Project Cycle Management Manual

1. Introduction

1. Introduction
1.1 Objective of the Manual
1.2 DANCEE Programme - Strategy, Priorities and Criteria for Support
1.3 Organisation of the Manual

1. Introduction

This project cycle management manual replaces the publication "Projektforslag til miljøaktiviteter i Øst- og Centraleuropa. Orientering fra Miljøstyrelsen, nr. 14, 1995".

1.1 Objective of the Manual

Project cycle management
Project cycle management is the process of developing and managing a project from the initial idea to the final evaluation of the project's results. A project is defined as a planned undertaking designed to achieve certain specific objectives within a given budget and within a specific period of time.

The purpose of the manual
The purpose of this Project Cycle Management Manual (the Manual) is to provide information on project cycle management procedures for projects supported by DANCEE.

The target group
The primary target group of the Manual is the Ministry of Environment (MoE) and environmental funds in the partner countries and potential project holders, e.g. consultants, institutions, Non-Governmental Organisations (NGOs), and enterprises, and their local partners and beneficiaries in the partner countries.

Donor organisations and international banks are the secondary target groups. The Manual should facilitate the co-financing of DANCEE support and support from other donors and international banks.

Two administrative models are applied in connection with environmental projects supported by DANCEE.

The application model
The application model is typically used by a Danish company or organisation in coorporation with a beneficiary in the partner country. This partnership identifies and describes a project according to DANCEE's guidelines for application - please refer to Section 2.4. Subsequently, the Danish organisation or company applies to DEPA for DANCEE support.

The tender model
In the tender model, DANCEE and MoE identify a project portfolio within the framework of the country programme - please refer to Section 2.3. The identified projects will subsequently be tendered according to DEPA's official tendering procedures.

The two models are designed to complement each other. The tender model allows DANCEE and MoE full control with the project portfolio, whereas the ideas for applications are initiated outside the formal ministerial collaboration.

Project holder
The term "project holder" is used in the Manual to describe an organisation (private, parastatal, government or non government institution), which has been awarded a contract after tender or a grant after application.

The aim of the Manual
The aim of the Manual is to facilitate the transparent and efficient development and management of DANCEE supported projects. The Manual will inform project holders about requirements for project preparation and implementation under DANCEE.

Furthermore, the Manual should assist project holders to undertake a more efficient preparation and implementation of projects. To achieve this aim, the Manual outlines a set of flexible but standardised guidelines for project preparation, award of projects, implementation and evaluation. Where necessary, projects may deviate from the guidelines, on DANCEE's initiative or based on a specific written agreement.

The project cycles for the two project models (application and tender model) differ to some extent. In particular, the responsibilities of DANCEE and the project holders differ in the project preparation process. However, DANCEE has harmonised the administrative procedures for the two models to the largest extent possible. The Manual will describe the procedures and guidelines in general. Differences between the two project models will be mentioned explicitly where appropriate and necessary.

The Manual is based on the terminology and the processes of the Logical Framework Approach (LFA).

1.2 DANCEE Programme - Strategy, Priorities and Criteria for Support

Strategy
The Danish government's strategy for environmental efforts in CEEC focuses on the Baltic Sea Region, EU accession, implementing international conventions, strengthening environmental awareness in the countries and increasing efforts in the Newly Independent States (NIS-countries).

The strategy takes into account the international environmental strategies resulting from the Conferences of the European Ministers of Environment held in Dobris in March 1991, in Lucerne in April 1993, in Sofia in October 1995 and in Århus in June 1998.

Partner countries
DANCEE funds are available for projects in a number of CEECs, including: Estonia, Latvia, Lithuania, Poland, Russia, The Czech Republic, Slovakia, Ukraine, Romania, Bulgaria, and Belarus. A cooperation agreement and a country programme has been drawn up with the partner countries, and DANCEE support is provided within this framework. The country programmes are described in the publication "Danish Environmental Support Fund for Eastern Europe", DEPA 1998.

Environmental strategies of partner countries
Support is granted to projects which are consistent with the partner country's environmental strategy as described in e.g. the National Environmental Action Plan (NEAP), the National Environmental Health Action Plan (NEHAP), and National Programmes for Adoption of the Acquis (NPAA). NPAA is prepared by a country applying for membership of the European Union (EU) and is the national plan for transposition and implementation of EU legislation. Most applicant countries have also developed sector strategies for implementing EU environmental legislation.

Criteria for support
DEPA has developed a number of criteria to determine which environmental projects may receive DANCEE funding. The criteria are outlined below and in Enclosure B of the Manual.

Needs of beneficiaries
A crucial criterion for DANCEE support is that projects reflect the needs and wishes of the beneficiary. It is essential to the success of a project that it is understood from the beginning which services and products are of interest to the beneficiary. The term "beneficiary" is broadly defined and may include public and private enterprises, government authorities, NGOs, etc.

Comformity with national and EU legislation
It is a key criterion for DANCEE support that the support conforms to the requirements of the environmental legislation of the partner country. Furthermore, support to countries applying for EU membership must contribute to the preparation of these countries for EU accession. At a minimum these projects in the EU candidate countries must be in compliance with the EU environmental legislation and other relevant EU standards.

Pollution reduction and environmental protection
The anticipated pollution reduction of a project constitutes another important criterion. Pollution reduction is measured in terms of quantity and toxicity. Projects which imply a significant quantitative and/or qualitative improvement of the environment and health standards are given high priority. However, technical assistance projects may be given just as high priority as an investment project if the projects are essential to the solution of environmental problems. Furthermore, priority is given to projects in geographical areas with serious environmental or health problems and to areas of particular natural value.

Focus on the prevention of environmental problems
Environmental problems are closely associated with the volume and structure of production and consumption. Therefore, projects should seek to attain savings in the consumption of raw materials, energy and water. Focus should be on pollution prevention, conservation, cleaner technologies and recycling, rather than on the reduction of existing pollution.

Danish know-how and technology
DANCEE support is primarily granted to projects which entail the transfer of Danish know-how and/or technology. As a general rule, only projects involving proven technologies will be approved. Projects involving the development of new technology may, however, be considered in exceptional cases.

Projects of general interest
Projects of general interest and utility, possessing the potential for being replicated, are given preference over projects of interest only to a limited number of potential project holders. All projects should include carefully designed activities contributing to the dissemination of project results, either in the form of workshops, articles in journals or similar activities. All projects must also provide a brief summary (ex-ante[1] and ex-post[2] ) of project implementation. These summaries are used in DANCEE annual reports and are posted on the DANCEE Internet homepage. Further, plant and major equipment supplied for projects should be clearly marked to acknowledge DANCEE financial support.

Co-financing
DANCEE funding is perceived as a means of promoting self-support. As such, projects involving the beneficiary's own funds or in-kind contribution, whether the beneficiary is an enterprise or a governmental agency, will be given priority over projects which rely solely on DANCEE support. Projects whose subsequent phases are likely to be financed by other sources - the beneficiary's own funds or funding from other donors or international financing institutions - will also be given high priority.

The DANCEE project management cycle
DANCEE's project management cycle has four phases. These are illustrated in the diagram of the project cycle shown in Figure 1.1. Each phase of the project management system is described in a separate chapter of the Manual.

Figure 1.1: DANCEE Project Management Cycle

The present chapter has outlined the objectives of the Manual and has described the criteria used by DANCEE to determine which projects to support.

Chapter two
Chapter two deals with project preparation. The chapter describes the development of projects from the initial idea to the final project document. The preparation process of projects by application and of projects by tender is outlined in separate sub-sections.

Chapter three
Chapter three deals with award of projects which in principle is identical for application and tender projects. The chapter describes the procedures used for contracting by DEPA and the standard conditions and responsibilities of the project holder.

Chapter four
Chapter four deals with project implementation. The chapter outlines the suggested project management structure and contains guidelines and procedures for reporting and monitoring.

Chapter five
Chapter five deals with project evaluation. The chapter describes DANCEE procedures for evaluation and contains guidelines for reviews, end-of-project and ex-post evaluation.

Notes:

1. Please refer to Executive Sumary in Enclosure B
   
2. Please refer to Statistical summary in Section 4.3.8