SFTAS Program Scope and Components

The proposed Program is a hybrid with two components of activities that support Nigerian states to achieve the key result areas of the Program: (1) a performance-based financing component for state governments, which will be implemented as a PforR; and (2) a technical assistance (TA) component for states and selected national-level institutions, which will be implemented as an IPF.

The performance-based financing component is open ex-ante to all 36 states and FCT[1] in Nigeria. The FSP and OGP set of reforms are relevant to all states, as fiscal management and performance are weak across the board, and all states still face considerable fiscal pressures. There is a very strong consensus across FMoF and all states[2] that out of fairness, relevance and need, no states should be ex-ante excluded from the Program. However, states have to meet the annual eligibility criteria (EC) to access PforR financing. The capacity building component will support states that demonstrate a need, targeting states that currently do not receive any capacity building support in program-related areas from ongoing World Bank or development partners[3].

The Program will support the full and sustained implementation of a strategic subset of reforms from the FSP and the OGP commitments that are implemented at the state-level. The selected reforms are considered the most critical and impactful for strengthening fiscal transparency, accountability and sustainability and contributing to the achievement of the PDO. The selected reforms form the basis of the eligibility criteria and the DLIs. The formulation of the DLIs are designed to address gaps in the programs identified in the technical assessment and strengthen the impact of the FSP and OGP programs.

Program Boundary: Figure 4 shows the SFTAS Program Boundary i.e. the subset of the FSP and OGP Fiscal Transparency government program supported by the SFTAS Program. 3 (three) out of the 19 state-level FSP actions form the Eligibility Criteria. A further 8 state-level FSP actions and 2 OGP state-level actions form the basis of the 9 DLIs across the four result areas of the Program.

The duration of the Program will be four years with the program effectiveness expected in October 2018 and end date expected in December 2022. The PforR will cover the fiscal performance of states over four fiscal[4] years: 2018-2021. Capacity building activities will commence after program effectiveness until the end of 2021. During preparation, different program durations were discussed and the Bank and the Government agreed that supporting states’ performance over four years was optimal for building momentum, incentivizing the sustained implementation of reforms, accommodating weaker states, and for allowing progression in the results/DLIs.

[1] Requested by the FMOF to also include FCT in the Program based on interest expressed by FCT

[2] Reflected in consultations that have covered all 36 states to date. States were represented by Commissioners of Finance, Finance Permanent Secretary, Commissioners of Budget and Planning, Accountant General, Chairman of State Bureau of Internal Revenue

[3] Approximately 14 states have received support to strengthen PFM systems.

[4] Fiscal year is the same as calendar year for the Nigerian government