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ABCs of IDA - Institutional Strengthening

Good governance and strong and accountable institutions are crucial for poverty reduction and development impact.

The International Development Association (IDA), the World Bank’s fund for the poorest, builds the systems that make assistance more effective. IDA works with ministries, agencies, and departments of the executive branch on managing public institutions and finances. On broader governance issues, IDA works with the legislative and judicial branches and other institutions that promote public accountability and greater engagement with society. As a result, governments become more transparent, more accountable to their citizens, less susceptible to corruption, and better at delivering services. From improving people’s access to the justice system in Honduras to removing “ghost workers” in Malawi, an effective public sector means better services for people and greater citizen participation.

IDA’s emphasis on long-term growth and capacity helps ensure that results are sustained and that countries are on a path where they can fund their own development.

With IDA’s help, hundreds of millions of people have escaped poverty—through the creation of jobs, access to clean water, schools, roads, nutrition, electricity, and more. During the past decade, IDA funding immunized nearly half a billion children, provided access to better water sources for 123 million people, and helped 65 million people receive health services. During the food crisis, we helped get seeds and fertilizers to 8.5 million farm households, cash or food-for-work programs to 1.7 million people, and meals to 923,000 school children.

Learn more about how IDA supports country efforts to build strong institutions for sustained results, and be sure to see our other “ABCs” of IDA, including an overarching ABCs fact sheet, as well as highlights of our work in Africa, on gender, and conflict and fragility at


  • Customs revenue collection increased twenty-fold in 2011, rising to $1 billion, compared with $50 million in 2003.
  • 469 customs declarations were processed per customs staff per year in 2011, up from 3 per staff per year in 2003.


  • Communication within the government now takes only a few seconds, compared with 1–3 business days in 2008, following a civil service-wide rollout of an electronic document management system.
  • 20 percent of tax returns were filed electronically in 2011, up from 0 percent in 2008.


  • Approximately 60 percent of contract awards in 2012 were published on the Central Procurement Technical Unit website, up from only 15 percent in 2007, and invitations for bids published in the newspaper increased to almost 100 percent in 2012, up from 70 percent in 2005.
  • More than 2,900 officials attended three weeks of procurement training over the last three years.
  • After the pilot phase, four key agencies rolled out the e-government procurement across all of their procuring entities.

IDA Results on the Ground


  • As a result of reform of the tax agency, internal revenue collection rose to 6.2 percent of GDP in 2006 from 4.9 percent of GDP in 1998 and is being sustained.


  • Port clearance times sharply decreased, the level of port activity rose 17 percent, and revenues increased 22 percent in the first quarter of 2011, following the signing of individual performance contracts by staff in the two largest custom offices.

Central African Republic

  • Budget execution reports for 2010 were released publicly through the Ministry of Finance website.


  • 2.6 million books were distributed to schools, 400 classrooms were built and equipped, 20,000 people were taught to read and write, and 11,700 community teachers were trained between 2003 and 2012.


  • Only 1 paper copy is now required for customs declaration forms, instead of 4, and cargo manifests are now processed as electronic documents, streamlining overall customs procedures.
  • Customs clearing time was reduced from 7 days to 1 day, and the number of days to process investments was reduced from 4 weeks in 2006 to 2–3 weeks in 2010.


  • 2,021,087 businesses had been issued computerized tax identification numbers (TIN) by 2012, up from 15,611 in 2005, which helped to broaden the tax base.
  • Ethiopia’s ranking for online services improved from 80 to 126, and its ranking for e-participation from 19 to 170 (out of 174 countries) between 2004 and 2012, thanks in part to the business process review (BPR) of more than 20,000 offices across the nation.


  • Accounting reform included adoption of the International Public Sector Accounting Standards (IPSAS) implementation plan in 2009; establishment of the Georgia Public Sector Accounting Standards Board in 2010; and piloting IPSAS-based modified cash-basis public sector accounting standards in 2011.
  • 92 percent of business tax returns were submitted via e-filing by 2011, thanks to the introduction of e-filing in 2009 and the issuance of standardized procedural guidelines for tax offices.
  • By the end of 2011, a risk-based tax audit system was introduced, replacing the discretionary and subjective selection of firms to be audited.


  • The principles of the Extractive Industries Transparency Initiative have been adopted for mandatory disclosures of oil and gas contracts by extractive companies, and with an independent oversight committee to manage the implementation of the Petroleum Revenue Management Act of 2011.


  • It took 30 days to process investment applications in 2012, compared with 90 days in 2008.


  • 100 percent of central government expenditure has been included in a single treasury account since 2010, and internal audit units now cover the entire central government.
  • 40 percent of the population had better access to the courts in 2011.

IDA Results on the Ground


  • There was a 2.4 percent disparity between budget allocations and actual expenditures in 2010–11, compared with 11 percent in 2004–05.
  • KSh 634.9 billion was raised by Kenya’s revenue authority in 2010–11, up from KSh 274.3 billion in 2005–06, through the automation of business processes.
  • Voluntary tax compliance improved from 88 percent in 2005 to 98.3 percent in 2011.

Lao People’s Democratic Republic

  • Civil servants, including teachers and doctors, were being paid on time via bank transfers in 2012. Previously, their monthly salaries could be delayed by more than five months.
  • Budget execution improved from 64–68 percent in 2004–05 to 93–100 percent in 2006–10 through improved procurement planning and streamlining of payment processes.


  • Revenues increased more than threefold, from $85 million in 2006 to $275 million in 2010.
  • The value of noncompetitive procurement was substantially reduced from approximately 80 percent to 30 percent in one year—from 2008 to 2009.
  • 95 percent of vouchers now are approved on receipt by the Ministry of Finance, up from 60 percent in 2006, with processing times decreasing from 14 days in 2009 to 7 days in 2011.
  • Liberia became the first African country to achieve compliant status (2009) with the Extractive Industries Transparency Initiative.


  • 4,878 “ghost workers” were removed from the payroll in 2011 when payroll control was strengthened, and wage bill discrepancies were reduced from 5 percent in 2004–05 to 0.2 percent 2010–11.


  • About 90 percent of national public budget balances were consolidated into a single treasury account at the National Bank of Moldova in 2011, up from 15 percent in 2006.


  • More than 12,000 out of 14,000 separate government bank accounts have been closed. In 2012, the single treasury account reported in real time on government revenues and expenditures.
  • Electronic bidding in the Department of Roads, first introduced in 2007, was extended to other line ministries in 2012. E-bidding is now required for any procurement over Rs 2 million (approximately $23,000).
  • More than 16,000 families and victims of conflict received state assistance through bank accounts, as part of the 2010 transparency improvements for deliveries of cash transfers and safety nets.


  • The land administration policy and legal framework was modernized between 2003 and 2009.
  • 145 microfinance offices and 320 supervised financial institutions were in operation at the end of 2012. A new microfinance law was enacted in 2011, and a regulatory body established in 2012.
  • More than 20 microfinance institutions and 100 cooperatives received training and technical support in accounting, finance, and risk management areas, from 2007 to 2012.


  • Payment processing to government suppliers took 7 days in 2012, compared with 33 days in 2004.
  • The ratio of government payment arrears to total expenditures was reduced from 15 percent in 2008 to 10 percent in 2011.
  • Between 2008–11, the number of registered taxpayers increased from 7,000 to 125,000 in Bauchi state, and from 30,000 to 100,000 in Kaduna State. From 2009–11, the number of federally registered taxpayers— corporate, small and medium enterprises, and individuals—increased from 475,725 to 941,901.
  • Tax collections in Bauchi state increased from Naira 1.2 billion in 2007 to Naira 4.5 billion in 2011, and in Kaduna state collections increased from Naira 3.7 billion in 2007 to Naira 9.2 billion in 2011.
  • A procurement regulatory body was established at the federal level, following the enactment of the Federal Public Procurement Law in 2007.


  • Submission times were reduced from 23 months to 8 months during 2009–10 for annual financial statements and audit reports to the legislature, for all levels of governments (federal, provincial, and district).
  • PEFA ratings increased from “D+” to a “B,” with audits at all tiers of the government carried out in accordance with International Organisation of Supreme Audit Institutions (INTOSAI) standards as of June 2012.
  • Annual financial statements of the federal, provincial, and district governments were prepared and submitted to the auditors within 2 months of the close of fiscal years 2009–10, down from 12 months in fiscal years 2006–07.


  • National revenue collection increased by 94 percent between 2007–11, and registered taxpayers increased by 213 percent from 20,535 to 64,260.
  • 75 percent of budget agencies produced complete annual financial reports within the stipulated time frame in 2011, up from 16 percent in 2008.

IDA Results on the Ground

Sierra Leone

  • Public financial management was improved by adopting a modern regulatory framework based on the Government Budget and Accountability Act and Public Procurement Act.
  • 73 percent of procurement transactions used open competition in 2011, compared with approximately 49 percent in 2009.
  • Some 96 percent of ministerial departments and agencies had dedicated procurement officers and functional procurement units in 2011, compared with an estimated 20 percent in 2008.
  • 45 percent of taxpayers filed income tax returns on time in 2012, compared with 19 percent in 2011.
  • In 2012, the government launched an online repository of all mining and exploration license details and associated nontax payments (broken down by license, company, mineral, date, and tax/levy type).

Sri Lanka

  • 100 percent of state-owned enterprises were covered in the Auditor General’s Annual Audit Report in 2011, up from 50 percent in 2008; and the timeliness of audits improved from delays of 2–4 years to 1 year by 2012.
  • 67 annual financial statements were prepared within three months of year’s end by local authorities in the north and east in 2011, up from 28 in 2010.


  • On September 1, 2011, the new civil service wage grid was extended to the entire civil service, removing all nontransparent bonuses, linking pay to outside market compensation, and reconciling pay for similar jobs across the government.
  • In 2010, 82 percent of vacancies in the civil service were filled through a competitive recruitment process. Before 2006, there had been no competitive recruitment system in place.
  • 47 government bodies now have access to an automated the Civil Service Register, listing all approved posts, grades, and their occupants.


  • There was a 34 percent increase in taxpayer awareness of tax education programs between 2006 and 2011.
  • Value added tax refunds made within one month increased from 62 percent in 2006 to 80 percent in 2011.
  • 14 percent of court cases were outstanding for two years or more in 2011, compared with 70 percent in 2005.


  • National accounts covering the period 2004–10 were published for the first time in 2012.
  • The budget (including three-year fiscal forecasts) has been routinely submitted to Parliament on time, since the introduction of a budget calendar in 2009.
  • Budget execution was strengthened and rates increased to 84 percent from 75 percent between 2005–11, even while the budget increased to $1,092 million (2011) from $72 million (2005).
  • Domestic tax collections increased from $53 million in 2008 to $111 million in 2011 (projected), from 9.0 percent of non-oil GDP in 2009 to 10.4 percent in 2011.


  • The computerized Financial Management Information System was put in place nationally in 2012; it is used for budget execution, accounting, and fiscal reporting for the central area and all 63 provinces and 700 districts.
  • Budget recording of concessional foreign-financed project expenditures took 3 months in 2011, down from 12 months in 2005.

Yemen, Republic of

  • An Accounting and Financial Management Information System was rolled out in 13 new central government ministries and 3 central government departments in 2010; a Loans and Grants Management Information System (LGMIS) was rolled out to 17 new project management units.
  • 8.5 days of lead time were taken by line ministries for disbursements in 2012, compared with 40 days in 2011—the result of the roll out of the LGMIS.
  • The government budget is now prepared using Global Financial System economic, administrative, and functional classifications, and is published on the government website to obtain public feedback. This led to a 15-point increase (5th largest in the world) in the Open Budget Index (OBI) between 2008 and 2010.

IDA Results on the Ground

The International Development Association

The International Development Association (IDA) is a game-changer in the field of development, paving the way for others in the most difficult and complex situations to help hundreds of millions of people escape the cycle of abject poverty.

IDA provides leadership on global challenges. From its support for climate resilience to the creation of jobs to get combatants back into society, IDA rallies others on tough issues for the common good and helps make the world more secure.
  • IDA is transformational. IDA helps countries develop solutions that have literally reshaped the development landscape— from its history-changing agriculture solutions for millions of South Asians who faced starvation in the 1970s to its pioneering work in the areas of debt relief and the phase-out of leaded gasoline.
  • IDA is there for the long haul. IDA stays in a country after the cameras leave, emphasizing long-term growth and capability to make sure results are sustained.
  • When the poorest are ignored because they’re not profitable, IDA delivers. IDA provides dignity and quality of life, bringing clean water, electricity, and toilets to hundreds of millions of poor people.
  • IDA makes the world a better place for girls and women. IDA works to reverse millennia of gender discrimination by getting girls to school, helping women access financing to start small businesses, and ultimately helping to improve the economic prospects of families and communities.
  • Working with the World Bank Group, IDA brings an integrated approach to development. IDA helps create environments where change can flourish and where the private sector can jump-start investment.