Management & Development of Complex Projects

Course Code - 706

MS Project Management
Public Sector Development
Projects Management
Lecture # 5
In previous Lecture, we have discussed about

Project management & operations management
Project management & organization & organizational
strategy
Project life cycle
Project management process groups



Summary of Previous Lecture

The Project Management Body of Knowledge
Government Extension

While the PMBOK Guide provides a
generic foundation for managing projects,
this extension addresses the specific
practices found in public sector projects.

This extension to the PMBOK describes
the generally accepted principles for public
projects that are not common to all project
types.

The number of Knowledge areas are 9 in
this guide however number of processes
in each knowldge area varies from the
PMBOK standard.
The basic job of the Government is to formulate
policies, legislation, provision of safety, security,
infrastructure and community services for
general public and to boost the overall economic
conditions of the state so that prosperity prevails.

Objectives of PSDP are to carry out such
obligatory projects, which provide essential
services for welfare of public but need huge
capital investment, and have long gestation
periods with low rate of financial returns
Why Government need Projects?
Main instrument for providing budgetary
resources for development projects and
programs.

Gives quantitative picture of total annual
spending on the ongoing and new
development projects being taken up or to be
taken up by the Federal Government during a
particular year.

All sectors of economy are reflected in the PSDP
along with their costs, allocations and
expenditures.
Public Sector Development Programme (PSDP)
Helps achieve the

objectives and targets set by the government, to
bring about a structural change towards
sustainable and higher growth.

Governments socio-economic objectives
envisaged for development of the common
people

Importance of PSDP
Key Indicators of PSDP
2006-07 2008-09 2010-11
Number of Schemes 1796 1770 1779
Average Cost per Scheme (Million Rs) 952 1257 1638
Throwforward as % of Cost of Cost of On-going
Schemes
63.6 65.9 62.7
Foreign Loans/Grants as % of Total Cost 17.5 18.1 22.7
New Schemes Cost as % of Total Portfolio 43.1 22.3 29.7
Share in PSDP of New Schemes (%) 30.0 24.7 21.0
Throwforward Allocation for on-going Schemes
(%)
4.4 4.4 10.8**
Cost of New Schemes/Allocation for New
Schemes (%)
7.7 3.9 17.1**
* Excluding Power sector
** as per the revised allocation following cutback
Source: PC

Approval Process of Public Sector Projects in
Pakistan

In Pakistan project identification, formulation, appraisal,
approval, implementation, monitoring and evaluation of
development projects is carried out by various line
ministries, autonomous bodies and departments at Federal
as well as provincial level.

Various forums have been set up by the Government for
approval of projects at provincial and Federal levels and
financial powers for such approval have been delegated to
ECNEC, CDWP, DDWP and PDWP
Generic Project Cycle
Identification
Implementation

Ex-post
Evaluation
Preparation
Appraisal &
approval

Financing
PC-III
PC-IV
P
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PC-V
Key Stakeholders
PIP and PIA Section
Technical Sections
Ministries/Organizations/ Provincial
Governments
Ministry of Finance
Economic Affairs Division

Methodology of Processing Project
Development
PC
Composition Functions
Chaired by the Chief Executive of the
Country (President/P.M)

Members:
Federal Ministers (in-charge of
Economic Ministries)
Deputy Chairman Planning
Commission
Governors/Chief Ministers of Provinces

Secretariat: Cabinet Division

Supreme policy
making body in the
economic field.

Approves all plans and
policies relating to
Development.

Overall control of
Planning machinery.
11
1. National Economic Council
12
Composition Functions
Chaired by the Prime
Minister

Members
All Federal Ministers of
Economic Ministries.

Secretariat:
Cabinet Division
Attends all urgent day to day
economic matters.
Coordinates the Economic Policies of
the Government
Keep vigilance on monetary and
credit situation.
Regulate credit in order to maximize
production and exports and to
prevent inflation.
Approve the projects in private sector
2. Economic Coordinate Committee of the
Cabinet (ECC)
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3. ECNEC
Composition Functions
Chaired by the Minister for
Finance.
Members
Federal Ministers of Economic
Ministries.

Provincial Governors/ Chief
Ministers or their nominees, and

Provincial Planning and Finance
Ministers.
Sanction development
projects in the public and
private sector.
Approve moderate changes
in the plan and plan
allocations.
Supervise the
implementation of Economic
Policies laid down by the
NEC/Government.
14
4. CDWP
Composition Functions
Chaired by Deputy Chairman
Planning Commission.
Members:
Secretaries of the Federal
Ministries Concerned with
Development

Heads of the Planning
Departments of the provincial
Governments

Secretariat: Planning Division
Approve/scrutinize
projects exceeding a
certain financial limit
of the Federal
Ministries, Provincial
Governments,
Autonomous Bodies.

Submit/ recommend
such projects to the
ECNEC for final
approval.
15
5. DDWP
Composition Functions
Headed by the respective
Secretary of the Division/
Head of the Deportment.

Members:
Representative of the
Finance Division

Concerned Technical
Section of the P&D Division
Approve Development
Projects of Federal
Ministries/
Division/Departments
according to their
financial limits.
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6. PDWP
Composition Functions
Headed by the Additional Chief
Secretary Development/ Chairman
P&D Board.

Members:
Secretaries of the Provincial
Departments concerned with
Development.

Representative of Federal Ministry of
Planning & Development
Approve Development
Projects according to its
financial limits.
Scrutinize projects for
inclusion in the provincial
ADP and
Recommend projects to
CDWP above certain
financial limits.
In December of every year Public Investment
Programme (PIP) Section of the PC seeks from
the Federal Ministries/Organizations/ Provincial
Governments the details and priorities of the
projects (whether ongoing or new) to be funded
from PSDP.

Working paper is prepared by the PIP section in
consultation with concerned technical sections
for the Priorities Committee meeting to be
held in the Finance Division, under the
chairmanship of Additional Secretary (Budget)
Phase-I ---Kick-off
Issues a schedule of consultative meetings (Feb.
to May) with the concerned stakeholders to
determine the priorities of the projects.

In consultation with the PIP section of the
Planning Commission and Ministries/
Organizations/Provincial Governments a
working paper for Annual Plan Coordination
Committee (APCC) reflecting prioritized
allocations in light of the available size of the
development envelope is prepared
Phase-II: Priorities Committee
It is headed by the Deputy Chairman Planning
Commission.

Projects and their allocations are finalized in
consultation with the same Ministries
represented at the level of
Ministers/Secretaries/Chief Secretaries.
Phase-III: Annual Plan Coordination Committee
Headed by the Prime Minister and attended by
Senior Federal & Provincial Ministers and
Secretaries of the concerned Ministries.

The final set of project allocations is prepared
and presented for the approval of National
Economic Council (NEC) and published/ printed
in shape of a book for circulation to all
concerned

NEC meeting is held in the last week of May or
first week of June.
Phase-IV: National Economic Council
PIP
Concerned
Ministries etc
Technical
Sections (PC)
Priorities Com
Annual Plan
Coordination
Com
National
Economic
Council
Core Forums
WP
Priorities
Com
WP
APCC
This Form envisages details with regard to
survey and pre-feasibility & feasibility
study before approving the project.

PC-II- Survey/Feasibility Study
This Form or document envisages complete
project details such as
Project description
Purpose
Objectives
Cost
Design
Completion time, annual recurring expenditure,
management structure, environmental impacts,
technical/financial/ economic feasibility/ rate of
return, benefits, justifications etc.

PC-I: Complete Project Detail
Production
Agriculture Production
Agriculture Extension
Industries, Commerce And
Minerals
Infrastructure
Transport &
Communication
Telecommunication
Information Technology
Energy (Fuel & Power)
Housing, Government
Buildings & Town
Planning
Irrigation, Drainage &
Flood Control


Social Sector
Education, Training and
Manpower
Health, Nutrition, Family
Planning &
Social Welfare
Science & Technology
Water Supply &
Sewerage
Culture, Sports,
Tourism &
Youth
Mass Media
Governance
Research
Categories of PC-I
The sponsors send 45 copies of the PC-I/II to
the PC. The document is first appraised by the
PIA Section which is the secretariat for the
above forums and if cleared by them it is
circulated to all Members of the DDWP/ CDWP/
ECNEC and the concerned technical section of
the PC dealing with the subject.

Technical section carries out the technical
appraisal while the Economic Appraisal Section
conducts the financial/economic viability of the
project including Internal Financial Rate of
Return (IFRR), Net Present Value (NPV) and
sensitivity analysis etc.
Appraisal
Forums for Approval of PC-I/II
Approval
Forum
Approval
Power
(Million)
Composition
DDWP Rs. 60 Headed by Secretary of Concerned Ministry with
Reps. of Planning Commission and Finance
Divisions as Members
CDWP Rs. 1000 Headed by DCPC with Secretary P&DD, Members
of the Planning Commission, ACS (Dev) of
Provinces, Reps of Finance, EAD and concerned
ministries as members
ECNEC Above Rs.
1000
Headed by Prime Minister with representatives
from Provinces an concerned ministries as
Members
Corporate
DWP
ECNEC
Powers
Headed by Chairman of the Public Sector
corporation with reps of Planning & Finance as
Members
Source: PC
Technical sections prepares a working paper for
CDWP

PIA Section circulates the working paper to all
the members of the CDWP who while attending
the meeting comment, appraise and support the
project.

After detailed deliberations projects may or may
not be approved keeping in view the
national/public interest.

If it is agreed to approve a project which is
beyond Rs. 1000 million, the CDWP
recommends it to the ECNEC for final approval.
Central Development Working Party
A summary for ECNEC is prepared by the
concerned technical section of the PC and sent
to the Cabinet Division who circulate the
summaries to all the members of the ECNEC.

ECNEC normally holds its meetings on quarterly
basis

Anticipatory Approval:
In case a project has to be started in urgency and the
CDWP has already recommended it for approval but
the meeting of ECNEC is not scheduled in near
future.
The sponsors through Planning Commission move a
request of anticipatory approval of Chairman ECNEC
stating the justification, importance and urgency of the
project


Executive Committee of the National
Economic Council
Once the project is approved from the relevant
forum, after receipt of minutes and other
necessary documents the PIA Section issues
administrative approval of the project to the
sponsors for taking up the case of financial
releases with the Finance Division who make
quarterly releases only if an allocation of that
project is available in the PSDP.
The sponsors are also required to prepare
annual cash/work plan of the project for getting
the releases.
Approval
The Projects Wing of the Planning Commission
is responsible for undertaking the quarterly
monitoring of the projects which have been
started by their sponsors and have attained 30%
progress.

The PC-III contains a questionnaire seeking
information on the progress of the project such
as physical and financial targets of the next
quarter and achievements of previous quarter.
Monitoring: PC-III
PC-III (A) form for Physical Targets based on
PSDP Allocations
To be furnished by 1st July of each year

Activity Chart or Work Plan/ Cash Plan

PC-III(B) Monthly Progress Reporting
To be furnished by 5th day of each month

Types of PC-III
Performa filled by the Sponsoring/Executing
Agency at the time of completion of a project
and sent to the Planning Commission for
approval and onward transmission to the
Finance Division for shifting the project from
implementation stage/development budget to
the operational stage/non-development/recurring
budget.

PC-IV: Project Completion Report
Once the project gets into the operational stage
after completion its performance is judged in light
of the given financial/economic feasibility,
benefits and objectives of the project as were set
out in the PC-I. This proforma has a
questionnaire seeking information on annual
performance of the project.
Report to be furnished by 31st July of each years
for 5 years after completion of Project indicating
Projects operational results during the last
financial year.
PC-V: Annual Performance Report After
Completion of Project
No Performa Purpose
1
PC-I Form

Detailed project document
2
PC-II Form
For preparation of pre-feasibility, feasibility study,
conducting survey
3
PC-III Form
For submission of quarterly monitoring/progress
report of project
4
PC-IV Form For submission of completion report of project
5
PC-V Form
For submission of evaluation /implementation
report on annual basis for five years (helps in
policy formulation for future)
6
Low cost PC-I Form
For preparation of small projects costing less
than Rs. 1.0 million

PC Performa: Summary

For the project cycle following six (6) proforma have
been designed by the Planning Commission.
In this Lecture, we have discussed about

Public Sector Project Life Cycle
Approving Authorities
PC Performas



Summary of This Lecture
End Note
Well Started is Half Done


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