sustainable environment support programme (sesp), bhutan ...€¦ · sustainable environment...

Sustainable Environment Support Programme (SESP), Bhutan

Programme Document

31 October 2009

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Programme Document

31 October 2009

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Map of Bhutan

Political Map of Bhutan

Note: The shaded Dzongkhags are the five poorest


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List of Contents Map of Bhutan .................................................................................................................................... iii Executive summary .............................................................................................................................. x 1. Introduction .................................................................................................................................. 1

1.1 Development cooperation between Bhutan and Denmark ................................................... 1 1.2 Events leading to the SESP formulation .............................................................................. 1 1.3 Lessons from previous development collaboration ............................................................. 2

2. National and sector context .......................................................................................................... 3 2.1 The national and poverty context ......................................................................................... 3

2.2 The development context ..................................................................................................... 4 2.3 The environment context ..................................................................................................... 5 2.4 Climate change and natural hazards ..................................................................................... 8 2.5 Local government reforms ................................................................................................... 9 2.6 Public financial management and procurement ................................................................. 13

2.7 Cross-cutting issues and priority themes ........................................................................... 15 2.8 Donor coordination mechanisms ....................................................................................... 16

3. Agreed assistance ....................................................................................................................... 17 3.1 The proposed support ......................................................................................................... 17 3.2 Objectives........................................................................................................................... 17 3.3 Strategic Approach ............................................................................................................. 18

3.4 Technical assistance ........................................................................................................... 20 3.5 Cross-cutting issues and priority themes ........................................................................... 21

3.6 Development partner harmonisation and alignment .......................................................... 21 4. Components of SESP ................................................................................................................. 22

4.1 Component 1: Budget support for capital investments in Gewogs .................................... 22

4.2 Component 2: Support for capacity development for environmental mainstreaming ....... 25 5. Programme management and organisation ................................................................................ 27

5.1 Programme management.................................................................................................... 27

5.2 SESP Steering Committees ................................................................................................ 29

6. Programme budget and financial management .............................................................................. 31 6.1 SESP grant ......................................................................................................................... 31 6.2 Financial management ....................................................................................................... 32

7 Assessment of key risks ............................................................................................................. 35

8 Monitoring, reporting, reviews and evaluations ........................................................................ 38 8.1 National monitoring and evaluation framework ................................................................ 38 8.2 Reviews .............................................................................................................................. 40

9 Implementation .......................................................................................................................... 42 Annex A: Environment in the 10

th FYP ............................................................................................. 44

Annex B: Overview of Environmental related legislation in Bhutan ................................................ 47 Annex C: ToR for District Environmental Officers ........................................................................... 51 Annex D: External Development Partners in Environmental, Natural Resource and Climate Change

............................................................................................................................................................ 53 Annex E: Resource Allocation for the 205 Gewogs in Bhutan ......................................................... 55 Annex F: Draft Format for Gewog Environmental Expenditure Assessment (ex-post Output

Statement Study) ................................................................................................................................ 59

Annex G: Proposed State of Environment (SoE) Output and Outcome Gewog Indicators .............. 60


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Tables:

Table 1: Annual sequence for grant instalments ................................................................................ 23 Table 2: SESP Budget Summary ....................................................................................................... 31 Table 3: SESP Budget according to Bhutan‟s financial year (DKK million) .................................... 31 Table 4: SESP Budget according to Denmark‟s financial year (DKK million) ................................ 32 Table 5: Flow of funds and financial management ............................................................................ 34

Figures:

Figure 1: Annual grants flow of funds ........................................................................................... 11 Figure 2: Flow of funds and NMES reporting and monitoring ................................................... 12

Text Boxes:

Box 1: Millennium Development Goals (MDG) .............................................................................. 4

Box 2: Environment as a cross-cutting theme in the 10th

FYP ...................................................... 6 Box 3: Evolution of local governance ............................................................................................. 10

Box 4: Bhutan and the Corruption Perception Index .................................................................. 13

Box 5: Proposed positive list for assessment of the environment contents ................................. 24


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List of Abbreviations

ADA Austrian Development Agency

APR Annual Programme Review

BAS Budget and Accounting System

BCCI Bhutan Chamber of Commerce and Industry

BPFFS Budget Policy and Fiscal Framework Statement

CBS Centre for Bhutan Studies

CEDAW Convention on the Elimination of all forms of Discrimination

Against Women

CEO Chief Executive Officer

CNR College of Natural Resources

CRC Convention on the Rights of the Child

CSO Civil Society Organisation

Danida Danish International Development Assistance

DDC District/ Dzongkhag Development Committee

DEC District/ Dzongkhag Environment Committee

DEO District/Dzongkhag Environment Officer

DKK Kroner (currency of Denmark)

DoA Department of Agriculture

DoF Department of Forests (MoA)

DoL Department of Livestock (MoA)

DPA Department of Public Accounts (MoF)

DPO District/Dzongkhag Planning Officer

DT Dzongkhag Tshogdu (District Committee)

DYT Dzongkhag Yargye Tshogdu (District Development Committee)

ECP Environment-Climate Change-Poverty

EFRC Environment-friendly Road Construction

EIMS Environmental Information Management System

ESPS Environment Sector Programme Support

EUSPS Environment and Urban Sector Programme Support (Danida)

FAO Food and Agriculture Organization of the United Nations

FRR Financial Rules & Regulations

FY Fiscal Year

FYP Five-Year Plan (of Bhutan)

GAO Gewog Administrative Officer

GCM Global Circulation Model

GDP Gross Domestic Product

GEF Global Environmental Facility


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GHG Greenhouse Gases

GIS Geographic Information System

GLOF Glacial Lake Outburst Flood

GNH Gross National Happiness

GNHC Gross National Happiness Commission (RGoB)

GT Gewog Tshogde (Block Committee)

GYT Gewog Yargye Tshogchung (Block Development Committee)

HDI Human Development Index

HRD Human Resources Development

ICBP Integrated Capacity Building Plan (for local governments)

ICDP Integrated Conservation and Development Programme

IMS Institute for Management Studies

INC Initial National Communication (to UNFCCC)

IPCC Intergovernmental Panel on Climate Change

JICA Japan International Cooperation Agency

JSP-SC Joint Support Programme Steering Committee

LDCF Least Developed Countries Fund

LDD Local Development Division (of GNHC)

LDPM Local Development Planning Manual

LG Local Government

LGSP Local Governance Support Programme

LOD Liaison Office of Denmark (in Thimphu, Bhutan)

MDGs Millennium Development Goals

MFA Ministry of Foreign Affairs (of Bhutan)

MoA Ministry of Agriculture (of Bhutan)

M&E Monitoring and Evaluation

MoEA Ministry of Economic Affairs (of Bhutan)

MoF Ministry of Finance (of Bhutan)

MoHCA Ministry of Home and Cultural Affairs (of Bhutan)

MoLHR Ministry of Labour and Human Resources (of Bhutan)

MoWHS Ministry of Works and Human Settlement

MSME Micro, Small and Medium Enterprises

MYRB Multi-Year Rolling Budget

MYRBF Multi-Year Rolling Budget Framework

NAPA National Adaptation Programme of Action (Climate Change)

NEC National Environment Commission (of Bhutan)

NECS National Environment Commission Secretariat

NEPA National Environment Protection Act 2007


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NGO Non-Government Organisation

NMEM National Monitoring and Evaluation Manual

NMES National Monitoring and Evaluation System

NPAG National Plan of Action for Gender

NSB National Statistics Bureau

Nu Ngultrum (Bhutanese currency)

PAR Poverty Analysis Report

PEER Public Environmental Expenditure Review

PEI Poverty Environment Initiative

PEMS Public Expenditure Management System

PlaMS Planning and Monitoring System

PMCD Plan, Monitoring and Coordination Division (of GNHC)

PMG Programme Management Group

PPD Policy and Planning Division

PSC Programme Steering Committee

RAA Royal Audit Authority

RDTC Rural Development Training Centre

REAP Rural Economic Advancement Programme

REDD Reducing Emissions from Deforestation and Degradation

RGoB Royal Government of Bhutan

RIM Royal Institute of Management

RNR Renewable Natural Resources

ROACH Results-oriented Approach to Capacity Development and Change

RSPN Royal Society for Protection of Nature

RTC Royal Thimphu College

SAARC South Asian Association for Regional Cooperation

SDC Swiss Agency for Development and Cooperation

SDGs SAARC Development Goals

SESP Sustainable Environment Support Programme (Denmark)

SLMP Sustainable Land Management Project (World Bank/GEF)

SNV Netherlands Development Organization

SoE State of Environment

TA Technical Assistance

TD Thromde Tshogde

TYD Thromde Yenlag Tshogde

ToR Terms of Reference

UNCDF United Nations Capital Development Fund

UNDP United Nations Development Programme


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UNEP United Nations Environment Programme

UNFCCC United Nations Framework Convention on Climate Change

UWICE Ugyen Wangchuck Institute for Conservation and Environment

WB World Bank

WTO World Trade Organisation

WWF World Wide Fund for Nature

List of Bhutanese Terms

Chathrim Law, statute

Chiwog Territorial constituency for the election of

Tshogpas to the Gewog Tshodge

Dzongdag District Administrator

Dzongkhag District

Dzongkhag Tshogdu District Council

Dzongkhag Yargye Tshogchung District Development Committee

Gewog A county, smallest geographical unit for public

administration, made up of a group of villages

Gewog Tshogde County Committee

Gewog Yargye Tshogchung County Development Committee

Gup Elected head of a county

Gyalyong Tshogdu National Assembly

Mangmi Elected deputy head of a county

Thromde Municipality

Thromde Tshogde Municipal Committee

Thromde Yenlag Tshogde Municipal Committee for a satellite town

Tshogpa Elected representative of a Chiwog

Exchange rate October 2009: BTN 100 = DKK 10.9; DKK 1.0 = BTN 9.1760


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Executive summary

Introduction

Danish development cooperation with Bhutan began in 1978. Bhutan has since 1989 been one of

the Danish programme cooperation countries. Denmark and Bhutan have had development

cooperation on environment for more than 15 years. The initial cooperation was on land-use

planning as well as support to the National Environmental Commission Secretariat (NECS) and

various activities related to watershed management, environmental management and legislation.

The Danish country strategy for development cooperation with Bhutan is the “Bhutan-Denmark

Partnership - Strategy for Development Cooperation (2008-2013)”. The priority sectors for the

Danish development assistance are: the social sector; environment and urban development; and

good governance.

The Royal Government of Bhutan (RGoB) and the Government of Denmark have agreed to prepare

and implement the four-year Sustainable Environment Support Programme (SESP). The SESP will

commence early 2010 and be finalised at the end of 2013. The SESP will be aligned with the last

three years of the 10th

Five-Year Plan (FYP) (2010/11-2012/13). It is noted in the Partnership

Strategy that the Danish assistance will be gradually phased out after 2013. The SESP will be the

last phase of cooperation between Denmark and Bhutan on environment applying the grant funding

modality. Future cooperation could continue with civil society and the private sector.

National and sector context

The 2008 Constitution of the Kingdom of Bhutan introduced a Democratic Constitutional

Monarchy. Free and universal elections were held to the National Council and National Assembly

in December 2007 and March 2008 respectively. The first elected parliamentary government was

formed on 11 April 2008. Local government elections are planned to be held in 2010 following the

enactment of the Local Governments‟ Act 2009 on 11 September 2009. Bhutan is known

worldwide for its philosophy of „Gross National Happiness‟ (GNH) as the guidance for

development in Bhutan. The development policy emphasises balanced economic development and

poverty reduction.

Protection of the environment and dependency on natural resources is deeply ingrained in Bhutan‟s

culture and economy. However, environmental conservation is becoming increasingly challenging

as the country opens up to meet the new development needs of a growing and modernizing

population. Pollution of air and water; reduced water resources; land degradation due to

unsustainable agriculture, deforestation and overgrazing; infrastructure development and mining;

solid waste; and biodiversity loss due to conversion of forest habitats are key challenges that

currently confront the country.

Climate change is a potential risk to development and livelihoods in Bhutan. The climate change

related natural hazards such as glacial lake outburst floods (GLOF), monsoon flash floods, and

landslides from heavy rainfall disrupt the livelihoods, access (transportation) and other parts of the

economy including agriculture, hydropower systems, industrial estates, and human settlements. The

pressures of land-use change, habitat degradation and infrastructure development compound the

threat of climate change further.

Protection of the environment and the dependency on natural resources is deeply enshrined in the

culture, and there is recognition that the environment and natural resources is important for all parts

of society and development in Bhutan. Environment is one of the four pillars of GNH. Environment


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is included as Article 5 of the National Constitution. Environment is included as a crosscutting

theme in the 10th

FYP, but environment is not defined as a sector.

Agreed assistance

The SESP will provide support to local governments (Dzongkhags and Gewogs) in two parallel sets

of interventions: 1) provision of investment capital to Gewogs; and 2) capacity development for

mainstreaming of environment, climate change and poverty concerns in policies, plans and

programmes – with the intent that the developed capacity will influence the way in which local

governments will plan and implement their development activities. SESP has been formulated in

accordance with the Bhutan-Denmark Partnership (2008 – 2013) and Bhutan‟s national

development framework. The SESP comprises two components:

1. Budget support for capital investments in Gewogs. Budget support will be provided to all

205 Gewogs through the Annual Capital Grant mechanism for funding of the Gewogs‟

development plans.

2. Support for capacity development for mainstreaming of environment, climate change and

poverty concerns. Support will be provided for mainstreaming of environment, climate change

and associated poverty (ECP) concerns in national policies, plans and programmes and in all

local development plans and programmes.

Component 1 is fully aligned with RGoB‟s Local Governance Support Programme (LGSP); and

Component 2 is the Joint Support Programme (JSP), formulated and to be implemented jointly with

UNDP/UNEP‟s Poverty Environment Initiative (PEI) Phase 2.

The SESP development objective is directly linked to the national development objective of poverty

reduction.

The development objective of Component 1 is similar to that of LGSP which is “effective and

transparent financing mechanism for local government service delivery established and in operation

with annual capital grants to all Gewogs”.

The development objective of JSP is: sustainable development planning and implementation

undertaken at national and local levels that contribute to: alleviation of climate change impacts;

conservation, protection and sustainable use of natural resources; and poverty reduction.

The immediate objectives are: 1) adequate level of investments in Gewogs to sustain economic and

social development (for Component 1); (and for JSP) 2) strengthened national level capacity that

facilitates national and local level five-year planning and implementation by mainstreaming

environment, climate change and poverty concerns in policies, plans and programmes; and 3)

strengthened local level capacity to formulate and implement five-year development plans and

annual plans in which environment, climate change and poverty concerns are mainstreamed.

The main strategies are to: 1) inject investment capital to enable the lowest level of government to

adequately cope with development needs in a sustainable manner; 2) develop national capacity for

ECP mainstreaming into national policies, plans and programme, especially those of relevance for

local governance; and 3) based on the national ECP framework, develop local capacity for

mainstreaming ECP into all local development plans and programmes, and for monitoring and

evaluation of planning and implementation cycles in order to enhance the responsiveness to ECP

challenges.

The principles of aid effectiveness are pursued with alignment to RGoB‟s development framework

and operational procedures, and harmonised with UNDP/UNEP‟s Poverty Environment Initiative


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(PEI). The SESP will be coherent with other Danish supported programmes, especially the Local

Governance Support Programme (LGSP) and the Social Sector Support Programme (SSPS).

Harmonisation with similar development partner programmes is pursued.

Programme management and organisation

GNHC will be the executing agency for the SESP. GNHC has no implementation mandate and does

not, therefore, take direct part in the actual implementation, but will undertake the overall

coordination functions.

Component 1: The budget support will be provided through the same procedures as those of LGSP

and the RGoB “Guidelines for Annual Grants for Local Governments”. The programme manager

for LGSP from Local Development Division (LDD) of GNHC will also function as the Programme

Manager for the SESP Component 1.

Component 2: The Development Cooperation Division (DCD) of GNHC together with PMCD and

LDD will have the overall coordination function in relation to sector ministries, national agencies

and local governments. The relevant sectors and local government councils (Dzongkhags and

Gewogs) will be the implementing agencies. A senior GNHC officer will be appointed as the

programme manager. Each sector ministry/national agency involved in the SESP will appoint a

senior officer, who will act as the focal point and coordinate activities within their respective

ministry/ agency. At the Dzongkhag level, it will be the District Planning Officer (DPO) and the

District Environmental Officer (DEO) who will jointly act as the focal point. The focal points will

be responsible for programme implementation in their respective central and local government

units. A Programme Management Group (PMG) will be established, which will be made up of

members from RGoB and development partners.

Steering committees: The existing LGSP Outcome Board/ Steering Committee (LGSP-SC) will

serve as the Steering Committee for the SESP Component 1. For Component 2, a Joint Support

Programme Steering Committee (JSP-SC) will be established, which will be made up of members

from RGoB and development partners. In order to oversee overall implementation, cooperation

issues, etc. for the SESP‟s two components, the Secretary GNHC and the Head of the LOD will

form a high-level coordination body having a mandate similar to a Programme Steering Committee

(PSC).

Programme budget and financial management

The programme budget is DKK 70.0 million and is allocated as follows:

Components DKK mn Percentage

Component 1: Budget support for capital investments in Gewogs 40.0 57 %

Component 2: Capacity development for environmental mainstreaming 20.0 29 %

Outcome 1: ECP mainstreamed in policies, plans and programmes 6.8 10 %

Outcome 2: ECP mainstreamed in all development plans and

programmes

11.2 16 %

Technical Assistance 2.0 3 %

Other: 10.0 14 %

Joint Reviews 2.0 3 %

Unallocated 7.0 10 %

Contingency 1.0 1 %

Total 70.0 100 %


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The financial management of the SESP will follow the RGoB procedures for budgeting, flow of

funding and accounting. Procurement of equipment and services will be the responsibility of the

implementing agencies and procurement will follow ordinary RGoB procurement in accordance

with the Procurement Rules and Regulation (2009). If requested by RGoB, procurement of TA

could be undertaken by LOD in line with current Danish procurement procedures.

Monitoring and reporting

The SESP monitoring system and associated indicators will be based on the RGoB indicators and

M&E system. The SESP will be monitored through the LGSP for Component 1 and the Joint

Support Programme for Component 2. The Joint Support Programme includes an outline of a

performance monitoring system that has been prepared in accordance with the GNHC Planning and

Monitoring System (PlaMS). However, during the formulation of the SESP, gaps were identified in

the national indicators and monitoring: i) the structure of the planning and financial monitoring

system – National Monitoring and Evaluation System (NMES) – is still being developed; ii) the

Gewog output and outcome indicators were not available, and iii) there is no comprehensive

environmental indicator system for the environment in place that applies at the Gewog level.

In order to estimate the actual environment expenditures of the Gewog annual plans, ex-post

assessments of implemented activities based on financial statements from the Department of Public

Accounts are planned to be carried out as separate studies and – if feasible – in cooperation with

and as an follow-up on the 2009 Public Environmental Expenditure Review (PEER) that is

undertaken by the PEI. The ex-post environment expenditure assessment will not be part of the

general monitoring system.

Financial and physical progress reporting shall comply with the formats in the RGoB PlaMS and

the Financial Rules & Regulations (FRR). Financial reports and accounts shall be submitted to MoF

through the Budget and Accounting System (BAS) and physical progress reports to GNHC through

PlaMS.

Reviews and evaluation

Annual Programme Reviews (APR) will be carried out jointly with RGoB and preferably other

development partners in the environment, climate change adaptation & mitigation and natural

resource management sectors. Joint reviews could as well be carried out with the LGSP. The APR

could coincide with the September sessions of the LGSP-SC and JSP-SC. A joint mid-term review

will be conducted during the third quarter of 2011 prior to launching the preparation of the 11th

Five-Year Plan, which will take stock of the local governance context and the performance of

SESP, LGSP and PEI Phase 2. An exit strategy will be elaborated during the third year of

implementation by taking ongoing and planned programmes into consideration. A “terminal

review” of lessons learned from the SESP will be undertaken towards the end of 2013.

Implementation

The programme duration is four years with an inception phase of six months (January to June

2010), three financial years (FY 2010/11 – FY 2012/13), and six months for Programme completion

(July to December 2013).


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1. Introduction

1.1 Development cooperation between Bhutan and Denmark

Danish development cooperation with Bhutan began in 1978. Bhutan has since 1989 been one of

the Danish programme cooperation countries. The main areas of development cooperation have

been: health, education, good governance as well as environment and urban development. Denmark

has for several years been among the larger providers of development assistance to Bhutan.

The Danish country strategy for development cooperation with Bhutan is the „Bhutan-Denmark

Partnership - Strategy for Development Cooperation (2008-2013)‟. The priority sectors for the

Danish development assistance are: the social sector; environment and urban development; and

good governance. The strategy is guided by five interrelated strategies:

1. Promotion of private sector development – emphasising diversification of the economy and

hence continued growth and poverty reduction;

2. Support to the social sectors to reduce poverty – emphasising the quality of service delivery

of the health and education sectors;

3. Support to the transition to parliamentary democracy, good governance, rule of law, and

safeguarding of human rights;

4. Promotion of sound and sustainable management of natural resources with a direct impact

on reducing poverty; and

5. Improvement of quality of services and basic infrastructure, amongst other by ensuring the

availability of district level capacity.

The Royal Government of Bhutan (RGoB) and the Government of Denmark have agreed to prepare

and implement the four-year Sustainable Environment Support Programme (SESP). The SESP will

commence early 2010 and be finalised at the end of 2013. The SESP will be aligned with the last

three years of the 10th

Five-Year Plan (FYP) (2010/11-2012/13).

It is noted in the Partnership Strategy (p.5) that “based on the positive macro-economic trends in

Bhutan, it is expected that the Danish assistance will be gradually phased out after 2013”. The SESP

will be the last phase of cooperation between Denmark and Bhutan on environment applying the

grant funding modality. Future cooperation could continue with civil society and the private sector.

1.2 Events leading to the SESP formulation

Denmark and Bhutan have had development cooperation on environment for more than 15 years.

The initial cooperation was on land-use planning as well as support to the National Environmental

Commission Secretariat (NECS) and various activities related to watershed management,

environmental management and legislation. A programmatic approach was initiated with the

Environment Sector Programme Support (ESPS) from 1998 to 2004, the Urban Sector Programme

Support (USPS) from 1999 to 2004, and the Environment and Urban Sector Programme Support

(EUSPS) from 2004 to 2009. The SESP will build on lessons learned from the previous

collaboration between RGoB and Denmark on environment.

Events leading up to the preparation of the SESP include the high level consultations (March 2007

and March 2009) and the joint environment programme review with UNDP and GEF (September

2008). A concept paper was prepared by the Liaison Office of Denmark (LOD) in consultation with


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31 October 2009 2

the Gross National Happiness Commission (GNHC) end of 2008, and endorsed by the Programme

Committee of the Ministry of Foreign Affairs of Denmark (MFA) on February 6, 2009.

A climate change screening of Denmark‟s development cooperation with Bhutan was carried out in

May 2008 and resulted in support to short-term climate change activities. It is the aim of the SESP

to include „climate change adaptation‟ in order to address emerging challenges from climate change

variability and erratic weather patterns, and to reduce risks of natural disasters.

The Danish SESP Component 1 will be implemented as part of the Local Governance Support

Programme (LGSP), and Component 2 and the UNDP/UNEP PEI Phase 2 have been jointly

designed to constitute the Joint Support Programme (JSP).

1.3 Lessons from previous development collaboration

Lessons learned of the EUSPS components on decentralised natural resource management and

urban environmental management have been prepared (September 2008)1. Among the lessons were

that the institutional arrangement and responsibility could be more aligned to the existing and

emerging RGoB structures. New opportunities for planning and financial management have

emerged with the local government reform and decentralisation. Most of the previous support to

environment was directed at central level with limited collaboration at local level beyond some pilot

activities.

The lessons learned assessment pointed to the need for capacity development and technology

transfer to harness the full potential of the environment and natural resources at local level. In some

cases, there is also scope for adding value on existing investments by linking marketing,

environmental mainstreaming and production technology packages with investments in irrigation

and rural roads. In the case of larger investments in urban settings, the solutions should be based on

appropriate technologies that consider efficiency and sustainability.

The SESP marks a logical shift in the emphasis from the previous project and programme approach

that focussed on central level activities. The direct lessons from ESPS and EUSPS that can be

carried over into the SESP for local government and budget support are few. The reasons are that

the SESP is more aligned to the local government reform with a shift in the focus from the central

to the local level. The previous experience in ESPS and EUSPS with local level implementation

was scattered and not systematic. Through ESPS and EUSPS, contributions have been made for the

establishment of the national framework legally and operationally for environmental management.

EUSPS supported the establishment of the District Environmental Officer positions in 2007. The

sustainability of the endeavours of EUSPS is yet to be assessed in the EUSPS completion report

expected by the end of 2009. A comprehensive Outcome Study of the EUSPS is undertaken

(August-October 2009), the result of which will provide input to the inception of the SESP.

There are lessons of budget support from the Health and Education Sector Programme Support, and

the Social Sector Programme Support (SSPS) that will be applied in the SESP. The Local

Governance Support Programme (LGSP) is providing support for local government financial

management and the provision of some budget support for the Annual Capital Grants (ACG) for

local government.

1 MFA/Danida, Lessons Learned from Decentralised Natural Resource Management Component: Gewog level

experiences on the planning and regulatory frameworks, September 2008; and MFA/Danida, Lessons Learned from

Support to Five District Towns: Municipal level experiences on planning and regulatory frameworks, October 2008.


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31 October 2009 3

2. National and sector context

This Chapter summarises findings of the sector assessments, and includes an overview of the

development and planning context, as well as sections on environment, climate change and natural

hazards, local government reform, public financial management, and cross-cutting issues.

2.1 The national and poverty context

Bhutan is a land-locked Least Developed Country with a land area of 38,394 km2 located

strategically between China and India. Only about 7.8 % of the land area of Bhutan is arable.2 It is a

constitutional commitment to maintain forest cover above 60 %. The population of Bhutan is

estimated at 671,083 (in 2008).3 Around 70 % of the population lives in rural areas. The population

is growing at a rate of 1.3 % p.a. at which rate the population could be doubled by around 2060. The

Poverty Analysis Report (PAR) from 2007 found that the poverty incidence in Bhutan was 23.2 %.4

The poverty rate was more severe in rural areas (30.9 %) compared with urban areas (1.7 % poverty

incidence). The depth of poverty is low, i.e. few citizens of Bhutan are facing extreme poverty. But

about 8 % of the rural population are subsistence poor consuming less than the food poverty line.5

The next PAR is expected published in 2012 based on household surveys to be conducted in 2011

by the National Statistics Bureau (NSB). According to NSB, the next PAR is expected to have

sampling sizes sufficiently large to disaggregate the poverty analysis at Gewog level.

In 2007, the then Planning Commission (now GNHC) undertook a nationwide survey of 1,200

households to assess the effectiveness of past development interventions and their impacts on rural

livelihoods. With a consistently high share of development expenditures for health and education,

Bhutan has steadily improved on the Human Development Index (HDI) scale. The 2009 ranking for

Bhutan is 132 out of 182 countries (UNDP, 2009). It appears that more than 80% of people have

access to basic facilities in health, education, water and sanitation and agriculture. Less progress has

been made in terms of access to income generating activities. RGoB‟s efforts to stimulate

enterprises are not widespread in rural areas. Some 35% of respondents reported food shortages

during the year, and this large segment of the population is caught in a cycle of borrowing and

repayment to meet food requirements.

The total Gross Domestic Product (GDP) was BTN 51.521 billion in FY 2007/08 and USD 1,770

per capita (current prices) in 2007. The economy of Bhutan has had a steady growth of an average

of 7.5 % since the 1980s. The relative contribution to the economy of industry and services has

grown while agriculture has gone from contributing to about half of the economy to about one-fifth

(18.6 % in 2006). Hydropower is the main contributor to national revenues and there is a large

economic potential for further development of hydropower for energy exports.

2 MoA: Compendium of RNR Statistics (2008)

3 Estimate by National Statistics Bureau (NSB). In the first census of Bhutan (the „Population and Housing Census of

Bhutan‟, 2005) the total population at the end of 2005 was estimated at 672,425.

4 In the PAR (2007) the total poverty line is set at a household consumption of BTN 1,096.94 per month (in 2007)

(about DKK 129 per month). This budget includes food and non-food consumption.

5 The food poverty line is the minimum food basket containing 2,124 Kcal. It was estimated at BTN 688.96 (in 2007)

(about DKK 81 per month).


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31 October 2009 4

2.2 The development context

Bhutan was established as a monarchy in 1907, unifying the country under the control of the

Wangchuck family. The Fourth King, Jigme Singye Wangchuck introduced multi-party

parliamentary democracy. The Fifth King Jigme Khesar Namgyel Wangchuck was crowned 1

November 2008. The Constitution of the Kingdom of Bhutan (ratified July 18, 2008) introduced a

Democratic Constitutional Monarchy. Free and universal elections were held to the National

Council and National Assembly in December 2007 and March 2008 respectively. The first elected

parliamentary government was formed on April 11, 2008. Local government elections are planned

to be held in 2010 following the enactment of the Local Governments‟ Act 2009 on 11 September

2009.

Bhutan is known worldwide for the philosophy of „Gross National Happiness‟ (GNH) as the

guidance for development in Bhutan.6 The development policy emphasises on balanced economic

development and poverty reduction. This is reflected in Bhutan‟s strong commitment to the

Millennium Development Goals (MDGs) to which Bhutan has made good progress (see Box 1). It

is also in line with the similar South Asian Association for Regional Cooperation (SAARC)

Development Goals to which Bhutan has also expressed its commitment. Bhutan has already

achieved the targets of halving the proportion of people without access to safe drinking water and

sanitation, and halving the percentage of underweight children under five years of age. Bhutan may

be on track to meet all national MDG targets.

Box 1: Millennium Development Goals (MDG)

Among the top priorities of the RGoB is the achievement of the MDG Goal to „Eradicate Extreme Poverty and

Hunger by Year 2015‟. The base line for MDG was the PAR (2000) when an estimated 36 % of the population

lived under the then poverty line of BTN 740 per capita per month. The PAR in 2007 produced a national

poverty figure of 23 %, i.e. a reduction by 36 %. The objective of the 10th FYP is to reduce poverty to below

15 % by 2013, which will be more than halving poverty since the PAR (2000) baseline.

The poverty reduction strategy of the RGOB is to first build road access to remote communities, then to

support social facilities, such as schools and hospitals, and power supplies (Bhutan Poverty Reduction Strategy

Paper, 2003). A needs assessment and costing exercise was carried out in 2006 to estimate the costs of

achieving the MDGs by 2015.7 The assessment also included non-MDG sectors such as transport, energy and

good governance as they are expected to contribute to the realisation of the core MDGs. Climate change issues

are discussed in the context of environmental sustainability (MDG 7), including carbon sequestration and

greenhouse gas emission reductions.

Bhutan may need to invest USD 2.5 billion at 2005 prices between 2006-2015 to achieve the MDGs, including

reducing the national poverty rate 15%. Education and health are the most demanding sectors, requiring 46 %

of investments, followed by agriculture with 17 %, and water supply and sanitation with 7 %.

6 Gross National Happiness (GNH), developed by the Fourth King Jigme Singye Wangchuck, embodies the country‟s

pursuit of development in broader aspects than just material well-being, notably spiritual development. GNH is deeply

rooted in Buddhist values. GNH is an attempt to add more dimensions to measure of development than found in the

one-dimensional measure of „Gross National Income‟. GNH is based on four pillars: a) the promotion of equitable and

sustainable socio-economic development, b) the preservation and promotion of cultural values, c) the conservation of

the natural environment, and d) the promotion of good governance

7 Planning Commission (2007): “Bhutan Millennium Development Goals – Needs Assessment and Costing Report”,

RGoB, Thimphu, Bhutan.


Programme Document

31 October 2009 5

The 10th

Five Year Plan (FYP) provides the development framework for the financial years 2008/09

to 2012/13. The reduction of poverty in pursuit of the GNH vision is the overarching objective of

the plan, with the emphasis to reduce the proportion of the population living below the national

poverty line from 23.1% to less than 15%. The 10th

FYP can be viewed as Bhutan‟s poverty

reduction strategy.

Six key interrelated strategies have been identified to achieve poverty reduction in the 10th

FYP.

These are: 1) vitalizing industry, 2) national spatial planning (including sustainable urban

development and housing), 3) synergizing integrated rural-urban development, 4) expanding

strategic infrastructure, 5) investing in human capital and 6) fostering an enabling environment

through good governance.

The 10th

FYP features several policy and planning innovations compared to previous FYPs. Some

of the highlights are:

Introduction of a „Results Based Planning Framework’. Based on the recommendations of

the Mid-Term Review of the 9th

FYP and the Good Governance Plus report (2005), a new

planning approach is introduced with clearly defined planning objectives and results. The

aim is to measure progress on results achievements and impact rather than processes,

products and services.

In order to create a dynamic planning and budgeting process, the planning process is

embedded in a multi-year rolling budget framework (MYRB) spanning over three years,

meaning that plans and budgets will be updated annually for three next years.

The resource envelope will be based on projections determined by the Budget Policy and

Fiscal Framework Statement (BPFFS) and accounts for all available resources to central and

local government. Development funds for local government (Dzongkhags and Gewogs)

consist of earmarked central government grants as well as Annual Grants (capital and

recurrent).

The progress and results achievements of the 10th

FYP will be monitored through the

National Monitoring and Evaluation System (NMES), which is closely connected to the

results indicators of the plan. Data will be collected through the Planning Monitoring System

(PlaMS) and the Public Expenditure Management System (PEMS).8

The devolution of functions, powers and finances play a key role in the 10th

FYP but it is

also recognised that low capacity at local level, particularly in the Gewogs, is a challenge to

the achievement of plan objectives.9

2.3 The environment context

Bhutan is rich in pristine natural resources and the environment features high in national policies

and plans. Protection of the environment and the dependency on natural resources is deeply

8 The NMES with PlaMS, MYRB and PEMS is developed as a web-based system to include all levels of government. It

is estimated that currently 45 out 205 Gewogs now have internet access through the Community Information Centres,

e.g. at post offices.

9 In order to encounter the capacity needs, an Integrated Capacity Building Programme (ICBP) has been funded and

piloted by JICA. The ICBP covers general and crosscutting aspects of local government in administration, management

and accounting. The target groups are elected positions, administration in local government and Dzongkhag sector

heads. The ICBP does not include training in technical topics like environmental management, which should be done by

technical agencies such as MoA and NECS. Hence there are no modules on environmental mainstreaming.


Programme Document

31 October 2009 6

enshrined in the culture, and there is recognition that the environment and natural resources is

important for all parts of society and development in Bhutan. Environment is one of the four pillars

of GNH. Environment is included as Article 5 of the National Constitution (see Box 2), and one of

the constitutional obligations is to maintain a minimum forest cover of 60%.

Environment is included as a crosscutting development theme in the 10th

FYP (see Box 2) but

environment is not defined as a sector (see Annex A).

Box 2: Environment as a cross-cutting theme in the 10th

FYP

Mainstreaming environment in rural road construction: Aim to implement environment friendly road

construction (EFRC) methods. The additional costs to the already high investments required to

implement these EFRC requirements may prove to be long-term cost-efficient.

Sustainable land management: The rural environment concerns are soil degradation due to over grazing

by livestock, loss of scarce agricultural lands due to urbanization, and non-sustainable use of forest

resources.

Climate change vulnerability: Climate change risks increase the proneness to flash floods, glacial lake

outbursts and landslides due to excessive rain.

Air and water quality: The ambient environment status is still relatively good but with emerging

problems of air pollution in and around industrial sites and deteriorating water quality near urban

centres, the air and water quality will deteriorate without effective environmental interventions.

Awareness and capacity: Bhutan is faced with limited human capacity and expertise to manage the

environment. Environmental awareness, education and sound practices can also be furthered.

Protection of watershed: The vast hydropower resources are Bhutan‟s comparative advantage, but

require management and protection of the critical watersheds. This provides not just an environmental

benefit but also has an economic justification and thus a high development priority.

In the institutional functions of the environment, the NECS has the mandate to support

mainstreaming of environment in the 10th

FYP. NECS also has the mandate to set environmental

standards, for environmental monitoring and state of the environment reporting and the

coordination and implementation of Multilateral Environmental Agreements (MEA). NECS also

has the mandate for policy and coordination of water resources (NEPA 2007).

NECS has designated the Dzongkhag Administrations as „competent authorities‟ under the

Environmental Assessment Act (2000) for issuing „environment clearances‟ for projects within

certain thresholds (e.g. farm roads less than 5 km). For larger projects NECS has the mandate or the

authority is delegated to the environmental unit of line ministries (e.g. in Ministry of Economic

Affairs but none in Ministry of Agriculture). The functional mechanism for environmental

mainstreaming and coordination at Dzongkhag level is the Dzongkhag Environmental Committee

(DEC). In order to deal with the low of capacity at Dzongkhag level to deal with issues related to

environment there are recent positions filled as District Environmental Officers (DEO).10

The DEO

is the focal point for the DEC on all environmental matters. The DEOs shall monitor the

10

The National Assembly at its session in June 2005 directed NECS to appoint the Dzongkhag Environmental Officers

(DEO). The DEOs were posted in each Dzongkhag from 2007. The DEOs according to their ToR shall assist the

Dzongkhag Environment Committees (DEC) in implementing and monitoring the Environmental Assessment Act

(2000) and the Regulation for Environmental Clearance of Projects (2002) as well as all environmental guidelines and

standards issues by NEC. The DEOs also have a role in monitoring environment at Dzongkhag and Gewog level.


Programme Document

31 October 2009 7

environment at Dzongkhag and Gewog level and ensure that environmental concerns are

incorporated into the FYP development plans of the Gewogs and Dzongkhags. The DEO acts as the

member secretary and technical backstopping for the DEC.

The functional roles of environmental management are changing with the decentralisation to local

government. The local government already has designated roles related to environment, but the

implementation in practice is variable. This is due to other priorities with limited financial resources

and capacity at Dzongkhag and not least Gewog level. Environment in various ways appears

directly or indirectly in the local government development plans.

Environment is not identified as a sector in the development plans. But with a high visibility and

priority of environment in the GNH philosophy, the Constitution and the 10th

FYP, environment is

also reflected as a high priority in the specific development activities. This may appear in two

ways:11

Through a high priority and visibility of environment (mainstreaming) in the local

government development plans (demand side)

Through a sizeable budget allocation for environment in the local grant allocations (supply

side)

The direct capital investments related to „environment‟ falls in two main groups. One group is the

„green‟ investments mainly related to some (but not all) of the Renewable Natural Resources (RNR)

investments within the mandates supported by MoA, e.g. in forestry and other land conservation. A

large part of the agriculture investment is for rural infrastructure like farm roads and irrigation

canals that are not directly „environment‟ investment, but with a high potential for poverty

alleviation using available productive natural resources, e.g. from improved access to markets and

water security. The other group is the „brown‟ investments related mainly to „health development‟

and „towns and human settlement‟ investment, e.g. waste management, sanitation and safe water, in

towns and larger villages.

There are elements from different sectors that are relevant for the environmental agenda. In the

RNR sectors in the Ministry of Agriculture (MoA) there are some but not all activities that may be

considered as environment. A Watershed Management Division in the Department of Forests of the

MoA has been created with the mandate to link, coordinate and engage in broader water policy

agenda of the country to collaborate with relevant agencies at all levels to incorporate watershed

management objectives into the sectoral plans, programmes and activities. The mandate and

functions will be executed in consultation and coordination with all agencies that have a mandate to

produce area based management plans, and particularly at the Dzongkhag and Gewog levels.

Similarly, there are topics under the urban sector under the Ministry of Works and Human

Settlement (MoWHS), health sector under the Ministry of Health, land management under the

National Land Commission (NLC), and industries under Ministry of Economic Affairs (MoEA) are

linked to the environmental agenda. Hydro-power development and climate change (meteorology)

are under the MoEA, and natural disaster management under Ministry of Home and Cultural Affairs

(MoHCA).

Environment is not defined as a sector in the 10th

FYP. Some areas that could be characterised as

environment includes watershed management, protected areas, forest management and

11

The Poverty and Environment Initiative (PEI) by UNEP/UNDP will carry out a public expenditure review of the

environment (expected end of 2009). The public expenditure review is likely to provide relevant analysis and

information for an assessment of the budget priority of the environment in Bhutan in the public expenditure.


Programme Document

31 October 2009 8

conservation, water and sanitation, waste management, and other activities. Some sectors like

forestry may all be termed environment, but environment is more than forestry.

Mainstreaming of environment into key development sectors is RGoB‟s response to comply with

the high priority given to environment in the GNH philosophy, the Constitution, and the 10th

FYP.

GNHC and NECS have prepared guidelines for mainstreaming environment in policies and

programmes for MoA, MoEA and MoWHS and will pilot these in Dzongkhags. The current

environment mainstreaming guidelines do not yet include implementation of development plans by

local government. A first step in the mainstreaming of environment is to follow the laws, rules and

regulation that concerns environment directly or indirectly. An overview of the key legislation for

environment and natural resources in Bhutan is included in Annex B.

Impacts of environmental investments will be attained through mainstreaming of environment in all

the development activities – centrally as well as locally. Guidelines on Environmental Friendly

Road Construction (EFRC) are one example, where the environmental concern comes with an

additional price tag. Mainstreaming of environment may not always result in increased investment

costs, but may rather be a question of having adequate capacity and skills to address environmental

issues in planning, implementation and operation of development interventions.

2.4 Climate change and natural hazards

Climate change is a potential risk to development and livelihoods in Bhutan. The climate change

related natural hazards such as glacial lake outburst floods (GLOF),12

monsoon flash floods and

landslides from heavy rainfall disrupt the livelihoods, access (transportation) and other parts of the

economy including agriculture, hydropower systems, industrial estates, human settlements, and

historical and cultural monuments. The pressures of land-use change, habitat degradation and

infrastructure development compound the threat of climate change further.13

Bhutan ratified the United Nations Framework Convention on Climate Change (UNFCCC) in

August 1995 and the Kyoto Protocol in August 2002. The Initial National Communication (INC)

submitted in November 2000 covered numerous topics, including: national circumstances related to

climate change; a Greenhouse Gas (GHG) emission inventory; assessment of vulnerability and

adaptation to climate change; policies and other measures to address climate change; education,

training and public participation; and recommended research. Because of data constraints, the INC

did not conduct any mitigation analysis, GHG emission projections, or temperature and

precipitation projections under different Intergovernmental Panel on Climate Change (IPCC)

emission scenarios using Global Circulation Models (GCM). The preparation of the Second

National Communication began in August 2007 and is still under preparation.

NECS is the national focal point for UNFCCC. MoHCA has the mandate for coordination of

disaster management. MoEA has the mandate for meteorological services in charge of monitoring

the climate, weather forecasting and possibly future early warning. The National Adaptation

Programme of Action (NAPA) was prepared with a grant from the Least Developed Countries Fund

for Adaptation to Climate Change (LDCF) and published in May 2006. Bhutan‟s NAPA includes

nine priority adaptation projects selected among 55 projects originally identified. The projects are

ranked according to four criteria: (1) human life and health saved by the intervention; (2) arable

12

There are 24 glacial lakes identified with GLOF potential and other potentially unstable glacial lakes may be forming

in the coming decades.

13 Further information on climate change in Bhutan is included in the „climate change screening of Denmark‟s

development cooperation with Bhutan‟ (May 2008).


Programme Document

31 October 2009 9

land saved by the intervention; (3) essential infrastructure; and (4) estimated costs. The budget for

the identified nine priority projects for urgent and immediate action is USD 7.9 Million. One project

of reduced risks and impacts of Glacial Lake Flood Outburst (GLOF) has been funded by LDCF.

The NAPA is a tool to attract external funding, not only from the LDCF, but also from development

partners.

The National Disaster Management Framework was published in 2006. The key objectives of the

Framework are to: i) Promote a disaster risk management approach with an emphasis on prevention,

mitigation and preparedness, instead of an ad hoc reactive approach to dealing with disasters; ii)

Recognise the respective roles of different organizations in disaster risk management and provide

all possible support to their work within the national framework for disaster risk management; and

iii) Establish linkages between disaster risk management and the activities in different development

sectors.

Adaptation to climate change and disaster risk reduction may become one of the areas where

interventions may be required in Bhutan on a larger scale. Skills and procedures can be developed

to address today‟s climate variability as an adaptation strategy to be ready for tomorrow‟s climate

change.

2.5 Local government reforms

2.5.1 Evolution of local governance

The process of decentralization will move steadily from deconcentration (where centrally defined

tasks have been assigned to Dzongkhags and Gewogs through Chathrims), to a steady and

incremental devolution of some powers, functions and responsibilities to the Dzongkhags and

Gewogs. The 10th FYP identifies decentralization as one of five crosscutting development themes –

environment is another – that are critical for the achievement of the national development and

poverty reduction objectives.

Article 22 of the Constitution of Bhutan enshrines local self-governance. The National Assembly

passed the new Local Governments‟ Act of Bhutan (LGAB) 2009. The LGAB specifies the concept

of democratic and decentralized governance with the overall objective to “facilitate direct

participation of the people in the development and management of their own social, economic and

environmental well being through decentralization and devolution of power and authority”.

The LGAB thus provides the overall legal framework for local governance to which the SESP will

be aligned14

. Local government elections are anticipated to take place in 2010 – resulting in elected

councils being established as follows:

Dzongkhag Tshogdu (DT)

Gewog Tshogde (GT)

Thromde Tshogde (TT)

The Dzongkhag Tshogdu will – in its area of jurisdiction – comprise two elected representatives

from each Gewog (Gup and Mangmi), one elected representative from the Thromde Tshogde, and

one elected representative from the Thromde Yenlag Tshogdes15

. The LGAB provides increased

powers and expanded functions to the local governments, which, among others, include: promotion

of holistic and integrated area-based development/ land use planning; conservation and

14 The Parliament passed the Local Governments‟ Bill at its extraordinary session on 11 September 2009. 15 Minor urban settlements – today only Thimphu and Phuntsholing have the status as autonomous municipal

corporations/bodies.


Programme Document

31 October 2009 10

enhancement of the environment; regulation of natural resource uses; regulation of pollution; and

organisation of relief measures in case of natural disasters and emergencies. The local government

functions are operationalised through five-year plans and annual plans and budgets, which

respectively are accumulated in RGoB‟s five-year plan and annual plans and budgets. The

Dzongkhag Tshogdu will monitor and evaluate the Gewogs‟ implementation performance, whereas

the Thromdes will conduct their own monitoring and evaluation.

Box 3: Evolution of local governance

Since the 5th FYP in 1981, the RGoB had a proactive policy of devolving institutional powers to govern and

promote participatory development at local levels. The major milestones in implementing decentralization

in Bhutan to date include:

The formation of the DYT and GYT (Dzongkhag (district) and Gewog (block) development

committees) in 1981 and 1991. The Dzongkhags and Gewogs have been headed by the DYTs and

GYTs since 2001.

Ratification of the DYT and GYT regulations (Chathrims) in 2002.

The creation of autonomous municipal city corporation‟s (Thromde) in Thimphu and Phuentsholing

in 2003 and 2006 respectively, under the Municipal Act from 1999.

Election of Gups (Mayors) based on adult franchise and their appointment as chair persons of GYTs

in 2002, repeated in 2005, and with an extended mandate until the election of new local

governments.

Gewog based participatory planning approach introduced as pilot in the 9th FYP and applied for all

with the 10th FYP.

GNHC coordinates the local government reform and guidelines for implementation. The Ministry

of Finance (MoF) monitors the Annual Grants and budgets to local government and sector agencies.

Ministry of Home and Cultural Affairs (MoHCA) previously had the mandate for local government.

The mandate of LDD and Department of Local Government (DLG) of MoHCA will be clarified

with the LGAB 2009.

Gewog Administrative Officers (GAO) and Gewog Accountants are being recruited for all Gewogs.

From FY 2010/11 there will be Gewog Accountants in all 205 Gewogs. There are Gewog

Accountants in 123 Gewogs, and some accountants currently cover more than one Gewog. The

remaining 82 posts will be filled with personnel trained by Royal Institute of Management (RIM)

by August 2010. The Gewog Accountants may in some cases not be based in the Gewog but at the

Dzongkhag administration. Services such as planning and engineering are supported by the

Dzongkhag administrations.

2.5.2 Annual grants to local governments

During the 9th

FYP period there has been an incremental move towards fiscal decentralisation and it

continues with the 10th FYP‟s focus on poverty reduction and local development. The budget for

implementation of the 10th

FYP is BTN 148 Billion of which around BTN 74 billion is for the

capital expenditures and BTN 73 billion is for current expenditures. RGoB‟s own revenue roughly

covers 50% of total 10th

plan outlay, meaning the other half of the plan outlay has to be covered by

external funding sources (primarily through grants and loans from the development partners). The

expected capital expenditure budget for local governments (Dzongkhags, Gewogs and Thromdes) is

BTN 12.0 Billion. The local government development grant is split 60/40 between Dzongkhags and

Gewogs.


Programme Document

31 October 2009 11

From the fiscal year 2009/2010, the Gewog Annual Capital Grant will be split 80/20 with up to

20% being allocated as untied grant. This implies that 80% of the grant is tied and has to be spent

within the 10th

FYP, while the GTs have full discretionary power over the remaining 20% that could

be spent over and above the 10th

FYP within a list of eligible expenditures.16

. It should also be taken

into account that the full five year plan period covers two local election terms, which would imply

that any newly elected GTs inevitably are going to inherit development plans adopted by its

predecessors and would like to change it to some extent. This should of course be possible in order

to safeguard the dynamics of local self-governance.

Figure 1: Annual grants flow of funds17

Source: GNHC (2009): „Guidelines for annual grants for local Government (Dzongkhags and Gewogs)„

The introduction of Annual Grants for Dzongkhags and Gewogs is embedded in the newly

developed intergovernmental fiscal transfer mechanism mentioned in the subsection on the 10th

FYP, which aims at transferring development grants to local government in a fairer, poverty-

oriented manner reflected in the emphasis on poverty in the Annual Grant allocation formula.

Increased predictability of fund flows for local government is another objective of the new

mechanism. Until now, Gewogs have struggled with late transfer of funds, which has caused delay

in implementation. In many areas of Bhutan the construction period, e.g. for roads is short due to

climatic reasons and delayed transfer of funds and the added time for tendering leave a short

16

The untied grant still needs to be spent within the positive list of the Annual Grant Guidelines. 17

Tied grant: Flow of funds from DPA to the Gewog within the Gewog plan

Untied grant: Flow of funds from DPA to the Gewog not tied to the Gewog FYP plan

Earmarked grant: Flow of funds from DPA via sector agency (and Dzongkhag) to Gewog

Annual Grants

(total of all

resources

Annual

Current

Grants

Annual

Capital

Grants

„Earmarked‟

Grants (sectors)

Criteria

determined by

DNB

„Tied‟ Capital

Grants > 80%

„Untied‟

Capital Grants

< 20%

From Sector

Ministries to

Local Govt.

Annual Capital

Grant allocation

formula:

- Population: 70%

- Poverty: 25%

- Land area: 5%


Programme Document

31 October 2009 12

window left for implementation, sometimes causing scheme cancellations and unspent budgets,

which needs to be transferred back to the MoF if not spent within the fiscal year.18

The developed budget allocation formula has three criteria with the following weights: Gewog

population (70%), Dzongkhag poverty (25%) and Gewog area (5%). There is no disaggregated

poverty assessment for the Gewog level so the Dzongkhag poverty is applied until the next PAR.

Figure 2 is an overview of the flow of funds and reporting system.

Figure 2: Flow of funds and NMES reporting and monitoring

2.5.3 The linkage between local government and environment

An assessment of the current functional assignments of Dzongkhags and Gewogs concerning

environment is included in Annex C. The linkage between local government and environmental

management emerges in three ways:

The decentralisation shifts the planning and implementation of development activities to

local government. The inclusion of environmental assessment and other mainstreaming of

sustainable environment should be addressed locally.

Mandates for regulation, implementation and monitoring of the environment increasingly

shifts towards local government. In particular monitoring environment outcomes is a new

18

The problem of delayed fund transfers and other important local governance issues like capacity constraints have

been analysed in detail in major reviews and evaluations, e.g. the joint Decentralisation Outcome Evaluation

(UNDP/UNCDF/Danida 2006), the DSP midterm review (UNDP/UNCDF, 2006) and the Capacity Development

Outcome Evaluation of Selected Organisations in Bhutan (Danida, 2006).

DPA / MoF DNB / MoF GNHC / LDD

Denmark

NMES

(MYRB, PEMS, PlaMS)

Outcome Outputs

Dzongkhags

SESP PSC

Annual

Budget

Approval

Reporting

RGoB

Sector

Agencies

Gewogs

Donors

Budget

allocation and plan

targets Flow

of

Funds


Programme Document

31 October 2009 13

area for local government. Adaptation to climate change and reduction of risks of natural

hazards will also be addressed locally.

Financing will be channelled directly as Annual Capital Grants (ACG) to local government

at whose discretion activities including environmental related will be initiated locally

according to local development plans. Capacity to address environment as a cross-cutting

issue may be a priority area in order to avoid that short term development priorities do not

carry long term costs.

The local government reform opens for new opportunities for financing and capacity development

to address environmental issues closer to the sources.

2.6 Public financial management and procurement

Several international assessments have concluded that Bhutan has made good progress with its PFM

system, although improvements are still needed to meet international standards. The RGoB has

initiated reforms in order to meet international review recommendations on shortcomings still

present in the PFM system.19

The PFM achievements are matched by: an overall favourable macro-economic situation (although

the consequences of the global financial crisis remains to be seen in Bhutan); appropriate national

and sector priorities in terms of poverty reduction (outlined in the five year plans); sound progress

in development of good governance and democracy; and a positive development within capacity

and quality of management in the public sector, including the management of the public finances.

In the context of a developing economy, public financial management is relatively strong in Bhutan.

Core PFM processes of budget formulation, procurement, accounting, and expenditure reporting

operate largely in accordance with an updated set of Financial Rules & Regulations (FRR, 2001).

The quality of external auditing provided by the Royal Audit Authority (RAA) is good and recent

developments to expand its scope and coverage in the areas of final accounts certification and

performance auditing have strengthened its function. 20

The overall level and quality of public

information on the budget and public accounts and the operations of particular Departments (e.g.

Revenue and Customs and the Royal Monetary Authority) is also of good standard compared with

other developing countries.

Box 4: Bhutan and the Corruption Perception Index

In 2006, Bhutan featured in Transparency International‟s Corruption Perspective Index (TI CPI). Bhutan came out as

an overall no. 32 on the global index, while it was ranked no. 7 in the Asia-Pacific region and the least corrupt in South

Asia. In 2008, the ranking slid somewhat to an overall no. 45 on the global index and to no. 9 on the Asia Pacific

regional index. Still, this is well above average and a good ranking, particularly in a regional context. The apparent

slide downwards between 2006 and 2008 may have been caused by the RGoB‟s additional focus on corruption and the

establishment of the Anti-Corruption Commission, which has made complaints about perceived irregularities easier

and monitoring more systematic.

19

Important PFM review documents include the World Bank Country Financial Accountability Assessment (2002) as

well as the joint Public Sector Accounting and Auditing: A comparison to International Standards Bhutan Country

report. The World Bank, November 2006.

20 Refer to the studies above as well as the RAA section of the Danida Capacity Development Outcome Evaluation of

Selected Organisations in Bhutan (2006) and the positive report by the Danish Auditor General and the Public Accounts

Committee (2008).


Programme Document

31 October 2009 14

However, it was found that programming of capital investments is weak, therefore in terms of

budget formulation; the major challenge is to improve the quality of forecasting contained in

original and revised estimates, both on the revenue side (non-tax and foreign aid) and on the

expenditure side. The recent adoption of the Multi Year Fiscal Framework (MYRB) and the Budget

Policy and Fiscal Framework Statement (BPFFS) should allow for more realistic planning and

avoid unrealistic estimates in the annual budget. The Department of National Budget (DNB) is

promoting spending agency discretion and reduction of budget changes.

A related task of the Ministry of Finance (MoF) is to articulate a longer-term public finance

management strategy. While some elements of it are clear (such as the introduction of MYRB and

BPFFS), other elements, such as the role of internal audit, are not. Equally important will be the

need to develop the capacity of finance officers to operate the Budget and Accounting System

(BAS). While there has been substantial training of finance officers under the 9th

FYP, the relevance

of some training has been questioned. The recent decision of the MoF to place the National Finance

Service, as a subordinate division of the Department of Public Accounts (DPA) should help to

improve the relevance of training, as should the new Masters Degree programme at the RIM, which

was launched with support from the previous Danida Good Governance programme.

The November 2006 assessment of Bhutan‟s public sector accounting and auditing by the World

Bank compared practices in Bhutan with international standards.21

The assessment revealed that the

then draft Public Finance Act (enacted by the National Assembly in June 2007) provides a sound

framework for PFM, but that there is a need to improve: the current budget and accounting

computerised system (BAS) to provide reporting in accordance with the requirements suggested in

the Act; and the reliability and consistency of reporting is mentioned. The assessment also revealed

that financial statements are not in accordance with international standards. The assessment

suggests the establishment of a formal board to advise on accounting and audit standards for both

the public and private sector, and points to the need for human resource development in accounting.

With regard to audits, the assessment states that the auditing standards of Bhutan are in line with

international auditing standards, but also in this field, there is a need for further human capacity

development and a need for alignment of new audit manuals with international standards.

In 2006, the World Bank and RGoB produced a draft roadmap to universal reliance on the national

system with focus on PFM in general, and procurement in particular as an important part of the

overall PFM. On PFM, the roadmap suggested the following improvements: more clear structure

and mandate of the internal audit function; updating of the Financial Rules and Regulations, 2001

(FRR), establishment of adequate networking facility for the BAS; and timely release of funds to

the central and local implementing agencies (electronic release of funds to Dzongkhags is now

functioning). According to analysis of the EC NRM identification mission in March 2009, it

appears that most of the draft roadmap has been implemented although not all was formally

adopted. The Procurement Manual from 1998 has been revised into the Procurement Rules and

Regulation (March 2009). A new Public Procurement Policy Division has been set up in the MoF

and a capacity development project is being implemented with support from the WB.

21

The Public Expenditure and Financial Accountability (PEFA) Secretariat of the World Bank carried out the

assessment with the use of the internationally recognized monitoring framework referred to as the Public Financial

Management Performance Measurement Framework.


Programme Document

31 October 2009 15

2.7 Cross-cutting issues and priority themes

The Danida AMG includes cross-cutting issues and priority themes to be addressed in development

cooperation. Cross-cutting themes is also included by RGoB in the development plans, and Chapter

5 of the 10th

FYP describes cross cutting development themes, which are critical to the attainment

of national development objectives. These are: decentralized governance, employment, women in

development, information and communications technology, environment, and HIV/AIDS.

2.7.1 Cross-cutting issues

Gender equality: In Bhutan, gender relations have traditionally been based on equality and

reciprocity. The RGoB has ensured that women issues are incorporated in planned development

initiatives. Bhutan has acceded to the CEDAW (Convention on the Elimination of all forms of

Discrimination Against Women). However, women are still disadvantaged especially in

participation in governance at all levels, tertiary education, economic and employment activities.

Other pertinent women issues to be addressed are to: enhance awareness among women on

HIV/AIDS; address the growing incidence of domestic violence; and trafficking and prostitution.

The 10th

FYP sees gender as a cross-cutting issue to be mainstreamed by all sectors/ministries in

policies, strategies and legislation. As a response, the National Plan of Action for Gender 2008-

2013 (NPAG) has been developed by the National Commission for Women and Children in

cooperation with GNHC.22

The recommendations in the NPAG are incorporated into the 10th

FYP.

The NPAG will be monitored using the results-based action with indicators, baselines and targets at

all levels. The government will strengthen gender awareness and sensitisation and improve

information collection, analysis and dissemination.

Environment: Article 5 (Environment) of the Constitution of Bhutan treats every Bhutanese as a

trustee of the Kingdom‟s natural resources and environment. Environment is one of the four pillars

of Gross National Happiness philosophy. Accelerated economic development, infrastructure

development, urbanisation and population expansion and changing consumption patterns will

require more attention to environmental protection and management in the coming years. RGoB has

promulgated the National Environment Protection Act of Bhutan (2007) and has regulation for

Environmental Assessment (EA) including Strategic Environmental Assessment (SEA).

Democratisation and respect for human rights: The Constitution of Bhutan guarantees

fundamental rights to all Bhutanese citizens providing equality before the law, equal and effective

protection of the law, as well as a number of other rights in accordance with international norms23

.

“However, Bhutan still faces the challenge of translating constitutional rights and intentions into

reality. Equal access and opportunities for all Bhutanese will continue to be of importance” (source:

Bhutan – Denmark Partnership – Strategy for Development Cooperation 2008-2013, p.16). Land topics

including resettlement and provision of land for the land-less are also a governance issue. A

nationwide cadastral survey is being undertaken, which will support land allocation and ownership

rights, and a National Land Policy is being drafted with support from Denmark. The first

democratic elections held in the spring of 2008 – based on universal adult franchise with 80 % voter

22

GNHC carries the overall role of gender focal point for the RGoB and there are also gender focal points in each

RGoB institution/ministry. 23

There are several groups of people from different cultures and religions in Bhutan. Among them, the Doyas and

Lhops living in Samtse Dzongkhag and the Monpas residing in a few villages in Trongsa are considered to be

indigenous people of Bhutan following their distinct culture, dress and language.


Programme Document

31 October 2009 16

turnout – brought the Druk Phuensum Tshogpa party to power. Gradual decentralisation over the

last two decades will culminate with the enactment of the LG Act – providing increased autonomy

to Dzongkhags, Gewogs and Thromdes local government entities.

2.7.2 Priority themes

HIV/AIDS: National response to the threat of AIDS became evident after the first AIDS infection

case was detected. Till date, 144 people have been infected with the virus of which 24 have

succumbed to the disease. Activities under the National Strategic Plan (NSP) for the Prevention and

Control of STIs and HIV and AIDS 2009 are being implemented. A National HIV/AIDS

Commission and Multi-sectoral Task Force in all the Dzongkhags are active in advocating

preventive measures, creating awareness and preparing for outbreaks of the disease.

Children and youth: Traditionally, children have been cared for through parental protection and

their extended families. With increasing modernization, more children and youth have increasingly

come into conflict with the law. Child labour has also become more noticeable with many working

in restaurants, automobile workshops, shops and homes. Many girls are domestic workers and are

vulnerable to abuse and exploitation.24

Over the next seven years approximately 63,000 young

people educated at secondary level will enter into the labour market. The RGoB recognises the need

to provide employment opportunities as essential to promoting social stability. An increasing

problem is lack of employment opportunities for the educated youth in the Gewogs, resulting in a

situation where many leave for urban areas in search of income and better living conditions.

Private sector: Trade, industry/ manufacturing and services are at the heart of the 10th

FYP‟s

development strategy to promote economic development and thereby contribute to poverty

reduction. Strategies have been conceived to increase private sector participation with a view to

stimulating rural and urban economies. Bhutan submitted an application for accession to the World

Trade Organisation (WTO) in 1999, and a Memorandum on the Foreign Trade Regime in February

2003. The bilateral market access negotiations are ongoing. A draft Working Party Report was

circulated in December 2007.

2.8 Donor coordination mechanisms

There are relatively few international donors in Bhutan and the donor coordination from the RGoB

side is carried out by the GNHC. There is no formal donor coordination in environment or natural

resources, but there is some informal coordination. There is a MoU and a joint review and shared

Steering Committee of EUSPS and the GEF and UNDP land-use projects.

The Round Table Meeting (RTM) is the highest level of coordination between RGoB and

development partners. The 10th

RTM was held in Thimphu in February 2008 and included delegates

from 14 countries and 20 multilateral organisations. The RTM is co-chaired by RGoB and UNDP.

24

The Constitution of Bhutan (in articles 9.17 and 9.18) spells out clauses for the protection of women and children

against all forms of discrimination and exploitation, including trafficking, prostitution, abuse, violence, harassment,

intimidation, degrading treatment and economic exploitation. Further, the Penal Code of Bhutan has provisions on

offences against children such as abandonment, child abuse, paedophilia, trafficking and endangerment of children. The

Ministry of Education has also banned corporal punishment in schools, which has helped in retaining children though

the practice has not been entirely eliminated. Labour laws in the country stipulate the minimum age for employment but

application and monitoring is low owing to capacity constraints with concerned agencies to enforce regulations.


Programme Document

31 October 2009 17

3. Agreed assistance

3.1 The proposed support

The SESP will provide support to local governments (Dzongkhags and Gewogs) in two parallel sets

of interventions: 1) provision of investment capital to Gewogs; and 2) capacity development for

mainstreaming of environment in policies, plans and programmes – with the intent that the

developed capacity will influence the way in which local governments will plan and implement

their development activities. The SESP comprises two components:

3. Budget support for capital investments in Gewogs. Budget support will be provided to all

205 Gewogs through the Annual Capital Grant mechanism for funding of the Gewogs‟

development plans. The budget support will be provided in accordance with RGoB‟s financial

management and reporting procedures. The Danish funding is a cost-sharing arrangement of the

Annual Capital Grant budget and will be utilised consistently with the “Guidelines for Annual

Grants for Local Governments”.

4. Support for capacity development for mainstreaming of environment, climate change and

poverty concerns. Support will be provided for mainstreaming of environment, climate change

and associated poverty concerns (ECP) in national policies, plans and programmes and in all

local development plans and programmes. Guidelines will be developed to assist all local

governments and targeted assistance will be provided to selected Dzongkhags and Gewogs

based on vulnerability criteria.

The programme grant is DKK 70.0 million. The programme duration is four years with an inception

phase of six months (January to June 2010), three financial years (FY 2010/11 – FY 2012/13), and

six months for Programme completion (July to December 2013).

SESP has been formulated in accordance with the Bhutan-Denmark Partnership (2008 – 2013) and

Bhutan‟s national development framework.25

. The rationale of the chosen aid modality and sector

approach is first, to provide budget support to the government‟s local government reform (further

supplementing the LGSP), and secondly, to go beyond the existing RNR sector managed only by

the MoA, as it is assessed to be too narrow an approach to address mainstreaming environment,

climate changes adaptation and poverty concerns (ECP).

The principles of aid effectiveness are pursued with alignment to RGoB‟s development framework

and operational procedures. The SESP will be coherent with other Danish supported programmes.

Especially the Local Governance Support Programme (LGSP) and the Social Sector Support

Programme (SSPS). SESP‟s Component 2 is the Joint Support Programme (JSP), formulated and

implemented jointly with UNDP/UNEP‟s PEI Phase 2. The SESP/JSP is to be harmonised with

other development partners‟ programmes of similar nature.

3.2 Objectives

In the 10th

FYP, the RGoB has adopted poverty reduction as the overarching theme and primary goal

consistent with the country‟s long-term development vision of GNH and the Constitution. The

overall national development objective of the 10th

FYP is: Reduction of poverty from the estimated

25

The Denmark-Bhutan Partnership (2008) notes for the environment programme that “the support to natural resource

management will be based on the development plans worked out at decentralised level, which will also help ensure

accountability for the sustainable use of natural resources” and that “the support will be in the form of budget support

directly to the decentralised level funding of the Gewogs‟ and town‟s own plans for development” (p.34).


Programme Document

31 October 2009 18

national poverty figure of 23.2% to less than 15%. The aim of the SESP is to contribute to the

reduction of poverty in Bhutan.

The SESP development objective is directly linked to the national development objective of reduced

poverty.

The development objective of Component 1 is similar to that of LGSP which is “effective and

transparent financing mechanism for local government service delivery established and in operation

with annual capital grants to all Gewogs”.

The development objective of JSP is: sustainable development planning and implementation are

undertaken at national and local levels that contribute to: alleviation of climate change impacts;

conservation, protection and sustainable use of natural resources; and poverty reduction.

The immediate objectives are: 1) adequate level of investments in Gewogs to sustain economic and

social development (for Component 1); (and for JSP) 2) strengthened national level capacity that

facilitates national and local level five-year planning and implementation by mainstreaming

environment, climate change and poverty (ECP) concerns in policies, plans and programmes; and 3)

strengthened local level capacity to formulate and implement five-year development plans and

annual plans in which environment, climate change and poverty concerns are mainstreamed.

3.3 Strategic Approach

The main strategies are to: 1) inject investment capital to enable the lowest level of government to

adequately cope with development needs in a sustainable manner; 2) develop national capacity for

ECP mainstreaming into national policies, plans and programmes, especially those of relevance for

local governance; and 3) based on the national ECP framework, develop local capacity for

mainstreaming ECP into all local development plans and programmes, and for monitoring and

evaluation of planning and implementation cycles in order to enhance the responsiveness to ECP

challenges. The preparation of the local governments‟ 11th

FYP will provide a specific opportunity

to address ECP challenges in the medium-term. Bhutanese public and private training institutions

will be the main providers of training to national and local governments. The main thrust of the

capacity development interventions will be on the corporate performance of the different units of

local governments and how they interact with central government. Corporate competence depends

on skills and attitudes of each individual officer in the local government units. The results-oriented

approach to capacity development and change (ROACH) will be pursued.26

The SESP outcomes

will be as follows:

Programme Outcomes and Indicators

Outcome

1.1 Effective and transparent financing mechanism

for local government service delivery established

and in operation with annual capital grants to all

Gewogs

90% of local governments receive and

report capital budgets on time and

schedule

Outcome

2.1:

ECP mainstreamed in national policies, plans

and programmes.

New policies and existing programmes

mainstream ECP

Outcome

2.2:

ECP mainstreamed in all development plans and

programmes at the local level.

70% of local government development

plans and programme mainstream ECP

26 Reference is made to “MFA/Danida, A Result-Oriented Approach to Capacity Change, February 2005.


Programme Document

31 October 2009 19

The tangible impacts will be assessed in terms of: living standards and poverty profiles27

, as well as

direct livelihood benefits, e.g. sustainable agricultural production and harvesting of forest products,

increased accessibility to economic, social and environmental services; and changes in the state of

the environment at the local level.

The Danish budget support will augment RGoB‟s annual grants for local governments.28

The

budget support will target the Annual Capital Grants to all 205 Gewogs and will be channelled

through the MoF. Danida is already applying the budget support modality in the SSPS and the

LGSP. Granting of budget support is justified as the experience gained with this funding modality

in health, education and local governance support programmes of all of the ten criteria for granting

budget support are positive. Briefly, decentralised governance, to which SESP is providing budget

and capacity development support, is one of the six development themes in the 10th

Five-Year Plan,

which is Bhutan‟s Poverty Reduction Strategy. Specific strategies towards enhancing decentralised

governance are discussed in the Volume 1 of the 10th

Five-Year Plan and were reviewed during the

LGSP technical review in September 2009. Similarly, the latest poverty reduction results have been

discussed under 2.1 (national and poverty reduction context). The manual for the results based

national monitoring system and the indicators and targets have been reviewed for central/sectoral

and local levels during July to September 2009.

As described under 2.6 (Public Financial Management and Procurement), Public Financial

Management and Procurement based on the Public Finance Act 2007 followed by the Public

Procurement Rules and Regulations and Standard Bidding Documents 2009, quality and capacity in

PFM has been improving towards strengthening of accountability and transparency; continued

improvement in public procurement through institutional capacity building and conduction of

increased number of performance audits by the independent and constitutional body represented by

the Royal Audit Authority; furthermore, an assessment of public finance management and risks was

undertaken for the LGSP.

Finally, this SESP budget support arrangement builds on the successful joint financing arrangement

under the Local Governance Support Programme.

EC is considering providing sector support to MoA.29

RGoB is conducting a new Public

Expenditure and Financial Accountability (PEFA) review later in 2009 with support from the World

Bank that will be peer reviewed by Denmark and EC.

The interventions to receive funding from the Annual Capital Grants will be decided by the elected

Gewogs Tshogdes, mainly in connection with the annual budget preparation process that is

undertaken within the framework of the Gewogs‟ 10th

FYP, but also in connection with the

27 The National Statistics Bureau is currently conducting a “Living Standard Survey and Poverty Analysis”, which will

be concluded during 2009. 28

According to OECD/DAC, budget support is defined as donor funds being channelled to the partner government‟s

national treasury, and thereafter managed in accordance with the partner‟s own budgetary procedures. The definition

encompasses general as well as sector budget support. Under both categories, funds are integrated into the national

budget and handled according to national procedures. However, the two differ in the kind of dialogue conducted

between development partners and governments. In the case of general budget support, focus is on overall policy and

budget priorities, whereas in the case of sector budget support, it is on sector-specific concerns. Budget support is,

however, more than the mere transfer of funds. It is a package consisting of several inputs, whose combination is the

key to achieving the envisaged results: the funds itself, continuous policy dialogue on critical development issues,

conditions regarding policies and reforms as well as resource allocation, support for capacity development, and

monitoring of performance and progress, including progress in poverty reduction.

29 The EC is considering support to MoA only for the RNR sector, a decision on which is yet to be taken, probably as a

commitment in 2011.


Programme Document

31 October 2009 20

Gewogs‟ preparation of the 11th

FYP. A concern is the extent to which the Annual Capital Grant

will finance environmental interventions. The SESP will not be tied to environmental interventions,

but it is assumed that the capacity development activities under Component 2 will influence the

environmental dimension in plan preparation and implementation. Environment is not identified as

a sector in the development plans, which makes environmental monitoring a challenge. 30

The only

control measure is to assess ex-post how the funds were used in the Gewogs and/or through the

Public Environmental Expenditure Reviews. In Chapter 4, it is outlined how an ex-post review can

be developed to assess the share of the Annual Capital Grant that was actually used for

environmental investments. The direct capital outlay related to environment falls in three main

groups:

The „green‟ capital outlay related to some (but not all) of the RNR activities, e.g. watershed

management. A large part of the agriculture investment is rural infrastructure for farm roads

and irrigation canals that are not directly „environment‟ investment, but with a high potential

for poverty alleviation;

The „brown‟ investments related mainly to „health development‟ and urban investments, e.g.

waste management, sanitation and safe water supply.

The environmental mainstreaming where environmental impacts are assessed and mitigated

in all other sector activities, e.g. environmental friendly rural roads.

The Annual Grant mechanism does not include grants to the towns (Thromde). Funding for the

Thromde is to begin with not provided through Component 1 as budget support. Budget support

may be feasible for secondary and tertiary municipalities through the Annual Grant mechanism.

Once towns are part of the Annual Grant budget support, Component 1 may also include the

districts towns. Part of the SESP unallocated funds may be spent on budget support for Thromdes.

3.4 Technical assistance

SESP has provisions for international, regional and national short-term TA that can be applied

during inception, implementation, and completion of the Programme. TA can be applied within the

following areas:

Environment and natural resource management, climate change adaptation and disaster risk

reduction, e.g. ECP mainstreaming guidelines and impact monitoring and assessment;

Capacity development – including on-the-job training – of central and local government

units and staff members for mainstreaming ECP in policies, plans and programmes;

Support to training institutions‟ curricula development related to the various target groups

and staff training;

Support to development of area-wide development plans;

Reviews and lessons learned – including public expenditure reviews;

30

LDD has estimated using the forestry sector as a proxy for environment that the capital outlay for activities proposed

in the development plan for the 20 Dzongkhag is BTN 214 Million and for the 205 Gewogs it is BTN 203 Million. This

is a lower estimate for environment in the local government development plans as other activities than forestry can be

considered as environment. In an example from Nangkor Gewog in Zhemgang Dzongkhag the „green‟ investments

were assessed to be 3 % and the „brown‟ investments to be 6% of the total budget. If this is extrapolated to all Gewogs

the potential direct investment in environment in the 10th

Plan Gewog budgets could be around 10 %. Such assessment

is rather uncertain and does not capture the full extent of the additional costs of environmental mainstreaming.


Programme Document

31 October 2009 21

Central or local government executing agencies will recruit TA. The need for TA will be further

explored during the Inception Phase. TA will not be engaged for management tasks. The budget

ceiling for TA will be less than 10 % of the total SESP grant. The assessment of RGoB‟s capacity

suggests that there is no need for long-term TA to support the SESP implementation. Short-term

international, regional or national technical assistance (TA) can be accessed to assist with

programme implementation in cases where adequate resources in the government system are not

available to undertake special tasks. ToR will be prepared for each assignment that clearly specifies

activities and reporting requirements.

3.5 Cross-cutting issues and priority themes

Democratisation and respect for human rights: One aim of the SESP – as it relates to the new

concept of benefit sharing – is to investigate ways in which poor villages can be given rights over

and access to the resources (land, forests and water) that they are responsible for managing. The

upcoming National Forest Policy 2009 will support this aspect.

Good governance: The SESP will contribute to good governance as regards public financial

management in relation to the Annual Grant system, e.g. planning and budgeting, accounting, and

auditing.

Environment: Clearly, a significant aim of the SESP is to lead to improved consideration of the

environment in local development planning. Most previous donor assistance to the environment has

focused at building national level capacity (although the establishment of DECs and DEOs is an

exception to this). This new programme moves to the local level, where there is much to be done to

build capacity and improve environmental management and climate change adaptation.

Gender equality: Two of the aims of the SESP will be to: enhance women‟s participation in the local

planning processes to promote that women‟s priorities are adequately reflected; and encourage the

development of “generic” mainstreaming guidelines, which could provide a template for other “sector-

specific” mainstreaming guidelines, including those related to gender. The SESP will ensure collection,

analysis of disaggregated gender data, e.g. of those receiving capacity development support under the

JSP and number of male and female beneficiaries of the local capital investments.

Employment and private sector development: One of the most significant international responses to

the recent global credit crisis has been initiatives aimed at supporting the development of “green

jobs”. This is now a major plank of the work of UNEP and UNESCAP31

. The SESP will

investigate ways in which green jobs might be encouraged through specific, village-oriented benefit

sharing initiatives in poor Gewogs, amongst other by promoting agro-processing and market access

in the local development planning.

3.6 Development partner harmonisation and alignment

The development partners assisting in the fields of environment, natural resources, integrated rural

development and local governance are mainly the UN, EC, WB and Denmark (see Annex D for an

overview). In September 2008, RGoB, Denmark, World Bank, and UNDP carried out a joint

programme review of the Sustainable Land Management Project (SLMP) and EUSPS and a joint

31 The United Nations Economic and Social Commission for Asia and the Pacific is the regional development arm of

UN in the Asia-Pacific region. UNESCAP seeks to overcome of the region‟s challenges related to: poverty reduction;

managing globalisation; and tackling emerging social issues.


Programme Document

31 October 2009 22

Review Aide Memoire (RAM) was subsequently prepared. The SLMP and EUSPS share the same

PSC.

There are opportunities for future donor harmonisation. Aid effectiveness can be enhanced by joint

financing arrangements, and joint analytical work, steering committee and reviews. This may be

formalised through a MoU between the RGoB and relevant development partners in environment

and natural resource management.

Component 2 has been formulated in full harmonisation and coordination with the UNDP/UNEP

Poverty Environment Initiative (PEI) by formulating the Joint Support Programme, which

comprises the SESP Component 2 and the UNDP/UNEP PEI Phase 2. The continued collaboration

with the WB/ GEF Sustainable Land Management Project (SLMP) will continuously be pursued.

The initial observation of the EC identification mission was that environment in the FYP is not a

defined sector, unlike the Renewable Natural Resources (RNR) sector, managed by MoA. However,

the EC is still considering their programme approach, and commitment will probably only be

committed in 2011 with funding support to begin by 2012.

4. Components of SESP

This chapter describes the SESP‟s two components. Component 1 is fully aligned with the LGSP,

the further details of which are found in the LGSP Programme Document. Component 2 is – as

mentioned above –the Joint Support Programme (JSP), the Programme Document of which

constitutes the Component Description (see the separate document). The overall Programme

management, monitoring, reviews and evaluation, risks, budget and implementation are included in

the subsequent chapters.

4.1 Component 1: Budget support for capital investments in Gewogs

The planning process

The purpose of Component 1 is to provide support to the implementation of the 205 Gewogs‟ 10th

FYP through budget support targeting the Annual Capital Grant transfer mechanism. The RGoB

procedures and conditions for grant transfers are outlined in the GNHC Guidelines for Annual

Grants for Local Governments (Dzongkhags and Gewogs).32

The investments included in the Gewogs‟ 10th

FYP are identified through participatory approaches

and reflect the locally identified needs to improved livelihoods and reduced poverty. The 10th

FYP

are operationalised through the preparation of annual work plans and budgets. The LGAB provides

increased powers and expanded functions to the local governments, which among others include:

promotion of holistic and integrated area-based development/ land use planning; conservation and

enhancement of the environment; regulation of natural resource uses; regulation of pollution; and

organisation of relief measures in case of natural disasters and emergencies.

The local planning process is dynamic and may also cater for new priorities during the planning

period as the Annual Grant facility provides some flexibility. This is important, not least because

local government elections are held during the five-year planning period,33

and therefore GTs

should be able to review the plan and make changes as deemed necessary. The system of Annual

32 The Annual Grant Guidelines were revised in July 2009 and may be subject to further revisions following enactment

of the Local Governments‟ Act of Bhutan 2009.

33 The next local elections are planned to take place in 2010.


Programme Document

31 October 2009 23

Grant transfers is expected to provide increased predictability and effectiveness in achieving the

10th

FYP targets. The main challenge is sufficiency of funds and local capacity.

There is at this point no environmental parameter in the local government budget allocation

formula. The Annual Grant allocation formula for local government had in earlier versions a proxy

for environment (forest cover) that would be used to distribute 10% of the ACG. The environment

factor in the budget allocation was later abandoned, and the allocation of ACG for local government

does not take Gewog-specific environmental status and vulnerability into consideration.

Release of SESP budget support

The minimum access conditions and „triggers‟ for releasing the payments for the SESP budget

support from LOD to MoF are following the LGSP procedures. The procedure for the grant

application and release of budget support instalments for the local government will follow the

sequence and timeline outlined below:

Table 1: Annual sequence for grant instalments

Year Annual Grant: 2nd

instalment

Gewog Work Plan

and Budget

Annual Grant

allocation: 1st

instalment

Ex-post

environmental

expenditure

assessment

Monitoring and

Audit

January March July December December

2010 SESP begins Work Plan and

Budget for FY

2010/11

1st instalment

subject to work

plan and budget for

FY 2010/2011.

- -

2011 2nd

instalment for

FY 2010/2011.

Work Plan and

Budget for FY

2011/12

1st instalment

subject to work

plan and budget for

FY 2011/2012.

Ex-post

environmental

expenditure

assessment for FY

2010/11

Financial statement

from DPA; Audit

report from RAA

for FY 2010/2011

2012 2nd

instalment for

FY 2011/2012 -

subject to

satisfactory

financial reporting

from previous year.

Work Plan and

Budget for FY

2012/13

1st instalment

subject to work

plan and budget for

FY 2012/2013.

Financial statement

from DPA; Audit

report from RAA

for FY 2011/2012

2013 2nd

instalment for

FY 2012/2013 -

subject to

satisfactory

financial reporting

from previous year.

10th

FYP ends Ex-post

environmental

expenditure

assessment for FY

2012/13

Financial statement

from DPA; Audit

report from RAA

for FY 2012/2013

SESP ends

*) Instalments are from DPA to Gewogs. The Instalments from LOD to MoF follow a similar pattern.

The planned capital budget outlay for the 10th

FYP for the 205 Gewogs is included in Annex E. The

average annual budget for a Gewog is BTN 4.4 Million but with variation subject to the allocation

criteria used. The budget is allocated to each Gewog using the local government Annual Grant

budget allocation formula. Annex E shows how the budget will be allocated for each Gewog when


Programme Document

31 October 2009 24

the budget allocation formula is applied. The planned SESP budget support allocation to

Component 1 is DKK 40.0 Million.34

Ex-post environment expenditure assessment

The current Gewog five-year plans are basically a long-list of investments, some of which could be

classified as environmental investments. The effect of the capacity development of ECP

mainstreaming will at the earliest effect the FY 2010/11 annual plans, but more likely the FY

2011/12 annual plans. In order to estimate the actual environment expenditures of the Gewog

annual plans, ex-post assessments of implemented activities based on DPA financial statements are

planned to be carried out as separate studies and – if feasible – in cooperation with and as follow-up

on the 2009 Public Environmental Expenditure Review that is undertaken by the PEI. Some of key

findings of the PEER 2009 are (i) the average Public Environmental Expenditure (PEE) during the

9th FYP, as a proportion of total public expenditure, was 7.4 percent with a declining trend of PEE

during the plan period; (ii) the average PEE as a percentage of GDP was estimated at 2.8; (iii) four

institutions of the Department of Forestry, Council of RNR Research for Bhutan and the National

Biodiversity Centre under the Ministry of Agriculture and the Department of Energy under the

Ministry of Economic Affairs accounted for about 50 percent of the total PEE of Bhutan; (iv)

environmental domain classification revealed that lowest level of expenditure incurred in “soil and

water conservation” sector which is an important concern for Bhutan where more than 80 percent of

the land consisted of mountains with steep slopes and (v) donor financing accounted for

approximately 34 percent of the total PEE during the 9th Plan period.

The assessment could be based on a „positive list‟ (see Box 5).

Box 5: Proposed positive list for assessment of the environment contents

Watershed and water resource management to protect and maintain a water flow;

Adaptation to climate variability and natural disaster risk reduction;

Locally based forest management and tree planting with environmental purpose and supply of local produce for

construction and fuel;

Land use management and soil conservation that benefits community groups;

Water supply using appropriate and cost-efficient technologies;

Local waste management in areas using appropriate and cost-efficient technologies;

Environmental Friendly Road Construction (EFRC) (only estimate for additional costs of environmental

mainstreaming);

Adding value to natural products, e.g. medicinal plants, handicrafts based on non-timber forest products, and

organic farming;

Community based development of eco-tourism facilities;

Fencing against wildlife to avoid crop damages and other means to reduce damages from wildlife on crops.

Items outside the „positive list‟ would be:

Farm roads, bridges, paths, irrigation systems, and other rural infrastructure;

Crop and livestock production system including horticultural production, pasture

improvements, all commercial crops and greenhouses, and agro-industry development;

34

The share of the capital budget outlay for 205 Gewog plans in the 10th

FYP is BTN 4.8 Billion of which BTN 4.5

Billion are allocated as Annual Grants. The SESP Component 1 grant of DKK 40 Million is equal to 7.5 % of the 10th

FYP plan budget for the Gewog Annual Grants (capital outlay) of the 205 Gewogs. Since the SESP will support 3 and

not 5 years of the 10th

FYP the annual share from SESP for those three years is 12.5 %.


Programme Document

31 October 2009 25

Establishment and refurbishment of RGoB facilities like Gewog RNR centres and facilities

located at these premises such as technology parks.

The ex-post environment expenditure assessments will not be part of the general monitoring, which

will follow the agreed existing and planned RGoB monitoring and reporting systems for the LGSP.

The financial reporting on budget performance will include monthly expenditure reports prepared

by the Gewog accountants and compiled by the Dzongkhag administration.

4.2 Component 2: Support for capacity development for environmental mainstreaming

The Danish SESP Component 2 and the UNDP/UNEP PEI Phase 2 have been designed to

constitute the Joint Support Programme (JSP) for ECP mainstreaming. The capacity development

will target the central level and the local level, but with a relative greater emphasis on the local

level. The national level capacity development is mainly aimed at creating a national framework

that will facilitate the local level ECP mainstreaming. The aim is to improve the local planning and

implementation processes so that annual development and recurrent grants are used most

effectively. The results framework of the JSP outcomes and outputs and the relative emphasis of the

two development partners will be as follows:

Outcomes and Outputs SESP PEI 2

Outcome 1: ECP mainstreamed in national policies, plans and programmes

1.1 ECP Mainstreaming Guidelines and Indicators Available for use by

sectors

Medium High

1.2 Poverty Environment linkages demonstrated and benefit sharing

policies, strategies and guidelines developed

Medium High

1.3 Staff and training modules available for ECP mainstreaming

trainings at all levels in relevant educational and training institutes

Medium Medium

1.4 Competent staff available in all sectors including the Help Desk to

mainstream ECP

Medium Medium

1.5 Competent staff available in other sectors to mainstream ECP Medium Medium

Outcome 2: ECP mainstreamed in all development plans and programmes at local level

2.1 Revised Local Development Planning Manual is available for use

by Local Governments

High High

2.2 Benefit sharing mechanisms applied to selected conservation

projects

Low High

2.3 Competent staff available at the local levels to mainstream ECP High High

2.3 Local Plans monitored for integration of ECP concerns High Medium

In order to achieve its socio-economic development goals as defined in the 10th

Five Year Plan, pro-

poor environmental considerations and climate change adaptation responses need to be

systematically integrated into development planning processes in Bhutan. The initiation of the

concept of national level environmental mainstreaming can be traced back to the Guidelines for the

Preparation of the 10th

Plan (2007-2012), which states that:

“Environment is a cross-cutting issue that is intimately intertwined with poverty reduction. Therefore, all sectors,

agencies, Dzongkhags and Gewogs should mainstream environmental issues in all their policies, plans, programmes


Programme Document

31 October 2009 26

and projects and build adequate mitigation measures to minimize any adverse impact on the environment”. (Clause

2.3(iv))

This requirement led to environmental awareness training undertaken by NEC under the EUSPS

programme for all sector agencies during the second half of 2006. It also encouraged other donors,

most notably UNDP, to consider supporting the government‟s attempts to build ECP mainstreaming

capacity. Evidence from EUSPS and PEI Phase I indicates that there is still work to be done at the

national level to support overall policy development, which will provide the framework for

development of local ECP guidelines and capacity development that will facilitate local level

planning, implementation and monitoring.

Five-Year Plans for the 10th

year plan period have been prepared for all Dzongkhags and Gewogs

based on guidelines and budget ceilings issued by GNHC. These 10th

FYPs form the basis for

preparation of annual plans according to the yearly planning cycle – the implementation of which is

funded by the Annual Capital Grants and the Annual Recurrent Grants. It is this planning process

that the capacity development interventions intend to influence with a view to incorporating ECP

concerns. The preparation of the 11th

FYP will start during FY 2011/12 and therefore provides an

important opportunity for ECP mainstreaming. Anticipating the passing of the draft LG Act with its

requirement of „holistic and integrated area-wide development Dzongkhag plans, the planning

process will become substantially more complex, but will also offer increased opportunities for ECP

mainstreaming. The DPO and the DEO assist the Gewog administrations with the preparation and

monitoring of the Gewog-level development plans and annual plans.

Currently, the planning and environmental issues are dealt with in the District Development

Committee (DDC) and District Environmental Committee (DEC) respectively. The DPO and DEO

and other senior officers are members of the two committees. The LG Act of Bhutan 2009 legalises

the formation of committees for purpose of specific functions but does not specify the committee

structure. The elected councillors will be members of the committees, including co-opted members

from amongst officials from any national agency, ministry, department and regional office or the

voters of the Thromde/Gewog.

Results-based monitoring will include an assessment of environmental outcomes. The outcome

monitoring will be incorporated as part of the RGoB M&E system and will be shared with

Component 2. The environmental outcome monitoring will be based on core environmental

indicators. Initial baseline assessments will be conducted in a number of Gewogs during the

Inception Phase. Output and outcome monitoring is further elaborated in Chapter 8. The purpose of

the output and outcome monitoring of Component is to assess how the environmental dimension

evolves in the annual plans and what the associated benefits will be.

The Dzongkhag DEOs and DPOs will assist the Gewog administrations with progress reporting as

regards the environmental outcomes and the environmental outcome statements. A proposal for a

simple draft format for the output statement reporting on expenditures for the environment is

attached as Annex F. This draft format can be further developed during the Inception Phase and

aligned to the expected requirements of RGoB output and outcome monitoring in NMES.


Programme Document

31 October 2009 27

5. Programme management and organisation

5.1 Programme management

GNHC will be the managing agency for the SESP. GNHC has no implementation mandate and does

therefore not take directly part of the actual implementation, but will undertake the overall

coordination functions.

Component 1

The budget support will be provided through the same procedures as those of LGSP and the RGoB

“Guidelines for Annual Grants for Local Governments”. The LDD will monitor the local

governments‟ overall performance as regards the implementation of the annual plans. As regards

grant management, the following agencies have specific roles:

The Department of National Budget will report on budget inputs and budget performance;

The Department of Public Accounts will release funds and endorse annual financial

statements;

The Royal Audit Authority (RAA) will conduct the necessary audits according to the RAA

Act.

The LDD Programme Manager for LGSP will also function as the Programme Manager for the

SESP Component 1.

Component 2

Component 2 will be implemented as part of the Danish-UNDP/UNEP Joint Support Programme

with LDD having the overall coordination function in relation to sector ministries, national agencies

and local governments. The local government councils (Dzongkhags and Gewogs) will be the

executing agencies at the local level and implement the JSP according to local governance

procedures – as mandated by the Local Governments‟ Act 2009 – in due coordination. The main

sector agencies are NECS, MoA and MoHCA, which will provide the policy framework and

strategic directions to the local governments according to their mandated roles.

A senior officer in GNHC Secretariat will be appointed as the programme manager, who will

coordinate and oversee overall progress and intervene if delays and other problems occur. NECS,

MoA and MoHCA will each appoint a senior officer who will act as the focal point and coordinate

activities within their respective ministry/ agency. At the Dzongkhag level, it will be the DPO and

the DEO who will jointly act as the focal point. The focal points will be responsible for programme

implementation in their respective central and local government units.

A Programme Management Group (PMG) will be established, which will be made up of members

from RGoB and development partners. Alternatively, the proposed The RGoB member will be the

GNHC Programme Manager and the focal points in NECS, MoA/ SLMP and MoHCA. The

development partner members will be UNDP/UNEP and Denmark. The PMG will meet at least

once every three months to review progress, discuss the way forward, and address important

strategic issues. Representatives from other national agencies, training institutions, civil society and

private sector will be invited on an ad-hoc basis when these representatives can contribute to the

issues being discussed. The GNHC Programme Manager will act as secretary to the PMG.

Short-term international, regional or national technical assistance (TA) will be provided to advice

with programme implementation in cases where adequate resources in the government system are


Programme Document

31 October 2009 28

not available to undertake special tasks. ToR will be prepared for each assignment that clearly

specifies activities and reporting requirements. The PMG will prepare these ToR, which will be

endorsed by the JSP-SC.

Role of central government

The primary role of central government is to mainstream ECP into policies, plans and programmes

and to ensure that the outcomes of this activity are effectively communicated to the concerned

stakeholders. The mainstreaming of ECP will impact on national level plans and local government

policy guidelines that will inform the local level plan preparation and implementation. Another

important aspect will be to mainstream ECP into the secondary and tertiary education institutions‟

curricula to ensure that the future professional cadres possess the competence to address

environment, climate change and poverty reduction challenges. The GNHCS and NECS will

assume the following functions:

Gross National Happiness Commission Secretariat

Overall coordination and management of the Joint Support Programme.

Management of capacity development of DPOs and GAOs.

Policy and planning guidance and backstopping to the PPDs of sector line ministries and

non-ministerial central government agencies.

National Environment Commission Secretariat

Management of capacity development of DEOs.

Technical guidance and backstopping to the environmental units of sector line ministries for

environmental assessment and monitoring.

Role of local government

The primary role of local governments is to mainstream ECP into their development and annual

plans based on planning and policy guidelines from line ministries/ central agencies. The two most

relevant committees35

in relation to the Programme are: 1) District Development Committee (DDC)

that will be responsible for the planning aspects; and 2) District Environmental Committee (DEC)

that will be responsible for environmental and natural resources management concerns. The

interface between the two committees is ensured because most senior district officers are members

of both committees, including the DPO and the DEO. The argument for maintaining the two

committees is that DECs have a regulatory function as well as a developmental function. The two

committees will be the main fora for discussing and agreeing on actions to be taken on planning and

ECP mainstreaming – and thus ensure that the combined expertise of senior district officers come in

play. The LG Act stipulates that council members will constitute the membership of the

committees, but that these can be expanded as warranted with the necessary sector expertise.

35 The Local Government Act does not contain clauses on the committee structures, but it is assumed that District

Development Committees – with somewhat similar functions as the current DYT – will be established as a „committee‟

that will report to the full Council.


Programme Document

31 October 2009 29

5.2 SESP Steering Committees

Component 1

The existing LGSP Outcome Board/ Steering Committee36

(LGSP-SC) will serve as the Steering

Committee for the SESP Component 1. The LGSP-SC has been established to oversee overall joint

programme activities. The LGSP-SC will meet twice a year in February and September respectively

to discuss component progress and endorse the overall direction of component implementation. The

LGSP-SC comprises the following members:

Secretary of the GNHC (chairperson)

Head of Policy and Planning Division, Ministry of Home and Cultural Affairs

Directors of DNB and DPA under MoF

One Dzongda

Two DT Chairpersons

Development partner representatives

Reference is made to the LGSP Programme Document for further details on the LGSP-SC.

Component 2

A Joint Support Programme Steering Committee (JSP-SC) will be established as the formal

mechanism for decision-making concerning the Joint Support Programme. The JSP-SC will meet

half-yearly in February and September to decide on major strategic directions and resolve

conflicting issues – and in due consultation with other ministries if such issues relate to their

mandated responsibilities. The JSP-SC comprises the following members:

GNHC:

o Secretary of GNHC (chairperson)

o Head of PMCD/GNHC

o Head of LDD/GNHC

o Head of DCD/GNHC (member secretary)

Sector agencies:

o NECS Head of PCD or DG

o Chief Planning Officer of PPD/MoA

o Head of Department of Local Government/MoHCA

Local Government level:

o One local Government representative (Gup). LDD will request a nomination at the

annual meeting of Gups.

o One representative of District Environmental Officers (DEO). The representative

will be nominated at the annual symposium for DEOs organised by NECS.

Development partners

o Head of LOD

o Head of Environment and Energy Unit of UNDP

o Others

36 The LGSP Outcome Board/ Steering Committee is abbreviated as OB/SC in the LGSP Programme Document


Programme Document

31 October 2009 30

The development partner members will initially be UNDP/UNEP and Denmark, but will be

expanded if other development partners embark on compatible programmes. The Secretary of the

GNHC will chair the JSP-SC, and the Programme Manager will act as secretary to the JSP-SC.

Reference is made to the separate JSP Programme Document for further details on the JSP-SC.

Overall Programme steering

In order to oversee overall implementation, cooperation issues, etc. for the SESP‟s two components,

the Secretary GNHC and the Head of the LOD will form a high-level coordination body. This body

will have a mandate similar to a Programme Steering Committee (PSC) and will consequently be

responsible for and mandated to reallocate funds between Programme components and allocation of

unallocated funds consistently with the SESP‟s objectives. The PSC is formed with a view to

establishing a flexible and efficient mechanism. All decisions of the PSC will be recorded in

minutes of meeting that will be jointly endorsed and signed by its two members.


Programme Document

31 October 2009 31

6. Programme budget and financial management

6.1 SESP grant

The SESP grant from Denmark is DKK 70.0 Million. The budget will cover the two components,

technical assistance and reviews as well as unallocated and contingency funding as shown in Table

2, Table 3 and Table 4.

Table 4 include the budget flow in both the financial years of RGoB and of Denmark. Reallocation

between the budget lines of each component can be decided by LGSP-SC and the JSP-SC

respectively, whereas the SESP PSC will decide reallocation between components.

Table 2: SESP Budget Summary

Components DKK mn Percentage

Component 1: Budget support for capital investments in Gewogs 40.0 57 %

Component 2: Capacity development for environmental mainstreaming 20.0 29 %

Outcome 1: ECP mainstreamed in policies, plans and programmes 6.8 10 %

Outcome 2: ECP mainstreamed in all development plans and

programmes

11.2 16 %

Technical Assistance 2.0 3 %

Other: 10.0 14 %

Joint Reviews 2.0 3 %

Unallocated 7.0 10 %

Contingency 1.0 1 %

Total 70.0 100 %

Note: Exchange rate October 2009: BTN 100 = DKK 109 ~ 1 DKK = BTN 9.2; 1USD = DKK 5.5

The main emphasis of the SESP Component 2 part of the Joint Support Programme will be at the

local government level and thus a major part of the budget will be allocated for capacity

development of Dzongkhags and Gewogs administrations. The Danish grant will be monitored in

DKK and transfers to the Programme will be based on the current DKK-Nu exchange rate. The

main purpose of capacity development at the national level will be to establish national level

frameworks that facilitate development of local governments‟ corporate capacity.

Table 3: SESP Budget according to Bhutan’s financial year (DKK million)

Components

2nd

half

FY

2009/10

FY

2010 /11

FY

2011/12

FY

2012/13

1st half

FY

2013/14

Total

Component 1: Budget support for capital

investments in Gewogs

- 10.0 15.0 15.0 0.0 40.0

Component 2: Capacity development for

environmental mainstreaming

2.1 5.1 5.9 4.9 2.0 20.0

Other - 2.5 3.0 3.0 1.5 10.0

Programme Reviews - 0.5 0.5 0.5 0.5 2.0

Unallocated - 2.0 2.0 2.0 1.0 7.0

Contingency - - 0.5 0.5 0.0 1.0

Total 2.1 17.6 23.9 22.9 3.5 70.0

Bhutan‟s Financial Year (FY) is from July to June.


Programme Document

31 October 2009 32

Table 4: SESP Budget according to Denmark’s financial year (DKK million)

Components FY 2010 FY 2011 FY 2012 FY 2013 Total

Component 1: Budget support for

capital investments in Gewogs 5.0 12.5 15.0 7.5 40.0

Component 2: Capacity development

for environmental mainstreaming 4.2 6.0 5.8 4.0 20.0

Other 1.5 2.5 3.0 3.0 10.0

Programme Reviews 0.5 0.5 0.5 0.5 2.0

Unallocated 1.0 2.0 2.0 2.0 7.0

Contingency - - 0.5 0.5 1.0

Total 10.7 21.0 23.8 14.5 70.0

Denmark‟s Financial Year (FY) is from January to December.

The SESP unallocated funds will be used for interventions that will contribute to the overall scope

of the SESP, but which have not yet been specified as specific outputs or activities. One such option

could be support to urban towns which small rural towns that are highly interlinked with the

neighbouring Gewogs. Such support would also be a logical continuation of the support provided

under the Danish EUSPS. Other options could be:

Actions concerning climate change adaptation and disaster risk reduction that are identified

from the ongoing pilot activities or post-COP15 initiatives;

Emerging specific strategic interventions that are identified during the SESP implementation

related to environment with high policy relevance for local level applications.

The use of the unallocated budget is subject to satisfactory progress reporting and approval by the

SESP PSC. Recommendations about the unallocated budget can be done during the annual

programme review. The contingency budget allows for any budgetary uncertainties due to currency

fluctuations and emerging priorities. The SESP PSC will decide how the contingency budget will be

used.

6.2 Financial management

The financial management of the SESP will follow the RGoB procedures for budgeting, flow of

funding and accounting. Procurement of equipment and services will be the responsibility of the

implementing agencies and procurement will follow ordinary RGoB procurement in accordance

with the Procurement Rules and Regulation (2009). If requested by RGoB, procurement of TA

could be undertaken by LOD in line with current Danish procurement procedures.

Flow of funds for Gewog development plans (Component 1): The flow of SESP funds will be

channelled through the Gewog Annual Capital Grant (ACG) facility. The procedures of budgeting

and flow of funds to the Gewogs will follow the regulations of the MoF according to the practice

established with the Financial Management Arrangement of the LGSP. Denmark will transfer funds

to the Budget Fund Account operated by the Department of Public Accounts (DPA). Release of

budget support from LOD to DPA is subject to disbursement triggers. The transfer will be made in

two annual instalments. The SESP funding will be fungible with funds from the RGoB and other

development partners contributing to LGSP. Gewogs need to comply with the requirements

outlined in the Guidelines for ACG for Local Governments (Dzongkhags and Gewogs) in order to

access the ACG.


Programme Document

31 October 2009 33

The RGoB have triggers for the release of the Annual Grant to each Dzongkhag and Gewog. The

release of tranches from the SESP budget support requires that the LGSP triggers be met. The 80%

annual tied grants will be accessed through the current practice of annual planning, budget release

and accounting procedures. Normal documentary requirements like detailed work plans,

procurement papers, cost estimates and technical design are endorsed and submitted by the Dzongkhag and Gewog administrations. The release of the 20% untied grants is subject to

fulfilment of three additional minimum access conditions:37

Annual Dzongkhag and Gewog Plans and budgets are in accordance with the functional and

financial assignments of the Dzongkhags and Gewogs endorsed by DTs and GTs. The

format for annual plans will be provided from the PlaMS, and the budget format from MoF.

Monthly accounts as per the Financial Rules and Regulations, 2001 (FRR) and existing

guidelines of MoF.

Minutes of GTs and DTs related to annual plans (to confirm the work plan and budget is

endorsed by the GT).

DPA produces an annual financial statement and a list of all Gewogs with status of work plans,

expenditure reports and audits for the LGSP SC. The material produced by DPA for the LGSP will

also be used as statements for SESP. In case of non-fulfilment of required reporting and budget

release triggers, the LOD will request the SC to address the issue, while also reserving the right to

reduce disbursements for the budget support.

Flow of funds for capacity development (Component2): Lead agencies for each of the JSP outputs

representing the local governments and relevant national agencies (GNHC, MoA, NECS and

MoHCA) will prepare annual work plans and budgets aligned to the 10th

FYP and capacity

development activities proposed under the various outputs of the JSP. The education and training

institutions will be contracted by GNHC or a national agency as relevant. Similarly, support to PS

and CSO capacity development could be provided through the Board for CSO fund currently under

consideration. PMCD and LDD will each compile a comprehensive annual work plan and budget at

Outcome level for prioritisation and approval by JSP-SC. Funding from the Joint Support

Programme is included as earmarked support with funds transferred to and accounted for by the

relevant agency. The GNHC will coordinate the programme and monitor the tasks according to

annual work plans.

The RGoB procedures for financial management and procurement will be applied. Subject to

decision by the JSP-SC, procurement of some services may be managed by LOD/UNDP in line

with standard Danish/UNDP procurement procedures.

Accounting: Dzongkhags and Gewogs will prepare quarterly expenditure reports to DPA on the

finances and activities according to the procedures developed by the MoF and GNHC. DPA will

prepare annual financial statements. The Budget and Accounting System (BAS) has been applied so

far, but Multi-Year Rolling Budgets (MYRB) and Public Expenditure Management Systems are in

the process of being introduced.

Auditing: The RGoB auditing procedures will be applied. In accordance with the Audit Act, the

Royal Audit Authority (RAA) will audit the accounts of public institutions including the

Dzongkhags on an annual basis and for Gewogs at least every second year. Each Gewog is an

independent accounting entity. An annual audited financial statement shall be submitted to LOD

and UNDP/UNEP once it is endorsed by Parliament.

37

Guidelines for Annual Grants for Local Governments (Dzongkhags and Gewogs)


Programme Document

31 October 2009 34

Table 5: Flow of funds and financial management

SESP component / output Financial flow Budget and Accounting Reporting and Auditing

Component 1: Budget

Support for Annual Capital

Grants (DKK 40 Million)

From Denmark to Treasury

as budget support included

in the budget for all Gewogs.

From DPA to Letter of

Credit Accounts of the

Gewogs. Annual Grant

approach will be applied as

defined in LGSP.

Budget as approved by the

Parliament. Allocations to

Gewogs as defined in the

Gewog Budget Allocation

Formula. Annual allocation

defined by DNB.

Accounting by Gewog

Accountants.

Reporting through the

PEMS and MYRB as well

as PlaMS.

Summary progress and

status reporting to SESP

PSC by GNHC.

Auditing by RAA.

Component 2: Capacity

Development to

Mainstream Environment

(DKK 20.0 Million)

From Denmark to Treasury.

From Treasury to:

Dzongkhag account for

DEO activities.

Relevant sector agency

and to sector agency to

local government as

„earmarked‟ grants

Budget to be agreed in

annual work plan

coordinated by GNHC and

endorsed by the JSP-SC.

Accounting by the

concerned agencies

according to RGoB

regulation.

Reporting on outcomes to

GNHC from relevant

sector agency.

Reporting on finances to

MoF.

Reporting to SESP SC by

GNHC.

Auditing by RAA.

APR, unallocated and

contingency budget (DKK

10.0 Million)

As for Component 2 or SC

request for LOD

procurement

As for Component 2 As for Component 2


Programme Document

31 October 2009 35

7 Assessment of key risks

There are a number of risks associated with the implementation of the SESP. The extent to which

the risks will materialise will be assessed during the Annual Programme Reviews. The risks are

summarised below:

Risks Likelihood Potential

Impact

Risk mitigation measures

Environmental Outcomes

1. Environment is not integrated in

the development planning #)

Medium High GNHC will sensitise the Gewogs on the relevance

of environment and natural resources for the

secured livelihoods and local economic

development. Environmental mainstreaming

guidelines by NECS and GHNC.

2. Mainstreaming ECP into local

level annual and five-year

planning may not happen due to

low local level capacity

Possible High Programme management should stress local level

capacity development for mainstreaming ECP

above all others

3. ECP mainstreaming guidelines

may not become part of GNHC

11th

Plan Guidelines

Possible High GNHCS has considerable ability to determine the

content of the 11th

Plan Guidelines. As long as

ECP guidelines are produced in a timely fashion,

this risk should be minimized.

4. Environmental outcomes are

unknown and cannot be

measured.

Medium Low Improved environmental monitoring locally, for

example through core environmental indicators.

Establishment of baselines and core indicators.

Integration of the environmental outcome

monitoring in the NMES.

Local Government and Planning

5. The implementation of the

Local Governments‟ Act

encounters difficulties

Possible Medium Joint Programme should have an input to the

writing of regulations under the new law.

6. Local Government Elections

are not held by October 2009 #)

Low High Develop interim measures until a new elected Gup

and other local government is in office. Emphasis

on capacity development of Gewog administrative

staff.

7. Several Initiatives on

elaboration of new planning

guidelines for the Gewogs may

send conflicting signals and

overload the weak capacity of

the Gewogs

Medium Medium Elaboration of one consolidated, integrated

planning guideline for Gewogs, which will address

all cross-cutting issues and themes and major

sector issues where relevant. Strong coordination

of these issues in the LGSP-SC.

8. Local Government

Development Plans for the

Gewogs are not available #)

Low Medium Support to Multi-Year Rolling Budget (MYRB)

process at Gewog level and continuous update of

the focus areas of the Gewog plans.

9. Indigenous peoples‟ rights and

involuntary translocation of

people due to construction of

new infrastructure are not

tackled

Medium Medium These issues should be addressed in the planning

guidelines and awareness raising and training

should encompass sufficient activities and

measures to mitigate this risk.


Programme Document

31 October 2009 36


Impact


10. Lack of technical support for

implementation at local level

Possible High Annual work plans need to ensure adequate

application of technical assistance during the

course of the Joint Support Programme.

11. Uncertain policy and capacity at

the central level may hamper

the proposed main focus on

local level capacity building

Possible Medium Initial Joint Support Programme work should

focus on completing mainstreaming awareness

raising and policy development at the central level.

12. Lack of human resources at

central level for oversight and

coordination

Likely High The Joint Support Programme will require full-

time project management from the GNHCS (either

based in LDD or DCD). The RGoB needs to work

with the two donors to ensure that daily, full-time

project management is sourced from GNHCS.

13. National M&E not adequate for

monitoring local level

implementation and impact of

such

Possible Medium The RGoB is currently revising the NMES and the

PLaMS. The Joint Support Programme needs to

ensure that this system takes local-level indicators

into account. Lessons learned regarding M&E

from previous decentralization projects will also

be taken into account.

Public Financial Management

14. Weak budgeting, monitoring

and reporting at the Local

Government level #)

Medium High Action from LGSP and ICBP to enhance capacity

for administration, management and accounting.

These core skills are outside the SESP activities.

15. The untied Annual Grant

system is not operational

Low Low An alternative to untied Annual Grant funding is

continued allocation of Gewog grants 100%, tied

to the 10th

FYP. This is as practised now in the

fiscal year 2008/09.

16. Delays in transfer of funds and

implementation of activities

Low High Emphasis on streamlining procedures for funding

and implementation to ensure that there is no spill

over of budget due to implementation delays

17. The funds are not used in a

transparent matter

Low Medium Emphasis on application on auditing and financial

reporting procedures. Zero tolerance for

misappropriation of development funds. Focus

area of the LGSP.

18. Corruption and misuse of funds

at local level

Possible Medium ADB/WB is supporting nationwide capacity

building on the use of the new procurement

manual 2007, as well as support to update the

existing Financial Rules and Regulations. Quite

strong audit procedures are in place and the Royal

Audit Authority performs audit of Gewog accounts

at least every second year.

Institutional Issues

19. Unclear division of tasks

between the core agencies

within the support to Gewogs,

including the Ministry of Home

and Cultural Affairs and the

GNHC, within areas such as

M&E and capacity

development

Medium Medium The new LG Act should address these issues and a

strong coordination between the various agencies

should be pursued throughout the implementation.

It should be made very clear for the Gewogs and

Dzongkhags who they refer to in which cases.


Programme Document

31 October 2009 37


Impact


Other Impacts

20. Demographic changes in rural

Bhutan and urban migration of

economic productive population

Medium Medium Develop opportunities in rural areas for

employment and improved livelihoods.

21. Impacts of climate change and

climate variability

High High Improved capacity for adaptation to climate

change and variability. Inclusion of seasonal

forecasting, early warning and vulnerability

reduction. Climate change proofing of

infrastructure projects like roads and irrigation.

#) Risks that were included in the Concept Paper

The sustainability of the capacity development activity will to a large extent be dependent on civil

servants remaining in their posts for a reasonable period of time, or that they at least are transferred

to positions where the acquired competence will remain useful. The sustainability aspect is

enhanced by the fact that the training is provided by Bhutanese educational and training institutions

and could in future be provided on a continuing basis. The sustainability aspects are, furthermore,

enhanced by guidelines being prepared and policies being mainstreamed – both of which will

capture the main thrust of the Programme.


Programme Document

31 October 2009 38

8 Monitoring, reporting, reviews and evaluations

8.1 National monitoring and evaluation framework

The SESP monitoring system and associated indicators will be based on the RGoB indicators and

M&E system. The SESP will be monitored through the LGSP for Component 1 and the Joint

Support Programme for Component 2. The Joint Support Programme includes an outline of a

performance monitoring system that has been prepared in accordance with the PlaMS. However,

during the formulation of the SESP, gaps were identified in the national indicators and monitoring:

i) the structure of the planning and financial monitoring system (NMES) is still being developed; ii)

the Gewog output and outcome indicators were not available, and iii) there is no comprehensive

environmental indicator system for the environment in place that applies at the Gewog level.

National monitoring and evaluation framework

The 10th

FYP moves away from traditional process monitoring, to a results-oriented monitoring and

evaluation system, which places greater emphasis on assessment of outcomes. The GNHC will

review the performance of plans through Mid-Term and Terminal Reviews. It will also conduct

periodic evaluations based on new indicators such as the Gross National Happiness Index and

various plan targets in collaboration with relevant stakeholders. The lessons and recommendations

of these evaluations will then be used as guidance for the prioritization of the 11th

FYP and updating

long-term plans.

The National Monitoring and Evaluation Manual 2006 (NMEM) is the guidance for M&E of the

10th

FYP. A revision and update of the Manual is forthcoming (expected September 2009). The

manual is a guideline for the NMES. The NMES is a results-based monitoring system. The

monitoring system is expected to become operational during FY 2009/2010.

The M&E system takes place at four levels (national, sector, Dzongkhag, Gewog) and integrates:

The Planning and Monitoring System (PlaMS). This is reporting to GNHC on the impacts,

outcomes and outputs of programme implementation. The PlaMS is a database system

established to monitor results, but it is only as good as the data and indicators included from the

programmes. Indicators used in PlaMS are due to be completed in late 2009.

The Multi-Year Rolling Budget (MYRB). This is the budget planning and reporting to DNB on

the budget outputs of the plan implementation.

The Public Expenditure Management System (PEMS). This is the reporting to DPA of MoF on

the expenditures.

Efforts are being made to fully integrate the financial management systems into the NMES –

especially to integrate the existing accounting system into PlaMS. PlaMS has been revised to enable

collection of financial data to allow reporting on output-based expenditure. For the time being, the

two systems are separate. There have also been delays in the MYRB implementation, as the line

ministries and agencies are not yet fully involved. In principle, all Dzongkhags and Gewogs plans

should be in the PlaMS and should also include expected outcomes from the five-year plan – in

practice this is not happening yet. The draft revision of the “Organisation of M&E in NMES” is

shown in Table 8.1.


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31 October 2009 39

Table 8.1: Organisation of M&E in NMES

Source: National M&E Manual (draft revision, 2009) and 10th

FYP

PlaMS is a centralized data collection and management system. It will enable real time online data

entry, analysis, data storage, and report generation of development programs and projects.

Currently, many Gewogs are yet to get Internet access, which prevents them from being directly

linked up to PlaMS. As an intermediate measure, the Gewogs will report the monitoring data to the

Dzongkhag DPO in hard copy, who will then enter these into the system. The current Dzongkhag

plans have limited outcome information, as the LDP Guidelines are very project and activity

focussed, which is correspondingly the case for Gewogs.

An M&E Coordinator or focal point at each level is to be appointed for undertaking monitoring and

evaluation at the designated levels and supporting the review committees. The concept of a Mobile

M&E Team is introduced in the 10th FYP whereby the GNHC in collaboration with the line

ministries and agencies will form a multi-disciplinary team. The team will undertake regular field

visits to monitor and assess the implementation of development programs and projects and

recommend solutions for reorientation and reprioritization of plans to the Government.

State of the Environment Reporting

In addition to monitoring the results of the 10th FYP, it is relevant to assess outcomes in terms of

changes in the state of environment at the Dzongkhag and Gewog levels. NECS has developed an

EIMS (Environmental Information Management System), which is just about to go “online”. The

EIMS captures national level aggregated data but does not yet include local or core environmental

indicators. The most developed source of local level data on natural resources is the RNR census

produced by MoA. A new RNR census has been prepared and is expected published at the end of

2009.

M&E Level M&E Review

Committee

Review Members M&E

Coordinator/

Focal Point

Focus of M&E Frequency

of Review

National GNH

Commission

GNH Commission members,

chaired by Prime Minister

GNH

Commission

Secretariat

Outcomes

Impacts

Budget

performance at

output level

Annual

Mid-term,

End of plan

Ministry and

Agency

GNH

Committee

Heads of Departments or

equivalent, chaired by

Minister or Head of

Autonomous Agency

Policy and

Planning

Division

Activities

Outputs

Outcomes

Semi-annual

Annual

Dzongkhag GNH

Committee/

Dzongkhag

Tshogdu

Dzongkhag Tshogdu

Members, Dzongdag,

Planning Officer & Sector

Officers. Chaired by DT

Chairperson

Dzongkhag

Planning Unit

Activities

Outputs

Outcomes

Semi-annual

Annual

Gewog GNH

Committee/

Gewog

Tshogde

Gewog Tshogde Members,

Gewog Sector Staff. Chaired

by GT Chairperson

Gewog

Administrative

Officer

Activities

Outputs

Semi-annual

Annual


Programme Document

31 October 2009 40

The conclusion based on an analysis of potential core indicators is that there is very little data

available to establish Gewog-level indicators for monitoring the state of environment. This was also

confirmed by GNHC when existing sources of potential environmental indicators for PlaMS were

assessed. GNHC is preparing a socio-economic profiling for Dzongkhags and Gewogs, which will

be available during 2009. Data for gender-disaggregated indicators are not available unless

specified as such in the indicators of the development plans (no example was identified). The

MDGs are an important system of core development indicators for Bhutan. Goal 7 focuses on

environmental sustainability, with target 9 addressing land use and climate change, and target 10

addresses water and sanitation.

Reporting

Dzongkhags and Gewogs will follow the guidelines prescribed in the NMEM of GNHC for

monitoring of the implementation of activities funded under the Annual Grants. Financial and

physical progress reporting shall comply with the formats in PlaMS and FRR. Financial reports and

accounts shall be submitted to MoF through the Budget and Accounting System (BAS) and

physical progress reports to GNHC through PlaMS. The Dzongkhag administrations will play a

lead role in consolidating financial and progress reports for Gewogs that do not report directly to

DPA and GNHC.

M&E procedures and indicators relevant for the SESP

The SESP M&E procedures will follow the procedures established by the NMES, and its guidance

manual (the NMEM). Additional M&E capacity development related to the environment and links

to poverty reduction are part of the Programme. The Programme will provide support to strengthen

Gewog-level M&E on environment under the guidance of the DEOs and sector agencies such as

NECS and MoA. This includes development of environment output and outcome core indicators.

The indicators should provide information about the environmental performance of the 10th FYP

and the state of the environment in the individual Gewogs. A tentative proposal of SoE outcome

and output indicators for Gewogs is shown in Annex G. Reporting of Programme implementation

performance is done twice annually in progress reports to the LGSP-SC and the JSP-SC. The

progress reports will be compiled by LDD.

8.2 Reviews

Annual Programme Reviews

Annual Programme Reviews (APR) will be carried out jointly with RGoB and preferably other

development partners in the environment, climate change and natural resource management sectors.

Joint reviews could be carried out with the LGSP. The APR could coincide with the September

sessions of the LGSP-SC and JSP-SC.

Mid-term review

A joint mid-term review will be conducted in 2011 prior to launching the preparation of the 11th

Five-Year Plan, which takes stock of the local governance context and the performance of SESP,

LGSP and PEI Phase 2 – based on which general recommendations will be made for the 11th

FYP

plan preparation, the remaining annual plans of the 10th

FYP, and the exit strategy. A multi-

stakeholder workshop will be conducted before, or in connection with, the mid-term review to share

experiences on the performance of various approaches to ECP mainstreaming with a view to

converge these into a unified approach for a nationwide rollout.


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31 October 2009 41

Exit strategy

At the end of the four year period it is anticipated that adequate capacity has been developed in

training institutions, national agencies and local governments to sustain the further capacity

development. An exit strategy will be elaborated during the third year of implementation by taking

ongoing and planned programmes into consideration. A “terminal review” of lessons learned from

the SESP will be undertaken towards the end of 2013.

An evaluation of capacity development was carried out in 2006. The evaluation of outcomes is

forthcoming in 2009/10 and the evaluation of impacts will be after 2013. These evaluations will

also cover the Denmark-Bhutan development cooperation on environment.


Programme Document

31 October 2009 42

9 Implementation

Since the capital development grants will be made available to all Gewogs, it is found pertinent to

disseminate information to all 20 Dzongkhags and their respective Gewogs and Thromdes on the

ECP Guidelines once they have been finalised in order to influence the annual planning process and

the preparation of the 11th

five-year plans. A limited number of Dzongkhags and Gewogs will

initially be selected based on poverty and vulnerability criteria in order to provide more intensified

capacity development support. It is anticipated that two to three batches of intensified support will

be provided to Dzongkhags and Gewogs during the four-year period. The first batch will be selected

during the Inception Phase38

. The experience from the intensified support will be fed into general

information that will be provided to all Dzongkhags with a particular attention to the preparation of

the 11th

five-year plans.

Inception Phase (January to June 2010)

The inception phase will run from January to June 2010. The purpose of the Inception Phase is to

prepare for the next three financial years and in particular for the FY 2010/11, which is the third FY

of the 10th

FYP. Task of the Inception Phase will include:

Functional analysis of the institutions in environment and natural resources relevant for local

government in order to further clarify mandates, responsibilities and capacity needs for

coordination, implementation and M&E.

Final selection of Dzongkhags and Gewogs for capacity development support – based on

vulnerability criteria.

Preparation of MoU or similar on improved harmonisation of external programme support,

e.g. with World Bank GEF/SLMP, EC, IFAD, SNV and Helvetas, for sharing of experiences

and technical assistance, joint programme reviews and similar contributions to aid

efficiency.

Further development of environment M&E and core indicators under the guidance of NECS

and GNHC for possible inclusion on PlaMS. Development of procedure for monitoring and

evaluation of environment outputs and outcomes in selected districts.

Strategies for local environmental mainstreaming and sensitization of key staff at the target

Dzongkhags. Consultations with DPOs and DEOs in selected Dzongkhags. Planning of

capacity development activities to elected DT and GT councillors for mainstreaming

environment in the FY 2010/11 annual plan.

Management related outputs from the Inception Phase include:

Detailed work plans and budget for FY 2010/11 and outline work plans for FY 2011/12 to

FY 2012/13.

Procurement of short-term TA (national and international) as process consultants to assist

with preparatory tasks.

38 Currently, there is no Dzongkhag/Gewog specific environment vulnerability data and there is limited human

resources capacity as well. The initial consideration has been to select the five poorest Dzongkhags and their Gewogs

for more intensified capacity development support. In case the more elaborate vulnerability selection criteria are not

ready during the Inception Phase for the first batch of Dzongkhags and Gewogs, the poverty selection criteria will

apply.


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31 October 2009 43

Preparation of the 1st SC meetings to be held in February 2010, including finalisation of

ToR and standard meeting agenda.

Preparation of draft ToR for 1st Annual Programme Review (inception review).

Preparation of Inception Report.

Implementation Phase (July 2010 to June 2013)

The implementation will follow the RGoB planning and budget cycle, implementation and

reporting procedures. The implementation should be aligned with the expected RGoB Mid-Term

Review of the 10th

FYP by the end of 2011. Contributions will be made to the development of the

11th

FYP with the aim to have environment output and outcome M&E further developed.

The JSP PMG should draft a work plan for Component 2 by May each year. SC meetings may be

held in February and September and could coincide with the APR. At the September meetings the

financial reporting, RAA audits and other RGoB institutionalised outcomes will be available. The

Component 2 work plan and budget should be available for discussion and final endorsement at the

September SC meeting.

The End of Programme (July to December 2013)

The SESP will conclude with the end of the 10th

FYP in 2013. This will also coincide with the

termination of Denmark‟s support to the environmental sector in Bhutan. GNHC and LOD will

prepare an exit plan for the SESP. The exit activities will be further detailed during the

implementation and be subject to further discussion at the February 2013 SC meeting. The issues to

be included in the phasing out are:

Reallocation of remaining funds to secure sustainability of SESP supported activities.

External review or internal lessons-learned assessment of the SESP.

A completion report will be prepared within six months after the termination of the 10th

FYP.

Closing the accounts (may take up to one year after the final disbursal)

An impact evaluation of Denmark‟s development cooperation with Bhutan including the

environmental sector is planned undertaken after 2013.


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31 October 2009 44

Annex A: Environment in the 10th FYP

“Chapter 5: Cross-cutting Development Themes

This chapter outlines the centrality of the following cross-cutting development themes in the attainment of

national development objectives. While there are several other critical themes that could also be considered,

these are regarded to be particularly pertinent for the Tenth Plan period in view of their all-round importance

and relevance across all sectors and given the context of the introduction of democracy in the country. The

important cross-cutting development themes identified through the consultative planning processes were

decentralized governance, employment, women in development, information and communications

technology, environment and HIV/AIDS. The Chapter highlights the specific relevance of these themes,

assesses their general policy environment, identifies the particular constraints and challenges and outlines the

various strategic initiatives that the Royal Government will undertake to address these pressing issues over

the plan period.”

Source: 10th FYP, vol.1, p.69.

“5.6: Environment

Environmental conservation constitutes an important part of national spatial planning strategic framework

and has always enjoyed a high priority in the country‟s development agenda. Conservation of the

environment has been robustly pursued even as Bhutan, a least developed country, is compelled to make

enormous short term sacrifices to serve the long term interests of not just the country alone but the region

and world at large. It is this unwavering commitment that has brought widespread global recognition for

Bhutan‟s efforts to protect its environment and natural resources.

The strong emphasis on protecting and conserving the environment will not diminish in any way over the

Tenth Plan. Indeed, the environment sector will require more attention than before in view of the accelerated

pace of economic and development activities accompanied by increased expansion of infrastructure

development, urbanization, industrialization, population expansion and consumption patterns that are likely

to put an even greater burden and stress on the natural environment.

Additionally, environmental conservation imperatives will be increasingly challenged by the need to balance

it judiciously against the urgency of sustaining and improving rural livelihoods and ameliorating poverty.

Close attention will be required to ensure that the costs of environmental conservation do not fall

disproportionately on the poor through crop loss or limited access to forest resources or cultivable land.

Some of these important environmental opportunities and challenges that the country must address over the

Tenth Plan are highlighted in the section below.

5.6.1: Opportunities and Challenges

There are significant factors that make environmental conservation more and more challenging each year

given the rapid pace of development and modernization in the country that places increasing pressures on

natural resources and compromises their sustainable utilization. On the other hand, the opening of global and

regional markets to local high-value herbal, horticultural and niche products and the harnessing of hydro-

power potential provide special opportunities for the country to enhance living conditions and eradicate rural

poverty. The natural environment thus presents significant opportunities that the country could capitalize on

in a sustainable manner and concurrently also poses significant environmental conservation and management

challenges that need to be addressed.


Programme Document

31 October 2009 45

Enhancing rural accessibility primarily through road access is an important consideration that cannot be

denied. However, in a mountainous country like Bhutan, road construction activities do have serious

environmental consequences that scar and degrade the environment irreparably. A major challenge will be to

effectively implement environment friendly road construction (EFRC) methods. While this will certainly add

extra costs to the already high investments required to implement these EFRC requirements, they will

ultimately prove to be much more cost-effective in the long run. Some of the other rural environment

concerns pertain to over grazing by livestock, inefficient use of forest resources, high levels of fuel wood

consumption and the loss of prime agricultural lands to urbanization and development. Another major

concern is the country‟s high vulnerability to climate change brought about by global warming such as

proneness to flash floods, glacial lake outbursts and landslides due to excessive rain.

While the air and water quality in the country are still relatively good there are emerging problems of air

pollution in and around industrial sites and deteriorating water quality near urban centers. Tackling these

issues at such an incipient stage will be essential to prevent them from becoming major public health

problems in the future. Similarly, the effective management of solid waste disposal in urban areas is proving

to be a major challenge due to the acute shortage of landfill sites.

In addition to the above constraints, Bhutan is faced with limited human capacity and expertise to manage

and implement environmental conservation activities. Environmental awareness, education and sound

practices within Bhutanese society are also nowhere near desired levels and will require to be promoted

further. Meeting all of the above challenges and addressing these important environmental concerns is likely

to be notably constrained by the future availability of resources.

The rich environment naturally confers significant opportunities and in Bhutan‟s context it is linked to the

rich water resources available in the country. The vast hydro-power resources are Bhutan‟s natural

comparative advantage, the sustainable exploitation of which depends on the health and quality of the

country‟s watersheds. The management and protection of the critical watersheds thus provides not just an

environmental benefit but immense economic rewards and hence is accorded a high development priority.

Additionally, as a net sequester of greenhouse gases and user of clean energy, Bhutan could benefit from the

new international regimes permitting emission trading under the Kyoto protocol.

5.6.2: Environment Policies and Strategies

The objectives of the environment sector for the Tenth Plan are to:

Ensure sustainable development in conservation of environment;

Disseminate environmental information and raise awareness among the general public;

Move towards a cleaner environment;

Mainstream environment issues into development policies, plans and programs;

Develop appropriate environmental legislation;

Develop environmental standards; Fulfilling country‟s obligations of Multilateral Environment

Agreements;

Enforcement of Environmental laws/Acts; and

Coordination for water resources management.

The above objectives for the environment sector will be addressed through the following strategies and

initiatives:

Development of appropriate policy and legal frameworks;

Compliance monitoring;

Provision of environmental services;

Decentralizing environmental governance and networking;


Programme Document

31 October 2009 46

Strengthening environmental information management system to support and improve decision making

(SOE, EIMS, etc);

Public education and awareness on environmental issues;

Utilizing environmental assessments as a tool for sustainable development;

Building and strengthening institutional capacity;

Mainstreaming environmental issues in sectoral plans, projects and programs of all government agencies;

and

Development of appropriate legal and policy framework for water resources management.”

Source: 10th FYP, vol.1, p.84-86.


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31 October 2009 47

Annex B: Overview of Environmental related legislation in Bhutan

Title Salient features

Constitution of

Bhutan (2008) The Constitution awards the trusteeship of the environment of Bhutan to each

Bhutanese citizen making it a fundamental duty of each citizen to contribute to

environmental conservation.

The Constitution also directs the government to protect and conserve the environment,

prevent pollution and environmental degradation to secure ecologically balanced

sustainable development while promoting justifiable economic and social development

The government is also directed to maintain a minimum of sixty percent of Bhutan‟s

total land under forest cover for all time to come

The Parliament is empowered to enact environmental legislation to ensure sustainable

use of natural resources and maintain intergenerational equity and reaffirm sovereign

rights of the State over its own biological resources.

National

Environment

Protection Act

(2007)

This Act provides for the establishment of an effective system to conserve and protect

environment through the National Environment Commission or its successors,

designation of Competent Authorities and constitution of other advisory committees, so

as to independently regulate and promote sustainable development in an equitable

manner

The Act enunciates several environmental principles such as fundamental rights and

duties to the environment, inter-generational equity, middle path strategy, precautionary

principle, 3-Rs (reduce, reuse and recycle) principle, Polluter pays principle, Right to

information, Access to justice, Sovereign rights principle and Payment for

environmental services.

The Act also sets out the institutional arrangements in implementation of the Act

namely the NEC, its Secretariat and Competent Authorities, terms and conditions and

tenure of members, roles and responsibilities of members; powers and functions and

meeting schedules

The Commission is entrusted to prevent environmental harm and regulates handling of

hazardous substances, discharge of environmental pollutants, environmental standards

of products, technologies and management practices, waste management and

environmental emergencies

The Act also calls for protection of forest, biodiversity and ecosystem integrity by

emphasizing on stewardship of the environment, forest coverage, protected areas and

vulnerable ecosystems, protection of genetic resources and research and monitoring

Sufficient funds will be allocated to all authorities mentioned under this Act to enable to

carry out their mandate. The Commission can also provide for incentives as well as

taxes to entities that promote or diminish the quality of the environment

All citizens and agencies have the right to access environmental information. The

Commission will also to the extent possible disseminate information and make it

available in the public domain Commission staffs are also empowered to set procedures

for inspections and verifications to investigate premises and with prior notice take

samples. The Commission may also establish environmental laboratories

Appropriate enforcements, offences and penalties are stipulated by the Act for

environmental compliance

Citizens also are empowered to participate in environmental decisions in public debates

and consultations. Citizens‟ rights vis-à-vis the environment will also be addressed

through a procedure of appeal and review procedure

National

Environmental

Assessment Act

This Act establishes procedures for the assessment of potential effects of strategic plans,

policies, programs and projects on the environment, and for the determination of

policies and measures to reduce potential adverse effects and to promote environmental


Programme Document

31 October 2009 48


(2000) benefits.

Regulations for

Environmental

Clearance of

Projects

These regulations formulated to operationalise the Environmental Assessment Act

(2000)

Aims to provide opportunities for public review of potential environmental impacts and

to ensure projects are implemented in line with sustainable development policy of the

government

Ensures impacts are considered, feasible alternatives are considered and mitigation

measures are instituted

Regulations for

the Strategic

Environmental

Assessment

These regulations formulated to operationalise the Environmental Assessment Act

(2000)

Provides broad guidelines for governmental agencies while formulating, renewing,

modifying or implementing any policies, plans, programmes and Five Year

developmental plans which may have significant impacts on the environment;

Directs agencies to perform a Strategic Environmental Assessment of policies, plans

and programmes before the proposal is adopted

Land Act (2007) Supersedes the Land Act 1979

The Act aims to facilitate the management, regulation and administration of the

ownership and use of land for socio-economic development and environmental well-

being of the country through efficient and effective land administration, security of land

tenure, equal opportunity to land, facilitation of operation of land market, effective use

of land resources and conservation of the ecosystem.

Trees, either grown naturally or planted, in a registered land belongs to the landowner.

Transportation and commercial use of timber from these trees shall be subject to the

Forest and Nature Conservation Act or any other law that shall govern the transportation

and commercial use of such timber in future.

The declaration of Thromde (urban), industrial, and protected agricultural areas shall

aim at the best use of land by:

- Assessing present and future needs by evaluating the land‟s capability to supply them;

- Identifying and resolving conflicts between competing uses, between the needs of

individuals and those of community, and between the needs of the present generations

and those of future generations; and

- Seeking sustainable options and choosing those that bring about the desired economic,

social and environmental well-being of the citizens of Bhutan.

Landowners can apply to through the Local Authority for conversion of wet land to

other uses for verification of the proposed conversion and submit to the Ministry of

Agriculture which shall assess the feasibility based on the technical criteria including

availability of water, soil and environmental conditions. For other types of agricultural

land, landowners can request for conversion to residential land the Local Authority

which can verify and demarcate the land.

All Tsamdro (pasture) and Sokshing (woodlots leased out for leaf litter) rights

maintained in the Thram prior to enactment of this Act shall be deleted from the Thram.

Upon deletion, the Tsamdro land shall be reverted and maintained as the Government

land in Thromde or the Government Reserved Forests land in rural areas.

The reverted Tsamdro and Sokshing in rural areas shall be converted to leasehold and

those in Thromde shall be maintained as the Government land.

Grazing and pasture development on Tsamdro shall be permitted based on a Tsamdro

management plan. The Department of Forests, Department of Livestock, and the lessee

shall be responsible to prepare Tsamdro management plan. The same applies to

Sokshing.

Forest & Nature The Act is comprehensive in regulating use of forest and forest products in Bhutan


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31 October 2009 49


Conservation Act

(2005) The Act stipulates management of forests through Management Plans.

A set of rules and regulations are described for Government Reserved Forests, use with permits and leasing of forest land

Permits and management plans for community forests established on government reserved forests and private forestry schemes under the concept of social forestry is elaborated

The Act also has explicit rules on designation of forests as protected areas conservation of wild life and soil and water conservation

Rules have been framed on transport and trade of forest produce and adequate safeguards have been put in place for enforcement and penalties

Biodiversity Act

(2003) Applies to all the genetic and biochemical resources including wild, domesticated and

cultivated species of flora and fauna, both in-situ and ex-situ conditions found within the

territory of Kingdom of Bhutan

Ensures the conservation and sustainable use of the biochemical and genetic resources

and promotes the equitable sharing of benefits derived from the use of genetic resources

and to promote technology transfer and capacity building at the national and local

levels.

Regulates and facilitates processes by which collectors may legally obtain genetic

resources. As a result, illegal access to genetic and biochemical resources and associated

Traditional Knowledge is prevented.

Provides legal recognition of varieties which are not protected under the internationally

existing patent and/or plant breeders rights laws and thereby recognize farmers‟ plant

variety improvements and innovations and provide a means of sharing benefits derived

from the use of farmers‟ or traditional varieties as breeding material for commercial

purposes.

The Government land or Government Reserved Forests land may be leased to a juristic person. Application to lease Government land or Government Reserved Forests land for any purpose shall be governed as per the existing rules and regulations. There shall be no ceiling for the Government land or Government Reserved Forests land on lease for the purposes of economic activity.

DYT (District Development Committees)

Chathrim (2002)

This Act stipulates legislation for the functioning of the District Development Committees

In terms of environmental and natural resources management, the DYT has the administratively empowered to give directions and approval on forest management plans including extraction, conservation and forest road construction in accordance with the Forest & Nature Conservation Act

It is also empowered to give direction and approval on protection of forests, tsamdro (pasture) and all types of government and community lands from illegal house and similar constructions and other encroachments

It can also control construction of structures, whether on national, communal or private lands, within 50 feet of highways falling within the Dzongkhag

GYT (Block Development Committees)

Chathrim (2002)

This Act stipulates legislation for the functioning of the Block Development Committees

In terms of environmental and natural resources management, the GYT has the administratively empowered to conserve and protect water sources, lakes, springs and rivers

It is also empowered to take custody and care for communal lands, community forests including sokshing and nyekor tsamdo, medicinal herbs and accordingly prevent illegal house construction and all other types of encroachments in such community lands as well as on government lands and forests

It can also control construction of structures, whether on national, communal or private lands, within 50 feet of highways falling within the Dzongkhag

The GYT can adopt and enforce regulations in the gewog in regard to control and


Programme Document

31 October 2009 50

Title Salient features prevention of pollution of air, soil and water; depredation of crops by livestock and wildlife, in accordance with the provisions of the Forest and Nature Conservation Act; protecting and harvesting of edible forest products in the local area in accordance with the Forest and Nature Conservation Act

Plant Quarantine Act of Bhutan (1993)

The Act aims to prevent the introduction of pest not already present or widespread in the country and to control those pests in the country from spreading by eradication and to provide facilities for services for import and export of plant products.

The Act also aims to extend cooperation in prevention of movement of pests in international trade and traffic.

Road Act (2004) The aims to ensure balanced socio-economic development to promote social equity and justice and general welfare.

The Act also stipulates the adoption and promotion of environment friendly techniques in implementation of road activities.

Further, the Dzongkhags are directed to carry out survey, design and construction of feeder roads, farm roads and power tiller roads within the Dzongkhags in accordance with guidelines issued by Department of Roads and NEC.

In addition to technical standards for road construction and maintenance, all road agencies must conform to environmental considerations and geological stability.

The Department of Roads and road related agencies have priority for the use of natural resources available within the roads‟ right-of-way and road control area over other organisations for road related purposes.

Civil Society Organisations Act (2008)

The Act aims to strengthen civil society by developing human qualities and rendering humanitarian activities.

Public Benefit Organisations by the Act are permitted to serve or supplement or complement the efforts of the government to, among others, assist in the protection of the natural environment.

Thromde Act (2007)

The purpose of the Act is to frame and enforce rules for protecting the health, safety and well being of residents, preserving and promoting the quality of the thromde (urban) environment.

Among others, the role of the thromde is to preserve and promote the quality of the thromde environment through environmental control, protection and conservation

Draft Bhutan Water Act (2002)

The draft Bhutan Water Act aims at, among others, to control water pollution and to preserve and protect the environment so that future generations of Bhutanese have assured access to adequate, safe and affordable water to maintain and enhanced quality of life.

Under management of water resources management, water resources conservation, development and management is to be done in an integrated manner. Activities like water shed conservation, water source protection and water resource development is to be carried out in an environmentally sustainable and economically feasible manner.

Mines & Mineral Act 1995

Aims to fulfil national goals of exploitation of natural resources namely minerals in a manner compatible with the social and economic policies of the government within the framework of sustainable development, protection of the environment and preservation of religious and cultural heritage. The Act will be supported by regulations and standards for environmental protection, effluent discharges, noise levels and use of explosives.

Conventions and Treaties

Ratification of or Accession to the Montreal Supplementary Protocol of 1998; UN Convention to Combat Desertification (UNCCD); Convention on International Trade of Endangered Species of Wild Fauna and Flora; International Treaty on Plant Genetic Resources for food and Agriculture; Basel Convention on the Control of Transboundary Movement of Hazardous Waste and Disposal; Vienna Convention for the Protection of the Ozone Layer and the Montreal Protocol on Substances that Deplete the Ozone layer.


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31 October 2009 51

Annex C: ToR for District Environmental Officers

Background

The National Environment Commission Secretariat (NECS) held annual meetings with Dasho

Dzongdags since 2001 to discuss the possibility of designating Dzongkhags as “Competent

Authorities” under the EA Act 2000 and its related regulations. One of the points repeatedly raised

by Dasho Dzongdags during all the meetings was the lack of capacity at the Dzongkhag level to

deal with environmental related issues. Further, it was mentioned that the environmental clearance

process will be more efficient if branch offices were established by the NECS in each Dzongkhag.

In view of the above constraints, suggestions were made to NECS to field

representatives/Dzongkhag Environment Officers in the Dzongkhags, to assist and guide the

District Environmental Committees (DECs). It may be mentioned that establishment of DEC is in

line with Government‟s Decentralization Policy.

The need for Dzongkhag Environment Officers was also raised during the mid-term review of the

9th

Five Year Plans of the NECS, Dzongkhags and Gewogs. Finally, this year, one of the resolutions

of the 83rd

session of the National Assembly was to depute a representative from the NECS to each

Dzongkhag. The Terms of Reference for the Environmental Officer is as follows:

Duties

The Dzongkhag Environment Officers will primarily function as an advisor to the District

Environment Committee (DEC) on all environmental related issues. The duties shall include, but

not limited to:

1. The environmental officer shall assist DEC in implementing and enforcing the

Environmental Assessment Act 2000, the Regulation for Environmental Clearance of

Projects 2002, all environmental guidelines and standards published/issued by the NEC and

environment monitoring in their respective Geogs and Dzongkhags;

2. Shall act as a focal person of DEC on environment related issues;

3. Ensure that environmental concerns are incorporated into the Five Year Development Plan

of the Geogs and Dzongkhag;

4. Support Dzongkhag in the preparation of the annual work plan and progress reporting,

related to environment;

5. Shall assist the Chairperson of DEC in discharging the routine responsibilities related to the

environmental issues;

6. Shall function as a Member Secretary on the DEC;

7. Shall provide technical backstopping to the DEC on environmental related issues;

8. Shall coordinate DEC meetings and maintain records;

9. Shall review and screen all the reports, papers and cases related to the environment,

including applications for environmental clearance and submit to the DEC for its direction;

10. Shall maintain all records of applications received for environmental clearances and actions

taken;


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31 October 2009 52

11. Shall be responsible for coordinating site visits for applications received by the Dzongkhag

for environmental clearances;

12. Shall assist the DEC in issuing environmental clearances of the listed activities;

13. Shall ensure that the environmental terms and conditions stated in the Environmental

Clearances are implemented by the applicants;

14. Shall keep record of problems encountered during implementation of the listed activities and

suggest amendments, if required, through DEC to the NEC on the basis of lessons learnt;

15. Shall liaise with the NECS on issues related to environment;

16. Shall compile information on environmental monitoring conducted by the DEC and submit

to the NEC, periodically;

17. Attend relevant trainings and workshops related to the environment;

18. Shall conduct environmental awareness campaigns within the Dzongkhag; and

19. Shall be the custodian of common seal of the DEC, records of the Committee proceedings

and correspondence.


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31 October 2009 53

Annex D: External Development Partners in Environmental, Natural Resource and Climate Change

Development

Partner

Support Area Geographical

focus

Coordinating

and

Implementing

Agency

Commitment

Denmark Environment and

Urban Environment

Programme (EUSPS)

(2004 – 2009)

National. RNR with

pilot Gewogs in 12

Gewogs in 12

districts. Urban

infrastructure in 5

towns.

NEC, MoA,

MoW&HS

DKK 110 million

Denmark Sustainable

Environment Support

Programme (2010 –

2013)

National – all 205

Gewogs (but with

initial emphasis on

field support

activities in Samtse,

Zhemgang,

Mongar, Lhuentse,

Samdrup Jongkhar)

GNHC, NEC

and MoA, and

local

government

DKK 70 million

Denmark Adaptation to Climate

Change (follow up on

climate screening)

National (no local) GNHC with

NEC, MoEA

and MoA

DKK 5.0 Million

Denmark

(and

UNDCF,

UNDP, SDC,

Austria)

Local Government

Support Programme

(LGSP) (2008 – 2013)

National and

nationwide

GNHC,

MoHCA

DKK 25.0 Million

UNDP,

UNEP,

UNESCAP,

UNESCO,

UNICEF,

WFP

Environment and

disaster risk

management (2008 –

2012)

National (no local) DMD/MoHCA Regular resources: USD

1.57 million; Other

resources: USD 11.7

million

EC Agriculture Sector

Support Project (2005

– 2009)

Samtse, Chhukha,

Dagana, Tsirang,

Sarpang, Wangdue

Prodang and

Punakha (6

Gewogs in each;

total of 42

Gewogs). Some

activities on

organic agriculture

in Gasa and

Bumthang

MoA € 5.0 Million

EC Natural Resources The identification MoA € 5.3 Million (to be


Programme Document

31 October 2009 54

Development

Partner

Support Area Geographical

focus

Coordinating

and

Implementing

Agency

Commitment

Management

programme (2010 –

2013)? Formulation is

forthcoming.

Identification was

done in March/April

2009

mission identified

possible budget

support to MoA for

all the MoA

programmes in the

10th FYP

confirmed)

World

Bank/GEF

Sustainable Land

Management (2006 –

2012). Denmark co-

financing (EUSPS)

Chhuka,

Zhemgang and

Trashigang (one

Gewog in each

Dzongkhag until

2009, additional

two Gewogs from

2009) (9 Gewogs)

MoA, National

Soil Service

Centre

USD 7.6 Million

(EUSPS Component 2 is

co-financing).

IFAD Agriculture, marketing

and enterprise

promotion

programme. SNV co-

financing (2006-2012)

Lhuentshe,

Mongar,

Pemagatshel,

Samdrup-Jongkhar,

Trashigang and

Yangtse (22.000

house holds)

MoA USD 19.7 Mio.; IFAD

loan USD. 13.9 Mio.

UNDP/UNEP Poverty-Environment

Initiative (PEI) (2007-

2009)

National (no local) GNHC with

MoA, MoF,

NEC,

USD 387,975

Helvetas Rural Livelihoods

Programme (2008-

2011)

Zhemgang,

Trongsa, Sarpang

and Bumthang

MoA CHF 2,150 million

Helvetas Participatory Forest

Programmes (2007-

2012)

Nation wide from

an initial 7

Dzongkhags

Social Forestry

Division, DoF

of MoA

CFH 3.230 million

SNV Small-Holder Cash

Crops (2006), forest

products (NTFP),

prop-poor tourism

UNDP / GEF

(LDCF)

GLOF project (NAPA

implementation)

Asian

Development

Bank

Under the non-lending

programme – clean

energy initiatives

within CDM

framework (2009 –

2011)

National USD350,000


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31 October 2009 55

Annex E: Resource Allocation for the 205 Gewogs in Bhutan Resource Allocation for Gewogs

Indicator % Amount

Population 70 3162.04

Total Area 5 225.86

Poverty Index 25 1129.30

TOTAL 100 4,517.20

Data (from GNHC): Gewog Budget allocation: SESP (205 Gewogs in 20 Dzongkhags)

Dzongkhag/Gewog Rural population Land area Below Poverty

Line

Population Land Poverty Total

Allocation

Per Cap. Total Grant Share of

capital grant

Per cap

Number km² % Million BTN Million BTN Million BTN Million BTN BTN Million BTN % BTN

Bumthang

1 Chhoekhor 4,553.00 1,526.31 10.90 32.80 8.93 4.93 46.67 10,250 3.51 7.5% 771

2 Chhumey 3,591.00 403.63 10.90 25.87 2.36 3.87 32.10 8,939 2.42 7.5% 673

3 Tang 1,816.00 511.31 10.90 13.08 2.99 1.96 18.03 9,929 1.36 7.5% 747

4 Ura 1,953.00 267.22 10.90 14.07 1.56 2.10 17.74 9,082 1.34 7.5% 684

Total 11,913.00

Chhukha

1 Dala 8,861.00 144.54 20.30 63.84 0.85 17.77 82.46 9,306 6.21 7.5% 700

2 Sampheling 7,310.00 73.58 20.30 52.67 0.43 14.66 67.76 9,269 5.10 7.5% 698

3 Bongo 6,870.00 396.78 20.30 49.50 2.32 13.78 65.60 9,548 4.94 7.5% 719

4 Phuntsholing 5,183.00 135.66 20.30 37.34 0.79 10.39 48.53 9,363 3.65 7.5% 705

5 Bjapcho 3,583.00 140.65 20.30 25.82 0.82 7.18 33.82 9,440 2.55 7.5% 711

6 Chapcha 3,248.00 128.95 20.30 23.40 0.75 6.51 30.67 9,442 2.31 7.5% 711

7 Logchina 2,672.00 70.44 20.30 19.25 0.41 5.36 25.02 9,364 1.88 7.5% 705

8 Geling 1,856.00 218.70 20.30 13.37 1.28 3.72 18.37 9,900 1.38 7.5% 745

9 Getena 903.00 239.55 20.30 6.51 1.40 1.81 9.72 10,763 0.73 7.5% 810

10 Dungna 731.00 199.51 20.30 5.27 1.17 1.47 7.90 10,807 0.59 7.5% 813

11 Metap 539.00 134.02 20.30 3.88 0.78 1.08 5.75 10,665 0.43 7.5% 803

Total 41,756.00

Dagana

1 Gozhi 2,187.00 20.36 31.10 15.76 0.12 6.72 22.59 10,331 1.70 7.5% 778

2 Drujegang 2,121.00 57.32 31.10 15.28 0.34 6.52 22.13 10,435 1.67 7.5% 785

3 Kana 1,964.00 193.12 31.10 14.15 1.13 6.03 21.31 10,852 1.60 7.5% 817

4 Lhamoizingkha 1,581.00 106.32 31.10 11.39 0.62 4.86 16.87 10,670 1.27 7.5% 803

5 Tsendagang 1,729.00 96.71 31.10 12.46 0.57 5.31 18.33 10,604 1.38 7.5% 798

6 Trashiding 1,636.00 39.48 31.10 11.79 0.23 5.03 17.04 10,418 1.28 7.5% 784

7 Tseza 1,106.00 592.30 31.10 7.97 3.47 3.40 14.83 13,411 1.12 7.5% 1,009

8 Tsangkha 1,352.00 36.70 31.10 9.74 0.21 4.15 14.11 10,436 1.06 7.5% 785

9 Deorali 1,315.00 92.94 31.10 9.47 0.54 4.04 14.06 10,691 1.06 7.5% 805

10 Gesarling 1,340.00 36.81 31.10 9.65 0.22 4.12 13.99 10,438 1.05 7.5% 786

11 Khibisa 1,212.00 96.37 31.10 8.73 0.56 3.72 13.02 10,742 0.98 7.5% 809

12 Lajab 863.00 108.90 31.10 6.22 0.64 2.65 9.51 11,015 0.72 7.5% 829

13 Dorona 754.00 106.50 31.10 5.43 0.62 2.32 8.37 11,104 0.63 7.5% 836

14 Nichula 479.00 140.49 31.10 3.45 0.82 1.47 5.74 11,993 0.43 7.5% 903

Total 19,639.00

Gasa

1 Lunana 693.00 1,717.31 4.10 4.99 10.05 0.28 15.32 22,111 1.15 7.5% 1,664

2 Laya 949.00 964.83 4.10 6.84 5.65 0.38 12.87 13,559 0.97 7.5% 1,021

3 Goenkhamey 906.00 148.90 4.10 6.53 0.87 0.37 7.77 8,572 0.58 7.5% 645

4 Goenkhatoe 166.00 286.71 4.10 1.20 1.68 0.07 2.94 17,717 0.22 7.5% 1,334

Total 2,714.00

Haa

1 Bji 2,901.00 745.85 13.20 20.90 4.36 3.78 29.05 10,013 2.19 7.5% 754

2 Uesu 2,575.00 64.74 13.20 18.55 0.38 3.36 22.29 8,656 1.68 7.5% 652

3 Sama 1,750.00 198.45 13.20 12.61 1.16 2.28 16.05 9,172 1.21 7.5% 690

4 Gakidling 1,116.00 336.39 13.20 8.04 1.97 1.46 11.46 10,273 0.86 7.5% 773

5 Katsho 1,115.00 42.37 13.20 8.03 0.25 1.45 9.74 8,731 0.73 7.5% 657

6 Sangbey 793.00 509.37 13.20 5.71 2.98 1.03 9.73 12,268 0.73 7.5% 923

Total 10,250.00

Lhuentse

1 Gangzur 2,690.00 535.71 43.00 19.38 3.13 11.43 33.94 12,618 2.55 7.5% 950

2 Menbi 2,528.00 88.86 43.00 18.21 0.52 10.74 29.47 11,658 2.22 7.5% 877

3 Tsenkhar 2,142.00 129.70 43.00 15.43 0.76 9.10 25.29 11,807 1.90 7.5% 889

4 Khoma 1,819.00 653.59 43.00 13.11 3.82 7.73 24.66 13,555 1.86 7.5% 1,020

5 Kurtoe 1,005.00 949.35 43.00 7.24 5.56 4.27 17.07 16,980 1.28 7.5% 1,278

6 Minji 1,382.00 137.60 43.00 9.96 0.81 5.87 16.63 12,035 1.25 7.5% 906

7 Metsho 1,210.00 216.81 43.00 8.72 1.27 5.14 15.13 12,501 1.14 7.5% 941

8 Jarey 1,143.00 135.83 43.00 8.24 0.79 4.85 13.88 12,148 1.05 7.5% 914

Total 13,919.00


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31 October 2009 56



Line


Allocation


capital grant

Per cap


Mongar

1 Mongar 3,421.00 73.95 44.40 24.65 0.43 15.00 40.08 11,717 3.02 7.5% 882

2 Drametse 2,130.00 48.25 44.40 15.35 0.28 9.34 24.97 11,723 1.88 7.5% 882

3 Chaskhar 2,376.00 51.23 44.40 17.12 0.30 10.42 27.84 11,717 2.10 7.5% 882

4 Saleng 2,110.00 464.52 44.40 15.20 2.72 9.25 27.17 12,879 2.05 7.5% 969

5 Ngatshang 2,109.00 71.23 44.40 15.20 0.42 9.25 24.86 11,788 1.87 7.5% 887

6 Kengkhar 1,996.00 99.72 44.40 14.38 0.58 8.75 23.72 11,883 1.79 7.5% 894

7 Sherimung 1,830.00 300.15 44.40 13.19 1.76 8.03 22.97 12,551 1.73 7.5% 945

8 Thangrong 1,863.00 68.37 44.40 13.42 0.40 8.17 21.99 11,805 1.66 7.5% 889

9 Narang 1,239.00 33.50 44.40 8.93 0.20 5.43 14.56 11,749 1.10 7.5% 884

10 Tsakaling 1,596.00 87.61 44.40 11.50 0.51 7.00 19.01 11,912 1.43 7.5% 897

11 Chali 1,620.00 24.57 44.40 11.67 0.14 7.10 18.92 11,679 1.42 7.5% 879

12 Silambi 1,458.00 159.95 44.40 10.50 0.94 6.39 17.84 12,233 1.34 7.5% 921

13 Jurmey 1,449.00 55.89 44.40 10.44 0.33 6.36 17.12 11,816 1.29 7.5% 889

14 Gongdue 1,329.00 185.32 44.40 9.58 1.08 5.83 16.49 12,407 1.24 7.5% 934

15 Tsamang 1,204.00 143.06 44.40 8.67 0.84 5.28 14.79 12,286 1.11 7.5% 925

16 Drepong 1,094.00 51.66 44.40 7.88 0.30 4.80 12.98 11,867 0.98 7.5% 893

17 Balam 1,092.00 28.30 44.40 7.87 0.17 4.79 12.82 11,742 0.97 7.5% 884

Total 29,916.00

Paro

1 Wangcha 6,425.00 18.61 3.90 46.29 0.11 2.48 48.88 7,607 3.68 7.5% 573

2 Tsento 5,253.00 581.89 3.90 37.85 3.41 2.02 43.28 8,238 3.26 7.5% 620

3 Shaba 4,319.00 81.42 3.90 31.12 0.48 1.66 33.26 7,700 2.50 7.5% 580

4 Lamgong 3,336.00 47.35 3.90 24.04 0.28 1.29 25.60 7,673 1.93 7.5% 578

5 Naja 3,007.00 139.18 3.90 21.67 0.81 1.16 23.64 7,861 1.78 7.5% 592

6 Dopshari 3,180.00 36.71 3.90 22.91 0.21 1.23 24.35 7,658 1.83 7.5% 576

7 Lungnyi 2,543.00 76.36 3.90 18.32 0.45 0.98 19.75 7,766 1.49 7.5% 585

8 Doga 1,866.00 106.23 3.90 13.44 0.62 0.72 14.78 7,923 1.11 7.5% 596

9 Hungre 1,250.00 11.87 3.90 9.01 0.07 0.48 9.56 7,646 0.72 7.5% 575

10 Doteng 1,149.00 193.60 3.90 8.28 1.13 0.44 9.85 8,576 0.74 7.5% 646

Total 32,328.00

Pemagatshel

1 Shumar 3,568.00 95.56 26.20 25.71 0.56 9.23 35.50 9,950 2.67 7.5% 749

2 Norbugang 2,023.00 183.91 26.20 14.58 1.08 5.24 20.89 10,325 1.57 7.5% 777

3 Nanong 2,351.00 83.18 26.20 16.94 0.49 6.08 23.51 10,000 1.77 7.5% 753

4 Dechenling 2,072.00 136.00 26.20 14.93 0.80 5.36 21.09 10,177 1.59 7.5% 766

5 Chokhorling 959.00 129.68 26.20 6.91 0.76 2.48 10.15 10,584 0.76 7.5% 797

6 Khar 1,846.00 115.13 26.20 13.30 0.67 4.78 18.75 10,158 1.41 7.5% 765

7 Zobel 1,697.00 64.04 26.20 12.23 0.37 4.39 16.99 10,014 1.28 7.5% 754

8 Dungme 1,470.00 108.37 26.20 10.59 0.63 3.80 15.03 10,224 1.13 7.5% 770

9 Yurung 1,313.00 28.26 26.20 9.46 0.17 3.40 13.02 9,919 0.98 7.5% 747

10 Chongshing 934.00 30.99 26.20 6.73 0.18 2.42 9.33 9,987 0.70 7.5% 752

11 Chimung 749.00 54.92 26.20 5.40 0.32 1.94 7.66 10,222 0.58 7.5% 769

Total 18,982.00

Punakha

1 Guma 4,288.00 33.94 15.60 30.89 0.20 6.61 37.70 8,792 2.84 7.5% 662

2 Dzoma 1,350.00 22.01 15.60 9.73 0.13 2.08 11.94 8,841 0.90 7.5% 665

3 Baap 3,326.00 25.58 15.60 23.96 0.15 5.13 29.24 8,791 2.20 7.5% 662

4 Toebesa 2,421.00 97.89 15.60 17.44 0.57 3.73 21.75 8,983 1.64 7.5% 676

5 Kabjisa 2,361.00 209.80 15.60 17.01 1.23 3.64 21.88 9,266 1.65 7.5% 697

6 Chhubu 1,991.00 90.13 15.60 14.35 0.53 3.07 17.94 9,011 1.35 7.5% 678

7 Talo 1,594.00 30.62 15.60 11.48 0.18 2.46 14.12 8,858 1.06 7.5% 667

8 Toewang 1,363.00 418.22 15.60 9.82 2.45 2.10 14.37 10,541 1.08 7.5% 793

9 Shengana 1,257.00 61.69 15.60 9.06 0.36 1.94 11.35 9,033 0.85 7.5% 680

10 Goenshari 622.00 83.91 15.60 4.48 0.49 0.96 5.93 9,535 0.45 7.5% 718

11 Lingmukha 597.00 34.46 15.60 4.30 0.20 0.92 5.42 9,084 0.41 7.5% 684

Total 21,170.00

Samdrupjongkhar

1 Orong 3,023.00 65.96 38.00 21.78 0.39 11.35 33.51 11,086 2.52 7.5% 834

2 Gomdar 2,751.00 81.69 38.00 19.82 0.48 10.33 30.62 11,132 2.31 7.5% 838

3 Martshalla 2,596.00 308.49 38.00 18.70 1.81 9.74 30.25 11,654 2.28 7.5% 877

4 Lauri 2,803.00 273.40 38.00 20.20 1.60 10.52 32.32 11,529 2.43 7.5% 868

5 Dewathang 3,113.00 197.89 38.00 22.43 1.16 11.68 35.27 11,331 2.65 7.5% 853

6 Phuntshothang 3,177.00 139.14 38.00 22.89 0.81 11.93 35.63 11,215 2.68 7.5% 844

7 Serthi 2,004.00 299.13 38.00 14.44 1.75 7.52 23.71 11,832 1.78 7.5% 891

8 Wangphu 1,932.00 77.59 38.00 13.92 0.45 7.25 21.63 11,194 1.63 7.5% 843

9 Pemathang 1,504.00 65.96 38.00 10.84 0.39 5.65 16.87 11,215 1.27 7.5% 844

10 Langchenphu 934.00 225.96 38.00 6.73 1.32 3.51 11.56 12,374 0.87 7.5% 931

11 Samrang 106.00 46.53 38.00 0.76 0.27 0.40 1.43 13,527 0.11 7.5% 1,018

Total 23,943.00


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31 October 2009 57



Line


Allocation


capital grant

Per cap


Samtse

1 Pugli 5,057.00 103.57 46.80 36.44 0.61 23.38 60.42 11,948 4.55 7.5% 899

2 Tendu 4,587.00 132.24 46.80 33.05 0.77 21.21 55.03 11,997 4.14 7.5% 903

3 Dorokha 4,419.00 102.96 46.80 31.84 0.60 20.43 52.87 11,964 3.98 7.5% 901

4 Tadhing 4,115.00 110.44 46.80 29.65 0.65 19.02 49.32 11,985 3.71 7.5% 902

5 Chengmari 3,877.00 115.47 46.80 27.93 0.68 17.92 46.53 12,002 3.50 7.5% 903

6 Bara 3,403.00 185.45 46.80 24.52 1.09 15.73 41.34 12,147 3.11 7.5% 914

7 Samtse 3,263.00 117.19 46.80 23.51 0.69 15.08 39.28 12,038 2.96 7.5% 906

8 Sibsoo 3,170.00 28.27 46.80 22.84 0.17 14.65 37.66 11,880 2.83 7.5% 894

9 Chargharey 3,155.00 39.17 46.80 22.73 0.23 14.59 37.55 11,900 2.83 7.5% 896

10 Biru 3,026.00 49.70 46.80 21.80 0.29 13.99 36.08 11,924 2.72 7.5% 897

11 NamgyeCholing (Lahereni)2,811.00 127.08 46.80 20.25 0.74 12.99 33.99 12,092 2.56 7.5% 910

12 Yoeseltse 2,809.00 19.52 46.80 20.24 0.11 12.99 33.34 11,868 2.51 7.5% 893

13 Dumtoe 1,326.00 46.97 46.80 9.55 0.27 6.13 15.96 12,035 1.20 7.5% 906

14 Ugyentse 1,536.00 21.74 46.80 11.07 0.13 7.10 18.29 11,911 1.38 7.5% 896

15 Denchukha 2,310.00 104.29 46.80 16.64 0.61 10.68 27.93 12,092 2.10 7.5% 910

Total 48,864.00

Sarpang

1 Gelephu 3,975.00 54.12 19.40 28.64 0.32 7.62 36.57 9,201 2.75 7.5% 693

2 Dekiling 3,835.00 115.72 19.40 27.63 0.68 7.35 35.66 9,298 2.68 7.5% 700

3 Jigmecholing 3,504.00 503.26 19.40 25.25 2.94 6.71 34.91 9,962 2.63 7.5% 750

4 Hiley 2,517.00 140.25 19.40 18.13 0.82 4.82 23.78 9,447 1.79 7.5% 711

5 Chuzargang 2,426.00 21.56 19.40 17.48 0.13 4.65 22.25 9,173 1.68 7.5% 690

6 Dohban 2,064.00 219.75 19.40 14.87 1.29 3.96 20.11 9,744 1.51 7.5% 733

7 Sershong 2,045.00 78.68 19.40 14.73 0.46 3.92 19.11 9,346 1.44 7.5% 703

8 Umling 1,546.00 122.50 19.40 11.14 0.72 2.96 14.82 9,585 1.12 7.5% 721

9 Bhur 1,517.00 55.88 19.40 10.93 0.33 2.91 14.16 9,337 1.07 7.5% 703

10 Shompangkha 1,130.00 22.42 19.40 8.14 0.13 2.17 10.44 9,237 0.79 7.5% 695

11 Singye 742.00 216.87 19.40 5.35 1.27 1.42 8.04 10,832 0.60 7.5% 815

12 Taklai 72.00 109.28 19.40 0.52 0.64 0.14 1.30 18,003 0.10 7.5% 1,355

Total 25,373.00

Thimphu

1 Mewang 5,916.00 223.46 2.40 42.62 1.31 1.40 45.33 7,663 3.41 7.5% 577

2 Chang 3,137.00 160.17 2.40 22.60 0.94 0.74 24.28 7,741 1.83 7.5% 583

3 Kawang 2,582.00 307.01 2.40 18.60 1.80 0.61 21.01 8,138 1.58 7.5% 613

4 Dagala 1,497.00 202.34 2.40 10.79 1.18 0.35 12.32 8,233 0.93 7.5% 620

5 Geyni 918.00 61.58 2.40 6.61 0.36 0.22 7.19 7,835 0.54 7.5% 590

6 Lingshi 495.00 382.70 2.40 3.57 2.24 0.12 5.92 11,966 0.45 7.5% 901

7 Naro 189.00 276.97 2.40 1.36 1.62 0.04 3.03 16,018 0.23 7.5% 1,206

8 Soe 183.00 171.35 2.40 1.32 1.00 0.04 2.36 12,921 0.18 7.5% 973

Total 14,917.00

Trashigang

1 Lumang 4,754.00 102.95 29.30 34.25 0.60 13.76 48.61 10,226 3.66 7.5% 770

2 Kanglung 4,749.00 63.33 29.30 34.22 0.37 13.74 48.33 10,177 3.64 7.5% 766

3 Shongphu 3,463.00 92.50 29.30 24.95 0.54 10.02 35.51 10,255 2.67 7.5% 772

4 Radhi 3,303.00 28.65 29.30 23.80 0.17 9.56 33.53 10,150 2.52 7.5% 764

5 Udzorong 3,148.00 102.17 29.30 22.68 0.60 9.11 32.39 10,289 2.44 7.5% 774

6 Khaling 3,046.00 154.55 29.30 21.95 0.90 8.82 31.67 10,396 2.38 7.5% 782

7 Samkhar 2,681.00 90.96 29.30 19.32 0.53 7.76 27.61 10,298 2.08 7.5% 775

8 Phongme 2,427.00 100.87 29.30 17.49 0.59 7.02 25.10 10,342 1.89 7.5% 778

9 Thrimshing 2,435.00 55.01 29.30 17.54 0.32 7.05 24.91 10,231 1.88 7.5% 770

10 Kangpara 2,217.00 341.99 29.30 15.97 2.00 6.42 24.39 11,002 1.84 7.5% 828

11 Yangnyer 2,315.00 72.36 29.30 16.68 0.42 6.70 23.80 10,282 1.79 7.5% 774

12 Sakteng 2,072.00 431.37 29.30 14.93 2.52 6.00 23.45 11,317 1.77 7.5% 852

13 Bidung 1,929.00 47.67 29.30 13.90 0.28 5.58 19.76 10,244 1.49 7.5% 771

14 Merak 1,621.00 465.12 29.30 11.68 2.72 4.69 19.09 11,778 1.44 7.5% 887

15 Bartsham 1,807.00 35.14 29.30 13.02 0.21 5.23 18.45 10,213 1.39 7.5% 769

Total 41,967.00

Trashiyangtse

1 Khamdang 3,297.00 44.49 14.30 23.75 0.26 4.66 28.67 8,696 2.16 7.5% 655

2 Bumdeling 1,988.00 847.36 14.30 14.32 4.96 2.81 22.09 11,112 1.66 7.5% 836

3 Toetsho 2,128.00 45.79 14.30 15.33 0.27 3.01 18.61 8,743 1.40 7.5% 658

4 Yalang 1,705.00 86.63 14.30 12.28 0.51 2.41 15.20 8,915 1.14 7.5% 671

5 Yangtse 1,546.00 266.49 14.30 11.14 1.56 2.18 14.88 9,626 1.12 7.5% 725

6 Tongmijangsa 1,555.00 67.56 14.30 11.20 0.40 2.20 13.80 8,872 1.04 7.5% 668

7 Ramjar 1,275.00 21.81 14.30 9.19 0.13 1.80 11.11 8,718 0.84 7.5% 656

8 Jamkhar 1,228.00 47.64 14.30 8.85 0.28 1.73 10.86 8,845 0.82 7.5% 666

Total 14,722.00

Trongsa

1 Langthel 2,637.00 508.39 22.20 19.00 2.98 5.78 27.76 10,526 2.09 7.5% 792

2 Nubi 2,466.00 554.34 22.20 17.77 3.24 5.41 26.42 10,713 1.99 7.5% 806

3 Drakteng 2,697.00 84.79 22.20 19.43 0.50 5.91 25.84 9,582 1.95 7.5% 721

4 Tangsibji 1,848.00 371.63 22.20 13.31 2.17 4.05 19.54 10,575 1.47 7.5% 796

5 Korphu 1,001.00 288.13 22.20 7.21 1.69 2.20 11.09 11,082 0.83 7.5% 834

Total 10,649.00


Programme Document

31 October 2009 58



Line


Allocation


capital grant

Per cap


Tsirang

1 Kikhorthang 2,869.00 17.86 13.90 20.67 0.10 3.94 24.71 8,614 1.86 7.5% 648

2 Tsholingkhar 1,670.00 13.77 13.90 12.03 0.08 2.29 14.41 8,626 1.08 7.5% 649

3 Mendregang 1,510.00 15.60 13.90 10.88 0.09 2.07 13.04 8,638 0.98 7.5% 650

4 Rangthangling 1,447.00 24.50 13.90 10.43 0.14 1.99 12.56 8,677 0.95 7.5% 653

5 Patale 1,352.00 137.63 13.90 9.74 0.81 1.86 12.40 9,174 0.93 7.5% 690

6 Goseling 1,428.00 9.90 13.90 10.29 0.06 1.96 12.31 8,619 0.93 7.5% 649

7 Semjong 1,318.00 14.54 13.90 9.50 0.09 1.81 11.39 8,643 0.86 7.5% 651

8 Beteni 1,203.00 170.97 13.90 8.67 1.00 1.65 11.32 9,410 0.85 7.5% 708

9 Phuentenchu 1,157.00 136.50 13.90 8.34 0.80 1.59 10.72 9,268 0.81 7.5% 698

10 Tsirangtoe 1,153.00 30.32 13.90 8.31 0.18 1.58 10.07 8,732 0.76 7.5% 657

11 Dunglagang 1,135.00 46.00 13.90 8.18 0.27 1.56 10.01 8,815 0.75 7.5% 663

12 Barshong 759.00 21.20 13.90 5.47 0.12 1.04 6.63 8,741 0.50 7.5% 658

Total 17,001.00

Wangduephodrang

1 Sephu 1,996.00 1,105.96 15.80 14.38 6.47 3.12 23.97 12,008 1.80 7.5% 904

2 Gwom 722.00 207.85 15.80 5.20 1.22 1.13 7.55 10,450 0.57 7.5% 787

3 Nyisho 2,304.00 115.51 15.80 16.60 0.68 3.60 20.87 9,059 1.57 7.5% 682

4 Thedtsho 2,222.00 20.87 15.80 16.01 0.12 3.47 19.60 8,821 1.48 7.5% 664

5 Bjena 2,110.00 121.73 15.80 15.20 0.71 3.29 19.21 9,103 1.45 7.5% 685

6 Phobji 1,929.00 145.71 15.80 13.90 0.85 3.01 17.76 9,208 1.34 7.5% 693

7 Rupesa 1,709.00 158.28 15.80 12.31 0.93 2.67 15.91 9,308 1.20 7.5% 701

8 Kazhi 1,284.00 622.54 15.80 9.25 3.64 2.00 14.90 11,603 1.12 7.5% 873

9 Ggom 2,241.00 28.71 15.80 16.15 0.17 3.50 19.81 8,841 1.49 7.5% 665

10 Daga 1,347.00 343.63 15.80 9.71 2.01 2.10 13.82 10,258 1.04 7.5% 772

11 Dangchu 1,299.00 171.13 15.80 9.36 1.00 2.03 12.39 9,537 0.93 7.5% 718

12 Athang 808.00 790.59 15.80 5.82 4.63 1.26 11.71 14,491 0.88 7.5% 1,091

13 Phangyue 1,127.00 32.75 15.80 8.12 0.19 1.76 10.07 8,936 0.76 7.5% 673

14 Nahi 823.00 64.71 15.80 5.93 0.38 1.28 7.59 9,226 0.57 7.5% 694

15 Gangtoe 1,677.00 99.05 15.80 12.08 0.58 2.62 15.28 9,111 1.15 7.5% 686

Total 23,598.00

Zhemgang

1 Trong 3,314.00 358.38 52.90 23.88 2.10 17.32 43.29 13,063 3.26 7.5% 983

2 Nangkor 2,527.00 494.09 52.90 18.21 2.89 13.20 34.30 13,575 2.58 7.5% 1,022

3 Nangla 2,017.00 214.33 52.90 14.53 1.25 10.54 26.33 13,052 1.98 7.5% 982

4 Bardo 1,997.00 209.16 52.90 14.39 1.22 10.44 26.05 13,043 1.96 7.5% 982

5 Shingkhar 1,546.00 309.10 52.90 11.14 1.81 8.08 21.03 13,600 1.58 7.5% 1,024

6 Phangkhar 1,367.00 541.32 52.90 9.85 3.17 7.14 20.16 14,748 1.52 7.5% 1,110

7 Goshing 1,533.00 98.92 52.90 11.05 0.58 8.01 19.63 12,808 1.48 7.5% 964

8 Bjoka 949.00 195.65 52.90 6.84 1.14 4.96 12.94 13,637 0.97 7.5% 1,026

Total 15,250.00

438,871.00 38,596.45 25.90 3162.04 225.86 1129.30 4517.20 10,617 340.00 799

Average


Programme Document

31 October 2009 59

Annex F: Draft Format for Gewog Environmental Expenditure Assessment (ex-post Output Statement Study)

Gewog: ____________________________

Dzongkhag: ____________________________

Financial Year: ____________________________

10th

FYP

Activities:

Annual

Grant

according

to Plan

Budget:

Annual

Grant:

actual

expenditure:

Environment

related

expenditure *)

Ex-post

Environmental

Expenditure

Assessment

Optional

location

(GPS

coordinates):

Watershed

protection

(afforestation)

100,000 82,000 100 % 82,000 xxyyzzvv

Rehabilitation

of school

building

300,000 300,000 0% 0 -

Farm road

(EFRC)

1,500,000 1,400,000 20 % 280,000 xxyyzzvv

Environmental

assessment of

farm road

30,000 30,000 100% 30,000 -

Etc.

SUM Σ

1,930,000

Σ 1,812,000 - Σ 392,000 -

21.6 %

*) According to the ‘Positive List’; 100% for direct expenditure and 10-25% for co-financing of the

additional costs of environmental mainstreaming.


Programme Document

31 October 2009 60

Annex G: Proposed State of Environment (SoE) Output and Outcome Gewog Indicators

The proposed selection of core environment indicators may be considered in the further

development of the environmental monitoring at Gewog level in PlaMS. These core indicators

can be used as proxies for environmental monitoring relevant for SESP and in general for RGoB

until it is feasible for the PlaMS to provide reports on environmental output and outcome

indicators at Gewog level. Indicator level Code Indicators Sources of Data Remarks

Theme A: Land

Output A1.1 Area under sustainable land management

(agriculture land and pasture)

Geog RNR

A1.1.1 Acres of agricultural land under improved land

management (terracing, bunding, bio-engineering,

check-dams)

Geog RNR

A1.1.2 Acres of land under organic farming Geog RNR Also in PlaMS

A1.1.3 Acres of land under improved pasture Geog RNR Also in PlaMS

Outcome A2(i) Level of farm productivity (paddy) Geog RNR

A2(ii) Level of farm productivity (maize) Geog RNR

Theme B: Water resources

Output B1.1 Number of households with access to safe

drinking water

DHS, DE

B1.2 Environmental assessment carried out for

irrigation schemes

DAO, DE, DEnvO

Outcome B2.1 Number of months of drinking water shortage Geog RNR, BHU

B2.2 Number of days water shortage faced during

paddy transplantation

Geog RNR

Theme C: Forests

Output C1.1 Sustainable management of forest resources Geog RNR

C1.2 Acres of land under Social Forestry schemes Geog RNR Also in PlaMS

C1.3 Acres of land under Community Forestry schemes Geog RNR Also in PlaMS

C1.4 Number of households with electricity Geog RNR

C1.5 Number of farmers stall-feeding cattle Geog RNR

Outcome C2 Area under forest cover RNR Census

Theme D: Rural Access

Output D1 Kms of farm roads constructed DAO, DE, DEnvO

Outcome D2 Proportion of Gewog's population living more

than one hour's walk from road head

Geog RNR Also in PlaMS

Theme E: Rural Waste Management

Output E1.1 Number of waste disposal facilities established at

community level

GAO, DEO

(environment)

E1.2 Community Waste Management Committees

established

GAO, DEO

Outcome E2 Incidence of communicable diseases BHU