultations with relevant civil society organizations (CSOs)
The background assessment was completed in late 2016, and only after that the Indonesian government and ADB agreed to conduct a detailed assessment of the suitability of CSS for PLN at the agency level.
Around 10 focus-group discussions/FGDs were conducted with relevant government stakeholders. Consultation with wider stakeholders including CSOs in March and April 2017 was conducted after the draft assessments disclosed.
ADB believes that only with some reasonable quality outputs that consultations will produce meaningful outcome.
Why did the CSS consultations took place only in few cities?
The first-round consultation process took place in 11 cities where PLN’s projects are located.
The principle is for ADB to provide opportunity to as many relevant stakeholders as time and resources permit, to provide feedbacks to the report. Due to the limitation, ADB has been strategic in consulting stakeholders and conducted meetings at regions where ADB currently or potentially provides significant support to PLN operation.
In the draft CSS report’s disclaimer, why does ADB avoid taking responsibility?
It is the requirement in ADB that for documents related to ADB Board of Directors’ meeting, ADB will be responsible for the final recommendation and relevant papers submitted to the Board. The current CSS report, still being a draft, bears the standard disclaimer applicable to all ADB final TA consultant’s reports.
Despite the disclaimer and the nature of the report, it was prepared jointly by a team of consultants together with a cross-departmental team from ADB. During the assessment process, the ADB team closely supervised the consultants, and provided guidance and inputs to their works to ensure compliance with ADB’s standards.
What is ADB’s policy in disclosing this draft CSS report?
What does the current CSS assessment for PLN cover?
The CSS assessment for PLN covers:
- an equivalence assessment for environment safeguards;
- an equivalence assessment for involuntary resettlement safeguards;
- an acceptability assessment for implementation of environment safeguards;
- an acceptability assessment for implementation of involuntary resettlement safe-guards; and
- a gap-filling action plan to address specific gaps in the assessment.
Does the use of PLN’s CSS mean ADB will not be involved in the safeguard implementation anymore?
Not at all. The use of PLN’s CSS does not relieve ADB of its due diligence and loan supervision responsibilities. ADB will continue to fully exercise its due diligence and to review and supervise the implementation of safeguards plan for all projects under the CSS. ADB’s supervision of approved projects will follow the same procedures as for any other ADB-financed project.
Will PLN’s projects that use CSS and financed by ADB make it ‘immune’ from the ADB’s Accountability Mechanism?
No. The use of CSS in ADB-financed projects by PLN does not exempt it from the scope of ADB’s Accountability Mechanism.
Can PLN use CSS in all its ADB-supported projects?
No. CSS, once approved, would not be applied to highly-sensitive and highly-complex projects. “Highly-sensitive and highly-complex projects” are projects that ADB deems to be highly risky or contentious or involve serious and multidimensional and generally interrelated potential social and/or environmental impacts.
What if PLN do not follow the action plan to fill the identified gaps?
The implementation of the action plan will be legally binding. The action plan also has an agreed timeframe, with some actions need to be completed prior to ADB Board of Directors’ approval, and some others prior to the project financing.
There will also be several long-term actions to support PLN continue improving its capacity to prepare, implement and monitor social and environmental safeguards for its projects. ADB will regularly monitor the implementation of the CSS-related action plan.
For more information on this subject, please contact the project’s team at: [email protected].
None currently available.