Access to trust funds gives the network VPUs a degree of autonomy to finance sector and corporate priorities such as gender and governance, and global priorities such as climate change whose externalities may extend beyond individual client countries and which may not otherwise be integrated into country programs. However, trust funds also create contribute to the decline noted earlier in cross support provided by the network VPUs to the Regions.21
Budget Incentives for Cross Support Budget rules hinder staff from working across organizational boundaries. Current arrangements require each unit to estimate the amount of cross support it expects to sell and purchase in the coming year. Even though the Bank’s time recording system captures actual cross support across organizational units in real time, deviations from the beginning-of-year estimate for inter-VPU cross support are only reconciled through adjustments in the budget for next fiscal year, or in limited circumstances twice per fiscal year. Each VPU is free to set internal rules for intra-VPU budget settlements, but in some cases, cross support within the same sector department may not involve budget settlements at all. This non-payment or substantial delay between the provision of cross support and the payment for that work penalizes a unit for providing unanticipated cross support. On the demand side, a disincentive arises from the significant differential between the cost of staff and the cost of consultants due to
Figure 5.2 Network Anchors and WBI Receive a Much Higher Proportion of Trust Funds (BETF) Than Bank Budget
FY08-10 Budget Actuals ($2,375 milllion annual average in 2010 constant US$)
FY08-10 BEFTs ($446 million annual average in 2010 constant US$) 1%
8% 2%
1%
3% 0%
1%
9%
Regions
13%
Network Anchors DEC/WBI 49%
Corporate
49%
Finance
8%
Administration Other Operations 6%
Other
36%
5% 9%
Source: World Bank databases. Note: Other included Central Accounts and Other Unit expenditures. Other Operations includes OPCS and QLP.
106
The Matrix System at Work