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31 March 1999

The Palestinian NGO Project
A Case Study of NGOs Role in Poverty Alleviation

Presented to
The World Bank Human Development Week Annual Meeting
Washington, D.C.

March 1999

A. Introduction

The Palestinian NGO Project is funded by the World Bank but does not exactly fall into the mold of the Social Funds. Before discussing the strengths and weakness of the project, its goals, and its unique character, I would like to provide a little contextual background, which, I think, will help you evaluate the applicability of our model in other environments.

The Palestinian social and political environment is admittedly unusual. In 1948, Palestinians lost 78 percent of what had been Palestine. What remained was two non-contiguous areas, the West Bank, representing 22 percent of the original area, and the Gaza Strip, 1 percent of the original area.

The scale of the human tragedy was immense. Nearly one million Palestinians became refugees overnight. Of those, 350,000 fled into the West Bank, and 250,000 into the tiny Gaza Strip. The population of Gaza was tripled by this influx of destitute people. Most of the people who lost their homes, possessions, and lands were illiterate peasants. Not only did they lose their source of livelihood, the land, they were poorly equipped to support themselves and their families in any other way than farming.

In addition to assistance efforts by the international community, many Palestinian organizations dedicated to the care of orphans and the destitute, education, training, and delivery of primary health care responded to the crisis.

The 1967 Arab Israeli War resulted in over a quarter of a century of military occupation of the West Bank and Gaza Strip. In the absence of a government that would provide services to the population, the Palestinian community again rose to the occasion. Palestinian NGOs that had been providing social services since 1948 continued, and new NGOs appeared.

The Intifada, an uprising against the military occupation began in 1987. Its toll on the economic and human resources of the Palestinian community were dramatic. Once again, Palestinian NGOs responded to emergency and structural needs. As a result of this history of conflict, refugees, and occupation more than 500 Palestinian NGOs today work in the West Bank and Gaza, providing vitally needed basic social services.

Following the signing of the Oslo Agreement between the Palestine Liberation Organization and the Government of Israel in 1993, the Palestinian Authority was established in the Gaza Strip and parts of the West Bank. The Authority has been the
recipient of generous international donor aid - $2.5 billion dispersed in the last four years. However, much of this aid has been directed towards capital investments in infrastructure.

The Authority's recurrent budget, from which services like education and health care are funded, while fairly well in balance, has little chance in the medium term of expanding. In the meantime, however, the Palestinian population is expanding.

Palestinians have one of the highest fertility rates in the world. Nearly 2.7 million people live in the West Bank and Gaza, 50 percent of whom are under the age of 15 years. Gaza, is one of the most densely populated places on earth with more than
5000 people per square mile.

While, the recurrent budget is limited and the demand for services is exploding, the Palestinian economy is faltering. Our economy, wracked by nearly 30 years of conflict and occupation, is still in a terribly weak position. The closure of our
borders, in place since March 1993, effectively isolates the economies of the West Bank and the Gaza Strip from each other and from the world.

What is the result? The Palestinian population is growing measurably and rapidly poorer and the percentage of the government budget to provide services is shrinking.

Today, 16 percent of people in the West Bank and 38 percent in Gaza are considered to be below the poverty line. Of those, 26 percent of the poor in Gaza and 9 percent in the West Bank are in absolute poverty - unable to obtain the basic needs of food, clothing, and shelter.1 Poverty in the Palestinian case happens to be closely correlated with geography - people living in rural areas of Gaza and the West Bank tend to be poorer than those in or near urban areas. Palestinian poverty also correlates to sociological status. Refugees, women, the elderly, the disabled, and the uneducated are more likely to be poor.

The Palestinian NGOs have played a very important and central role in the delivery of a myriad of social services, education, health care, mental health care, services to the disabled and handicapped, agricultural extension, economic development, services to women, and legal aid. There are historical reasons why the Palestinian NGO movement is strong and vibrant. Probably the most important one is that the Palestinians were without a government of their own to provide important services for most of the twentieth century. Palestinian NGOs, because of their historic focus on meeting the needs of the grassroots and reaching out to the poor and the marginalized, have a strong institutional capacity to deliver social services in areas and to segments of the population that the central authority has simply been unable to reach.

B. Background of the Palestinian NGO Project

1st. Rationale

The development debate has swung between themes over the past decades, and at last in the 1990’s, poverty reduction is center stage again. In response to the World Summit on Social Development, many UN organizations have made poverty eradication their top priority, guided by the paradigm of Sustainable Human Development, with a combined emphasis on job creation, the advancement of women, protection and regeneration of environment.

After all these years of debate, there is now consensus as to what constitutes an effective poverty alleviation strategy, reflected in development research and donor policy documents, given special focus in the Bank’s 1990 World Development Report (WDR) on Poverty, and in UNDP’s Human Development Report (HDR of 1996).

The World Bank in the 90’s has again renewed its commitment further to poverty alleviation through its country-focused programs, and established the Palestinian NGO Project as a Poverty Alleviation scheme. The Project is also committed to the
strengthening both the NGO sector, and the coordination between the NGO sector and the Palestinian National Authority (PNA), and clearly defines these as objectives of the Project.

Research in development has proven over the years that poverty alleviation schemes are more successful when the following is promoted:

1. A Pro-poor Pattern of Growth: through efforts to promote household incomes, or sustainable livelihoods, by increasing and sustaining the use and productivity of the poor’s greatest assets, especially labor

2. Investment in People : through efforts to improve access by the poor to basic services (health, education, water, etc), to allow the poor to take better advantage of economic opportunities

3. Decentralized and Participatory Planning is conducted at the community level, whereby the target beneficiaries themselves are empowered through the process of needs assessment, planning and managing their own services.

On the other hand, there is also the recognition:

1. That the importance and impact of civil society institutions in poverty alleviation is increasing

2. That responsibilities of planning and management of basic services required for poverty reduction should be delegated to local structures and community institutions whose sphere of authority is closest to the people.

3. That incentives should be provided for these institutions to mobilize local resources and community support

4. That participation of the local communities should be strengthened through these institutions with special focus on marginalized social groups, like women, people with special needs, orphans, elderly, refugees, and rural population.

5. That central/local dialogue can only be enhanced through a system of information flow, clear division of labor, and devising a system whereby incorporation of local priorities and planning within the central planning system is possible and encouraged.

With this in mind, the Palestinian NGO (PNGO) Project was established in 1997, with a Trust Fund of about $14.8 Million from the World Bank, the Government of Italy and Saudi Arabia, all managed by the World Bank. It is worth mentioning that the project concept came about as early as 1996 and was widely discussed with Palestinian NGOs locally as well as with representatives of the PNA, especially representatives of line ministries.

It is not incidental that the World Bank elected the West Bank and Gaza as a place of choice to set up such an innovative project. Indeed, the recognition of the Palestinian NGOs’ crucial and historical role in delivering services and fostering the existence of a civil society greatly informed the Bank’s decision. The establishment of the PNA in 1994 translated in a severe decrease of funding for the NGO sector as donors directed their support to the emerging Palestinian government. It is estimated that funding to the non-governmental sector fell by 50% between 1992 (the peak year for external funding) and 1995. The PNA neither has the capacity to take over all NGO services, nor will it be the most cost-effective option in light of the NGOs technical experience in delivering services to the Palestinian population, accumulated over a period of more than four decades. So far, Ministries such as the Ministry of Health (MOH) and the Ministry of Education (MOE) soon came to the realization that division of labor is needed to be put in place with the NGOs and, to a lesser extent, the private sector. Areas in which NGOs have demonstrated a comparative advantage at service delivery were hence left to the sector to manage (e.g. handicapped care, pre-school education, women’s activities and catering to the poor and marginalized population in general). With the PA in place, NGOs also had to rethink their contribution to the Palestinian society as they were no longer the sole agents of development.

Consequently, the PNGO project seeks to: (1) to support the NGO sector in continuing to deliver essential service with a focus on the poor and the marginalized; (2) help NGOs to move towards developmental work and accordingly build up their
delivery capacity, (3) foster a productive relation between the PA and the NGO sector to encourage a clear division of labor, avoid duplication of services, and facilitate a concerted and consensual strategy of development. In pursue of these goals, the project is consultative in nature, and has created a dialogue, partnerships and mechanisms through which information and support can flow from the NGOs to and from the Palestinian National Authority, and where responsibilities and accomplishments can be shared.

The project is a three-year project that awards grants for NGOs for service delivery, coupled with capacity building and policy research support, as a supplementary component to empower and inform the service sector. The Project aims at promoting best NGO practices, and thus is gearing its capacity building program in that direction.

B. Aims and Objectives of the PNGO Project

C. Guiding Principles of the Project

D. Target Groups

The project has three target groups.

1. The most important target group is, of course, poor and marginalized Palestinians who rely upon services provided to them by NGOs.

2. The NGOs are also a target group of the project since the project aims to build their institutional capacity for service delivery, and encourage and support their adjustment to a new legal, logistical, and funding environment. The project employs them as a vehicle of outreach to the remotest corners of the community.

3. The Palestinian Authority is also a project target. The project seeks to strengthen a productive, mutually supportive work relationship between the government and the NGOs. In addition, the project is participating in the ongoing effort to create a positive legal framework for the NGO community.

C. Institutional Design of the PNGO Project?

A. Consortium of NGOs as manager (The PMO)
The Palestinian NGO project is run by a project management organization that was created for and is dedicated to this task alone. At the executive level, the field office is comprised of a small staff of nationals selected for their expertise in design, management, and implementation of development projects.

At the management level, in this particular case, there is a Steering Committee comprised of representatives of the Consortium to which the World Bank awarded the project. The Consortium is comprised of the Welfare Association, a large Palestinian NGO with a strong record in both economic development and social service projects, the British Council, and Charities Aid Foundation, a British-based charity that focuses on support and technical assistance to NGOs and charities around the globe.

Our Steering Committee also includes a representative of the private sector, a banker, as it happens.

The Steering Committee performs three roles. One of these is supervisory. The Committee also provides technical assistance to the project as it is needed and they lend a range of views and experience to the project.

The Palestinian NGO Project also has a Supervisory Board composed of Board members of the lead organization, The Welfare Association, and the Steering Committee members. The Supervisory Board is the ultimate decision making body for grants disbursed by the project.

B. Role of the Palestinian National Authority

The Palestinian Project has been designed and is being implemented to draw central government, the Palestinian National Authority, and Palestinian NGOs together in a harmonious, mutually supportive, working relationship. Officials from relevant and ministries provide a consultative function to the project and participate in meetings and workshops with their counterparts in the NGO community. The focal ministry for the Project is the Ministry of Planning and International Cooperation (MOPIC), who has formed an inter-ministerial Sectoral Committee, made up of members of the different sector Ministries to liaise with the Project.

C. The Role of the PNGOs and PNGO Networks: The Consultative Mechanism

Very important to the project design and viability is its highly consultative character. The PMO holds regular meetings with NGO network representatives to discuss issues and elicit feedback. Indeed, there is a formal mechanism to ensure NGO representation in the decision making processes of the PMO.

The Palestinian NGO project is participatory in three primary ways:

The ultimate goals of the consultative body are:

Why is participation valuable?

Thus, the project has a very large number of stakeholders. The positive side of this is that there is a great deal of input, energy, and creativity lent to the project. The negative side is that it is difficult to move things along when there are a large number of actors.

IV. Mechanisms of the Project

The Palestinian NGO Project funds two broad categories of activities, Grants and Services.

1. Grant Awards include:

a. Cycle Procedures

Two. Project Appraisal process in relation to Poverty and Marginality
Palestinian NGOs have been for years vital services for the Palestinian society, especially in the absence of a national government. The NGOs in Palestine have been offering a wide range of services that the governments under normal circumstances do.

With the emergence of the Palestinian National Authority, and in adherence to its objectives, the PNGO Project is assisting and encouraging NGOs to shift emphasis towards the poor and marginalized. The assumption is that NGOs can provide local services in a more cost-effective way compared with PNA. This will need consistent time, effort and technical assistance for the NGO sector to mobilize them in that direction.

Thus the PNGO Project has now developed Poverty and Marginality Indicators (PAMIs), to assist NGOs in both targeting areas and communities that are more impoverished and marginalized, and devising selection criteria to reach the poorer beneficiaries. These have been prepared as part of the submission package for Cycle 2, and nine (9) district workshops targeting roughly 400 NGOs have been held to train NGOs on how to fill the package, with special focus on how to collect and measure poverty indicators. In this sense, the Project is unique and innovatively experimental. The National Commission on Poverty in Palestine has issued its first report in November 1998, the first ever to be issued in Palestine. The PNGO Project, guided by this report is developing social assessment indicators at the micro or project level.

The establishment of indicators that would assist in targeting project proposals towards the poor, appraisal of those proposals, and then monitoring and evaluation of projects against that particular markers continues to be a critical, and very difficult task of the PNGO Project.

The Project is working with local and international consultants to develop poverty and marginality indicators. Several workshops have been organized by the PMO with NGOs to try to come up with a common definition of poverty and marginality, and later indicators that can be used by the PMO to evaluate or appraise the projects submitted for funding.

The key challenges are:

The Project Management Organization has called upon local expertise and built upon work already begun by a consortium of the United Nations, NGOs, and the Palestinian National Authority/Poverty Commission to take an objective look at poverty in Palestine in order to formulate a draft of poverty alleviation indicators. This process is supported by the Department of International development (DFID) of the British Government which is offering long-term assistance for the project to develop these indicators and incorporate them in the appraisal system.

In the second cycle, a whole set of indicators has been prepared and integrated into the proposal package. Given the fact that these have not been tested yet, it is premature to make a judgment of the quantitative value and relevance of these indicators. What is crucial here is the process facilitated by the PMO to develop consensus on these indicators, involving the three key parties, the World Bank, the NGOs themselves, and the central government.

An intriguing element of the experimental system is that the proposing NGO, in effect is required to conduct a needs assessment and perform a poverty survey, the results of which are reported in the proposal package. Thus, the process is highly participatory and decentralized in its nature. The steps within the proposal pack are carefully laid out to guide the NGOs through the process and to ascertain that the appraisal process will be fair, and also to create a database for future reference and benchmarks to evaluate program progress. The results should be fascinating, since, once again, each NGO will be working in its own geographic and specialty area.

2. Service Contracts: Capacity Building and Research

Service Contracts include:
a. Service contracts, including capacity building activities for the Palestinian NGOs and Research Grants, intended to service the project and the NGO sector, obviously do not run on cycles, but rather in response to perceived needs. Capacity building and research institutions, however, do go through a pre-qualifying process, which ultimately allows the PMO to access needed services in a speedy manner.

Two. Assessment of technical assistance and capacity building of NGOs


Within two to three months of signing the GIA with an NGO, the PMO will conduct a Capacity building Assessment. The purpose of the assessment is to evaluate the need of the NGO for technical assistance and training. The assessment is participatory and staff and board members are expected to work along with PMO staff. Participatory Rapid Appraisal (PRA) tools are employed.

Capacity Building of NGOs

Qualified training institutions and consultants are contracted through a competitive bidding process to provide group training or tailored one-on-one counseling to individual NGOs, as appropriate.

V The First and Second Cycles: Sub-projects profile

A. General Profile of Proposals

In the First Cycle of Development Grants, the PMO received 357 proposal packs in total for Jerusalem, the West Bank and Gaza. The World Bank granted “no objection” on 14 July 1998 to 39 projects distributed among regions as in the table below:

First Cycle, Development Grants
(Distribution of Projects among Regions and Amounts per Region)

In the Second Cycle of Development Grants, the PMO received 231 proposals. Of those, 176 applications are from the West Bank and 55 from Gaza. Out of the 231 proposals received, there are 32 proposals with positive recommendation to the Supervisory Board with a total budget of US$ 2,708,722.

Sample Projects under Implementation from Cycle One:


Due to the lack of opportunities for hearing-impaired women to obtain proper education and training, and the prevailing negative attitude and misconceptions in the community towards them, Atfaluna Society in partnership with the World Vision established a vocational and training program for deaf and hearing-impaired women. The training course include sewing, knitting, embroidery, needle works, pottery and glazing. The project intends to empower these women to generate income for themselves and their families through obtaining employment or running their own business. The program also contains a component to enhance opportunities for integration within the community.

The project location is in Gaza City and several other locations in the Gaza Strip. The total number of direct beneficiaries is estimated around 350 for a duration of one year.

The PNGO grant to this project is US$101,569 of a total budget of US$113,478 allocated to the following components: staff and personnel, equipment and supplies, furniture, expenses, supplies and materials. The project is going well under implementation and the NGO already spent an amount of US$33,710 of the total grant amount. Expected date of completion is the end of September 1999.


The water harvesting project aims at increasing water harvesting in two remote villages; Tammoun in Toubas District and Kufur Thulth in Tulkarem District. The targeted villages are very poor and marginalized and suffer a real crisis in water availability especially for agriculture. The project consists of two main components which are wells construction for rain-fed cisterns coupled with training workshops for farmers in water usage, home gardens and farming techniques.

The PNGO grant to this project is US$ 49,980 allocated to wells construction and extension services. The project is now is in its final stages under completion. The NGO has already spent an amount of US$ 42,000.


The project aims at expanding the activities offered to the youth and the local community, and to include women and children in their programs. Nur Shams is a refugee camp in the Tulkarem District, which is a very impoverished area. The project consists of building a new floor to absorb the increasing social and youth activities at the center. Activities are various and include cultural activities, health seminars, poem evenings, folklore dancing and plays.

The PNGO grant to this project is US$ 36,720 allocated to the new construction and expansion of services.

VI. Issues of Concern and Risks

There are a number of issues of concern for the Palestinian NGO Project.

1. Sustainability is a problem shared by many of the regional social funds, but particularly for one that is as autonomous and as reliant on international donor aid as is the PNGO Project. In the medium-term, we see two important areas of focus in this.

2. Another issue of concern in the Palestinian context is the overall uncertainty inherent in the current political arrangements and the undefined legal status of the NGO community in Palestine.

3. A third concern, which I am sure is a concern to every development effort in the world, is ascertaining that we have identified, and are effectively implementing mechanisms help us reach our target - the poor.

4. A challenge particular to our project is to remain in the position of being a magnet for consultation and participation and not to transform into just another bureaucratic layer in an international aid process.


VII. Impact of the PNGO Project

It is early yet to assess the impact of the Palestinian NGO Project. However, we anticipate both direct and indirect outcomes. Amongst the direct outcomes would be:

1. Service delivery of poverty alleviation programs that will reach directly and indirectly over 100,000 people.

2. Empowerment through capacity building and technical assistance to over 200 NGOs.

3. Mobilization of NGO sector to participate in poverty alleviation programs.

4. Enhance the development of Palestinian civil society through a higher level of participation in civic and public issues.

Indirect impact is:
1. Reduce extremism and the potential escalation in violence.
2. Contribute to political and social stability.
3. Contribute significantly to the development of dynamic Palestinian civil society.

VIII. How is the Palestinian NGO Project different from Social Funds?
We feel that the Palestinian NGO Project, as a model, has particular strengths in comparison to some familiar social fund models.

1. The Project is highly consultative and mechanisms for beneficiary participation in the needs assessment and project identification are built into the process and the cycles. I have already discussed the needs assessment process, and would like to talk a little about the setting of poverty and marginality indicators as another example of beneficiary participation.

This project has a central mission - to deliver needed social services to the poor. Obviously, it is important that we do that effectively, and that we are able to demonstrate that we have done so. Thus, the PMO, which the assistance of local and international consultants is engaged in a process of setting poverty and marginality indicators which are part of the proposal package, the appraisal system, and then the monitoring and evaluation of the various projects. Setting indicators has been no simple matter. Poverty, as you know, is highly contextual. The effort to determine that a project is going to serve the poor and serve them effectively, is very delicate.

Our effort to identify indicators and find ways to objectively weigh them involved all the stakeholders in the project. In a day-long workshop, NGO representatives, experts, donors, and government representatives worked together in facilitated small groups to hone down a system. The system was refined and is being tested in this grant round. Feedback from the beneficiaries in terms of this critical tool for orienting the project is a central, indispensable element.

Block grant managers will also be extending the system to sub-grantees.

2. The project works solely on the basis of grants, not a mix of loans and grants.

3. The project is entirely autonomous. The fact that the PMO was created solely for the purpose of running the project has meant that the project can be very flexible to environmental changes and responsive to lessons learned as we go along. It also permits quick response in a project which is highly demand driven.

4. The Project is also wholly in realm of civil society. The project manager is a Palestinian NGO and the delivery mechanism is also NGOs. The role of the government is purely consultative.

5. Unlike most of the social funds in the region, this project concentrates activity on the delivery of social services through the NGOs. This is particularly appropriate to the Palestinian environment at present since donor funding covers one hundred percent of the capital and infrastructure budget. The Palestinian NGO project, furthermore, does not seek to create temporary employment in response to shocks in the economy, but rather to build a sustainable institutional base for service delivery in the NGO community.

6. The Beneficiary Assessment of the World Bank Community Development Program noted that while communities were generally happy with the interventions, they sought more input for women, youth, and children, particularly in the areas of education and health. This is exactly the fine detailing that the Palestinian NGO project is able to deliver.

IX. Conclusion: Is the model replicable? What elements can be replicated?


We believe that this project model is viable, and could easily adapted and replicated. But some of its features are clearly context-specific. The project replication could be difficult were none of the conditions that allowed for itset-up in Palestine prevail any given country. Not all countries have NGOs that are as experienced and organized as their Palestinian equivalent. Palestinian NGOs have a history of community development activism which stems from the absence of a centralized government until 1994 and culminated during the Intifada (1987-1993). The Palestinian political and economic situation is thus unique and has resulted in exceptional community self-reliance.

The legal environment in which NGOs operate is also a key factor in the good functioning of the project. NGOs must be given a fair set of rights and duties in their relation to the government, as well as be able to play their role of catalysts of a vibrant civil society. In the West Bank and Gaza, the PNA has tried to draft a legislation governing the NGO sector since 1995 but the proposed drafts were quite restrictive and opposed by the NGO community. The latest attempt to develop an NGO law in the West Bank and Gaza, which arose out of a joint effort between the political subcommittee of the Palestinian Legislative Council and a coalition of NGOs, seems very promising. The resulting “Draft Law of Charitable Associations and Community Organizations” offers a sound framework for establishing a modus operandi between the PA and NGOs and should be enacted in the near future. Once the law ratified, several activities have been planned to discuss the significance and implications of the law, and will be administered by the PMO in agreement with the Bank. The Bank thus recognizes the central importance of a good NGO legislation in enabling NGO operations and, by extension, those of the PNGO project itself. The MENA region is known for a generally more restrictive and prohibitive nature of the laws, which regulate the non-governmental sector. This could hamper the establishment of a similar project elsewhere.

However, many elements of the project are adaptable - be it with trade unions, charities, associations, professional organizations, or networks.

Most adaptable of these elements are:

Benefits of the Palestinian NGO Project Model

Palestinian NGO Project: Section 2
Structure and Organization

1 National Commission for Poverty Alleviation, Palestine Poverty Report 1998: Executive Summary, pp 6-7.

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