Document of The World Bank...Bodri Kuto) In 3 basins the Balai PSDAs plan basin operations and...

Document of

The World Bank

Report No: ICR00001861

IMPLEMENTATION COMPLETION AND RESULTS REPORT

(IBRD-47110, IBRD-77570, IDA-38070, TF-52124, TF55997)

ON A

LOAN/CREDIT/GRANT

IN THE AMOUNT OF US$45.0 MILLION (LOAN), SDR17.9 MILLION

(CREDIT), US$14.0 MILLION (GOVERNMENT OF NETHERLANDS GRANT)

AND EURO 9.5 MILLION (EC GRANT) RESPECTIVELY

TO

THE REPUBLIC OF INDONESIA

FOR A

WATER RESOURCES AND IRRIGATION SECTOR MANAGEMENT PROGRAM

PHASE I PROJECT AND

NUSA TENGGARA BARAT WATER RESOURCE MANAGEMENT PROJECT

March 30, 2012

Indonesia Sustainable Development Unit

Sustainable Development Department

East Asia and Pacific Region

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CURRENCY EQUIVALENTS

(Exchange Rate Effective December 31, 2011)

Currency Unit = Indonesian Rupiah

IDR = US$0.00011236

US$* = IDR 8,900 *All $ in this document refer to US currency unless otherwise noted.

GOI FISCAL YEAR

January 1 – December 31

ABBREVIATIONS AND ACRONYMS

ADB

AMDAL

APBD(K)

APBD(P)

APBN

APL

AWP

Balai PSDA

Bangda

Bapedalda

Asian Development Bank

Full Environmental Assessment

Kabupaten Government Budget

Provincial Government Budget

Central Government Budget

Adaptable Program Loan

Annual Work Plan

Provincial River Basin Management Organization

DG Regional Development, MoHA

Local Environmental Management Office

Bappeda

Bappenas

B (B)WS

BPKP

BWRC

BWRM

BWRMP

CAS

CDD

CDP

CDMU

CPS

CSO

DA

DAS

DGWR

DGAIF

Dinas Pertanian

Dinas PUP

Dinas SDA

DPRD

DSC

EMP

FMR

GOI

GP3A/IP3A

IAIP

IBRD

ICR

IFR

IMEU

IMF

JBIC

JIWMP

Kabupaten

Local Government Development Planning Board

National Development Planning Board

National River Basin Management Organization

Central Government Audit Agency

Basin Water Resources Council (Committee)

Basin Water Resources Management

Basin Water Resources Management Plan/Planning

Country Assistance Strategy

Community-driven development

Community Development Plan

Central Dam Monitoring Unit within MPW

Country Partnership Strategy

Civil Society Organization

Designated Account

River Basin

Directorate General of Water Resources, MPW

Directorate General of Agriculture Infrastructure and Facilities

Local Government Agriculture Services

Local Government Public Works Services (Department)

Local Government Water Resources Services (Department)

Local Government Legislative Assembly

Dam Safety Commission

Environmental Management Plan

Financial Monitoring Report

Government of Indonesia

Federation/Apex Body of Water Users Associations (WUAF)

Kabupaten Irrigated Agriculture Improvement Program

International Bank for Reconstruction and Development

Implementation Completion Report

Interim Financial Reports

Impact Monitoring and Evaluation Unit

Irrigation Management Fund

Japan Bank for International Cooperation

Java Irrigation and Water Resources Management Project

District

KIIF

KLH

KOMIR

KPIU

KPMU

MIS

MoA

MoEnv

MOF

MoHA

MPW

MOU

NPIU

NPMU

NSCWR

NWC

O&M

PAD

PDO

Perda

PIM

PIU

PJT I/II

PKPI

PMU

PMM

PPISP

PPIU

PPMU

PPTPA

PTPA

PWRC

SRI

RBC

RIM

TA

UPTD

WISMP

WS

WUA

WUAF

WUR

Kabupaten Irrigation Improvement Facility (DPI-K)

State Ministry of Environment

Irrigation Commission (Committee)

Kabupaten Project Implementation Unit

Kabupaten Project Management Unit

Management Information System

Ministry of Agriculture

Ministry of Environment

Ministry of Finance

Ministry of Home Affairs

Ministry of Public Works

Memorandum of Understanding

National Project Implementation Unit

National Project Management Unit

National Steering Committee for Water Resources

National Water Council

Operation and Maintenance

Project Appraisal Document

Project Development Objectives

Local Government Regulation

Participatory Irrigation Management

Project Implementation Unit

Basin Management Corporation I/II

Irrigation Management Reform Policy

Project Management Unit

Project Management Manual

National Policy on Irrigation

Provincial Project Implementation Unit

Provincial Project Management Unit

River Basin Water Management Committee

Provincial Water Management Committee

Provincial Water Resources Management Council

System of Rice Intensification

River Basin Corporation

River Infrastructure Maintenance and Rehabilitation

Technical Assistance

An Operational Unit within Dinas PUP

Water Resources and Irrigation Sector Management Program

River Territory

Water User Associations

Water User Association Federation (GP3A/IP3A)

Water Use Right

Vice President:

Pamela Cox, EAPVP

Country Director: Stefan Koeberle, EACIF

Sector Director: John Roome, EASSD

Sector Manager: Franz Drees-Gross, EASIS

Task Team Leader: Xiaokai Li, EASIN

INDONESIA

Water Resources and Irrigation Sector Management Program Phase I Project

(WISMP1) and

Nusa Tenggara Barat Water Resource Management Project (NTB-WRMP)

CONTENTS

Water Resources and Irrigation Sector Management Program Phase I Project Data Sheet…………………………………………………………………………………….i

A. Basic Information

B. Key Dates

C. Ratings Summary D. Sector and Theme Codes

E. Bank Staff

F. Results Framework Analysis

G. Ratings of Project Performance in ISRs H. Restructuring

I. Disbursement Graph

Nusa Tenggara Barat Water Resource Management Project (NTB-WRMP)

Data Sheet…………………………………………………………………………………….xi

A. Basic Information B. Key Dates

C. Ratings Summary

D. Sector and Theme Codes

E. Bank Staff F. Results Framework Analysis

G. Ratings of Project Performance in ISRs

H. Restructuring

I. Disbursement Graph

1. Project Context, Development Objectives and Design…………………………..1

2. Key Factors Affecting Implementation and Outcomes …………………………7

3. Assessment of Outcomes ………………………………………………………15

4. Assessment of Risk to Development Outcome ……………………………….. 24

5. Assessment of Bank and Borrower Performance ………………………………26

6. Lessons Learned ………………………………………………………………..29

7. Comments on Issues Raised by Borrower/Implementing Agencies/Partners ….29

Annex 1. Project Costs and Financing ……………………………………………31

Annex 2. Outputs by Component …………………………………………………34

Annex 3. Economic and Financial Analysis ……………………………………...41

Annex 4. Bank Lending and Implementation Support/Supervision Processes …...45

Annex 5. Beneficiary Survey Results …………………………………………….48

Annex 6. Stakeholder Workshop Report and Results …………………………….49

Annex 7. Summary of Borrower's ICR and/or Comments on Draft ICR…………50

Annex 8. Comments of Cofinanciers and Other Partners/Stakeholders ………….55

Annex 9. List of Supporting Documents ………………………………………….56

MAP: IBRD 39248

i

For WISMP 1 (Phase I of the WISMP APL):


Country: Indonesia Project Name:

Water Resources &

Irrigation Sector

Management Program

Project ID: P059931 L/C/TF Number(s):

IBRD-47110, IBRD-

77570, IDA-

38070,TF-52124

ICR Date: 03/29/2012 ICR Type: Core ICR

Lending Instrument: APL Borrower: REPUBLIC OF

INDONESIA

Original Total

Commitment: USD 84.00M Disbursed Amount: USD 86.00M

Revised Amount: USD 84.00M

Environmental Category: B

Implementing Agencies:

Directorate General Water Resources of Ministry of Public Works (DGWR-MOPW)

Directorate General Regional Development of Ministry of Home Affairs (DGRD-MOHA)

Directorate General Land and Water of Ministry of Agriculture (MOA)

Co-financiers and Other External Partners: Government of Netherlands (USD 14 Million)

B. Key Dates

Process Date Process Original Date Revised / Actual

Date(s)

Concept Review: 12/17/2001 Effectiveness: 11/24/2005 11/24/2005

Appraisal: 03/17/2003 Restructuring(s):

Approval: 06/26/2003 Mid-term Review: 03/17/2008 03/28/2008

Closing: 12/31/2009 12/31/2010

C. Ratings Summary

C.1 Performance Rating by ICR

Outcomes: Moderately satisfactory

Risk to Development Outcome: Moderate

Bank Performance: Moderately Satisfactory

Borrower Performance: Moderately Satisfactory

C.2 Detailed Ratings of Bank and Borrower Performance (by ICR)

Bank Ratings Borrower Ratings

Quality at Entry: Moderately

Satisfactory Government:

Moderately

Satisfactory

Quality of

Supervision: Satisfactory

Implementing

Agency/Agencies: Satisfactory

ii

Overall Bank

Performance: Moderately

Satisfactory Overall Borrower


Satisfactory

C.3 Quality at Entry and Implementation Performance Indicators

Implementation

Performance Indicators

QAG Assessments

(if any) Rating

Potential Problem

Project at any time

(Yes/No):

No Quality at Entry

(QEA): Satisfactory

Problem Project at any

time (Yes/No): Yes

Quality of

Supervision (QSA): None

DO rating before

Closing/Inactive status: Satisfactory


Original Actual

Sector Code (as % of total Bank financing)

General water, sanitation and flood protection sector 50 30

Irrigation and drainage 50 70

Theme Code (as % of total Bank financing)

Rural services and infrastructure 50 50

Water resource management 50 50

E. Bank Staff

Positions At ICR At Approval

Vice President: Pamela Cox Jemal-ud-din Kassum,

Country Director: Stefan G. Koeberle Andrew Steer

Sector Manager: Franz R. Drees-Gross Mark D. Wilson

Project Team Leader: Xiaokai Li Guy Alaerts

ICR Team Leader: Xiaokai Li

ICR Primary Author: Xueming Liu &

John Weatherhogg ( FAO/CP)


Project Development Objectives (from Project Appraisal Document)

(a) Water allocation, water quality and water conservation improved in Project basins, and

river infrastructure better maintained, through strengthened capacity for planning and

management; and investments;

(b) Sector governance enhanced, and sector fiscal sustainability strengthened, nationally,

and in Project basins, through setting up Water Resources Councils; ensuring stakeholder‟s

iii

involvement; unbundling of operational tasks, and Private Sector Participation; and improved

cost recovery; and

(c) Increased agricultural productivity and improved performance of irrigation, based on

participatory irrigation management, through setting up and strengthening WUAFs;

strengthening restructured Dinas PUP of local government; financing rehabilitation and

improvement of existing irrigation schemes; and facilitating access to agricultural support

services and micro-credit.

The project development objective stated in the Development Credit Agreement (DCA) is as

follows: The objective of the Project is to assist the Borrower in attaining a strengthened

water resources sector by improving the performance of its water resources and irrigation

sector, and rehabilitating and upgrading the infrastructure of the said sector.

Revised Project Development Objectives (as approved by original approving authority)

There is no revision of project development objectives in the course of project

implementation. There are some discrepancies between the monitoring indicators of the DCA

and those of the PAD. As per advice of the Operations Support Team of the EAP Sustainable

Development Department, the indicators from the PAD were used for reporting below.

iv

Indicator Baseline Value

Original Target

Values Formally Revised

Target Values Actual Value

Achieved at

Completion or

Target Years

Indicator 1 Allocation of deliverable water more equitable for all competing uses and needs (incl.

environmental).

Value

quantitative

or

Qualitative

No

participatory

water allocation

planning

practiced

>75% of demand being

met in each sub-sector,

in 5 project Basins

Participatory allocation

planning was piloted in 5

river basins and is being

practiced in 9 river

basins, enabling more

equitable water

allocation for all uses.

However, no information

is available on the exact

percentage of sub-sector

water demand met.

Date

achieved

31-May-2003 31-December-2006 31-December-2010

Comments

Achievement: Virtually achieved based on the number of river basins practicing

participatory water allocation planning

Indicator 2 System of water pollution monitoring and control effective

Value

quantitative

or

Qualitative

No basin

oriented water

pollution

monitoring and

control system

in place

System of water

pollution monitoring

and control, incl.

discharge permits and

fees, effective in 1

Project Basin

Water quality monitoring

is practiced in 27

participating basins and

water quality databases

established. The data

collected was shared

with the respective

environmental agency

responsible for water

pollution control,

discharge permit, and

fees, for further action.

Date

achieved

31-May-2003 31-December-2006 31-December-2010

Comments

Achievement: partially achieved. Water quality/pollution monitoring target fully achieved

while there is no data available on the effectiveness of water pollution control (discharge

permit and fees, etc)

Indicator 3 Economic losses reduced as river infrastructure development and O&M are better geared

to regional priorities and sustained cost recovery.

Value

quantitative

or

Qualitative

River

infrastructure

development

and O&M were

carried out

without public

consultation

Economic losses

reduced as river

infrastructure

development and O&M

are better geared to

regional priorities and

sustained cost recovery.

Priority maintenance of

key river infrastructure

in 54 Balai PSDA is

based on public

consultation and

participation. O&M cost

is met through

government budget as

cost recovery through

service fees was

precluded by Law No.

7/2004.

Date

achieved

31-May-2003 31-December-2006 31 December-2010

v

Comments Achievement: largely achieved, based on the fact that river infrastructure development and

O&M are better aligned with regional priorities and needs through consultation and

participation.

Indicator 4 Balai PSDA plan basin operations and investments based on BWRMPs

Value

quantitative

or

Qualitative

BWRMP

prepared for 2

basins (Pekalen

Sampean and

Bodri Kuto)

In 3 basins the Balai

PSDAs plan basin

operations and

investments based on

Basin Water Resource

Management Plans

(BWRMPs)

In 20 project basins the

BWRMPs were prepared

and six of these plans

were legalized and are

being used as the basis

for basin operations and

investments.

Date

achieved


Comments Achievement: over 100% by the number of basins where basin operations and investments

are based on BWRMPs.

Indicator 5 Demonstrable improvement in construction quality and contract management, annual

work programs based on cost-effectiveness, improved inter-agency coordination.

Value

quantitative

or

Qualitative

Construction

work program

was prepared

through top-

down approach,

with little inter-

agency

coordination

Demonstrable

improvement in

construction quality and

contract management;

annual work programs

based on cost-

effectiveness;

Improved inter-agency

coordination.

Construction quality and

contract management

improved through

beneficiary participation;

Work program more cost

effective because of end

user participation in

investment prioritization;

Inter-agency

coordination established

and strengthened through

river basin councils

Date

achieved


Comments

Contract management follows established procedures but more transparent with better

quality results by involving beneficiaries. Achievement: largely achieved

Indicator 6 A National Water Council and its Secretariat develop policies for fiscal sustainability and

sector governance and resolve inter-agency conflict

Value

quantitative

or

Qualitative

There was no

dedicated

multi-

stakeholder

coordination

setup for water

sector.

A National Water

Council has appropriate

stakeholders

representation,

reflecting gender

sensitivity, and has its

Secretariat fully

established, staffed,

funded and operational

as evidenced by policy

decisions made.

Target remained the

same, and achievement

date amended to

become December 31,

2010.

A National Water

Council (NWC)

established with multi-

stakeholder

representation in 2009,

and its secretariat fully

functional with adequate

staff and funding from

National Budget

(APBN); A National

Water Resources Policy

was prepared by NWC in

2010 and enacted in

2011.

Date

achieved

31-May-2003 31-December-2006 31-December-2010 31-December-2010

Comments Achievement: 100% based on establishment of a NWC with a fully functional Secretariat

Indicator 7 Number of Participating Provinces that have established Provincial and Basin Water

vi

Resources Councils (PWRC and BWRC ) with appropriate stakeholder representation

Value

quantitative

or

Qualitative

Provincial

Water

Resources

Management

Committees

(PTPA) existed

in a small

number of

provinces,

without

stakeholder

participation.

In 12 Provinces and 15

basins multi-

stakeholder Water

Resources Councils

reflecting sensitivity

towards gender

sensitivity and

vulnerable groups are

established, and

demonstrably influence

regulations, water

allocation investments

and budgets.

50% of the Participating

Provinces establish

PWRCs with proper

stakeholder

representation, and 50%

of these provinces in

process of establishing

BWRCs.

Target achievement

date amended to be

December 31, 2010.

13 out of 14 provinces

established PWRCs, with

9 fully functional and 5

out of the 9 PWRCs

finalizing the provincial

water resources policy.

9 out of the 14 provinces

established a total of 16

BWRCs that were

engaged in basin

strategic plan review and

water use conflict

resolution.

Date

achieved

31-May-2003 31-December-2006 31-December-2010 31-December-2010

Comments

Achievement: over 100% based on the number of total PWRCs and BWRCs established

(against amended targets)

Indicator 8 Basin Water Resources Management Plans (BWRMP)adopted by the local parliament

(DPRD) and the Provincial Water Resources Council

Value

quantitative

or

Qualitative

2 Basin Water

Resources

Management

Plan are

prepared, have

not been

discussed in

PPTPA.

3 BWRMPs adopted by

DPRD and Provincial

Water Resources

Councils.

9 basin strategic plans /

BWRMP have been

reviewed and adopted by

the Provincial Water

Resources Councils/local

parliament (DPRD).

Date

achieved


Comments

Achievement: over 100% based on the number of BWRMPs adopted

Indicator 9

Local Government (Pemda) budget allocation covers 50% of Balai PSDA operating cost;

abstraction and effluent discharge fee revenue covers 25% of operational expenditures of

a new river basin corporation (RBC)

Value

quantitative

or

Qualitative

In Balai PSDAs

established

prior to the

project, major

part of the

budget

originated

from central

government

In 3 basins, earmarked

Pemda budget

allocation covers 50%

of Balai PSDA

operating costs;

Abstraction and effluent

discharge fee revenue

covers 25% of

operational

expenditures of a new

basin organization

(RBC)

In each of the 14 Participating Provinces

for each basin under their

authority, a Balai PSDA

established in each of 14

provinces for every

provincial basin with

100% funding

(structural) from

provincial budget

(APBD). Effluent

discharge fee not

allowed by the Water

Law No. 7/2004.

Date

achieved


Comments

Achievement: fully achieved if measured by the number of basins where the Balai PSDAs

get 50% of their operating costs from APBD.

Indicator10 Operational Framework prepared to pilot more commercial approach in APL II

Value Operational Operational Framework Operational framework

vii

quantitative

or

Qualitative

framework not

available

prepared to pilot more

commercial approach in

APLII

based on public service

corporation (BLU)

concept developed but

not yet accepted by the

National Government.

Date

achieved

31-May-2003 31-December-2006 31- December-2010

Comments

Financial administrative regulations require a full separation of management entities of

BLU and Balai WS. This issue was not resolved during WISMP2 (APLII) negotiations so

the BLU could not be officially included in WISMP2. Achievement: partially achieved

Indicator11 Public irrigation schemes in kabupaten are governed by WUAFs in partnership with

kabupaten government.

Value

quantitative

or

Qualitative

493,540 ha

irrigation area

adopted joint

management;

166,173 ha

rehabilitated

and managed

by WUAF with

technical and

matching grant

financial

support;

Irrigation

commissions

established in

50 Kabupatens

50% of public irrigation

schemes in 70

kabupaten (690,000 ha)

managed by WUAFs in

partnership with

Kabupaten government;

At least 25% of

secondary canal

services (345,000 ha)

managed by WUAFs

with technical and

matching grant financial

support;

Kabupaten Irrigation

Commissions

operational in 70

Kabupaten

A total of 1,027,194 ha

of public irrigation areas

governed by WUAFs in

partnership with

kabupaten or provincial

government agencies

(>100%);

Secondary canals serving

354,464 ha rehabilitated

and managed by WUAFs

jointly with Kabupaten

irrigation agencies

providing technical and

financial support

(>100%); and 12

Provincial and 95


Commissions operational

(>100%).

Date

Achieved


Comments Achievement: over 100% (See above)

Indicator 12 Active participation of women farmers in WUAs and WUAFs enhanced

Value

quantitative

or

Qualitative

Women were

rarely active in

the WUAs and

WUAFs.

Active participation of

women farmers in

WUAs and WUAFs

enhanced

Women‟s participation in

WUAs and WUAFs is

stimulated through their

inclusion in training and

provision of female

community organizers or

facilitators (30%),

resulting in increased

active women

participation in many

WUA/WUAF boards,

now accounting for 5%-

7% of total board

members.

Date

achieved


Comments Achievement: fully achieved, based on qualitative assessment of women‟s participation in

WUAs and WUAFs

Indicator 13 Capacity of 70 Kabupaten Irrigation Departments Improved

Value

quantitative

Participatory

irrigation

Capacity of 70


99 Kabupaten and 12

provinces restructured

viii

or

Qualitative

management

newly

introduced

Departments Improved their irrigation

departments, issued

Regulations on

Irrigation, and trained

their staff (about 7,000)

in participatory irrigation

management, rapid

assessments, and

supporting user

communities.

Date

achieved

31-May-2003 31-December-2006 31 December 2010

Comments: Achievement: over 100% measured by the number of Kabupaten irrigation departments the

capacity of which has been improved under the project

Indicator 14 Reduction in Government rehabilitation investment expenditures by 10% by transfer of

tasks and budgets to WUAFs

Value

quantitative

or

Qualitative

Contribution of

the WUAFs to

rehabilitation

cost piloted in

the irrigation

systems under

previous

IWIRP project.

Reduction in

Government

rehabilitation

investment expenditures

by 10% by transfer of

tasks and budgets to

WUAFs

Participatory

construction enabled

WUAF contributions in

form of labor, materials

and sometimes cash, and

related budget transfer to

them. WUAFs‟

contributions reached

10% of rehabilitation

cost, and led to better

quality and longer use

life of project works

Date

achieved

31-December-2006 31- December-2010

Comments Achievement : 100% by percentage of WUAF contribution to government system

rehabilitation investment expenditures

Indicator 15 Matching contributions from WUAFs for O&M of schemes are at least 20% of expenditure

in half of the schemes and increase in all schemes.

Value

quantitative

or

Qualitative

There was no

mechanism for

WUAF to

participate in

the O&M

activities. If

any, it was

done in an ad

hoc manner.

Matching contributions

from WUAFs for O&M

of irrigation schemes

are at least 20% of

expenditure in half of

the schemes and

increase in all schemes.

For O&M of public

systems the WUAF

contributed in form of

labor amounting to 20%

or more of the O&M

cost. In general,

WUAFs‟ contributions to

O&M of all the project

schemes have increased.

Date

Achieved


Comments: Achievement: full achieved

Indicator 16 Irrigation O&M budgets of 11 provinces and 70 kabupaten reach a satisfactory and

sustainable level.

Value

quantitative

or

Qualitative

The local

budget (APBD)

allocated for

irrigation

system O&M is

erratic and

marginal, well

below the level

of 60,000Rp/ha

level.

Irrigation O&M budgets

of 11 provinces and 70

Kabupaten reach a

satisfactory and

sustainable level.

At least15 Participating

Kabupaten provide

from their APBD at

least Rp60,000/ha per

year for O&M over the

total irrigated areas.

Target achievement

date amended to be

December 31, 2010.

9 Provinces and

71Kabupaten,

representing a total of

1,387,000 ha of irrigated

areas, allocated O&M

budgets of over 60,000

Rp/ha(average 130,000

Rp/ha). About 30% of

these provinces and

Kabupatens in 2010

ix

matched or exceeded

150,000 Rp/ha.

Date

achieved

31-May-2003 31-December-2006 31-December-2010 31- December-2010

Comments: Achievement: 99% against original target and 500% against amended target of total

number of provinces and Kabupatens that provided satisfactory level of O&M budget

Indicator 17 No decrease in average and median farm income in 30 irrigated kabupaten, and

mechanisms in place that will increase income over WISMP2

Before the

project the

irrigation water

efficiency tends

to decline,

causing

decrease in

production and

farm income.

No decrease in average

median farm income in

30 irrigated Kabupaten,

and mechanisms in

place that will increase

income during

WISMP2

Government statistics

showed significant

increase in farm income

in all Participating

Kabupaten, especially in

18 Kabupaten where

agricultural support was

piloted, although no

project specific

monitoring data

available. Investments in

capacity building in all

99 Kabupaten

contributed to better

water management and

to increasing farm

income under WISMP

Date

Achieved


Comments: Achievement: fully achieved, based on the qualitative assessment

Indicator 18 Increase in ERR of benefits based on income from higher rice yield and higher value

crops; and improved farm gate prices.

Crop yield was

generally

decreasing due

to declining

irrigation

system

performance.

Most farmers

sell their

products to the

mediators /

collectors at

low price for

quick cash.

Increase in ERR of

benefits based on

income from higher rice

yield and higher value

crops; and improved

farm gate prices.

Crop production

increased in project areas

due to improved

irrigation system

performance leading to

increase in both crop

intensity and

diversification, which

was reflected in a re-

calculated overall ERR

of 23% (See Annex 3).

Many WUAFs signed

farming contracts with

the private companies,

enabling better prices of

farm products although

systematic record on

farm gate prices are not

available.

Date

Achieved


Comments: Achievement: fully achieved based on economic analysis results

x


No. Date ISR Archived

DO IP Actual

Disbursements (USD millions)

1 12/30/2003 Satisfactory Satisfactory 0.00

2 06/25/2004 Satisfactory Unsatisfactory 0.00

3 12/20/2004 Satisfactory Unsatisfactory 0.00

4 06/01/2005 Moderately Satisfactory Unsatisfactory 0.00

5 06/27/2005 Moderately Satisfactory Satisfactory 0.00

6 06/27/2005 Moderately Satisfactory Satisfactory 0.00

7 06/07/2006 Moderately Satisfactory Moderately Satisfactory 6.15

8 06/25/2007 Moderately Satisfactory Moderately Satisfactory 7.20




H. Restructuring (if any)

N/A

I. Disbursement Profile

The actual disbursement is the total of credit, loan and grant while the original and

formally revised amounts do not include the grant amount.

xi

For NTB-WRMP:


Country: Indonesia Project Name:

EC GRANT - ID

NTB-River Basin

Water Resources

Management Program

Project ID: P095128 L/C/TF Number(s): TF-55997

ICR Date: 03/29/2012 ICR Type: Core ICR

Lending Instrument: SIL Grantee: REPUBLIC OF

INDONESIA

Original Total

Commitment:

Euro 9.05 M

(USD 12.00 M

equivalent)

Disbursed Amount: N/A

Revised Amount:

Euro 9.50M

(USD 11.36M

equivalent)

Disbursed Amount

Euro 9.46M

(USD11.31M

equivalent)

Environmental Category: U

Implementing Agencies:

Directorate General Water Resources of Ministry of Public Works (DGWR-MOPW)

Directorate General Regional Development of Ministry of Home Affairs (DGRD-MOHA)

Directorate General Land and Water of Ministry of Agriculture (MOA)

Co-financiers and Other External Partners: European Commission(EC)

B. Key Dates

Process Date Process Original Date Revised / Actual

Date(s)

Concept Review: * Effectiveness: 12/27/2005 12/27/2005

Appraisal: * Restructuring(s): N/A N/A

Approval: * Mid-term Review: 03/28/2008 02/19/2008

Closing: 06/30/2011 06/30/2011

* There was no formal concept review, appraisal and Board approval.

C. Ratings Summary

C.1 Performance Rating by ICR

Outcomes: Moderately satisfactory

Risk to Development Outcome: Moderate

Bank Performance: Moderately satisfactory

Grantee Performance: Moderately Satisfactory

C.2 Detailed Ratings of Bank and Borrower Performance (by ICR)

Bank Ratings Borrower Ratings

Quality at Entry: Moderately

Satisfactory Government:

Moderately

Satisfactory

xii

Quality of

Supervision: Satisfactory

Implementing

Agency/Agencies: Satisfactory

Overall Bank


Satisfactory Overall Borrower


Satisfactory

C.3 Quality at Entry and Implementation Performance Indicators

Implementation

Performance Indicators

QAG Assessments

(if any) Rating

Potential Problem

Project at any time

(Yes/No):

No Quality at Entry

(QEA): None

Problem Project at any

time (Yes/No): No

Quality of

Supervision (QSA): None

DO rating before

Closing/Inactive status: Satisfactory


Original Actual

Sector Code (as % of total Bank financing)

General water, sanitation and flood protection sector 50 30

Irrigation and drainage 50 70

Theme Code (as % of total Bank financing)

Rural services and infrastructure 67 67

Water resource management 33 33

E. Bank Staff

Positions At ICR At Approval

Vice President: Pamela Cox Jemal-ud-din Kassum

Country Director: Stefan G. Koeberle Andrew Steer

Sector Manager: Franz R. Drees-Gross Mark D. Wilson

Project Team Leader: Xiaokai Li Guy Alaerts

ICR Team Leader: Xiaokai Li

ICR Primary Author: Xueming Liu &

John Weatherhogg ( FAO/CP)


Project Development Objectives (from Grant Agreement)

The objective of the Grant is to assist the Recipient in strengthening the water

resources and irrigation sector in the Province of Nusa Tenggara Barat and in the

Kabupatens of the said province by improving the performance of the Province's and

xiii

the Kabupatens' water resources and irrigation sector, and rehabilitating and

upgrading its infrastructure of the said sector.

Revised Project Development Objectives (as approved by original approving authority)

There is no revision of the project development objective in the course of project

implementation.

There is no PAD for this project, therefore the performance indicators in the 2005

Grant Agreement (amended in 2009) are used for the analysis.

Indicator Baseline

Value

Original Target

Values (from

approval

documents)

Formally Revised

Target Values

Actual Value

Achieved at

Completion or

Target Years

Indicator 1

A Provincial Water Resources Council (PWRC) with appropriate stakeholder

representation and its Secretariat established and functional.

Value

quantitative or

Qualitative

No provincial

water resources

council exists.

A PWRC, with

Secretariat,

established with

representative

stakeholder

representation,

reflecting gender

sensitivity established

and functional with

evidence

A PWRC established

with a fully staffed and

funded secretariat in

2009. PWRC includes

women and

vulnerable group

representatives. It is

functional, and has

discussed provincial

policy on climate

change adaptation, and

resolved water use

conflicts.

Date achieved 20-December-

2005 30-June-2011 30-June-2011

Comments

(incl. %

achievement)

The PWRC and its Secretariat established with appropriate representation and fully

functional. Achievement: fully achieved

Indicator 2 Basin Water Resources Councils (BWRCs) established with appropriate stakeholder

representation and functional.

Value

quantitative or

Qualitative

No provincial

basin water

resources

council exists.

All BWRCs

established covering

the whole territory of

the Province and each

BWRC has

representative

stakeholder

representation.

Two BWRCs are

established in Sumbawa

and Bima-Dompu

covering the whole

Island of the province,

each with representative

stakeholder

representation.

Two BWRCs

established with

required representation

in NTB. BWRC

Lombok established in

2009 and functional -

discussed strategic

plan and basin

management issues;

BWRC Bima -Dompu

established in 2010,

and BWRC Sumbawa

in 2011


2005 30-June-2011 30-June-2011 30-June-2011

Comments

(incl. %

Achievement: 100% by number of BWRCs established (According to Water Law

No.7/2004, BWRC establishment is based on need).

xiv

achievement)

Indicator 3 Balai PSDA covering entire provincial territory established and operational with

trained staff.

Value

quantitative or

Qualitative

No formal basin

unit or Balai

PSDA exists.

All UPTD/ Balai

PSDA established,

covering the entire

Province, adequately

staffed and

operational, and at

least half of such

entities are receiving

50% of their

operational budget

form the Province

Government

Three Balai PSDAs

and one Balai ISDA

established and

functional. Necessary

training carried out

with over 100

personnel trained.

These entities are

receiving over 50% of

their budgets for

operations, from

Provincial

Government.


2005 30-June-2011 30-June-2011

Comments

(incl. %

achievement)

All Balai PSDA established covering the whole territory of the Province, and

appropriately staffed and fully operational. Achievement: 100% by number of Balai

PSDA.

Indicator 4

A decree of Dinas PUP has been issued for role sharing in hydrometeorology between

the relevant Dinas PUP and UPTD or Balai PSDA, and the hydromet network is

operational.

Value

quantitative or

Qualitative

There were no

dedicated funds

for hydromet

work in the

Balai, although

limited funds

available in

Dinas for this

purpose.

A Dinas PUP Surat

Keputusan has been

issued for role

sharing in

hydrometeorology

between the relevant

Dinas PUP and

UPTD or Balai PSDA

in the Province.

Hydromet asset mgt

fully transferred from

the Dinas PUP to the

relevant UPTD or

Balai PSDA and

hydromet network

fully operational

A decree of Dinas

PUP issued, 4 Joint

Operation Agreements

between Dinas PUP

and Balai PSDA

Lombok, Balai PSDA

Sumbawa,

Balai PSDA Bima-

Dompu and Balai

ISDA signed in 2007.

Hydromet asset mgt.

transferred; and and

hydrometric data being

collected and

managed by Balai

ISDA.


2005 30-June-2011 30-June-2011

Comments

(incl. %

achievement)

Achievement: largely achieved.

Indicator 5 The provincial planning unit in Dinas PUP appropriately staffed and funded, and

producing basin water resources management plans.

Value

quantitative or

Qualitative

There was no

planning unit in

the Dinas PUP.

The provincial

planning unit in

Dinas PUP

appropriately staffed

and funded, and

producing basin

water resources

management plans.

The Provincial

Planning Team in Dinas

PUP established,

appropriately staffed

and funded and capacity

developed to prepare

strategic and master

plans for river basins

under the authority of

the Province.

The planning function

integrated into the

structural functions of

Dinas PUP. A

provincial planning

team established

supervising outsourced

planning services;

strategic plans for

Lombok and Bima

xv

Dompu basins

completed and

legalized.


2005

30-June-2011 30-June-2011 30-June-2011

Comments

(incl. %

achievement)

Achievement: virtually achieved based on the number of basin plans completed.

Indicator 6 : Quality assurance plans and infrastructure maintenance plans produced and being

implemented.

Value

quantitative or

Qualitative

There was no

Quality

Assurance Plans

in existence.

Quality Assurance

Plans and river

infrastructure

maintenance plans

produced and being

implemented.

Quality Assurance

Plans and irrigation

infrastructure

maintenance plans

produced and being

implemented.

Quality Assurance

Core team established,

quality assurance and

maintenance plans

produced and being

implemented, and

annual river

infrastructure

maintenance plans

prepared in

consultation with

stakeholder and

implemented.


2005

30-June-2011 30-June-2011 30-June-2011

Comments

(incl. %

achievement)

Achievement: fully achieved.

Indicator 7 : Area of irrigation system is co-managed by WUAFs.

Value

quantitative or

Qualitative

There was no

co-management

arrangements

for irrigation

system

At least 60,000 ha of

irrigation system is

co-managed by

WUAFs, resulting in

demonstrable

operation and

maintenance, crop

productivity, water

use efficiency, and

reduced levels of

infrastructure

deterioration.

145,000 ha of

irrigation schemes co-

managed with

WUAFs;

crop productivity

increased 4.4% and

harvested areas

increased 24.5%; and

infrastructure

improved with longer

life expected.


2005 30-June-2011 30-June-2011

Comments

(incl. %

achievement)

Achievement: 225% by number of hectare co-managed by WUAFs.

Indicator 8 Number of WUAFs established in 7 Participating Kabupatens.

Value

quantitative

or

Qualitative

No WUAF

request

mechanism

was in

At least 160

WUAFs in 7

Kabupatens

established,

presented to

respective

The Province and 7

Kabupatens issued

Perdas and

established

Irrigation

Commissions; A

xvi

existence.

Irrigation

Commissions IMF

funding proposals

endorsed by the

relevant Dinas

PUP.

total of 214 WUAFs

established;

WUAFs‟ proposals

presented to

Irrigation

Commissions.

Date

achieved

20-

December-

2005

30-June-2011 30-June-2011

Comments

(incl.%

achievement)

Achievement: 135% by number of WUAFs established.

Indicator 9 Number of IMF funding proposals received by the Irrigation Commissions from

WUAFs in the 7 Participating Kabupaten.

Value

quantitative

or

Qualitative

Neither

WUAF

request

mechanism

nor Irrigation

Commission

exists.

In 7 Participating

Kabupaten, the

Irrigation

Commissions

received, reviewed,

evaluated and

recommended at

least 100 WUAFs‟

proposals for IMF

funding endorsed

by the relevant

Dinas PUP.

The Irrigation

Commission

received and

evaluated over 100

proposals endorsed

by the Dinas PUP,

and 91 proposals

were recommended

for IMF funding.

Date

achieved

20-

December-

2005

30-June-2011 30-June-2011

Comments

(incl. %

achievement)

Achievement: 100% by number of proposals received by the Irrigation

Commissions and endorsed by Dinas PUP.

Indicator 10 Number of Participating Kabupaten that provide from APBD at least 60,000 Rp/ha

O&M budget for their project schemes.

Value

quantitative

or

Qualitative

Local budget

(APBD)

allocated for

irrigation

system O&M

was erratic

and marginal,

well below

the level of

60,000Rp/ha

level.

At least 3

Kabupaten

supplied from their

APBD, at least

60,000 Rp/ha per

year of IMF funds

over the total

irrigated area in

their respective

Kabupatens,

besides required

counterpart budget

The Province and 4

Kabupatens

allocated over

60,000 Rp/ha O&M

budget through

APBD. All 7

Participating

Kabupatens

provided required

counterparts budgets

for project

implementation.

Date

achieved

20-

December-

2005

30-June-2011 30-June-2011

Comments

(incl. %

achievement)

Achievement: 100% by number of Kabupaten providing the required O&M budget.

xvii


No. Date ISR Archived

DO IP Actual

Disbursements (USD millions)

1 06/25/2008 Satisfactory Moderately Satisfactory 3.79



4 06/27/2011 Satisfactory Highly Satisfactory 12.21

H. Restructuring (if any)

N/A

I. Disbursement Profile

The Grant has been fully disbursed. Disbursement Profile for NTB-WRMP is not

available in the system because it is not treated as a separate project due to its special

relation with the WISMP 1 project, although NTB-WRMP has its own project

number.

1

1. Project Context, Development Objectives and Design

1.1 Context at Appraisal

1.1.1 Country and sector background: Water resources and irrigation management plays an

important role in Indonesia‟s socio-economic development in terms of food security since

most grain production is from irrigated areas. Development of water resources and irrigation

between the 1970s and mid 1980s focused on achieving and maintaining self sufficiency in

rice after a period of serious food shortages. During five consecutive five-year plan periods

starting in 1969, some 2.5 million hectares of irrigation areas were rehabilitated and 1.7

million hectares of new areas were developed. River basin management was mainly seen as a

requirement for securing irrigation supply and flood protection. Such efforts were supported

by massive expansion and farm input programs leading to self sufficiency in rice in 1984.

1.1.2 However, the government could not maintain rice self-sufficiency after that. One of

the main reasons was the lack of attention to and funding for operation and maintenance

(O&M) of the newly rehabilitated and developed irrigation systems. The subsequent rapid

deterioration of the physical systems resulted in frequent and premature rehabilitation or

deferred maintenance of the infrastructure. In the late 1990s it became clear that such a supply

driven approach led to unsustainable use of water resources and poor cost recovery.

1.1.3 In response to the financial crisis, the government embarked in 1998 on a process of

democratization and decentralization. This also involved reform of the water resources and

irrigation sector aiming at devolution and unbundling of management responsibilities to

provincial and district governments. It introduced stakeholder participation to enhance

sustainable management of the resource and infrastructure, and put more emphasis on demand

responsive and decentralized service delivery.

1.1.4 These reforms were fully supported by the Bank. The Country Assistance Strategy

(CAS) (2001) had three main objectives, (a) promoting broad-based growth; (b) building

national institutions for accountable government;, and (c) delivering better public services to

the poor, including support to local governments that put reform into practice. The WISMP

program and this first phase project contributed substantially to objectives (b) and (c) of the

CAS.

1.1.5 Rationale for Bank Assistance: After the 1997/98 financial crisis, the Bank played a

leadership role through its support to the regulatory reform (Water Resources Sector

Adjustment Loan (WATSAL, Ln. 4469-IND) (1999 - 2003)) and the large-scale field pilot of

new institutional arrangements for irrigation and basin water resources management (Java

Irrigation Improvement and Water Management Project (JIWMP, Ln. 37624) (1995 - 2002)

and Indonesia Water and Irrigation Reform Implementation Project (IWIRIP, TF 29896)

(2001 - 2004) resulting in a new Law on Water Resources in 2004. Other donors were also

actively supporting the reform process, leading to the formation of the Donor Water

Resources Sector Support Group in October 2000. The Asian Development Bank (ADB) and

the Japan Bank for International Cooperation (JBIC), which both held larger water resources

portfolios than the bank, increasingly adopted the principles and concepts emerging from

JIWMP and WATSAL. As a result, both ADB and JBIC harmonized their own project

designs, culminating in the ADP Participative Irrigation Project (PISP) and participatory

approaches in JBIC loans for small-scale irrigation management projects. The Government of

Indonesia‟s intention was to implement these reforms in the decade up to 2014. Due to its

deep involvement in WATSAL and the other projects piloting the reforms, the Bank was well

positioned to support WISMP to implement and further the sector reforms. Furthermore, the

Bank‟s long-standing involvement in Indonesia‟s water sector provided a sound basis for

project design, in particular sequencing priorities and benefiting from earlier project

implementation experiences.

2

1.1.6 When GOI and the European Union (EU) decided to undertake a project with similar

institutional reform goals with more poverty focus in the province of Nusa Tenggara Barat

(NTB), it was agreed that the EU grant could best be administered by the Bank. In addition to

increasing the geographic coverage of the WISMP water sector reforms, it was in line with

the on-going Good Governance in Water Resource Management Project (GGWRMP)

financed by EU and covering three river basins (respectively in DI Yogyakarta, East Java and

Lampung).

1.2 Original Project Development Objectives and Key Indicators

1.2.1 The WISMP was designed as a twelve-year adaptable program loan (APL). The

WISMP program objectives were as follows:

(a) Sustainable and equitable management of surface water resources and their

utilization infrastructure by: (i) transparent sector governance institutions and, (ii)

more accountable and better performing sector agencies;

(b) Increased irrigation farm household incomes and improved regional food security

as a result of raising the overall productivity of irrigated agriculture and reducing its

vulnerability to natural and economic shocks through: (i) sustainable participatory

irrigation management for more reliable and equitable water provision and, (ii) better

agricultural and marketing support services for members of irrigation water user

associations; and

(c) More cost-effective and fiscally sustainable management of sector agencies.

1.2.2 Within these overall program objectives the project development objectives of the

WISMP Phase I (WISMP1) were stated as follows:

(a) Water allocation, water quality and water conservation improved in Project basins,

and river infrastructure better maintained, through strengthened capacity for planning

and management; and investments;

(b) Sector governance enhanced, and sector fiscal sustainability strengthened,

nationally, and in Project basins, through setting up Water Resources Councils

(WRCs); ensuring stakeholder involvement; unbundling of operational tasks, and

Private Sector Participation; and improved cost recovery; and

(c) Increased agricultural productivity and improved performance of irrigation, based

on participatory irrigation management, through setting up and strengthening Water

User Association Federations (WUAFs); strengthening restructured Local

Government Public Works Water Resources Departments (Dinas PUPs); financing

rehabilitation and improvement of existing irrigation schemes; and facilitating access

to agricultural support services and micro-credit.

All the triggers for WISMP to migrate to Phase II (WISMP2) were met satisfactorily and

WIMSP 2 loan was approved in 2011, and is now under implementation. This ICR covers

both the WISMP1 and NTB-WRMP projects as approved by the OPCS.

1.2.3. The NTB-WRMP had similar institutional reform objectives with a more clear focus

on poverty alleviation by being located in one of the poorest provinces of Indonesia over a

five year project period. The purpose of the Grant was to assist the Recipient in attaining a strengthened water and irrigation sector in its Province of Nusa Tenggara Barat and in the

Kabupatens in the said province by improving the performance of the Province‟s and the

Kabupatens‟ water resources and irrigation sector, and rehabilitating and upgrading the

infrastructure of said sector.

3

1.2.4 The Key Indicators identified for the WISMP project were as follows (See details in

the Data Sheet):

Governance and Institutional Capacity-building: National Water Council (NWC)

established and focusing on implementation of the National Water Policy (as a transitional

arrangement, the National Coordination Team (of Ministers) for Water Resources

Management is upgraded). Basin policy decisions and basin agency operations are transparent

and reviewed by provincial and basin councils or committees that include stakeholders

(including representation of the interests of women and vulnerable isolated indigenous

peoples). Irrigation schemes are governed by WUAFs in partnership with kabupatens via the

Komisi Irigasi, which have stakeholder representation. Water use rights system piloted for

more rational and fair water allocation and providing for in-stream needs.

Management Performance of Sector Agencies: Management audits show that kabupaten

agency assistance to WUAFs is participatory and effective, with Management Information

System (MIS) being maintained, hydrology operations improving, and National Water

Quality Monitoring Network operational in pilot sites.

Fiscal Sustainability of Sector: Cost recovery mechanisms for river infrastructure

maintenance identified and arrangements made for its implementation. Arrangements for fees

on effluent discharges and for water abstraction were operationalized in two basins. KIIF

funds disbursement on a matching basis under way.

(Initiation of) Integrated Approach to Irrigated Agriculture Support: Farmers use extension

services more regularly, raise income (i.e. increased farm incomes).

1.2.5 The Key Indicators for NTB-WRMP were analogous to those for WISMP and were

as follows (See details in the Data Sheet):

(a) A Provincial Water Resources Council (PWRC) with appropriate stakeholder

representation and its Secretariat established and functional;

(b) Basin Water Resources Council (BWRC) established with appropriate

stakeholder representation and functional; (c) Balai PSDA covering entire provincial territory established and operational

with trained staff;

(d) A Dinas PUP Surat Keputusan has been issued for role sharing in

hydrometeorology between the relevant Dinas PUP and UPTD or Balai PSDA, and

the hydromet network operational;

(e) The provincial planning unit in Dinas PUP is established with appropriate

staffing and funding, and starts producing strategic and master plans for provincial

basins;

(f) Quality Assurance Plans and infrastructure maintenance plans produced and

being implemented;

(g) At least 60,000ha of irrigation system is co-managed by WUAFs;

(h) At least 160 WUAFs established in the 71 participating kabupaten;

(i) At least 100 IMF funding proposals received by the Irrigation Commissions

from WUAFs in the 7 Participating Kabupaten; and

(j) At least 3 Participating Kabupaten provide from their APBD at least

Rp60,000/ha O&M budget for their project schemes.

1 Originally 6 kabupaten but later Sumbawa was split into two.

4

1.3 Revised PDO and Key Indicators

1.3.1 The WISMP PDO remained the same throughout implementation. The loan/credit for

the project was negotiated but the signing and effectiveness of the loan was delayed by two

years because government wanted to ensure consistency with the new law on water

resources only issued in 2004 (Law 7/2004). The consequent changes in the legal and

institutional environment required changes to some key outcome indicators which were

amended accordingly (as expressed in the restated Development Credit Agreement (DCA) of

2009, and shown in the ICR Data Sheet). The PDO for NTB-WRMP was unchanged during

implementation. The key outcome indicators were amended through the Grant Agreement, as

shown in the ICR Data Sheet.

1.4 Main Beneficiaries

1.4.1 The primary target population of WISMP comprised:

(a) The water users in the Project‟s river basins in the 14 Project provinces, notably

men and women farmers, urban and rural settlements, industries, and communities

that depend for their livelihood on water from the rivers;

(b) Men and women farmers, as well as landless laborers and by extension the rural

population, in the Project areas, as they will benefit from better water availability and

from programs to assist in strengthening the rural economy. As the Project intended

to cover approximately 2.35 million ha of irrigated area, it would affect around 6.7

million farmer households or 40 million rural dwellers that directly depended on

irrigation, whilst an additional group‟s income in the rural space depended indirectly

on the performance of irrigated agriculture;

(c)The population on Java as food security and environmental quality will be

improved; and

(d) The communities living in the upper catchment areas in the Project areas and that

would be assisted with programs to improve the management of the soils and land

cover to reduce soil erosion.

1.4.2 For WISMP 1 at least 1.3 million poor farm families, especially share-croppers, as

well as possibly 1 million daily laborers were likely to benefit directly from the more reliable

irrigation service and increased income, and indirectly from improved access to agricultural

information and extension services, and new business opportunities. For NTB-WRMP the

beneficiaries were estimated at around 200,000 households.

1.5 Original Components

1.5.1 The WISMP1 project has the following three components:

Component A. Basin Water Resources Management (Base Cost – US$56.7M)

A1. Sector Governance and Basin Planning (Base cost – US$14.1M): to assist in

establishing and/or strengthening of the following institutions: (a) National Water Council

(NWC) and its precursor the Coordination Team (of Ministers) for Water Resources

Management, with their Secretariats; (b) National Steering Committee for Water Resources

(NSCWR) plus Secretariat; (c) Provincial Water Resources Council (PWRC) plus Secretariat,

in 12 provinces; (d) Basin Water Resources Committees (BWRC) in project river basins; and

(e) Dam Safety Commission (DSC) and Dam Safety Unit. In addition, Provincial Planning

Units were to be established as well as the Central Basin Planning Unit.

5

A2. Management Capacity of Basin Agencies (Base Cost - US$10.4 M): to establish

and/or strengthen the River Basin Management Units (Balai PSDA), under provincial budget

and Basin Corporations (PJTs), including all studies, training and technical assistance.

A3. Fiscal and Cost Recovery Policy (Base Cost - US$2.00 M): to establish and/or

strengthen the fiscal position and cost recovery of water management in river basins through

funding to the Balai PSDA, PJT (Basin Corporations), provincial and kabupaten Bapedaldas

(Environmental Management Offices) and provincial Dinas PUP, contingent upon the Annual

Work Plan/Program (AWP) review.

A4. Basin Management and River Infrastructure Improvement (Base Cost - US$28.7

M): including: (a) support for operation and monitoring; (b) river infrastructure maintenance

(RIM) - operationalization of asset management and routine maintenance; (c) prioritized

urgent repairs of key river and flood control infrastructure; and (d) establishment of a

National Water Quality Monitoring Network.

A5. National Capacity Building Network (Base Cost - US$1.6 M): To develop a

sustainable human resources (HR) capacity building process for water resources and irrigation

management, it was necessary to reorient higher education programs towards multi-

disciplinary and integrated approaches.

Component B. Participatory Irrigation Management (Base Cost - US43.0 M)

B1. Water User Associations Capacity Building (Base Cost - US$8.3 M): to establish and

operationalize: (a) Kabupaten Irrigation Commissions (Komisi Irigasi), with Kabupaten

Dinas, WUAFs (GP3A) and other stakeholders and gender sensitive; and (b) scheme-level or

apex WUAFs (IP3A), and individual WUAs, with voluntary active women‟s participation

(GP3A,IP3A2) in all schemes.

B2. Irrigation Department Capacity Building (Base Cost - US$5.1 M) at Kabupaten level

since the role of Kabupaten Dinas PUP would orient more to facilitation and be reorganized

so technical staff, extension workers (KF'L) and Community Organizers would work with

WUAFs to provide technical/management guidance for O&M and construction, including:

B3. Irrigation Infrastructure Improvement (Base Cost - US$26.8 M) funded Kabupaten

and provinces that adopted the institutional model of the irrigation reform PKPI. Once the

Kabupaten Irrigation Improvement Facility (KIIF) had been established WUAF could also be

funded.

B4. Irrigated Agriculture Improvement Program (IAIP) (Base Cost - US$2.7 M) aimed

to: (a) strengthen farmer organizations‟ (WUAFs) technical, organizational, and managerial

capacity to formulate demands and to interact efficiently and with bargaining power with

service providers (research, extension, agricultural inputs, processing, credit, etc.); and (b)

make service providers (public and private) more responsive (demand driven), farmer

oriented and accountable.

Component C. Project Management (Base Cost US$8.1M)

This Component would support the National Project Management Unit and the National

Project Implementation Units, as well as the Provincial and Kabupaten Project Management

2 IP3A is Induk P3A or apex WUAF and is the voluntary working entity of all GP3As in one irrigation

system

6

and Project Implementation Units. The following were the main Technical Assistance

packages to support Project Management: (a) Financial Management Service (FMS); (b)

Impact Monitoring and Evaluation Unit (IMEU); and (c) Preparation of WISMP 2.

1.5.2 The NTB-WRMP intentionally had an identical project structure, components and

sub-components. More specifically it has three components: (a) Basin Water Resources

Management (Euro 5.17 million); (b) Strengthening Participatory Irrigation Management

(Euro 4.60 million) and (c) Project Management and Technical Assistance (Euro 0.93

million). Despite this overall similarity, there was a significant difference in the proportion of

costs of the various expenditure categories between the two projects. For NTB-WRMP the

Services category (TA, Training, Studies and M&E) amounted to 56% of total costs and

Works to 36% compared with 46% and 37%3 respectively for WISMP.

1.6 Revised Components

1.6.1 There was no significant modification of the components in the program project,

except that under WISMP1 the activities related to dam safety management and some

activities related to water environment management were taken out. This is because: (a) the

dam safety management related activities were taken up by a parallel Dam Operational

Improvement and Safety Project financed by the Bank; and (b) the Ministry of Environment

had already got its own similar program funded by the Government.

1.7 Other Significant Changes

1.7.1 Changes in design. Some aspects of the Program changed after WISMP 1 was

approved in 2003 prior to the issue of UU 7/2004, such as the re-arrangement of irrigation

system and basin water resources management authority and mandates. These adjustments

mainly affected the irrigation component and were accommodated in the restated DCA and

approved by management:

Transfer of irrigation management authority to the WUAFs was replaced by participatory irrigation management (PIM) as public irrigation asset ownership and

control was vested in the State. PIM Principles were agreed upon and confirmed in

the restated DCA;

Cost recovery through service fees by government agencies was precluded through the Law on Water Resources and the regulations on public administration. As

a consequence, alternative mechanisms were developed through (i) enhanced

contributions from water users by sharing management tasks and responsibilities and

(ii) enhanced government budget allocations. Another consequence was that the

support for corporatization of basin agencies that recover costs from irrigation water

users could not be materialized.

1.7.2 Changes in regulations. The issuance of revised government and ministerial regulations necessitated a further adjustment at the Mid-Term Review (MTR) through a DCA

Amendment. This involved some changes in the key indicators.

1.7.3 Changes in financing mechanism of GoI contribution. The co-financing method for the GoI contribution was changed into parallel financing for participating provinces

and kabupaten to harmonize central and local government project budgeting

processes. Under the initial co-financing arrangement both central government

budget (APBN) and local government funds (APBD) were applied together which

3 Including all River Infrastructure Maintenance (RIM) expenditures.

7

caused administrative difficulties during implementation. Parallel financing separated

the central and local budget processes. After the change, disbursement increased

significantly. The change was approved by the management and incorporated in the

DCA amendment of 2009.

1.7.4 Changes in implementation arrangements. Following the issue of Government

Regulation 38/2007, the responsibility for guidance to WUAF was changed from MoPW to

MoA. This had only budgeting consequences as MoA was already fully engaged in the

implementation process. This minor change was approved by management through the

supervision aide memoire.

1.7.5 Changes in scope and scale. The scope of activities remained the provincial and

district water resources and irrigation agencies and their river basins and irrigation systems.

National basins and systems were excluded from the project after the new water resources law

UU 7/2004 because of the lack of downstream regulations on management arrangements for

national basins. The geographic scope of activities increased during the implementation of the

program and was approved by management through the supervision aide memoires:

The number of provinces included increased by 2 to 14 with the inclusion of Aceh and the splitting of South Sulawesi into South and West Sulawesi;

For the Basin Water Resources Management component, the initial number of 42 basins grew to 54 basins due to re-delineation of the river basin boundaries in 2006;

For PIM the number of participating districts (kabupaten) grew from 70 initially to ultimately 99 due to splitting of 6 participating districts and the introduction of 23

new districts in 2009 for initial introduction of the reform only.

1.7.6 The above changes also affected NTB-WRMP. In addition, during implementation

increased attention was given to watershed conservation, which was an issue of particular

relevance to NTB, but of less crucial interest to most of the 12 provinces covered by WISMP.

2. Key Factors Affecting Implementation and Outcomes

2.1 Project Preparation, Design and Quality at Entry

2.1.1 Soundness of Background Analysis: WISMP was an extension and consolidation of

the broad and coherent support the Bank provided from 1997 onwards. This support

emphasized institutional development. It took both the form of gradual introduction of new

administrative and regulatory mechanisms at local and national government levels, and the

extensive piloting thereof in the field. Even after the issuance of proper “facilitating”

national-government regulations, few local governments were able to act upon them. Water

users, and especially farmer irrigators, were ill prepared to assume their new responsibilities.

Progress was slow since the local governments, newly empowered by the 1999 Regional

Autonomy Laws, and civil society-based organizations had to adjust and develop the requisite

local consensus and absorb the new opportunities.

2.1.2. JIWMP first introduced and piloted novel irrigation management arrangements on

Java and notably set up, and “coached” a large number of autonomous, self-governing

Federations of Water User Associations (WUAFs) of irrigators. JIWMP also introduced and

supported River Basin Management Units under provincial governments (Balai PSDA) and

Water Resources Management Committees to foster integrated resource management and

enhance accountability. In parallel, WATSAL built on this new body of field experience, and

supported the development of a broad-based framework of policy, legal, regulatory and

administrative reforms at national and local levels. Thereafter, IWIRIP replicated these

reforms in seven provinces outside Java, whilst continuing support in the Java provinces. The

pilot reforms under JIWMP and IWIRIP had been successful as demonstrated in a

8

representative household survey completed in April 2003. They appeared robust after four

solid years of field implementation, and the gradual consolidation of the new legal and

regulatory frameworks at the national level. These pilot areas covered approximately 235,000

ha in 63 kabupatens in 12 provinces.

2.1.3. WISMP Phase I was the response to the challenges of the reform implementation and

a consistent and systematic extension of this prior support, whilst offering the opportunity to

further improve and adapt the institutional designs to Indonesia‟s diversity. Project

preparation and design was therefore firmly grounded in a wealth and depth of prior

experience and piloting. The whole WISMP program was sensibly structured as a three-

tranche, 12-year APL, which ensured the longer period of continued financing required with

benefits not only in continuity but also greater flexibility.

2.1.4 Assessment of Project Design. The project development objectives (PDO) were well

chosen and appropriate, stressing better water allocation and water conservation, better sector

governance, and increased agricultural productivity and improved irrigation performance. The

division of the project into two main components, one mainly supporting change in overall

management and planning institutions and the other looking at participative irrigation

management and strengthening of Water User Associations and Federations (WUAs/WUAFs)

struck a good and sensible balance. However, project design was too complex and ambitious

in a number of respects, although such design may well be justified for an institutional reform

oriented operation of this nature: (a) the project‟s geographic coverage extended to 12

provinces and included 70 kabupatens4; (b) the project supported a wide range of reforms and

initiatives through some 9 sub-components; (c) project organization was also complex,

involving four ministries, namely the Ministry of Public Works, formerly the Ministry of

Settlement and Regional Infrastructure (Kimprawil), the Ministry of Home Affairs (MoHA),

the Ministry of Agriculture (MoA) and the Ministry of Environment (KLH). Implementation

arrangements involved setting up Project Management Units (PMU) and Project

Implementation Units (PIU) for each of the participating Ministries at each of the three levels

– national, provincial and kabupaten; (d) the project was co-financed by the Government of

Netherlands and the associated NTB-WRMP project parallel financed by the European

Union.

2.1.5 The project scope, both geographically and in the range of activities, supported

imposed a heavy burden on both project management and Bank supervision. Setting up the

many PMUs and PIUs required significant new recruitment and created difficulties in getting

staff of adequate qualification and experience. Overall guidance was provided by a National

Steering Committee (on Water Resources) chaired by the National Development Planning

Agency (Bappenas) with the main responsibility for implementation resting with the

Directorate General of Water Resources (DGWR) of Kimprawil and the participating

provincial and kabupaten governments. The decentralized approach adopted by the project

and Government‟s fiscal decentralization helped implementation. Adequate regard was paid

to Bank safeguard policies for environmental and social concerns.

2.1.6 Government commitment: The overall WISMP program and the WISMP Phase I

project constituted a major plank in the Government (GoI) policy of decentralization. GoI had

issued the new decentralization legislation covering administrative regional autonomy (Law

22) and fiscal balance (Law 25) in 1999. These major sector reforms were to be implemented

through the Five-Year Development Strategy (Propenas) which became law in 2000. At

project appraisal, GoI had completed the most significant parts of the Water Resources

Reform Program on which WISMP was based. All the 12 provinces and their constituent

4 From 2009 onwards, 14 provinces and 99 kabupaten

9

kabupaten had 2 to 4 years of piloting river basin management and participatory irrigation

management, and had started reforms at the local government level. 63 out of the 70

kabupatens had already adopted the irrigation reform principles and were participating in the

JIWMP and IWIRIP programs. In terms of river basin management, some 23 River Basin

Management Units (Balai PSDA) had been established in all the river basin territories (SWS)

of Java and a further 10 had been formed in the Outer Islands. The WISMP program and the

Phase I project were therefore at the heart of a major GoI policy initiative. Weak aspects of

government commitment were the more than two years delay in WISMP loan effectiveness,

the inability to introduce legislation to enable cost recovery and frequent late budget releases.

The two-year delay in loan effectiveness was due to the government‟s decision to await the

issuance of the new water law in 2004, which led to no disbursement before 2006.

2.1.7 Stakeholder commitment: Interest in improving irrigation system infrastructure and

management grew with the advances made by earlier projects. Local government, civil

society, farmer groups including WUAs and farm families were all enthusiastic about the

project. However, the speed with which this underlying commitment could be put into

practice depended on the time taken for issuing of the necessary laws and regulations at

national, provincial and district (kabupaten) levels.

2.1.8 Risks: The PAD identified a large number of risks. These included (a) the possibility

that the sector agencies would dominate the public consultation process; (b) that inadequate

priority and resources would be given to collect information for management information

system (MIS) establishment and M&E activities; and (c) that insufficient priority and support

would be given to the fiscal sustainability and cost recovery aspects.

2.1.9 The first of these risks has been successfully mitigated during project implementation

by encouraging the participation of water users and civil society. The other risks duly became

apparent during implementation. With such a large, complex and innovative project coming at

a time when political changes and strategy still remained to be consolidated there were clearly

many uncertainties and numerous risks to be faced. Three important risks were not listed: (a)

risk of implementation delays due to lack of the necessary laws, decrees or other legal

instruments to allow implementation to proceed systematically, particularly since in most

cases enabling legislation was required at the highest level in order to get – “by cascade” - the

necessary instruments at Ministerial, Provincial and Local Government levels; (b) delays in

release of government annual budget at the central and local levels, which has been a chronic

problem for many years; and (c) the over-frequent transfer of staff, which is also a

longstanding problem and one which has a very negative impact on building institutional

capacity, dissipates training impact and slows implementation. Considering the number of

uncertainties and challenges the project faced in implementation, a substantial overall risk

rating would have been more appropriate.

2.1.10 QAG “Quality at Entry”. The project was reviewed by the QAG and received an

overall rating of satisfactory.

2.1.11 NTB-WRMP did not share the experience of long involvement in water resources and

Bank projects and the same depth of background analysis. The fact that the province had

missed out on earlier assistance was one of the reasons for EU interest in funding. To enable

the project to run concurrently with WISMP it had to be prepared quickly and with a more or

less identical design as WISMP. There do not appear to have been very substantial inputs of

government officers in project identification and appraisal. The project assessment was

carried out on the basis of a consultant assessment report, and there was not a formal appraisal

mission nor a project appraisal document. As a result, the design in terms of activities to be

undertaken was identical to those included in WISMP and were not tailored to the particular

needs of NTB, especially in regard to the need for catchment rehabilitation and management.

Also some aspects of the design were inadequate, most noticeably in relation to M&E. There

10

was a serious lack of definition of appropriate key performance indicators, and there was no

baseline survey. Consequently whatever M&E data was eventually collected provided little

help to project management since the results could not be interpreted5.

2.1.12 The project design was almost identical for WISMP 1 and NTB-WRMP. Under the

WISMP Program, the first phase project focused largely on institutional change and capacity

building. In contrast, NTB-WRMP‟s targeting of agricultural productivity and income

improvement, although not officially part of the project objectives, appears overly optimistic.

The degree of commitment of both the provincial and local governments and other

stakeholders on the other hand appears to have been equal to or greater than that for WISM

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