## PUBLIC INVESTMENT MANAGEMENT ASSESSMENT: REVIEW AND UPDATE (Executive summary and framework excerpts)

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### Background and Purpose
- Public Investment Management Assessments (PIMAs) are the IMF‘s key tool for assessing infrastructure governance over the full investment cycle and supporting economic institution building in this area.
- The PIMA framework was first introduced in the 2015 Board Paper on “Making Public Investment More Efficient,” as part of the IMF’s Infrastructure Policy Support Initiative (IPSI).
- Key motivations and roles:
  - Strong infrastructure governance is critical for public investment to spur economic growth.
  - PIMAs offer rigorous assessment of infrastructure governance—i.e., the key public investment management (PIM) institutions and processes of a country.
  - PIMAs summarize strengths and weaknesses of country public investment processes and set out a prioritized and sequenced reform action plan.
- Implementation and uptake:
  - Over 30 PIMAs conducted to date (mainly in emerging markets (EMs) and low income developing countries (LIDCs)), with a pipeline of new requests in place; eight PIMAs have been or are about to be published.
  - Most PIMAs conducted in cooperation with other partners: World Bank (24), IADB (2), ADB (1).
  - Six countries have published PIMAs (Botswana, Ireland, Jordan, Kosovo, Liberia, Mali); two more in process (Benin, Brazil). Publication is voluntary.
- Administrative and authorship details:
  - April 25, 2018.
  - Prepared by a staff team from the Fiscal Affairs Department under the supervision of Gerd Schwartz and Sanjeev Gupta, led by Manal Fouad and Carolina Renteria, and including Richard Allen, Taz Chaponda, David Gentry, Torben Hansen, Isabel Rial, Johann Seiwald, Ha Vu, and Nour Chamseddine. The revised PIMA framework also benefited from useful inputs from a World Bank team comprising Jim Brumby, Jay-Hyung Kim, Jens Kristensen, and Tuan Minh Le.

### Coverage, Method, and Use
- Scope of assessments:
  - Analysis based on PIMAs conducted since 2015 in 30 countries, covering Africa (13), Asia and the Pacific (5), Europe (5), Western Hemisphere (4), and Middle East and Central Asia (3).
  - Country sample includes one Advanced Economy (AE), 15 Emerging Markets (EMs), and 14 Low Income Developing Countries (LIDCs).
- Purpose and method:
  - PIMA evaluates infrastructure governance using 15 key institutional features across three stages of the public investment cycle: (i) planning; (ii) allocating; and (iii) implementing productive public assets.
  - Each PIM institution is assessed from three perspectives: design (“de jure”), effectiveness (“de facto”), and reform priority.
  - Recommendations presented as a sequenced reform action plan with clear priorities, specific timelines and key actors.
- Application:
  - PIMA results used in IMF lending, surveillance, and capacity development (CD); have improved coordination among CD providers.
  - PIMAs inform program design (e.g., structural benchmarks) and surveillance (e.g., SIPs).
  - Publication of PIMAs is voluntary; many countries prefer internal use to guide reforms.

### Key Findings — Design (Institutional design scores)
- General patterns:
  - Significant room for improving the design of PIM institutions, both across and within country groups.
  - Using a scoring system ranging from 0 to 10, with 10 indicating full alignment with good PIM practices, EMs, on average, score higher in design compared to LIDCs.
  - Europe scores higher in design than other regions; Africa is the weakest.
  - Dispersion within groups is material (example: Africa scores range from 1.3 to 6.4).
  - Even the best performing countries in EMs and LIDCs have much room for improving design relative to the maximum score of 10.
- Distribution across the investment cycle:
  - Institutions are better designed in the planning stage compared to the allocation and implementation stages.
  - Highest design scores found in: budget unity, budget comprehensiveness, and national planning (planning and allocation stages).
  - Weakest design scores found in allocation and implementation stages, notably: project appraisal, project selection, project management, and asset monitoring.
  - Management of PPPs is a relatively low-scoring institution even in the planning stage.

### Key Findings — Effectiveness (Design vs effectiveness)
- General pattern:
  - For almost all PIM institutions, design scores exceed effectiveness scores.
  - Countries are better in designing PIM institutions than in implementing them effectively.
- Largest design–effectiveness gaps observed in:
  - National and sectoral planning: formal plans often fragmented, not properly costed, not aligned with the medium-term framework and annual budget, and do not inform public investment decisions.
  - Multiyear budgeting: half of assessed countries publish medium-term estimates for capital spending by ministry or sector; the other half publish at least aggregate capital ceilings. Forecasts for two or more years ahead are often unreliable.
  - Transparency of execution: procedures for procurement transparency exist in most countries, but PIMAs revealed significant non-compliance by procuring agencies; central monitoring mechanisms frequently do not lead to corrective actions.
  - Project selection: published technical criteria often not used in practice.

### Reform priorities and typical recommendations
- PIMAs prioritize institutions with low effectiveness scores and propose sequenced reform plans.
- Most frequent measures recommended (share of PIMAs reporting each recommendation):
  - Project selection — 90 percent.
    - Establish a pipeline of projects; develop a comprehensive project database; define/improve project guidelines and selection criteria.
  - Project appraisal — 86 percent.
    - Develop and implement guidelines for project appraisal (including cost-benefit and risk analysis).
  - Multiyear budgeting — 76 percent.
    - Improve credibility of multiyear budgeting including transparency over multi-annual commitments, better assessment of fiscal space, establish capital budget ceilings, or publish existing ceilings.
  - Management of PPPs — 72 percent.
    - Integrate PPPs into the overall PIM framework; improve budgeting, accounting and reporting of PPP operations, including long-term commitments and contingent liabilities.
  - Project management.
    - Adopt project management guidelines, provide training, centralize monitoring, pilot/implement ex-post reviews.
  - National and sectoral planning.
    - Improve costing of plans, consolidate sector strategies, introduce overall national strategies.

### Efficiency gap and economic impact
- The average country loses about 30 percent of the value of its investment to inefficiencies in its public investment processes.
- Improvements in infrastructure governance can help countries close up to two-thirds of that “efficiency gap.”
- The most efficient investors get twice the growth “bang” for their investment “buck” than the least efficient investors.
- Staff estimates of the efficiency gap for each country were based on the methodology developed in the 2015 Board Paper and included in all PIMA reports.

### Framework revisions and focus areas (2015 → 2018 Revised)
- The revised PIMA framework retains the three-phase structure (planning, allocation, implementation), 15 institutions, three dimensions per institution, and three possible scores per dimension (not/partially/fully met), while emphasizing governance aspects.
- Four major aspects given more in-depth focus:
  - Maintenance: new specific institution; emphasis on budgeting for routine and capital maintenance and methodologies to estimate required expenditure.
  - Procurement: established as a dedicated PIMA institution to address technical efficiency and corruption risks.
  - Independent review of projects: expanded as an evaluation criterion to counter political influence and improve quality.
  - Enabling environment: qualitative assessment of legal framework, information systems, and staff capacity (three enablers).
- Streamlining and rewording:
  - Fiscal principles and rules: revisions emphasize fiscal policy’s role in providing a stable, predictable context for public investment.
  - PPPs: addressed across several PIM institutions rather than a single institution.
  - Budget Comprehensiveness and Budget Unity: merged into Budget Comprehensiveness and Unity.
  - Portfolio management and oversight: clarified to address portfolio-level challenges.
  - Coverage expanded to include public corporations and all financing sources.

### Scoring, prioritization, and practice
- PIMA scoring is two-fold: institutional design and effectiveness; reform priority rankings are included to support sequenced reform plans.
- Typical inference rule: low scores on both design and effectiveness imply high reform priority; high-priority recommendations also include reforms with significant impact on public investment efficiency and high implementability.
- Cross-cutting issues (IT support, legal framework, staff capacity) are assessed qualitatively rather than fully integrated into scoring.

### Implementation, monitoring, and capacity development (CD)
- PIMAs have proven helpful for countries reforming PIM frameworks to improve public investment efficiency.
- Staff will monitor implementation of PIMA recommendations and support follow-up CD; progress measured via monitoring reform plans and repeat PIMAs at reasonable intervals.
- CD support will be provided upon request, consistent with the Fund’s CD mandate and resource envelope, integrated into resource allocation planning (RAP), and focused on macro-critical reforms within the Fund’s fiscal governance mandate.
- MDBs and bilateral development agencies are invited to use PIMAs to support procurement, project appraisal, and infrastructure regulation reforms.
- Staff will balance resources between conducting new PIMAs and meeting demand for CD follow-up, informed by CD RAP processes.
- Staff will continue to encourage country authorities to publish their PIMAs to draw attention to key issues and mobilize external support.

### Practical findings, demand, and examples of follow-up financing
- Demand and uptake:
  - Since launch in mid-2015, on average, ten countries per year have requested a PIMA; staff expects this demand to continue.
- Perceived benefits (post-PIMA survey: questionnaires sent to 30 countries; 19 responses):
  - All respondents indicated PIMAs comprehensively captured key elements of PIM institutions and were useful in distinguishing design and effectiveness.
  - Nearly all respondents found PIMAs accurately reflected the state of PIM and provided relevant recommendations.
  - Approximately three quarters found PIMAs useful in informing CD and external financing needs.
  - All respondents indicated they introduced reform measures based on PIMA recommendations.
  - Most countries would consider a PIMA update within 2–4 years to assess progress.
- Examples of mobilized/linked external funding and CD:
  - Mozambique: three-year program with approximately US$2 million in funding toward strengthening PIM.
  - Madagascar: World Bank follow-up interventions to revive PIM manual, strengthen project appraisal, and provide training.
  - Togo: World Bank five-year project with approximately US$10 million in funding to strengthen PIM.
  - Zambia: World Bank, EU and African Development Bank used PIMA results in country programs.
  - Maldives: US$12 million additional financing of the capital budget under the World Bank’s PFM Systems Strengthening Project is informed by the 2016 PIMA report; the project will be presented to the World Bank Board on May 30, 2018.

### Questionnaire structure and sample scoring tiers (selected items)
- A. Planning Sustainable Levels of Public Investment — sample items and verbatim answer tiers:
  - Fiscal targets and rules: presence of targets/limits for debt sustainability and permanent fiscal rules; existence and scope of a medium-term fiscal framework (MTFF).
    - Example tiers preserved verbatim include:
      - "There is no target or limit to ensure debt sustainability."
      - "There is at least one target or limit to ensure central government debt sustainability."
      - "There is at least one target or limit to ensure general government debt sustainability."
      - "There are no permanent fiscal rules."
      - "There is at least one permanent fiscal rule applicable to central government."
      - "There is at least one permanent fiscal rule applicable to central government, and at least one comparable rule applicable to a major additional component of general government, such as subnational government (SNG)."
      - "There is no MTFF prepared prior to budget preparation."
      - "There is an MTFF prepared prior to budget preparation but it is limited to fiscal aggregates, such as expenditure, revenue, the deficit, or total borrowing."
      - "There is an MTFF prepared prior to budget preparation, which includes fiscal aggregates and allows distinctions between recurrent and capital spending, and ongoing and new projects."
  - National and Sectoral Planning: tiers range from partial coverage to comprehensive publication and costing of projects regardless of financing source.
  - Project Appraisal: tiers cover presence of rigorous technical, economic, and financial analysis; central support and independent review options.
  - Alternative Infrastructure Financing: tiers include published PPP strategy/policy and oversight/consolidated reporting on public corporations’ investment plans.

- B. Ensuring Public Investment is Allocated to the Right Sectors and Projects — sample items:
  - Multiyear Budgeting: publication of capital spending projections over a three to five-year horizon, multiyear ceilings (indicative or binding), and publication of total construction cost projections with annual breakdowns over a three-five-year horizon.
  - Budget Comprehensiveness and Unity: tiers address coverage of capital spending through the budget, inclusion of all capital projects regardless of financing source, and joint presentation of capital and recurrent budgets.
  - Budgeting for Investment: tiers cover whether total project outlays and multiyear commitments are included in budget documentation, virement rules, and prioritization of ongoing projects.
  - Maintenance Funding: tiers address standard methodologies for routine maintenance and major improvements, and budget identification/reporting.
  - Project Selection: tiers address central review of major project appraisals, published selection criteria and processes, and maintenance of an appraised project pipeline.

- C. Delivering Productive and Durable Public Assets — sample items:
  - Procurement: tiers on competitive tendering, procurement databases and monitoring, and procurement complaints review.
  - Availability of Funding: tiers on cash-flow forecasts, timely release of project outlays, and integration of external donor funding into the main government bank account structure.
  - Portfolio Management and Oversight: tiers on central monitoring during implementation, rules for reallocating funds across projects, and systematic ex-post reviews.
  - Management of Project Implementation: tiers on senior responsible officers, standardized rules for project adjustments, and ex-post external audits.
  - Monitoring of Public Assets: tiers on asset registers, recording of nonfinancial asset values in financial accounts, and depreciation in operating statements.
  - Cross-cutting issues assessed qualitatively: IT support, legal/regulatory framework, staff capacity and clarity of roles and responsibilities.

### Sample PIMA summary outputs (Annex II excerpt)
- PIMA Scoring Heatmap example (Jordan):
  - A. Planning
    - 1 Fiscal rules — Design: Medium; Effectiveness: Low; Reform Priorities: Medium
    - 2 National and sectoral planning — Design: Medium; Effectiveness: Low; Reform Priorities: High
    - 3 Central-local coordination — Design: Medium; Effectiveness: Low; Reform Priorities: Medium
    - 4 Public-private partnerships — Design: Medium; Effectiveness: Low; Reform Priorities: High
    - 5 Regulation of infrastructure companies — Design: Medium; Effectiveness: Low; Reform Priorities: High
  - B. Allocation
    - 6 Multiyear budgeting — Design: Medium; Effectiveness: Medium; Reform Priorities: Low
    - 7 Budget comprehensiveness — Design: Medium; Effectiveness: Medium; Reform Priorities: Medium
    - 8 Budget unity — Design: Good; Effectiveness: Medium; Reform Priorities: Low
    - 9 Project appraisal — Design: Low; Effectiveness: Low; Reform Priorities: High
    - 10 Project selection — Design: Low; Effectiveness: Low; Reform Priorities: Medium
  - C. Implementation
    - 11 Protection of investment — Design: Low; Effectiveness: Medium; Reform Priorities: Medium
    - 12 Availability of funding — Design: Medium; Effectiveness: Low; Reform Priorities: Medium
    - 13 Transparency of execution — Design: Medium; Effectiveness: Medium; Reform Priorities: Medium
    - 14 Project management — Design: Medium; Effectiveness: Low; Reform Priorities: Medium
    - 15 Assets accounting — Design: Low; Effectiveness: Low; Reform Priorities: High

*Source: PUBLIC INVESTMENT MANAGEMENT ASSESSMENT: REVIEW AND UPDATE, April 25, 2018 (International Monetary Fund).*

### EXECUTIVE SUMMARY

### EXECUTIVE SUMMARY

### Background
- Public Investment Management Assessments (PIMAs) are the IMF‘s key tool for assessing infrastructure governance over the full investment cycle and supporting economic institution building in this area.
- The PIMA framework was first introduced in the 2015 Board Paper on “Making Public Investment More Efficient,” as part of the IMF’s Infrastructure Policy Support Initiative (IPSI).
- Key motivations and roles:
  - Strong infrastructure governance is critical for public investment to spur economic growth.
  - PIMAs offer rigorous assessment of infrastructure governance—i.e., the key public investment management (PIM) institutions and processes of a country.
  - PIMAs summarize strengths and weaknesses of country public investment processes and set out a prioritized and sequenced reform action plan.
- Implementation and uptake:
  - Over 30 PIMAs conducted to date (mainly in emerging markets (EMs) and low income developing countries (LIDCs)), with a pipeline of new requests in place; eight PIMAs have been or are about to be published.
  - PIMAs have been used in IMF lending, surveillance, and capacity development (CD) work, and have improved support and coordination among CD providers.
- Framework features and revision:
  - The revised PIMA framework retains the 2015 framework structure, including the three-phase structure (planning, allocation, and implementation) with five institutions assigned to each phase, three dimensions under each institution, and three possible scores under each dimension (not/partially/fully met).
  - The revision highlights governance aspects more prominently, including maintenance, procurement, independent review of projects, and the enabling environment (e.g., adequacy of the legal framework, information systems, and staff capacity).
  - Revision benefited from extensive stakeholder feedback including IMF teams, World Bank staff, and country authorities.
- Administrative and authorship details:
  - April 25, 2018.
  - Prepared by a staff team from the Fiscal Affairs Department under the supervision of Gerd Schwartz and Sanjeev Gupta, led by Manal Fouad and Carolina Renteria, and including Richard Allen, Taz Chaponda, David Gentry, Torben Hansen, Isabel Rial, Johann Seiwald, Ha Vu, and Nour Chamseddine. The revised PIMA framework also benefited from useful inputs from a World Bank team comprising Jim Brumby, Jay-Hyung Kim, Jens Kristensen, and Tuan Minh Le.

### PIMA Findings — Coverage and Overall Results
- Scope of assessments:
  - Analysis based on PIMAs conducted since 2015 in 30 countries, covering Africa (13), Asia and the Pacific (5), Europe (5), Western Hemisphere (4), and Middle East and Central Asia (3).
  - Country sample includes one Advanced Economy (AE), 15 Emerging Markets (EMs), and 14 Low Income Developing Countries (LIDCs).
  - Most PIMAs conducted in cooperation with other partners: World Bank (24), IADB (2), ADB (1).
  - Six countries have published PIMAs (Botswana, Ireland, Jordan, Kosovo, Liberia, Mali); two more in process (Benin, Brazil). Publication is voluntary.
- Purpose and method:
  - PIMA evaluates infrastructure governance using 15 key institutional features across three stages of the public investment cycle: (i) planning; (ii) allocating; and (iii) implementing productive public assets.
  - Each PIM institution is assessed from three perspectives: design (“de jure”), effectiveness (“de facto”), and reform priority.
  - Recommendations presented as a sequenced reform action plan with clear priorities, specific timelines and key actors.

### Key Findings — Design
- General:
  - Significant room for improving the design of PIM institutions, both across and within country groups.
  - Using a scoring system ranging from 0 to 10, with 10 indicating full alignment with good PIM practices, EMs, on average, score higher in design compared to LIDCs.
  - Europe scores higher in design than other regions; Africa is the weakest.
  - Dispersion within groups is material (example: Africa scores range from 1.3 to 6.4).
  - Even the best performing countries in EMs and LIDCs have much room for improving design relative to the maximum score of 10.
- Distribution across the investment cycle:
  - Institutions are better designed in the planning stage compared to the allocation and implementation stages.
  - Highest design scores found in: budget unity, budget comprehensiveness, and national planning (planning and allocation stages).
  - Weakest design scores found in allocation and implementation stages, notably: project appraisal, project selection, project management, and asset monitoring.
  - Management of PPPs is a relatively low-scoring institution even in the planning stage, reflecting lack of well-designed PPP frameworks in many countries.
- EMs vs LIDCs:
  - EMs show overall better design scores than LIDCs.
  - EMs score better or similar to LIDCs across most institutions, except national and sectoral planning, where LIDCs sometimes score higher due to historical development planning legacies (e.g., PRSPs).
  - EMs have relatively better-designed institutions for availability of funding and company regulation; both groups show similar weaknesses in project appraisal and selection.

### Key Findings — Effectiveness
- General pattern:
  - Countries are better in designing PIM institutions than in implementing them effectively.
  - For almost all PIM institutions, design scores exceed effectiveness scores.
- Largest design–effectiveness gaps observed in:
  - National and sectoral planning:
    - Many countries have formal plans, but they are often fragmented, not properly costed, not aligned with the medium-term framework and annual budget, and do not inform public investment decisions.
  - Multiyear budgeting:
    - Half of assessed countries publish medium-term estimates for capital spending by ministry or sector; the other half publish at least aggregate capital ceilings.
    - Forecasts of public investment for two or more years ahead are often unreliable, limiting benefits of medium-term budgeting.
  - Transparency of execution:
    - Most countries have procedures to ensure procurement transparency, but PIMAs revealed significant non-compliance by procuring agencies.
    - Central monitoring mechanisms of project implementation frequently do not result in corrective actions.
  - Project selection:
    - Some countries have standardized technical criteria per good international practices, but governments frequently do not implement these criteria in practice.

### Findings on Economic Impact and Rationale
- Efficiency and growth:
  - The average country loses about 30 percent of the value of its investment to inefficiencies in its public investment processes.
  - Improvements in infrastructure governance can help countries close up to two-thirds of that “efficiency gap.”
  - The most efficient investors get twice the growth “bang” for their investment “buck” than the least efficient investors.

### Framework Features and Assessment Mechanics
- 2015 framework essentials:
  - PIMA evaluates 15 institutions across planning, allocation, and implementation.
  - Most PIMAs assess institutions from three perspectives: institutional design, effectiveness, and reform priority.
  - Design is scored via a three-level classification (low, medium, high) in the 2015 descriptive framework; the updated framework preserves the three-phase structure and three-dimension approach.
- Scoring and comparisons:
  - Scores used in comparative analysis: 0 to 10 scale for design (10 = full alignment with good practice).
  - PIMA scores are not released for countries that have not agreed to publication.

### Application and Use of PIMAs
- Use cases:
  - PIMA results and recommendations have been used in IMF lending, surveillance, and capacity development (CD) work.
  - PIMAs have improved coordination among CD providers and informed reform sequencing.
- Publication and confidentiality:
  - Publication of PIMAs is voluntary; many countries prefer internal use to guide reforms.

*Source: EXECUTIVE SUMMARY, PUBLIC INVESTMENT MANAGEMENT ASSESSMENT: REVIEW AND UPDATE, April 25, 2018 (International Monetary Fund).*

### 11.      However, countries sometimes are better at protecting investment spending than

### PUBLIC INVESTMENT MANAGEMENT ASSESSMENT: REVIEW AND UPDATE

### Design vs. Effectiveness of PIM Institutions
- Countries sometimes protect investment spending in practice more than institutional design implies; line ministries may sign multiyear contracts or renew one-year contracts without another procurement process.
- Figure note: Number of observations 27. Effectiveness scores for three of the 30 countries are not available.

### Reform priorities (PIMA recommendations)
- PIMAs provide prioritized recommendations focused on institutions with low effectiveness scores.
- Most frequent measures recommended:
  - Project selection
    - 90 percent of PIMAs contained recommendations to strengthen project selection.
    - Recommendations include establishing a pipeline of projects, developing a comprehensive project database, and defining and/or improving project guidelines and selection criteria.
  - Project appraisal
    - 86 percent of PIMAs proposed developing and implementing guidelines for project appraisal (including cost-benefit and risk analysis).
  - Multiyear budgeting
    - 76 percent of PIMAs proposed country-specific measures to improve credibility of multiyear budgeting, including improving transparency over multi-annual commitments, better assessment of fiscal space for new projects, establishing capital budget ceilings, or publishing existing ceilings.
  - Management of PPPs
    - 72 percent of PIMAs recommended integrating PPPs into the overall PIM framework and improving budgeting, accounting and reporting of PPP operations, including long-term commitments and contingent liabilities.
  - Project management
    - Recommendations included adopting project management guidelines, training, centralized monitoring, and piloting/implementing ex-post reviews.
  - National and sectoral planning
    - Recommendations included improving costing of plans, consolidating sector strategies, and introducing overall national strategies.

### Efficiency gap and impact of reforms
- The 2015 Board papers found about 30 percent of the benefit of public investment is lost in weaknesses in the investment management process.
- The most efficient countries double the impact of public investment on growth, relative to the least efficient.
- Strengthening PIM through better-designed and more effective institutions can close up to two-thirds of the public investment efficiency gap.
- Staff estimates of the efficiency gap for each country were based on the methodology developed in the 2015 Board Paper and included in all PIMA reports.

### Application of PIMAs: demand, usefulness, and follow-up
- Demand and uptake
  - Since launch in mid-2015, on average, ten countries per year have requested a PIMA; staff expects this level of demand to continue.
- Perceived benefits and usage
  - PIMAs provide a standard framework to assess infrastructure governance, allow cross-country comparisons, and help develop an overarching strategy for PIM accessible to policy makers and development partners.
  - One post-PIMA survey: questionnaires sent to 30 countries; 19 responses.
    - All respondents indicated PIMAs comprehensively captured key elements of PIM institutions and were useful in distinguishing institutional design (de jure) and institutional effectiveness (de facto).
    - Nearly all respondents found PIMAs accurately reflected the state of PIM and provided relevant recommendations.
    - Approximately three quarters of respondents found PIMAs useful in informing CD and external financing needs.
    - All respondents indicated they introduced reform measures to improve public investment efficiency based on PIMA recommendations.
    - Most countries would consider an update of PIMA evaluation within 2–4 years to assess progress.
- Integration with IMF work and country programs
  - PIMA teams regularly consult area departments and include comments before finalizing reports, contributing to program design (e.g., structural benchmarks) and surveillance (e.g., SIPs).
  - Examples of PIMA influence include structural benchmarks and program measures in multiple countries (e.g., Kyrgyz Republic, Ireland, Togo, Côte d’Ivoire).
- Mobilizing external funding and coordination
  - PIMAs have helped mobilize and coordinate external funding and CD:
    - Mozambique: three-year program with approximately US$2 million in funding toward strengthening PIM.
    - Madagascar: World Bank follow-up interventions to revive PIM manual, strengthen project appraisal, and provide training.
    - Togo: World Bank five-year project with approximately US$10 million in funding to strengthen PIM.
    - Zambia: World Bank, EU and African Development Bank used PIMA results in country programs.
    - Maldives: US$12 million additional financing of the capital budget under the World Bank’s PFM Systems Strengthening Project is informed by the 2016 PIMA report; the project will be presented to the World Bank Board on May 30, 2018.
- Third-party recognition and critique
  - ODI review (September 2017) favorably noted PIMA’s emphasis on budgetary and fiduciary concerns and institutional features needed for fiscal sustainability.
  - ODI suggested limitations including potential under-emphasis on downstream aspects of implementation, maintenance, and operation; many of these issues are addressed in the revised PIMA framework.

### Lessons learned from PIMA implementation
- Framework strengths
  - The three-phase PIMA structure—planning, allocation, implementation—works well, is easy to communicate, flexible, and reinforces equal weight across phases for achieving public investment efficiency.
- Cost-effective assessments
  - Typical mission teams are four to five staff/experts; country self-assessments and short pre-mission visits improved evaluation quality and ownership.
- Areas needing deeper analysis and framework adjustments
  - Initial PIMA framework was seen as deficient in some areas and redundant in others; a stronger focus was needed on procurement, maintenance, independent review of projects, and portfolio management.
  - The revised PIMA framework seeks to address these issues.
- Implementation channels and fiscal risks
  - The PIMA originally took central government ministries as primary reference, but assessments showed subnational governments and public corporations often account for a large share of infrastructure services, especially in EMs.
  - Public corporations dominate areas such as water and energy provision, and long-distance rail; PPPs, though smaller, are growing, generate significant fiscal risks, and can circumvent required public investment rules and procedures.
  - The adjusted PIMA framework distinguishes more clearly between alternative implementation channels for public investment.
- Cross-cutting issues
  - Legal/regulatory frameworks, IT-support services, and general staff capacity act as system enablers that affect the effectiveness of the 15 core PIM institutions.
  - Given complexity, a qualitative assessment of cross-cutting issues (rather than full integration into scoring) is preferred.

*Source: PUBLIC INVESTMENT MANAGEMENT ASSESSMENT: REVIEW AND UPDATE (excerpts).*

### 27.      Updates to the PIMA framework were made in consultation with assessment teams,

### pp042518public-investment-management-assessment - 27.      Updates to the PIMA framework were made in consultation with assessment teams,

### Updates to the PIMA framework
- Updates were made in consultation with assessment teams, country authorities, and external stakeholders, reflecting recommendations of an IMF-World Bank working group that received inputs from mission teams, country authorities, and other stakeholders.
- The revised framework maintains the existing structure and total number of institutions while adjusting their composition.
- The revised PIMA framework seeks to accommodate the World Bank’s assessment structure (the eight PIM “Must-Haves”), while maintaining the comprehensive analytical character of the PIMA framework.

### Four major aspects given more in-depth focus
- Maintenance
  - Public capital provides benefits beyond the initial investment; appraisal and selection are based on present value of returns over the asset’s life.
  - Lack of routine maintenance threatens expected returns and undermines efficient allocation.
  - The revised framework includes a specific institution on maintenance and emphasizes budgeting for both routine and capital maintenance using a methodology to estimate required expenditure.
- Procurement
  - Technical efficiency of public investment spending is as important as appraisal and selection.
  - Procurement deficiencies can cause higher costs, lower quality, longer construction time, and increased corruption risk.
  - The revised framework establishes a dedicated PIMA institution for procurement.
- Independent review of projects
  - Independent experts and organizations in appraisal, selection, and ex-post review help ensure high-quality and unbiased assessments, counter political influence, and reduce corruption.
  - Independent review was expanded as an evaluation criterion.
- Enabling environment
  - Three cross-cutting “enablers” are identified: (1) a supportive legal framework; (2) good systems for managing information; and (3) adequate staff capacity, with clear roles and responsibilities.
  - These enablers are assessed qualitatively and separately, focusing on how they support PIM institutions.

### Streamlining and rewording of institutions and criteria
- Fiscal principles and rules
  - Significant revisions emphasize fiscal policy’s role in providing a stable and predictable context for public investment planning, budgeting, financing, and execution.
- Public-private partnerships (PPPs)
  - PPPs are addressed across several relevant PIM institutions rather than in a single institution.
- Budget Comprehensiveness and Budget Unity
  - Merged into a single, new institution: Budget Comprehensiveness and Unity (reflected in the 2018 Revised phase mapping).
- Portfolio management and oversight
  - Evaluation criteria modified to clarify portfolio-level challenges (e.g., shifting funds across approved projects, managing multiple concurrent projects).
- Public corporations and financing sources
  - Coverage expanded to include public corporations and all potential financing sources.

### Comparison highlights (2015 Framework → 2018 Revised)
- Phase I – Planning: PPPs moved into Project Appraisal; Regulation of Infrastructure Companies became Alternative Infrastructure Financing; Budget Unity consolidated under Budget Comprehensiveness and Unity.
- Phase II – Allocation: New institution on Maintenance Funding added; Project Appraisal and Project Selection retained.
- Phase III – Implementation: Procurement becomes a distinct institution; Portfolio Management and Oversight added.
- Cross-cutting issues assessed qualitatively include IT support, legal framework, and staff capacity with clear roles and responsibilities.

### Scoring, prioritization, and evaluation practice
- PIMA scoring is two-fold: institutional design and effectiveness.
  - Separate scores underscore that good on-paper policies do not guarantee effective implementation.
- PIMAs will contain a ranking of reform priorities to design sequenced, prioritized reform plans.
  - Typically, low scores on both design and effectiveness lead to a recommendation of high reform priority.
  - High-priority recommendations also apply to reforms that could significantly impact public investment efficiency and are readily implementable.

### Implementation, monitoring, and capacity development (CD)
- PIMAs have proven helpful for countries reforming PIM frameworks to improve public investment efficiency.
- Without robust PIM frameworks, increased investment spending may not yield improved growth and could increase fiscal risk.
- PIMAs assist countries in identifying growth-supportive reform priorities and priorities for CD support to achieve SDGs.
- A Guidance Note on how to apply the PIMA questionnaire will be prepared.
- Implementation of PIMA recommendations will be closely monitored by staff and supported by CD, emphasizing follow-up actions at the country level.
  - Progress measured via monitoring implementation of reform plans and repeat PIMAs at reasonable intervals.
  - Countries can use reform plans to coordinate development partner support.
- CD support
  - CD to support infrastructure governance reforms can be provided upon request, consistent with the Fund’s CD mandate and resource envelope.
  - Follow-up CD will be integrated into the usual resource allocation planning (RAP) processes and focus on macro-critical reforms within the Fund’s mandate, mainly in fiscal governance.
  - MDBs and bilateral development agencies are called upon to use PIMAs to support procurement, project appraisal, and infrastructure regulation reforms.
- Resource balancing
  - Staff will balance resources between conducting new PIMAs and meeting demand for CD follow-up, informed by CD RAP processes.
- Publication
  - Staff will continue to encourage country authorities to publish their PIMAs to draw attention to key issues, strengthen public support for reform, and invite external support.

### Selected features of Annex I — The Updated PIMA Questionnaire (sample items and scoring tiers)
- A. Planning Sustainable Levels of Public Investment
  - 1. Fiscal targets and rules: presence of targets/limits for debt sustainability and permanent fiscal rules; existence and scope of a medium-term fiscal framework (MTFF).
    - Examples of answer tiers preserved verbatim:
      - "There is no target or limit to ensure debt sustainability."
      - "There is at least one target or limit to ensure central government debt sustainability."
      - "There is at least one target or limit to ensure general government debt sustainability."
      - "There are no permanent fiscal rules."
      - "There is at least one permanent fiscal rule applicable to central government."
      - "There is at least one permanent fiscal rule applicable to central government, and at least one comparable rule applicable to a major additional component of general government, such as subnational government (SNG)."
      - "There is no MTFF prepared prior to budget preparation."
      - "There is an MTFF prepared prior to budget preparation but it is limited to fiscal aggregates, such as expenditure, revenue, the deficit, or total borrowing."
      - "There is an MTFF prepared prior to budget preparation, which includes fiscal aggregates and allows distinctions between recurrent and capital spending, and ongoing and new projects."
  - 2. National and Sectoral Planning: existence, publication, and comprehensiveness of national and sectoral public investment strategies; whether strategies are costed; inclusion of measurable targets for outputs and outcomes.
    - Sample answer tiers include:
      - "National or sectoral public investment strategies or plans are prepared, covering only some projects found in the budget."
      - "National or sectoral public investment strategies or plans are published covering projects funded through the budget."
      - "Both national and sectoral public investment strategies or plans are published and cover all projects funded through the budget regardless of financing source (e.g., donor, public corporation (PC), or PPP financing)."
      - Costing tiers range from "no cost information" to "costing of individual, major investment projects within an overall financial constraint."
      - Targets tiers range from "do not include measurable targets" to "include measurable targets for both outputs and outcomes (e.g., reduction in traffic congestion)."
  - 3. Coordination between Entities: coordination of SNG capital spending with central government; transparent, rule-based capital transfer systems with timely information; reporting of contingent liabilities from SNGs, PCs, and PPPs.
    - Example tiers include notification timing: "SNGs are notified about expected transfers less than six months before the start of each fiscal year" versus "expected transfers are made known to SNGs at least six months before the start of each fiscal year."
  - 4. Project Appraisal: whether major projects undergo rigorous technical, economic, and financial analysis; existence of standard methodology and central support for appraisal; risk assessment and mitigation planning.
    - Tiers include publication or independent external review of selected results.
  - 5. Alternative Infrastructure Financing: regulatory support for competition; published PPP strategy/policy and legal/regulatory framework; oversight and consolidated reporting on PCs’ investment plans and financial performance.
  - B. Ensuring Public Investment is Allocated to the Right Sectors and Projects
    - 6. Multiyear Budgeting: publication of capital spending projections over a three to five-year horizon, multiyear ceilings (indicative or binding), and publication of total construction cost projections with annual breakdowns over a three-five-year horizon.

*Source: PUBLIC INVESTMENT MANAGEMENT ASSESSMENT: REVIEW AND UPDATE (excerpts from the provided content).*

### 7. Budget Comprehensiveness and Unity: To what extent is capital spending, and related recurrent spending, undertaken th

### 7. Budget Comprehensiveness and Unity: To what extent is capital spending, and related recurrent spending, undertaken through the budget process?

### Budget comprehensiveness and unity (questions 7.a–7.c)
- 7.a. Is capital spending mostly undertaken through the budget?
  - Significant capital spending is undertaken by extra-budgetary entities with no legislative authorization or disclosure in the budget documentation.
  - Significant capital spending is undertaken by extra-budgetary entities, but with legislative authorization and disclosure in the budget documentation.
  - Little or no capital spending is undertaken by extra-budgetary entities.
- 7.b. Are all capital projects, regardless of financing source, shown in the budget documentation?
  - Capital projects are not comprehensively presented in the budget documentation, including PPPs, externally financed, and PCs’ projects.
  - Most capital projects are included in the budget documentation, but either PPPs, externally financed, or PCs’ projects are not shown.
  - All capital projects, regardless of financing sources, are included in the budget documentation.
- 7.c. Are capital and recurrent budgets prepared and presented together in the budget?
  - Capital and recurrent budgets are prepared by separate ministries, and/or presented in separate budget documents.
  - Capital and recurrent budgets are prepared by a single ministry and presented together in the budget documents, but without using a program or functional classification.
  - Capital and recurrent budgets are prepared by a single ministry and presented together in the budget documents, using a program or functional classification.

### Budgeting for Investment (questions 8.a–8.c)
- 8.a. Are total project outlays appropriated by the legislature at the time of a project’s commencement?
  - Outlays are appropriated on an annual basis, but information on total project costs is not included in the budget documentation.
  - Outlays are appropriated on an annual basis, and information on total project costs is included in the budget documentation.
  - Outlays are appropriated on an annual basis and information on total project costs, and multiyear commitments is included in the budget documentation.
- 8.b. Are in-year transfers of appropriations (virement) from capital to current spending prevented?
  - There are no limitations on virement from capital to current spending.
  - The finance ministry may approve virement from capital to current spending.
  - Virement from capital to current spending requires the approval of the legislature.
- 8.c. Is the completion of ongoing projects given priority over starting new projects?
  - There is no mechanism in place to protect funding of ongoing projects.
  - There is a mechanism to protect funding for ongoing projects in the annual budget.
  - There is a mechanism to protect funding for ongoing projects in the annual budget and over the medium term.

### Maintenance Funding (questions 9.a–9.c)
- 9.a. Is there a standard methodology for estimating routine maintenance needs and budget funding?
  - There is no standard methodology for determining the needs for routine maintenance.
  - There is a standard methodology for determining the needs for routine maintenance and its cost.
  - There is a standard methodology for determining the needs for routine maintenance and its cost, and the appropriate amounts are generally allocated in the budget.
- 9.b. Is there a standard methodology for determining major improvements (e.g. renovations, reconstructions, enlargements) to existing assets and are they included in national and sectoral investment plans?
  - There is no standard methodology for determining major improvements, and they are not included in national or sectoral plans.
  - There is a standard methodology for determining major improvements, but they are not included in national or sectoral plans.
  - There is a standard methodology for determining major improvements, and they are included in national or sectoral plans.
- 9.c. Can expenditures relating to routine maintenance and major improvements be identified in the budget?
  - Routine maintenance and major improvements are not systematically identified in the budget.
  - Routine maintenance and major improvements are systematically identified in the budget.
  - Routine maintenance and major improvements are systematically identified in the budget, and are reported.

### Project Selection (questions 10.a–10.c)
- 10.a. Does the government undertake a central review of major project appraisals before decisions are taken to include projects in the budget?
  - Major projects (including donor- or PPP-funded) are not reviewed by a central ministry prior to inclusion in the budget.
  - Major projects (including donor- or PPP-funded) are reviewed by a central ministry prior to inclusion in the budget.
  - All major projects (including donor- or PPP-funded) are scrutinized by a central ministry, with input from an independent agency or experts prior to inclusion in the budget.
- 10.b. Does the government publish and adhere to standard criteria, and stipulate a required process for project selection?
  - There are no published criteria or a required process for project selection.
  - There are published criteria for project selection, but projects can be selected without going through the required process.
  - There are published criteria for project selection, and generally projects are selected through the required process.
- 10.c. Does the government maintain a pipeline of appraised investment projects for inclusion in the annual budget?
  - The government does not maintain a pipeline of appraised investment projects.
  - The government maintains a pipeline of appraised investment projects but other projects may be selected for financing through the annual budget.
  - The government maintains a comprehensive pipeline of appraised investment projects, which is used for selecting projects for inclusion in the annual budget, and over the medium term.

### C. Delivering Productive and Durable Public Assets

### Procurement (questions 11.a–11.c)
- 11.a. Is the procurement process for major capital projects open and transparent?
  - Few major projects are tendered in a competitive process, and the public has limited access to procurement information.
  - Many major projects are tendered in a competitive process, but the public has only limited access to procurement information.
  - Most major projects are tendered in a competitive process, and the public has access to complete, reliable and timely procurement information.
- 11.b. Is there a system in place to ensure that procurement is monitored adequately?
  - There is no procurement database, or the information is incomplete or not timely for most phases of the procurement process.
  - There is a procurement database with reasonably complete information, but no standard analytical reports are produced from the database.
  - There is a procurement database with reasonably complete information, and standard analytical reports are produced to support a formal monitoring system.
- 11.c. Are procurement complaints review process conducted in a fair and timely manner?
  - Procurement complaints are not reviewed by an independent body.
  - Procurement complaints are reviewed by an independent body, but the recommendations of this body are not produced on a timely basis, nor published, nor rigorously enforced.
  - Procurement complaints are reviewed by an independent body whose recommendations are timely, published, and rigorously enforced.

### Availability of Funding (questions 12.a–12.c)
- 12.a. Are ministries/agencies able to plan and commit expenditure on capital projects in advance on the basis of reliable cash-flow forecasts?
  - Cash-flow forecasts are not prepared or updated regularly, and ministries/agencies are not provided with commitment ceilings in a timely manner.
  - Cash-flow forecasts are prepared or updated quarterly, and ministries/agencies are provided with commitment ceilings at least a quarter in advance.
  - Cash-flow forecasts are prepared or updated monthly, and ministries/agencies are provided with commitment ceilings for the full fiscal year.
- 12.b. Is cash for project outlays released in a timely manner?
  - The financing of project outlays is frequently subject to cash rationing.
  - Cash for project outlays is sometimes released with delays.
  - Cash for project outlays is normally released in a timely manner, based on the appropriation.
- 12.c. Is external (donor) funding of capital projects fully integrated into the main government bank account structure?
  - External financing is largely held in commercial bank accounts outside the central bank.
  - External financing is held at the central bank, but is not part of the main government bank account structure.
  - External financing is fully integrated into the main government bank account structure.

### Portfolio Management and Oversight (questions 13.a–13.c)
- 13.a. Are major capital projects subject to monitoring during project implementation?
  - Most major capital projects are not monitored during project implementation.
  - For most major projects, annual project costs, as well as physical progress, are monitored during project implementation.
  - For all major projects, total project costs, as well as physical progress, are centrally monitored during project implementation.
- 13.b. Can funds be re-allocated between investment projects during implementation?
  - Funds cannot be re-allocated between projects during implementation.
  - Funds can be reallocated between projects during implementation, but not using systematic monitoring and transparent procedures.
  - Funds can be re-allocated between projects during implementation, using systematic monitoring and transparent procedures.
- 13.c. Does the government adjust project implementation policies and procedures by systematically conducting ex-post reviews of projects that have completed their construction phase?
  - Ex-post reviews of major projects are neither systematically required, nor frequently conducted.
  - Ex-post reviews of major projects, focusing on project costs, deliverables and outputs, are sometimes conducted.
  - Ex-post reviews of major projects focusing on project costs, deliverables, and outputs are conducted regularly by an independent entity or experts, and are used to adjust project implementation policies and procedures.

### Management of Project Implementation (questions 14.a–14.c)
- 14.a. Do ministries/agencies have effective project management arrangements in place?
  - Ministries/agencies do not systematically identify senior responsible officers for major investment projects, and implementation plans are not prepared prior to budget approval.
  - Ministries/agencies systematically identify senior responsible officers for major investment projects, but implementation plans are not prepared prior to budget approval.
  - Ministries/agencies systematically identify senior responsible officers for major investment projects, and implementation plans are prepared prior to budget approval.
- 14.b. Has the government issued rules, procedures and guidelines for project adjustments that are applied systematically across all major projects?
  - There are no standardized rules and procedures for project adjustments.
  - For major projects, there are standardized rules and procedures for project adjustments, but do not include, if required, a fundamental review and reappraisal of a project’s rationale, costs, and expected outputs.
  - For all projects, there are standardized rules and procedures for project adjustments and, if required, include a fundamental review of the project’s rationale, costs, and expected outputs.
- 14.c. Are ex-post audits of capital projects routinely undertaken?
  - Major capital projects are usually not subject to ex-post external audits.
  - Some major capital projects are subject to ex-post external audit, information on which is published by the external auditor.
  - Most major capital projects are subject to ex-post external audit information on which is regularly published and scrutinized by the legislature.

### Monitoring of Public Assets (questions 15.a–15.c)
- 15.a. Are asset registers updated by surveys of the stocks, values, and conditions of public assets regularly?
  - Asset registers are neither comprehensive nor updated regularly.
  - Asset registers are either comprehensive or updated regularly at reasonable intervals.
  - Asset registers are comprehensive and updated regularly at reasonable intervals.
- 15.b. Are nonfinancial asset values recorded in the government financial accounts?
  - Government financial accounts do not include the value of non-financial assets.
  - Government financial accounts include the value of some non-financial assets, which are revalued irregularly.
  - Government financial accounts include the value of most nonfinancial assets, which are revalued regularly.
- 15.c. Is the depreciation of fixed assets captured in the government’s operating statements?
  - The depreciation of fixed assets is not recorded in operating statements.
  - The depreciation of fixed assets is recorded in operating statements, based on statistical estimates.
  - The depreciation of fixed assets is recorded in operating expenditures, based on asset-specific assumptions.

### Cross-cutting issues
- A IT support. Is there a comprehensive computerized information system for public investment projects to support decision making and monitoring?
- B Legal Framework. Is there a legal and regulatory framework that supports institutional arrangements, mandates, coverage, procedures, standards and accountability for effective PIM?
- C Staff capacity. Does staff capacity (number of staff and/or their knowledge, skills, and experience) and clarity of roles and responsibilities support effective PIM institutions?

### Annex II. Sample PIMA Summary Outputs
- A. PIMA Scoring Heatmap for Jordan
  - Phase / Institution — Design Effectiveness Reform Priorities
  - A. Planning
    - 1 Fiscal rules Medium Low Medium
    - 2 National and sectoral planning Medium Low High
    - 3 Central-local coordination Medium Low Medium
    - 4 Public-private partnerships Medium Low High
    - 5 Regulation of infrastructure companies Medium Low High
  - B. Allocation
    - 6 Multiyear budgeting Medium Medium Low
    - 7 Budget comprehensiveness Medium Medium Medium
    - 8 Budget unity Good Medium Low
    - 9 Project appraisal Low Low High
    - 10 Project selection Low Low Medium
  - C. Implementation
    - 11 Protection of investment Low Medium Medium
    - 12 Availability of funding Medium Low Medium
    - 13 Transparency of execution Medium Medium Medium
    - 14 Project management Medium Low Medium
    - 15 Assets accounting Low Low High
- B. PIMA Peer Comparison Chart for Jordan
  - Source: Jordan: Technical Assistance Report: Public Investment Management Assessment, December 2017, IMF Country Report No. 17/366.

*PUBLIC INVESTMENT MANAGEMENT ASSESSMENT: REVIEW AND UPDATE*

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_Source: https://www.imf.org/-/media/files/publications/pp/2018/pp042518public-investment-management-assessment.pdf_