WASHINGTON, March 16, 2010 – The World Bank’s Board of Executive Directors today approved a US$9 million credit for the Second Public Sector Modernization Project (PSMP II) for Armenia. The project will assist the Government of Armenia in its efforts to improve the quality of public services by introducing a performance-based pay system and a code of conduct for civil servants, and by enhancing public access to all available government information.
“Strengthening governance through improved public service delivery is among the priorities for Bank support,” saidAsad Alam, World Bank Regional Director for the South Caucasus. “While some improvements have been made in the area of governance and anti-corruption, important challenges remain, including in the enforcement of conflict of interest legislation pertaining to public officials.”
In the new economic reality brought about by the global economic crisis, public administration reform has grown even more important, as getting better value from public expenditures and improving public services have become a necessity. Ensuring that public service provisions do not suffer at a time of tighter fiscal constraints requires focused efforts to strengthen performance management.
“To improve public service delivery, enhancing technology is not enough by itself. The most crucial and difficult part is changing behavior and organizational culture,” added Kathy Lalazarian, head of the World Bank team designing the project. “It’s important to have efficient public services throughout the recovery because – more than ever – families are counting on the services the government provides.”
This demanding agenda will be tackled by the PSMP II, as despite progress in civil service reform under the ongoing PSMP I, policy formulation and implementation functions need additional strengthening. The Project will also help build capacity for performance management, and will support the Government’s efforts to bolster the rules regulating conflict of interest in public service and improve enforcement.
PSMP II has three main components. It supports: (i) the design of organizational structures in pilot institutions and improvement of the management of business processes by streamlining and coordinating functions; (ii) making human resource management more effective, and enhancing public service ethics and staff performance systems; and (iii) complementing and enhancing the electronic governance and automation systems to make them accessible to the general public, aiming for better service delivery, and more transparency and efficiency.
The IBRD Flexible loan has a maturity of 25 years and a grace period of 10 years included.
Since joining the World Bank in 1992 and IDA in 1993, the commitments to Armenia total approximately US$ 1, 318, 7 million.