Poverty Reduction Fund (PRF III), Phase 4


Since 2002, the Poverty Reduction Fund is a main programme in Lao PDR that effectively and efficiently delivers resources and public services, such as water supply, dispensaries, schools and village roads to the poorest villages in remote areas. PRF contributes to reduce rural poverty through enabling poor communities to assess their own needs and priorities through participatory mechanism and to determine how best to use resources to maximize their social and economic development.

Country/region Topic Period Budget
Laos
Governance
Decentralisation
Public sector policy
01.10.2016 - 30.06.2020
CHF 17'300'000
Background

Lao PDR has made significant progress in reducing poverty and increasing access to services over the past 20 years. Poverty has declined steadily from 46% in 1993 to 28.8% in 2012/13 and 24.5% in 2015. The impressive poverty reduction and welfare improvements, however, mask significant differences between regions and among socio-economic groups. Poverty stands at 29% in rural areas compared to 10% in urban areas. Ethnic groups tend to be significantly poorer than the majority Lao-Tai population. A significant portion of Lao citizens who escaped poverty in the recent past have fallen back into poverty again. About half of the poor in 2012/13 were previously non-poor in 2007/8 and more than two thirds of them had been non-poor at some point during that 10-year period. According to the UN review in 2015, Lao PDR did not meet most of the Least Developed Countries criteria to progress from its LDC-state, pushing back the earliest possible graduation date to 2024.

Objectives

The overall goal of the Poverty Reduction Fund is to improve access to basic services for the project’s targeted poor communities.

The goal is achieved through inclusive community level and local development processes with emphasis on ensuring sustainability.

Target groups

Direct beneficiaries:

About 690’000 villagers in minimum 1,300 villages in 44 Districts in 10 provinces of Laos will participate in PRF activities annually.

Medium-term outcomes

Objective 1: To improve delivery of public services at village level in remote upland areas, including by providing access to health and education facilities, safe and reliable water for consumption and irrigation.

Objective 2: To strengthen citizen engagement in local development and encourage the adoption of responsive and accountable participatory planning, financing and implementation approaches for service delivery.

Results

Expected results:  

1.1: Improved access to and utilization of basic economic and social services in 275 kumbans (1’300 villages) supported by the PRF, resulting in a measurable increase in access and utilisation of health services by 42%; access and utilisation of safe water sources by 15%; access to and utilisation of access roads by 58%; and access to improved quality educational facilities by 60%.

2.1: Increased participation and representation of disadvantaged groups in planning and implementation of PRF-supported investments, resulting in a greater than 75% satisfaction rate reported by beneficiaries (690’000 people);

2.2: Increased capacity of local government to carry out local level planning and delivery services resulting in a significant increase of participatory plans used by Government and other development actors for planning and funding local investments.


Results from previous phases:  

  • About 1,930 small-scale rural infrastructures (water supply systems, schools, dispensaries, rural roads) have been financed and benefited more than 655,000 rural poor (10% of the total population) in over 1,300 villages.
  • About 1’000’000 villagers have participated in the PRF planning activities. Benefits include: increase of 37% in use of health services; increase of 86% in access to safe water resources; and increase of  48% in access to all weather roads in target villages.
  • About half the direct beneficiaries are women, and ethnic minorities account for 75% of direct beneficiaries.
  • The PRF received the 2015 ASEAN Rural Development and Poverty Eradication Leadership Award, for its leading and exemplary contribution in rural development and poverty reduction in Lao PDR.


Directorate/federal office responsible SDC
Credit area Development cooperation
Project partners Contract partner
Foreign state institution
  • Central State of South East
  • SDC Field Office


Other partners

The World Bank

Coordination with other projects and actors

National Governance and Public Administration Reform Program – NGPAR.

Budget Current phase Swiss budget CHF   17'300'000 Swiss disbursement to date CHF   11'623'695
Project phases Phase 4 01.10.2016 - 30.06.2020   (Current phase) Phase 3 01.10.2011 - 31.12.2016   (Completed)