PROJECT ADMINISTRATION INSTRUCTIONS
PAI No. 2.01
Issued on October 2010
DEFINITIONS, PRINCIPLES AND RESPONSIBILITIES
1. This project administration instruction (PAI) defines commonly used terms and elaborates on the general policies in the Guidelines on the Use of Consultants by Asian Development Bank and Its Borrowers (Guidelines on Use of Consultants). PAIs 2.02 to 2.07 set forth the specific requirements and procedures in recruiting and managing consulting services. Appendix 1 spells out frequently used abbreviations in the PAIs on consulting services.
2. In these instructions,
· “ADB Financing” includes financing by loans, grants, technical assistance (TA) grants, or funds from external sources ADB administers, ADB’s administrative budget, and the special capital budget.
· "Consultant" is an individual or consulting firm (as defined below) that provides consulting services.
· "Consulting firm" means any private or public entity with the capacity to provide consulting services. Such entities include international and national consulting firms, engineering firms, construction firms, management firms, procurement agents, inspection agents, auditors, United Nations (UN) agencies and other multilateral organizations, universities, research institutions, government agencies, and nongovernmental organizations (NGOs), when such entities provide consulting services.
· "Consulting services that ADB administers" refers to the consulting services, or services provided by resource persons, financed by ADB's administrative budget, capital budget, TA grant, or other grant projects funded from special funds or trust funds, for which ADB selects and engages the consultants. ADB may also hire consultants funded by advance payment from prospective clients in its private sector operations.
· "Consulting services that executing agencies (EAs) administer" refers to the consulting services provided under ADB’s loan projects, grant projects or delegated TA projects for which the EA selects and engages the consultants.
· “Borrower” has a broader meaning that includes agencies or entities which act for the borrower to carry out the project. It also includes recipients of grants for projects under which the EA administers consulting services.
· "DMC" means developing member country.
· “EA” refers to the executing agency as identified in a financing agreement or TA agreement to supervise the implementation of a loan, grant, or a TA grant-funded project. The term EA may be extended to include implementing agency which the EA designates to implement the project and recruit consultants.
· “Project unit” refers to an ADB project division, regional office, or resident mission that supervises a loan or grant financed project or a delegated TA.
· “Procurement Plan”, prepared by the borrower before loan negotiations, in consultation with ADB, covers goods, works, and consulting services for the entire project. For consulting services, the plan presents (i) particular contract packages; (ii) proposed methods for selecting consulting services and type of proposal; and (iii) overall indicative recruitment schedules and budgets for each consulting contract package. PAI 3.01 details procurement plans.
· “Consultant Recruitment Plan” is prepared by the user unit for each specific consulting service assignment financed by ADB. Details are explained in PAI 2.02. For a loan project, the consultant recruitment plan(s) should be prepared based on the procurement plan for the project and reflected in the Project Administration Manual (PAM).
· "Recruiting party" refers to the party responsible for selecting and finally signing a contract with the consultant. ADB’s Central Operations Services Office (COSO) is the recruiting party for TA assignments (except for delegated TAs), staff consultancy assignments and assignment financed by grants administered by ADB. The EA or implementing agency (IA) is the recruiting party for loan assignments, grant assignments administered by the EA and assignments for delegated TAs. Under special circumstances, such as lacking the required capacity, the EA may request ADB to help recruit consultants. Subsequent PAIs use the term recruiting party when describing rules and procedures applicable to both ADB and EAs.
· "RFP" means “Request for Proposal”. The RFP document specifies the criteria for selecting a consulting firm and describes the rules and procedures consultants must comply with when submitting their proposals.
· “RRP” stands for “Report and Recommendation to the President” which sets out the terms and conditions proposed for a loan project or grant financed project, and seeks approval from ADB's Board of Directors.
· “Terms of reference” (TOR) is a document describing the objectives, scope of work, detailed tasks, and reporting requirements for a specific consulting service assignment.
· "User unit” means an ADB division, department, office, resident mission, regional office, or representative office or the EA’s project implementation unit using consulting services.
3. ADB’s policies on recruiting and managing consultants follow six principles:
· Consulting services should be of high quality.
· Engagements should be economical and efficient.
· All eligible consultants should have an equal and fair opportunity to compete for assignments.
· ADB encourages developing and using consultants from DMCs.
· The selection process should be transparent.
· Transactions should be without any corrupt, fraudulent, coercive or collusive practice.
4. Such principles are best served through a competitive process among qualified shortlisted consultants, usually with a selection that is based on the quality and cost of services.
5. ADB and its borrowers’ EAs aim to recruit consultants promptly and effectively by
D. Anticorruption Policy
· providing a range of recruitment options;
· permitting quick engagements for emergency assignments;
· harmonizing procedures with those of the other major multilateral development banks; and
· monitoring the recruitment process.
6. ADB requires consultants, borrowers, EAs, IAs, and ADB staff under ADB-financed projects to observe the highest standard of ethics when selecting consultants and implementing contracts. If ADB determines that a consultant, EA, or IA has acted corruptly, fraudulently, collusively, or coercively during selection or implementation, ADB may take any of the steps listed in para 1.23 of the Guidelines on Use of Consultants. Staff should refer allegations of corrupt, fraudulent, collusive, coercive, or obstructive behavior to the Office of Anticorruption and Integrity (OAI).
E. Conflict of Interest
7. ADB considers it a conflict of interest when a party has interests that could improperly influence its performance of official responsibilities, contractual obligations, or compliance with laws and regulations. A conflict of interest may contribute to, or constitute, a prohibited practice under ADB’s Anticorruption Policy. ADB will address conflicts of interest and may reject a consultant selection if it decides that a conflict of interest has affected the integrity of selection. Para 1.11 of the Guidelines on Use of Consultants describes examples of potential conflicts of interest. Staff should refer allegations of conflicts of interests to OAI and COSO.
F. Avoiding Unfair Competitive Advantage
8. A consultant competing for an assignment should not gain an unfair competitive advantage from having completed a related assignment. To avoid this, ADB and its borrowers provide all the shortlisted consultants with the same information so that no consultant has an unfair advantage.
G. Consultant Management System (CMS)
9. CMS is an on-line information technology (IT) system that allows COSO and user units to advertise consulting services opportunities, recruit consultants, manage contracts, and process consultants' performance evaluation reports. Consultants also use CMS to register in ADB’s consultant database and submit expressions of interest and proposals.
10. COSO generally requires user units to use CMS for recruiting consulting services that ADB administers.
11. As internet is essential for consulting firms, ADB believes that using CMS will normally not disadvantage any firm in the competitive selection for consulting services. Yet, for special circumstances, such as recruiting national consultants from a remote place that has no internet in a DMC, COSO or user units may follow the procedures in PAI 2.04 (para 2) and use paper-based selection instead. Paper-based selection may also be used when the CMS or ADB's server that supports the CMS is not functioning, is experiencing a prolonged technical problem, or is otherwise unavailable for data processing.
a) EA Responsibilities for Loan or Grant-Financed Projects
12. The EA, or IA of the borrower’s EA, authorizes, selects, engages, and supervises consultants following the Guidelines on Use of Consultants for loan project or grant-financed project. For this the RRP indicates that the EA (or IA) will administer the consulting services. However, under special circumstances, such as when an EA lacks capacity, the EA may request assistance from ADB in selecting consultants provided that the EA negotiates and signs the consulting service contract.
13. ADB is normally responsible for selecting, engaging, and supervising consultants financed by ADB's internal administrative budget, capital budget, TA grant, and other grant project for which the RRP indicates that ADB administers the consulting services. ADB may also be responsible for hiring consultants funded by advance payment from prospective clients in its private sector operations.
b) ADB Responsibilities for TA, Staff Consultancy and Consultancy in Private Sector Operations
c) EA and ADB Responsibilities for Recruiting Consultants for Delegated TAs
14. To increase the EA's ownership of TA projects and to improve sustainability of project benefits, ADB may delegate responsibility to the TA recipient's EA to recruit and supervise TA consultants. The recommendation to delegate follows an assessment of the EA’s capacity to recruit and manage consultants and is indicated in the TA report or TA concept paper (CP), when a full TA report is not required, for approval, as appropriate, by the department head, the vice-president, the President, or the Board. The approving authority depends on the TA category and size as set out in OM D12/OP. The project officer assesses EA capacity during fact-finding missions. COSO may assist. Depending on the EA's capacity, delegation may be partial or complete. For complete delegation, the EA selects and signs the contract with the consultant, and assumes primary responsibility for supervising the consultant. For partial delegation (also known as "delegation through enhanced partnership"), the EA selects the consultant, ADB signs the contract, and the EA and ADB jointly supervise the contract. PAI 2.05 sets out the procedures for recruiting consultants under delegated TAs.
d) Responsibilities of Central Operations Services Office (COSO)
15. COSO is responsible for ensuring that ADB staff comply with ADB's requirements by monitoring the recruitment process for consulting services that are either administered by the EA or ADB. It reviews documents, advises staff, and chairs the consultant selection committee (CSC), when required. COSO responds to consultants' and EA’s queries regarding the selection process.
16. COSO determines the terms and conditions, signs the contracts, and supervises the contract variations for consulting services that ADB administers. To improve efficiency and expedite consultant recruitment, COSO may delegate to a user department certain consultant recruitment functions, such as national consultant recruitment, provided that such a user department staff have obtained the requisite training on consultant recruitment, and the delegation is supported by an accreditation and monitoring system. COSO may also, under certain conditions or thresholds (as defined in PAI 5.11), delegate particular contract administration activities to user units for consulting services that ADB administers. Unless COSO or a delegated recruiting party signs the contract, the user unit should not commit to engage the consultant or allow the consultant to start working. The same principle also applies to a case where a replacement or new consultant team member is to be mobilized under an existing contract through a contract variation. In such cases, the user unit should not mobilize the consultant until COSO or the delegated recruiting party signs the contract variation.
17. COSO supervises the consultants’ performance evaluation process, and maintains and updates the consultants' performance evaluation reports. COSO may also communicate with consultants about their performance evaluation results.
18. COSO, supported by the Office of Information Systems and Technology (OIST), manages CMS. COSO answers internal and external inquiries on CMS business processes.
e) Responsibilities of User Units
19. For consulting services that ADB administers, user units prepare the TORs, select the consultants following PAIs, supervise implementation of consulting services contracts, authorize consultant payments, and evaluate consultant performance. Heads of departments ensure that consulting services are used properly. User units respond to questions from consultants on assignments.
20. With COSO support, user units ensure that EA staff comply with ADB policies and procedures for consulting services that EAs contract and administer.
f) Responsibilities of Controller’s Department (CTL)
21. CTL verifies and processes ADB payments to consultants under ADB contracts.
g) Responsibilities of Office of Information Systems and Technology (OIST)
22. OIST provides information technology (IT) support on the CMS and helps internal and external users resolve IT issues related to CMS and other activities involving recruiting IT consultants.
h) Responsibilities of Office of the General Counsel (OGC)
23. OGC advises on legal issues arising from recruiting consultants, administering contracts, and related activities.
i) Responsibilities of Consultant Selection Committee (CSC)
24. A CSC is convened to decide on consulting services matters, when required by PAI 2.04 or 2.05 or 2.07.
25. For consulting services that ADB administers, the CSC normally consists of a COSO director or professional staff member representing the director as chairperson, the user unit officer, and a professional staff from another department chosen from a roster maintained by COSO. The third member should be impartial and possess technical expertise that is similar to that being sought by the TOR. The CSC members represent directors of their divisions. Video conferences may be used when a CSC member is from a resident mission or regional office. Under special circumstances, the CSC may be established based on the requirements of a specific task force designated by ADB Management or the concerned department heads. For consulting services that EAs administer, the CSC normally comprises 3-7 member appointed by the EA. The CSC members must not have any perceived conflict of interest in the CSC decision process. A conflict of interest will be present if a CSC member has an affiliation with or a financial interest in the individual or entity on which the CSC will make a decision on, or will otherwise benefit the CSC member financially or derive a personal benefit as a result of the decision. Please also refer to para 7 of this PAI regarding conflict of interest.
I. Types of Consultants
26. Consulting firms are usually used for complex assignments that require multiple-expertise-teamwork. Consulting firms may also be preferred for engagements that span over a long period and when the risk of loss of continuity is high.
27. Individual consultants are more suitable for assignments that can be carried out by individuals independently. Individual consultants may be engaged directly or through a firm.
28. Consultation with COSO is required before contracting several individual consultants separately under one project for assignments that are interdependent on inputs by these consultants. In such a case, a consulting firm should normally be engaged through a competitive selection process to provide these individuals as a team.
J. Types of Assignments
29. For purposes of the PAIs, ADB classifies consulting assignments by the instruments or type of operations the consultants serve:
· Loan assignments are undertaken by consultants working under ADB loan projects.
· Grant assignments are undertaken by consultants working under ADB grant projects.
· TA assignments are undertaken by consultants working under ADB TA operations.
· Staff consulting assignments are required to support ADB’s institutional operations and financed by ADB’s administrative budget, staff development budget, or capital budget.
30. For purposes of the PAIs, ADB also classifies consulting assignments by expertise:
K. Using National Consultants from Developing Member Countries (DMCs)
· Assignments requiring international expertise are open to eligible consultants possessing the international experience required by the TOR.
· Assignments requiring national expertise are open to eligible consultants possessing extensive background and experience in the project country or in the country where the assignment takes place under a regional TA, as provided in the TOR.
31. ADB encourages using qualified consultants from DMCs.
32. ADB considers a consulting firm as a national firm of a project country if it is established or incorporated in that country. Similarly, an individual consultant qualifies as a “national consultant” if he/she is a citizen of the DMC concerned.
33. Nationals of a DMC who possess the appropriate international experience may be considered for assignments that require international expertise, whether in the national's own country or in other DMCs. The international experience that is required for a particular assignment will be defined and described in the pertinent TOR.
34. ADB promotes the development of the consulting profession in DMCs. COSO conducts seminars for consultants in DMCs and implements TAs to help develop DMC consulting industries.
L. Using Individual Staff Consultants
35. ADB recruits individual consultants to supplement its staff. They provide specialized expert knowledge and advice for limited periods. User units fund these staff consulting assignments from their administrative budgets.
36. Staff consulting assignments do not normally include work that is typically performed in connection with a TA to member countries, because ADB finances such work through TA operations.
37. Individual staff consulting assignments should include specific, time-bound outputs, for example, providing technical expertise during a fact-finding, appraisal, or review mission; writing a policy paper or developing computer software. The TOR should clearly identify the outputs and expected completion dates.
38. Individual staff consulting assignments may also include ongoing work similar to the work ADB staff regularly perform. Individual staff consultants are typically recruited when
· staff are unavailable for the assignment, for example, during peak work periods or because staff are on leave;
· ADB’s staff skills-mix needs supplementing, for example, when ADB staff do not have the required expertise and experience; or
· ADB requires specialized expertise for a limited period only.
39. Individual staff consulting assignments without specific time-bound outputs may only be used to temporarily alleviate staff shortage, and must generally last less than 1 year. The process for obtaining approval for staff consultants is set forth in PAI 2.04.
a) Eligibility Requirements for All Consultants
40. The Guidelines on Use of Consultants (para 1.13) list the general principles on eligibility requirements for consultants working on ADB-financed assignments. Specific requirements are defined as follows:
41. The following restrictions on government organizations and employees apply to all assignments:
42. Former ADB staff, advisers to executive directors, and former executive directors and alternate executive directors on the Board may not work as consultants for consulting services that ADB administers within 1 year of their effective termination dates. Vice-presidents may not work as consultants for consulting services that ADB administers within 3 years of their effective termination dates. The President may waive such requirements when ADB specifically requires a person’s services.
· Government-owned enterprises, institutions and organizations may work as consultants in their own countries only if they can establish that they are legally and financially autonomous; operate under commercial law; and do not depend on the borrowing government, a government agency, or subborrower. However, ADB may sometimes approve a government-owned university or research center, or one of its staff, to participate in an assignment when the services to be provided by such entity or staff are exceptional or unique, and the participation of such entity or staff is critical to the assignment. COSO has the authority to interpret this requirement and approve specific cases when sufficient justifications are provided by the user/project unit.
· Current employee of an EA for an ADB-financed loan or TA may not work as a consultant under the loan or TA.
· Civil servants (public sector employees working for a government department or agency) may only be hired under consulting contracts, either as individuals or as team members of a consulting firm, if (i) they are on leave of absence without pay; (ii) they are not being hired by the agency they were working for immediately before going on leave; and (iii) their employment would not create a conflict of interest. A letter from the candidate’s agency may be required to certify if these requirements are met.
c) Former ADB Staff
43. The Budget, Personnel, and Management Systems Department (BPMSD) clears proposals to engage former ADB staff for the first time as consultants for consulting services that ADB administers and in the case of former staff at director level and above, for each engagement. This occurs if (i) the former staff was nominated by a first-ranked consulting firm in its technical proposal or (ii) the former staff is proposed as an individual consultant for consulting services that ADB administers. The procedures to obtain clearance are as follows:
44. To review proposals to engage former staff whose positions were at the level of director or above up to department or office head, BPMSD forms a committee. The committee comprises the Director General, BPMSD as chairperson, the head of the user department or office, and the head of another department or office as an independent member. The Director, BPHR acts as the secretary for the committee. The committee considers all factors, including
· If the former staff position was below director level, the user unit refers the candidate’s name to the Director, Human Resources Division (BPHR), who checks that they had no performance, disciplinary or other related problem while working in ADB.
· If the former staff position was at the level of director or above up to department or office head, the user unit submits, with adequate lead time, the name to the Director General, BPMSD for clearance. BPMSD forms a committee of senior staff to review the nomination.
· If the candidate was a director or alternate director on the Board or a vice-president, the director of the user unit, with adequate lead time, briefly justifies and recommends recruitment through (i) the head of the user department or office; (ii) the Director General, BPMSD; and (iii) the vice-president/managing director general, as applicable, to the President for approval. A copy goes to the Secretary, Office of the Secretary (OSEC).
45. ADB staff spouses applying to work for consulting services that ADB administers will be subject to the conditions below.
· the former staff member's ADB records with respect to any performance, disciplinary, or related problems;
· the proposed scope of work;
· the expertise required and whether other candidates are equally qualified;
· the extent to which the staff member was associated with the proposed work;
· the extent to which the staff's previous work or his/her former subordinates’ work relates to the proposed work; and
· the risk that the engagement might involve, or be seen to involve, favoritism or conflict of interest.
d) Spouses of ADB Staff
46. Spouses of certain staff categories are restricted from working as a consultant for consulting services that ADB administers. These include the President, vice-president, head or deputy head of an office or department, dean of the Asian Development Bank Institute, and managing director-general. The head of the user department or office may recommend that the President waive this restriction in special cases, such as unique qualifications, urgency, or the overriding importance of the assignment. If the candidate is the current President’s spouse, the ranking vice-president may approve the recruitment.
47. The recruitment process for an ADB staff's spouse shall include due diligence to determine whether or not an actual or potential conflict of interest exists. A spouse may not be recruited as an ADB consultant if
48. When a user unit suspects an actual, potential or perceived conflict of interest, it refers the matter to the Principal Director, COSO who will decide if the recruitment may proceed.
· the proposed consultancy position is in the same division/unit as the ADB staff whose spouse is being considered for such position, or such staff would supervise the work of his/her spouse by rating performance and recommending rate increases; or
· the proposed consultancy position involves an actual or potential conflict of interest on the part of the ADB staff and/or his/her spouse.
49. Staff must not promote their spouses’ interests. Staff should not communicate with prospective user departments for engaging their spouses as consultants. Doing so may result in disciplinary measures.
50. Spouses who are interested in individual consulting assignments should register in the CMS. Spouses interested in working for consulting firms or organizations as team members should contact those consulting firms or organizations directly.
51. If a spouse is a candidate on a shortlist, the concerned user unit should evaluate the spouse using the same eligibility requirements as other candidates. The fact that a proposed consultant is the spouse of a staff should not be a consideration for selecting such a consultant. The user unit should also confirm that the assignment will not create any actual, potential, or perceived conflict of interest.
52. Single source selection of a spouse for an individual consulting assignment is discouraged. When a single source selection of a spouse is proposed, the user unit concerned must submit proof that no other qualified candidate has expressed interest, following public advertising of the position in the consulting services recruitment notice (CSRN), regardless of the assignment duration and level. The user unit submits a recommendation with a detailed justification including an assessment of any submitted expressions of interest through the head of the user department or office, to the Director, BPHR, for clearance. The head of the user department or office then approves the single source selection.
53. The Director, BPHR clears the initial engagement of spouses, similar to the engagement of former bank staff.
54. ADB does not provide spouses working on individual consulting assignments with
55. Close relatives of current ADB staff, other than spouses, may not work as consultants for consulting services that ADB administers. Administrative Order 2.01 Appendix 1 defines close relatives as son, daughter, stepson, stepdaughter, adopted son, adopted daughter, mother, father, brother, sister, niece, nephew, grandmother, grandfather, granddaughter, grandson, aunt, uncle, cousin, stepmother, stepfather, stepsister, stepbrother, mother-in-law, father-in-law, sister-in-law, brother-in-law, daughter-in-law, son-in-law.
f) Close Relatives of Consultants Currently Engaged by ADB
56. Close relatives of consultants currently engaged by ADB may not work as consultants or temporary administrative assistants if such engagement creates an actual or potential conflict of interest situation. Consultants who are close relatives shall not be engaged to work as individual consultants under the same assignment.
g) Consultants Currently Engaged by ADB or EA
57. Consultants currently engaged by ADB or by the EA for ADB-financed projects on full-time and continuous assignments should not work as consultants for another ADB-financed TA or loan project. Consultants currently working for an ADB-financed assignment on intermittent basis may be allowed to work on another intermittent assignment provided that COSO receives clearance from the concerned user units that there would be no overlapping in working days between the assignments in question.
h) Experts in specialized fields
58. For certain ADB-administered assignments that require specific professional qualifications, such as legal or information technology experts, the department which possesses the relevant knowledge may request, through COSO, clearance of proposed candidates before engaging them. See PAI 2.04 (paras 79/80) for details.
Abbreviations Used in the PAI
ADB - Asian Development Bank
BMCS - Budget Monitoring Control System
BPBM - Budget and Management Services Division
BPHR - Human Resources Division
BPMSD - Budget, Personnel, and Management Systems Department
BTP - Biodata Technical Proposals
CEP - capital expenditure projects
CMS - Consultant Management System
COSO - Central operations Services Office
CP - Concept Paper
CPS - country partnership strategy
CQS - Consultants’ Qualifications Sélection
CRAM - Consultant Recruitment Activity Monitoring
CSC - Consultant Selection Committee
CSRN - consulting services recruitment notice
CTL - Controller’s Department
CV - curriculum vitae
DMF - design and monitoring framework
EOI - expression of interest
FBS - Fixed-Budget Selection
FR - full registration
FTP - Full Technical Proposals
GEFP - gross evaluated financial proposal
GFIS - Grant Financial Information System
HOD - head of the department
IA - Implementing Agency
ICS - Individual Consultants Selection
ICR - international consultant remuneration
IT - information technology
JV - joint venture
LCS - Least-Cost Selection
LCU - Loan Consulting Services Unit
MOU - memorandum of understanding
NCR - national consultant remuneration
NEFP - net evaluated financial proposal
NGO - nongovernmental organization
OAI - Office of Anticorruption and Integrity
OGC - Office of the General Counsel
OIST - Office of Information Systems and Technology
OM - Operations Manual
OSEC - Office of the Secretary
PAI - Project Administration Instructions
PAM - Project Administration Manual
PPTA - project preparatory technical assistance
QCBS - Quality and Cost-Based Selection
QBS - Quality-Based Selection
RFP - Request for Proposal
RM - resident mission
RRP - Report and Recommendation of the President
RSC - request for the staff consultant
SCOS - Staff Consultants System
SR - simplified registration
SSS - Single-Source Selection
STP - Simplified Technical Proposals
TA - Technical Assistance
TAIS - TA Information System
UN - United Nations