Approaches to and Experiences with Meeting Urban Sector Capacity Enhancement Demands :

1. Approaches to and Experiences with Meeting Urban Sector Capacity Enhancement Demands: Lessons from India and Sierra Leone Barjor Mehta World Bank Institute

2. Experiences from: Financial Institutions Reform and Expansion – Debt (FIRE-D), USAID-sponsored initiative World Bank Projects India • Tamil Nadu Urban Development Project – II (TNUDP) • Andhra Pradesh: Urban Reform and Municipal Services Project (AP:URMS) under preparation Sierra Leone • Institutional Reform and Capacity Building Project (IRCB) under preparation

3. Upfront Clear Statements of Results is Absolutely Essential

4. FIRE-D Enable municipalities to raise capital from the national financial market (1995 – 1999)

5. Initially only one major city (Ahmedabad) signed on and became the project’s “Champion” • All project resources concentrated there but dialogue and links with “wait and see” cities maintained and encouraged • Local consultants/institutions “paired” with international consultants – process change (international accounting standards), knowledge development (how to/not to) • International credit rating agencies “paired” with local rating agencies to develop an Indian system to rate municipalities

6. Every time Ahmedabad reached a milestone extensive publicity given • “Champion” provided reference and knowledge to late comers • A competition began between cities to become “creditworthy” • Market for private consultants opened up Situation in 2003: • Large number of cities now have credit ratings • several have raised funds from the financial market • active and growing private sector consulting and training market

7. TNUDP and (AP-URMS): Move resource management in municipalities from single entry system to accrual accounting system Improve service delivery Provide / upgrade existing city-wide infrastructure networks

8. Changing Accounting Systems • Big challenge: 110 municipalities in TN -- need to design content for and continued training: • 2,000 staff in (a) book keeping; (b) computer skills (c) financial reporting • > 4,000 elected councilors in new systems of (a) strategic planning; (b) budget formulation; (c) resource monitoring • 8,000 municipal staff responsible for service delivery in (a) estimating budget requests; (b) soliciting private participation (tendering, contracting); (c) monitoring projects.

9. Accounting manuals prepared by local government auditors, commented upon by Indian Institute of Chartered Accountants • Team of local government auditors became mentors (one auditor per five to seven municipalities) • Had to visit each municipality every two weeks and work with staff for two days; be available to answer questions over the phone (how do I?) • Ensure the local staff transfer cash-based ledgers into new accounting system based on standard manuals

10. Standard computer package chosen by the state • TOR for computer skills training prepared by a partnership of experienced local accountants • Skill benchmarks for staff clearly established (ability to independently use all modules of software) • EOI/bids solicited from private computer training institutions in each municipality/region -- competition • Computer skills training provided by locally-based trainers to municipal staff • Mentors evaluated training w.r.t. skill benchmarks reached by staff

11. Improving Service Delivery • Each city required to formulate its own “Citizen’s Charter” • What every citizen should expect from the local government through precise statements • birth and death certificate to be issued within one hour; • property tax bill payment not to exceed 30 minutes; • garbage pick up every day • Complaint registration (15 minutes) and redressal (max. one day) • Each municipality prepares an action plan including capacity building requirements on how to change/modify processes

12. Project PMU created a panel of pre-qualified consultants through competitive bidding • Municipalities encouraged to “shop” for consultants to assist with process change and training • Based on level of reforms / change achieved in accounting systems and service delivery, municipality qualifies for capital investment for city-wide infrastructure Cities eligible for investment envelope proportional to reform achieved

13. IRCB (Sierra Leone) Post-conflict country under stress (Re)Start Town Councils

14. Modest but strategic goals: End of first year • Valuation office completes input of Valuation Roll source data for all wards • Rates office able to produce Demand Notes from Rate Register • Cash & Deposit office able to post payments direct into town accounting system • Payroll sheets produced on a monthly basis Functional Town Treasuries

15. Town Clerk of Kampala to provide TA • Informal association of Town Clerks, Treasurers to decide on standard formats and schedules • Institute of Chartered Accountants of Sierra Leone contracted to provide “on the job” training (performance indicators) • One/two CAs paired with each town council • Town treasurer’s office staff “learning by doing” • Skills training (book keeping, computers) provided “in office” when appropriate benchmarks are reached

16. Capacity Enhancement not an end in itself but in the context of pre-determined and agreed upon process of measurable change