Impact Evaluation of the Public Finance Modernization Support Project Financed by the African Development Bank in the Democratic Republic of Congo

Independent Development Evaluation conducted an impact evaluation of the Public Finance Modernization Support Project (PAM-FP) in the Democratic Republic of Congo (DRC), financed by the African Development Bank Group (AfDB or "the Bank"). This project was approved in 2012 for a total of UA 10 million (15 million USD) from the African Development Fund and was completed in 2017.

The evaluation aimed to provide the Bank’s Board of Directors and Management with credible estimates of the impact of institutional support on public finance management and resource mobilization, useful lessons, and potential areas of improvement, to inform the design and implementation of new projects under the Bank Group's Strategy for Economic Governance in Africa (2021-2025), as approved by the Board in February 2021.

Being an impact evaluation, it applied counterfactual methods to estimate the causal effects of the project. Specifically, it compared a group of 2,669 beneficiaries from the 5 provinces covered by the project (the treated group) with a similar group of 2,331 actors from 8 provinces not covered by the project (the control group) immediately after the project’s completion. Among others, the evaluation found that PAM-FP made it possible to increase domestic resource mobilization in the beneficiary provinces, by 10% per year on average. It also increased the efficiency of public expenditure, with economic agents in treated provinces reporting greater access to waste disposal services, good roads, electricity connection, and drinking water than those in untreated provinces. The project also improved the working conditions of tax administration agents and officers in the treated provinces. The evaluation also found that users have a lower sense of unfairness and are less likely to face corruption in the tax administration in treated than in untreated provinces. An issue of concern is the project’s sustainability since there are no financial mechanisms to ensure its institutional and technical sustainability, and the buildings, materials and equipment provided will degrade over time.

The key lessons drawn from the evaluation were: (i) Institutional support for public finance modernization contributes to the improvement of domestic resource mobilization; (ii) A strategy for managing properly trained human resources is essential to the sustainability of institutional support project outcomes; (iii) The absence of an equipment maintenance mechanism undermines the sustainability of infrastructure, transport equipment, and IT systems; and (iv) Donor coordination enhances support to countries.

The recommendations made included: strengthening institutional support projects in the governance sector to ensure the long-term sustainability of outcomes; improving the results-based management of development outcomes to facilitate implementation, monitoring, and evaluation of outcomes; and strengthening the ongoing policy dialogue with other Technical and Financial Partners on governance issues, including on harmonization of the interventions of the Bank and those of other donors in the sector.

Evaluation Task Manager: Eric Kéré, Senior Evaluation Officer