World Bank Study Recommends Improvements to Rural Financing

World Bank Study Recommends Improvements to Rural Financing
Report to assist policy makers and donors to make rural investment more effective

HONIARA, February 6, 2015 – A World Bank report launched today in Honiara has looked at ways in which the Solomon Islands Government and development partners can improve their funding mechanisms; resource distribution and; planning processes for investing in rural infrastructure and service delivery.

World Bank Country Manager Anne Tully said, “following the Tension, when Government capacity had greatly diminished in parts of the country, donors and Government invested in a number of programs which delivered direct benefits to rural areas. Now, a second generation of programs is taking shape, and this report is intended to inform discussion as to how best to refine and institutionalize more effective, accountable and transparent investment in rural development.”

Solomon Islands, Towards Better Investment in Rural Communities identifies ways to strengthen current methods for investing in rural service delivery by examining the main types of financing for small-scale infrastructure and livelihood activities at provincial, constituency, and community levels. It examined 1449 sub-projects funded between 2008 and 2012.

The report looked at a total of more than US$134 million in rural funding disbursed through the four largest rural investment programs: Provincial Capacity Development Fund (provincial level); Rural Development Program and the Rural Advancement Micro-projects Program (community level); and the Rural Constituency Livelihood Fund, and constituency funds more broadly (constituency level).

Specifically, the report analyzed how the four programs performed in the areas of local development planning; efficiency and effectiveness; accountability, transparency and dispute management; and technical quality and sustainability.
“The findings of the report highlight the need to redefine the current funding streams at constituency, community and provincial levels,” said World Bank Senior Operations Officer Erik Johnson. “Funds should be aligned with clear mandates as well as appropriate capacities for implementation. There is currently signficant overlap in the use of funds, and no clear vision as to how the funds can complement each other as well as the activities of sector ministries.”

Solomon Islands, Towards Better Investment in Rural Communities recommends the redistribution of resources across constituency, provincial and community funds as well as an integrated planning process to better align currently disconnected processes – starting with inclusive, participatory village and ward level planning, and working up through the constituency, provincial Government and national levels.

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