Contract for $12.5m grant signed with WB

KABUL Bank and the Afghan government on Tuesday signed a contract for a $12.5 million grant to fund the continuation of a project aimed at improving public pension schemes and providing safety nets to the country’s poorest people.

Coming from the International Development Association (IDA), the bank’s concessional lending arm, the additional grant was approved on June 14 to support the completion of building renovations and the rollout of the Management Information System (MIS) of the Public Pension scheme.

World Bank Country Director for Afghanistan Robert Saum and Finance Minister Omar Zakhilwal signed the agreement. The project will help scale up the administrative reform of the pension system to expand coverage to the Martyrs and Disabled Pension Program (MDPP).

Also present on the occasion was Minister of Labour and Social Affairs Amina Afzali, who told reporters the World Bank grant would be managed and spent by the Afghan government. The WB-funded project would be completed in June 2016, she added.

Expected to create facilities for pensioners, the scheme “represents glad tidings for the Afghans, particularly the helpless compatriots”, remarked the minister, who recalled the Safety Nets and Pensions Support Project was launched in 2009. 

Expanding cash transfer interventions to another 10,000-12,000 poor families (nearly 60,000 individuals), the funding would continue to improve processes for effective targeting and payment delivery, Zakhilwal said.

It would be used to build institutional capacity of the Ministry of Labor, Social Affairs, Martyrs and Disabled to manage and implement the pension reforms and safety net policy, he added. The initiative would also help contain corruption, he hoped.

Over the past two years, more than 16,000 of the poorest families and close to 80,000 individuals have received cash assistance. The financing will help the Ministry of Labour, Social Affairs, Martyrs and Disabled scale up the progress made to date.

For his part, Saum promised support for the government’s efforts at modernising systems and assisting the poorest families. He estimated 36 percent of the Afghans were living below the poverty line.

The bank would continue to back efforts at managing social safety net programmes more efficiently, so that poor people could better withstand economic and weather-related hardships, he continued.

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