China CDD Pilot Project:

Community Procedures Manual

A. Introducing Community-Driven Development

China’s 11th Five-Year Plan recognizes that creation of a “harmonious and well-off society” requires new approaches to poverty alleviation. To realize this goal, poor households and communities must themselves be active participants in local development, while local government agencies must dedicate themselves to serving the needs of poor communities.

Consistent with China’s development objectives, the State Council Leading Group on Poverty Alleviation and Development is now testing a new development approach called “community-driven development” (CDD). Your communitywill have an opportunity to participate in this pilot program. The program offers three different ways in which people in your community may benefit. This manual describes the program and its benefits, explains the processes your community will be expected to follow, and the assistance available to you from your village facilitator and from local government agencies.

What is CDD?

CDD programs differ considerably in their design. But CDD generally includes two key characteristics: community members choose local development activities to be funded under the program, and subsequently manage program funds and implementation processes.

CDD Pilot Program Objectives

The CDD pilot program is intended to give poor communities:

1)An opportunity to improve local infrastructure or public services;

2)An opportunity to collectively managea revolving fund, available to households wanting to pursue income-generation activities;

3)An incentive to consider sustainable natural resource management or other environmental improvements in determining local development priorities;

4)More effective community organization, with developed capacity for community planning and management;

5)An improved relationship with local government agencies, who will be more responsive to your community’s priorities.

B. CDD Pilot Program Activities

The program provides three opportunities for participating communities to receive funding. Each is described below.

Category A: Community Small-Scale Infrastructure and Public Services.Subgrant funds are available for making infrastructure or service improvements, to be chosen and designed by community members. Proposed activities must benefit the community as a whole, and must fit within program restrictions (as described below). Beyond meeting these minimum conditions, communities themselves can choose anything for program funding. In other CDD programs, communities typically have chosen these kinds of activities:

1)Local road or bridge improvements;

2)Water supply improvements, both for drinking water and irrigation purposes;

3)Electricitygeneration or distribution;

4)Communication access, including telephone and telecommunications;

5)Community healthcare, including construction of clinics, or improved access to trained personnel, equipment or medicinal supplies;

6)Education, including construction or repair of classrooms or learning centers, or support for personnel training or access to educational materials.

Category B: Community Natural Resources Management or Environmental Improvement:Subgrant funds are available for communities interested in promoting sustainable management of natural resources, or in other forms of local environmental improvement. As in Category A, activities must benefit the community as a whole, and must fit within program restrictions (as described below). Examples of activities that may be chosen under this category include:

1)Community reforestation, or community-managed measures for firewood utilization or planting of windbreakers;

2)Physical and biological measures for lowering soil erosion and environmental degradation;

3)Reducing agro-pollution, through lowering use of pesticides and chemical fertilizers, or through promotion of organic farming techniques;

4)Community sanitation, including treatment of human and livestock waste, or local management of solid wastes;

5)Community energy efficiency, including promotion of equitable access to energy-efficient stoves or biogas pits, and

6)Training activities relevant to environment knowledge and awareness.

Category C: Community Development Funds:Subgrants will be available to local communities committed to revolving fund management. While the community will collectively manage the revolving funds, this category is intended to provide low-cost loans to households pursuing income-generating opportunities. Each community will determine which activities are worthy of funding, but examples may include:

1)Animal husbandry;

2)Handicraft making;

3)Marketing access skills;

4)Seed improvement;

5)Greenhouse agriculture.

C. CDD Pilot Project Fund Allocation

The CDD program design provides opportunities for funding to 15 administrative villages within your county (or district). Though subject to change during program implementation, the amounts and allocation criteria for each of the three categories of funding at present are as follows: .

1.Community Small-Scale Infrastructure and Public Services: Each participating administrative village will be eligible to receive about RMB 600,000 for this category, with the funds allocated in three tranches. All natural villages can make proposals. Village representatives will choose proposals for funding through a competitive process at the administrative village level.

2. Community Natural Resources Management or Environmental Improvement: Each participating administrative village will be eligible to receive about RMB 48,000 for this category, with the funds allocated in two tranches. All natural villages can make proposals. Village representatives will choose proposals for funding through a competitive process at the administrative village level.

3. Community Development Funds: Each participating administrative village will be eligible to receive about RMB 80,000 for this category, with the funds allocated in two tranches. Revolving funds will be managed at the natural village level. Funds will be allocated to each natural village based on its number of households, as a proportion of the overall number of households in the administrative village.

Why Allocation of Funds is Tranched

CDD supports community capacity-building through “learning by doing.”A single allocation of all available program resources would not give communities repeated opportunities to learn, and to become familiar with decision-making and program management processes. Similarly, distributing funds in tranches creates incentives for responsible management of funds, and gives program officials a mechanism by which to improve program performance if misuse of funds is discovered in an early tranch. The fund allocation to administrative villages and natural villages in each tranch is as follows:

Unit: RMB

Total to each administrative village / First tranch / Second tranch / Third tranch / To natural village
Small-Scale Infrastructure and Public Services / 600,000 / 200,000 / 200,000 / 200,000 / As awarded through a competitive process
NaturalResource Management or Environment Improvement / 48,000 / 24,000 / 24,000 / 0 / As awarded through a competitive process
Community Development Fund / 80,000 / 40,000 / 40,000 / 0 / Allocated as proportion of number of households in natural village to number of households in administrative village.
Total / 728,000 / 264,000 / 264,000 / 200,000

What are program restrictions?

The CDD program is designed to allow participating communities as much control as possible over decision-making, implementation, and fund management. Nonetheless, program rules are necessary to ensure that participatory processes are followed, that program activities do not result in harm to others, and that program funds are used responsibly. Key rules of the program are as follows:

All activities intended for program funding must be selected through the processes specified in this manual; activities chosen through intervention by others will be disqualified.

Activities under categories A and B will be disqualified during program screening if they are likely to cause any of the following adverse environmental or social impacts:

  • Conversion or degradation of natural habitats, including forest cutting or wetland reclamation
  • Potential damage to cultural property or religious facilities
  • Industrial activities that cause significant environmental pollution;
  • Construction of Class III or higher roads
  • Activities within drinking water source protection areas
  • Introduction of foreign plant or animal species (without measures to mitigate ecological risk)
  • Mining activities
  • Use of banned pesticides or agrochemicals
  • Dams and weirs higher than 10meters
  • Activities causing involuntary loss of land, access to resources, or structural demolition.

During program implementation, all funds provided must be used in a manner consistent with program procedures, with a record of expenditures available for official review. Any misuse of funds will result in immediate suspension of program eligibility.

D. Community Preparation for the CDD Program

What is community preparation?

The initial step in the CDD pilot program is to prepare communities for participation. Through local capacity-building measures, villagers should gain a better understanding of the program andshould learn how to organize themselves to obtain program support.

What needs to be done?

Specific tasks to be done in the community preparation phase are:

  1. Program information dissemination and community mobilization
  2. Establish a ProjectManagement Committee (PMC), with transparent operating procedures, at the natural village level
  3. Set up management rules for the Community Development Fund (CDF)at the natural village level
  4. Establish a Project Decision Making Group (PDMG), with transparent decision-making procedures, at the administrative village level
  5. Verify completion of community preparation

How are these tasks to be done?

The CDD program will assign a paid and trained community facilitator to each participating administrative village. The community facilitator is expected to play an important role in encouraging villagers to organize themselves effectively, in making sure that all interested villagers can participate, and in obtaining assistance that may be needed in helping villagers to overcome any obstacles to program effectiveness.

During the community preparation phase, tasks and responsibilities are as shown in the table below:

Tasks / Responsible persons / Methods / Results
Program information dissemination and community mobilization / Community facilitator, with natural village head and local Women’s Federation representative / 1. Village meetings
2. Information leaflets
3. Broadcasts
4. Village bulletin boards
5. Separate focus group discussions with women and poor households / 1. Information regarding program objectives, processes, fund allocations and rules is widely known within each natural village.
2. Villagers areorganized for program participation.
3. A record of information dissemination measures is kept by the community facilitator.
Establish Project Management Committee (PMC) at natural village level / Community facilitator with village head / 1. Through simple majority vote, PMC members are elected at a village meeting with minimum of two third of households in the village. One third of participants of the village meeting should be women and each household has one vote.
2. The PMC should consist of 3-5 persons.
3. At least one third of PMC member should be female (e.g, 1 of 3, or 2 of 4-5),. / 1. PMC established in each natural village.
2. PMC is responsible for planning for, and management of, all activities to be funded in all three categories under the program.
3. Gender representation established.
Set upCommunity Development Fund (CDF) management rules at natural village level / Community facilitator with PMC members / 1. Consultation with villagers through village meeting and focus group discussions.
2. Separate focus groupsrequired for women and for poor households. / 1.CDF management rules formulated with villagers’ agreement by 80% households.
2. CDF management rules are publicly disclosed on village information bulletin board;
3. Community facilitator records CDF management rules.
Establish Project Decision Making Group (PDMG) / Community facilitator and administrative village head / 1. Each natural village elects two PDMG members (one male and one female) by simple majority rule.
2. PDMG is formed at administrative village level, consisting of elected natural village representatives, the administrative village head and the local Women’s Federation representative.
3. One Director and two Deputy Directors of PDMG are elected at a plenary meeting of PDMG, one of them should be women. / 1. PDMG is established at administrative village level.
2. PDMG works out decision-making principles and rules.
3. The PDMG membership list and PDMG decision-making rules are recorded by the community facilitator.
Verify completion of community preparation / Community facilitators, NGO, administrative village heads, and countyPMO / 1. Community facilitator and administrative village head verify in writing that community preparation activities are complete.
2. Spot check by NGO and CountyPMO. / 1. CountyPMO confirms completion of community preparation;
2. Director of PMDG inform natural villages to start preparation of project proposal.

E. Process Steps for Program Funding Categories

Small-Scale Infrastructure and Public Service Subproject Cycle

Implementation Arrangements and Responsibilities

Steps / Responsible persons / Approaches / Results
Step 1: Formulation of village priority list based on discussion of village conditions, any existing poverty reduction plans,and eligibility criteria / Village meeting, facilitated by PMC members and community facilitator / 1. Village meeting announced at least one week in advance, and attended by at least half of the adults presently living in the village
2. Separate focus group discussionsfor women and poor households.
3. Village priorities are established through simple majority voting (one person, one vote).
4. PMC and community facilitators should ensure that priorities for funding are consistent with program restrictions. / 1. Priority list for small-scale infrastructure and public service improvements is formulated.
2. The priority list is publicly disclosed on the village information bulletin board.
3. The priority list is recorded by the community facilitator.
Step 2: PMC prepares subproject proposals, with technical assistance from township government agencies. / PMC members, community facilitator, and township government officials / 1. Each natural village can prepare up to two project proposals which are included in the priority list.
2.The maximum amount of funding to be provided within one tranch for a single proposal is RMB 150,000. The total cost of the subproject can be more if the community is willing to make a supplemental contribution.
3. Township government agencies provide guidance on a no-fee basis to PMC on technical feasibility and cost estimation upon request. / 1. Up to two proposals are prepared.
2. The community facilitator helpsthe PMC prepare proposalswithin the format provided.
3. Proposals are submitted to PDMG.
Step 3: PDMG selects subprojects submitted by natural villages for funding. / PDMG members, administrative village head, Women’s Federation representative, community facilitator. / 1. For each tranch, at least four subprojects (at least two for funding, two standby) are selected.
2. Decisions must be based on established voting procedures, with a tabulation of results disseminated in all participating natural villages.
3. The community facilitator observes the selection process and records results. / 1. At leasttwo subprojects are selected for program funding.
2. At least two standby subprojects are selected.
3. The community facilitator documents the estimated cost and location of selected and standby subprojects.
Step 4: CountyPMO coordinates technical and regulatory review by government agencies. / County PMO and county technical sectors. / 1. The PDMG sends a list of selected subprojects to countyPMO.
2. CountyPMO coordinates with technical agencies to screen selected subprojects for eligibility, technical feasibility and cost estimation and to recommend remedial measures where warranted.
3. CountyPMO providestechnical review feedback to PDMG and relevant PMCs within 15 working days following receipt of selected proposals.
4. The county PMO may reject only subprojects that do not meet eligibility criteria. The countyPMO may withhold funding for subprojects that would cost more than the amount allocated by the PDMG, pending redesign to lower costs, or commitment of supplemental funds by the relevant community PMC. / 1. Selected subprojectsare screened for program eligibility, and reviewed for technical feasibility and cost estimation.
2. CountyPMO provides comments and suggestions to relevant PMCs within 15 working days.
3. Community facilitators document timing and content of proposals submitted to the countyPMO, and responses provided to PMCs.
Step 5: Second village meeting for finalization of project proposals and preparation for project implementation. / Village meeting facilitated by PMC and community facilitator. / 1. Village meeting announced at least one week in advance, and attended by at least half of the adults presently living in the village.
2. PMC and community facilitator ensure that technical comments and suggestions are considered.
3. If the natural village needs to commit supplemental funds to meet subproject costs, this must be approved by a simple majority vote among villagers present at the meeting (one vote per household).
4. The PMC may withdraw its request if it cannot meet all program requirements (in which case preparation of a standby subproject is initiated). / 1. Project proposal finalized.
2. Project implementation arrangements(including procurement) are agreed.
3. Amounts and sources of local contribution are confirmed.
4. Transparent financial book-keepingarrangementsare agreed.
5. Operation and maintenance arrangements are agreed.
6. Community facilitators document all results from the above.
Step 6: Fund disbursed to natural villages and subproject implemented by villagers (or contractors hired by PMC). / CountyPMO, PMC, and community facilitator. / 1. PMC submits revised and finalized subproject proposals to PDMGand countyPMO.
2. Prior to disbursement of program funds, a joint account (in local agricultural bank or cooperative) is established in the names of at least two PMC members (one should be a woman). PMC establishes and discloses rules for transparent management of program funds.
3. CountyPMO transfers funds to natural village project fund joint accounts following final review and acceptance.
4. PMC initiates implementation, or contracts for implementation services. / 1. Subprojects revised and accepted for funding.
2. Implementation team organized or contractor selected.
3. Subproject fundsare disbursed to natural villages.
4. Subproject implementation is initiated.
5. Fund use information is posted publicly in the village every three months.
Step 7: Subprojectimplementation is monitored and financial expenditures are audited. / PMC, community facilitator, and CountyPMO / 1. PMC monitors physical progress during implementation.
2. The community facilitator verifies that monitoring is conducted and that financial expenditures are recorded and disclosed.
3. Financial expenditures are audited by the countyPMO. / 1. The community facilitator reports on program monitoring every threemonths.
2. The county PMO reports on program audits every six months.
Step 8: Financial and technical progress assessment carried out by countyPMO and communities / PDMG evaluation group and
countyPMO / 1. Comparative participatory assessment among natural villages arranged by PDMG and community facilitator.
2. CountyPMO conductstechnical performance assessment.
3. Assessmentsshould be carried out when about 70% of subproject budget has been used.
4. Unless issues involving misuse of funds are pending, all natural villages remain eligible for subsequent program tranches. / 1. Subprojectassessment form completed by both the community comparative assessment group and countyPMO.
2. Eligibility for subsequent program tranches is established.

Natural Resource Management and Environmental Improvement Subproject Cycle