day2 session3 pcm milestones

INTRODUCTION TO PROJECT CYCLE

MANAGEMENT: MAJOR STAGES AND

MILESTONES OF PCM PROCESS

David SimekOECD

Promoting Clean Urban Public Transport in Kazakhstan: Designing a Green Investment Programme

14 December 2016, Astana

Policy: response to perceived problem or set of issues.

Statement of approach or decision-making procedure to

obtain an objective. Public policy is the course of action,

including laws, regulatory measures and funding

priorities, to address a given objective

Programme: broad areas of work required to

implement policy decisions and priorities. Group of

activities intended to contribute to an

identifiable set of government objectives with a

clearly defined budget and a timeframe for achieving

these objectives

Projects, Programmes, Policies (1)

Project: "series of activities aimed at bringing about

clearly specified objectives within a defined time-period

and with a defined budget."

Project should have:

– Clearly identified stakeholders, including the primary target group

and the final beneficiaries

– Clearly defined coordination, management and financing

arrangements

– Monitoring and evaluation system (to support performance

management)

– appropriate level of financial and economic analysis, which

indicates that the project’s benefits will exceed its costs

Projects, Programmes, Policies (2)

PCM tries to ensure that:

1. Projects contribute to overarching policy objectives

2. Projects are relevant to the agreed strategy & the

target groups / beneficiaries

3. Projects are feasible (i.e. within the possibilities and

scope of action of implementing agencies)

4. Project results are sustainable (in medium / long

term)

Key Principles of Project Cycle

Managament (PCM)

Programming; Establishing Funding Priorities

Identification of Projects

Formulation of Projects

(Pre-selection of Potential Projects)

(Complete Appraisal of Pre-selected Projects)

(Selection of Projects for Financing)

Negotiations and Contracting

Project Implementation and Monitoring

Project Evaluation

Stages of PCM (1)

Stages of PCM (2)

Strategic and Programme Considerations

Feedback loops

Process flow

Implementation

Planning

Programming

Identification

FormulationImplementation

Evaluation and

Audit

Financing???

Project

Start-up

Project

Execution

Project

Sustainability

Project

Identification

Project

Preparation

During the Programming phase, the situation at national

and sectoral level is analysed:

To identify problems, constraints and opportunities which

cooperation could address

To identify the main objectives and sectoral priorities for

cooperation, taking into account national as well as donor

objectives

I. Project Programming (1)

National Policy Statements

National Programmes: specify overall policy

directions and funding priorities

Establish Funding Priorities: based on overall policy

directions and programme priorities

Based on this, the Implementing Agency publishes

written guidelines:

– on use of funds, types of projects financed, type of assistance

available for each type of project, maximum funding amount,

etc.

– Sometimes, priority investments are even listed by name

I. Project Programming (2)

Analysis of relevance of project ideas within the

framework of sectoral, thematic or “pre-feasibility”

studies

Analysis of relevant stakeholders / target groups /

beneficiaries (in terms of gender, socio-economic groups,

etc.)

Identification of their problems and feasible options to

address them

Implementation schedule (with proposals of main

milestones)

Brief outline of M&E (objectives/results,

assumptions/risks etc.)

II. Project Identification (1)

II. Project Identification (2)

Implementing Agency

Applicant Competition Winner

Distribute information

Call for projects - competitive;

aimed at specific

environmental problem

Project Concept Project

FACILITATING INITIATING

Relevant project ideas are developed into project

plans

Preparatory studies that outline feasible (i.e. likely to

succeed) and sustainable (i.e. will generate long-term

benefits) aspects of the project (technical, economic /

financial, institutional / management, socio/cultural,

environmental, etc.)

Beneficiaries and other stakeholders participate in the

detailed specification of the project idea

Again, checks need to ensure that cross-cutting issues

and overarching policy objectives are adequately

considered in the project design and objectives

III. Project Formulation

Also referred to as feasibility study or ex ante evaluation

phase

Before a financing decision can be made, a submitted

project is reviewed for compliance with programme

objectives

It is recommended that the appraisal process comprise of

two stages:

i. Preliminary appraisal

ii. Project appraisal and selection

IV. Project Appraisal

V. Preliminary Appraisal (1)

Applicant completes short

application form

Short application:

Basic Applicant Data,

Project Objectives,

Expected Environmental Effects,

Basic Technical and Economic

Information

Implementing Agency:

Pre-appraisal

Application is

sent to Implementing Agency

Decision

V. Preliminary Appraisal (2)

Implementing Agency

determines whether project fulfills all of

the preliminary criteria

Implementing Agency

sends Applicant:

Invitation to submit

a full application

Implementing Agency

sends Applicant:

Rejection Letter

YES NO

Timeframe:

Maximum Several Weeks

VI. Project Application (1)

Implementing Agency

Applicant Competition Winner

Distribute information

Call for projects - competitive;

aimed at specific

environmental problem

Project Concept Project

FACILITATING INITIATING


Compiles additional

documentation and permits

Completes full application

depending on investment

type, plus environmental

(technical) and financial

section

Evaluates application

accuracy and completeness

Technical and economic

experts evaluate project

Applicant Implementing Agency

Following documents should be part of the final

application

Feasibility study

Cost-benefit analysis

Design study / Technical design

Financing proposal

Financing application


If all the required documentation is submitted,

Implementing Agency accepts the application

If the application is accepted, the project is subjected to

appraisal and ranking

In regular periods (for instance, quarterly, semi-annually,

annually), the Implementing Agency compiles the results of the

ranking

If the project ranks high, the Implementing Agency will invite

representatives of the best projects to negotiations, up to the pre-

set budget limit for that financing objective

VII. Project Appraisal and Selection (1)

In case of incomplete or unclear documentation,

the Implementing Agency may

⇒ reject the project

⇒ encourage the Applicant to further elaborate

certain aspects

VII. Project Appraisal and Selection (2)

The Implementing Agency and the Applicant enter into

negotiations on the conditions of the contract

– Form of Assistance (grant, loan, equity)

– Conditions of Assistance

– In case of loan: Grace Period, Interest Rate, Credit Period

The loan or grant agreement is signed and the

disbursements are sent to the Applicant as negotiated.

Equipment purchases are typically reimbursed after

delivery based on an invoice

The Applicant initiates bidding procedures in accordance

with Public Procurement Law

VIII. Negotiations, financing decision

and disbursement

Usually, projects and programmes are implemented over

several years

Main stages:

I. Inception phase

II. Implementation phase

III. Final period

Main principles:

A. Planning and pre-planning (implementation schedule)

B. Monitoring (internal: project management / external:

implementing agency)

C. Reporting (internal and external reports on progress, usually

on quarterly basis)

IX. Project Implementation

and Monitoring (1)

Internal monitoring and reporting: usually on quarterly

basis with a focus on:

- Efficiency (conducted activities + implemented finances = overall

performance), i.e. relation between inputs and outputs (results)

External monitoring and evaluation: once or twice per

project cycle with a focus on:

- Relevance (results are relevant to the objective)

- Effectiveness (results have an impact on the objective)

- Sustainability (results are of long-term nature)


and Monitoring (2)


and Monitoring (3)

Selects contractor

Manages own and

Implementing Agency

resources

Implements and monitors

project (if according to

schedule)

Maintains documentation,

invoices for Implementing

Agency inspection

May appoint an expert to

evaluate project

performance at a given

stage

May conduct on-site visits to

evaluate project

performance

Inspects and approves

invoices

Applicant Implementing Agency

Implementing Agency should conduct evaluation that is:

Impartial & independent (from the project management)

Credible (level of expertise)

Participatory (incorporating stakeholders’ views)

Possible evaluation stages:

i. Ex ante (feasibility)

ii. Mid-term (recommendations)

iii. Final (results / objectives)

iv. Ex post (impact / lessons learnt)

X. Evaluation