World Bank Public Financial Management Reform Trust Fund Project for the West Bank and Gaza – WB proposal/press release

West Bank and Gaza – Public Financial Management Reform Trust Fund Project, Vol. 1 of 1 

Document Type: Program Document 

The Public Financial Management Reform Trust Fund builds on the successful budget support mechanisms of the European Commission – the Special Cash Facility and the Direct Budgetary Assistance Program (Phases 1-5) – which disbursed funds against a series of Palestinian Authority (PA) reforms between November 2000 and December 2002. Lessons from this assistance form an integral part of the design of the Reform Fund, which would extend a similar mechanism to a wider set of donors. In collaboration with the Ministry of Finance (MOF), the International Monetary Fund (IMF) and key donors, the Bank outlined a program of reforms, and arrangements for a multi-donor trust fund. The objective of this Reform Program is two-fold. First, to further improve the PA ' s financial management systems, within a broader national reform agenda; and second, to provide budgetary and fiduciary assurances to donors. The first tranche under the Reform Fund, would be authorized upon fulfillment of: submission and passage of the PA Budget Law for 2004; submission of statements on the PA ' s fiscal operations in 2002; full implementation of the 2004 Budget Law ' s requirement, that salary payments of all PA security personnel be directly deposited into individual bank accounts; completion and publication of the final report on the valuation of assets of the Palestine Investment Fund (PIF); and, full compliance with the 2004 Budget Law in relation to public sector personnel hiring. The Bank will set up a single, multi-donor trust fund, to mobilize additional donor resources in support of the PA budget; to harmonize donor assistance in exchange for a commonly agreed Reform Program; and, to simplify procedures for the PA. The Bank as Reform Fund Administrator would be responsible for supervising the implementation of the agreed reform measures, monitoring and verifying compliance.