А. BACKGROUND

Mongolia has received a credit from the International Development Association (IDA) for the Strengthening Fiscal and Financial Stability Project (SFFSP). The Objective of the SFFS Project is designed to improve fiscal policy and sustainability in a mineral-based economy, protect the poor and vulnerable, and restore confidence in the financial sector. The project is designed into five components: (I) Strengthening Macroeconomic and Fiscal Management; (II)Improving the Efficiency of Public Financial Management; (III) Enhancing Financial Sector Stability; (IV) Strengthening the Social Protection System; (V) Project Management and Monitoring. The objectives are to Strengthening fiscal responsibility and implementing relevant policy measures, improving fiscal discipline, strengthening the resiliency of the banking system, improving public expenditure quality in social protection, providing support for Project implementation, coordination, monitoring, and evaluation, including, inter alia, audit arrangements, reporting requirements, procurement, and financial management activities respectively. For more details, please refer to the Project Appraisal Document Report No. PAD2269.  

The Social Welfare Law (2012) aims to make social assistance more effective in reducing poverty and protecting the vulnerable.  Specifically, it defines the eligible beneficiaries as “the members of households living below poverty line whose living standard has been assessed and entered into a central database of households established in accordance with the methodology jointly approved by the National Statistical Committee and the State central administrative organization in charge of social welfare”. Living standards are assessed based on the scores generated by a Proxy Means Test (PMT) formula using the data collected through the PMT surveys, which is known as the Household Living Standards Assessment (HLSA). It is administered en-masse about every three years, with on-demand updating in-between. Upon verification, the survey data and the scores are then stored in a central Integrated Household Database (IHD). 

The PMT formula is determined by estimating a relationship between a measure of welfare (usually a natural logarithm of pre-transfer consumption per equivalent member) and a set of indicators through linear regression. To perform such an estimation, a survey dataset with accurate measures of household welfare (for example, a consumption module) as well as potential ‘proxies’ are required. Such PMT modeling generates a set of indicators and coefficients. Data on indicators are collected from the eligible population through PMT surveys, and the coefficients are used to generate welfare scores. 

In Mongolia, the first PMT model was developed in 2009 with support from the World Bank and the Asian Development Bank using the Household Socio-Economic Survey of (HSES) 2007/2008 data.  It was then revised in 2013 and 2016 based on the HSES 2012 and HSES 2014 respectively. In all cases, separate models were estimated for Ulaanbaatar, Aimag (Province) Centers, and Soums (sub-province that includes soum centers and the countryside). 

Beginning in 2017, select information collected in the PMT survey (HLSA) is verified against administrative databases. Once data is digitized and checked for internal validity within the survey, select information is then verified against administrative databases. This includes information about household members (demographics) from the civil registry, car ownership from the vehicle registry, livestock numbers from the annual livestock census, immovable properties from the property registry, and employment status from the social insurance contribution database. If there is any conflicting information between these data and those provided in the PMT survey (HLSA forms), social workers at the grassroots level are asked to validate the information and provide possible explanations for the discrepancy. Once the information in the PMT survey matches or is reconciled with the administrative databases, the household living standard score is computed using the PMT formula. Currently, the IHD has information for 714,000 verified households, representing about 70 percent of the total households in Mongolia.”   

The IHD is currently used largely for the poverty-targeted Food Stamp Program (FSP). There are some criticisms about how well it performs in identifying the households truly deserving the support. Such criticisms come from current and potential program beneficiaries, as well as from program implementers. Most criticisms reflect the public opinion that the current indicators used in the PMT survey are not reflective of actual household wellbeing. Likewise, implementers view the information provided in the surveys as prone to manipulation. Also, there is a high percentage of targeting errors in exclusion and inclusion. 

The Government of Mongolia is keen to develop a methodology for determining household living standards based on direct income data. Therefore, the MLSP, NSO and the Ministry of Finance and other relevant organizations started to research and analysis. Also, the MLSP has established a Working Group and sub workgroup with the participation of the NSO and other relevant government agencies on 30th of November 2020 with the task to guide the process for improving the targeting methodology. A technical sub-working group which consists of IT experts from relevant organizations and the Customs, Taxation and Financial Information Technology Center under the Ministry of Finance have prepared the dataset including the latest 2018 HSES  survey (the sample is about 16,000 households) information and the administrative data for the same households using a unique identification number of individuals. Such administrative data include data from the General Office for Labor and Welfare Services (GOLWS) and Social Insurance General Office (SIGO) that provide information on social welfare benefits and salaries, social insurance contributions, and social insurance pensions and benefits respectively.

The Ministry of Labour and Social Protection (MLSP) is keen to refine the current PMT methodology to improve its performance.  The best practices around the world especially the experiences of Georgia and Turkey are of interest to Mongolia The targeting methodology revision is expected to comprehensively improve the government's approach to identifying the poor households and decreasing the inclusion and exclusion errors.

A recent analysis by the World Bank (2020)  indicates that revision of the PMT formula without significant additional data (for example, from administrative sources) will bring only a marginal reduction of the inclusion and exclusion errors.  Therefore, MLSP would like to explore options for developing and adopting a hybrid method that makes use of an improved PMT methodology and available government administrative databases for better assessment of household living standards (wellbeing).  

The HSES 2018’s compiled dataset  includes information on income and taxes (income tax, real estate, vehicle information, salary, social insurance premiums, etc) from relevant government organizations based on the unique identification numbers of citizens covered by the 2018 HSES. It is hoped that this dataset will serve as a good basis data for improving the methodology for determining household living standards.  Annex 1 to this TOR provides the income and tax-related questionnaire of HSES 2018.  

With this background, MLSP wishes to hire an experienced international consultant for developing a hybrid model for the living standard measurement of households using PMT and administrative databases.  

B. OBJECTIVE OF THE ASSIGNMENT

The main objective of this consultant service is to advise the MLSP  for developing a hybrid model for the living standard measurement of households using PMT and administrative databases.  

The developed model, including the revised PMT formula, will be approved by the order of the Minister of Social Protection and head of NSO in accordance with the Law on Social Welfare. The hybrid model then will be utilized for the identification of the poor and providing social welfare services for the poor such as, food stamps and health insurance benefits to members of households and other programs targeting the poor that are expected to be introduced through social welfare reforms.

C. SCOPE OF THE WORK

The national consultant is expected to provide support to the international consultant (i) by effectively liaising with relevant authorities for accessing data, providing all relevant information in a timely manner, collecting and cleaning data as necessary, and helping to identify key issues; (ii) participating in all tasks related to data analysis of the international consultant for developing a relevant methodology that is well suited to the country context; (iii) developing implementation guidelines; and (iv) providing information to the MLSP and relevant working groups as necessary, on the works and development covered by this TOR. 

The work is divided into  four main tasks which are the following:

Task 1. Provide information to assist the international consultant;

i. Obtain from authorities and relevant organizations all necessary datasets, including 2018 HSES datasets linked with administrative data through the unique identification numbers of citizens covered by the 2018 HSES; 

ii. Provide information on the work being done by NSO and relevant organizations in this area and organize online meetings and provide translation (verbal and written); 

iii. Translate relevant documents in English and Mongolian which are related to the process or outcomes of the international consultant.

Task 2. Support and co-carry out  with an international consultant, the estimation and development of the “hybrid PMT models” with the focus on the following tasks:

i. assessing the usability of various administrative databases that have been linked with the HSES 2018 survey by the NSO;

ii. assessing the linkage of this assignment and with the assessment of databases undertaken by the NSO and the Ministry of Finance for direct income/welfare estimation and provide recommendations;

iii. estimating the hybrid PMT models based on the HSES and linked administrative data, and assessing their relative performance;

iv. proposing the revised PMT formulas separately for UB, urban, soum, and rural/countryside; and 

v. pilot-testing and finalizing the hybrid formula and tools. 

The national consultant shall refer to the TOR of the international consultant for a detailed description of a series of tasks associated with developing the hybrid models.

Task 3. Support and co-identify with the international consultant, the policy, and/or institutional challenges that need to be addressed to implement the ‘hybrid’ model.

A national consultant will provide support to the international consultant in delivering this task. The support of the national consultant shall include providing necessary information and documents, including their available translations, identifying and discussing key issues, providing an update of recurring and recent developments on relevant areas, help to coordinate with the working group, and gathering any relevant local information.

D. DELIVERABLES

Аll deliverables should be discussed with relevant officials of MLSP and GOLWS with the incorporation of comments in order to ensure the quality of the deliverables:

Deliverable 1. Report describing the support to the international consultant in collecting and providing all necessary information and data sets preparing them for analyzing as well as providing other relevant support (referring to Task 1).

Deliverable 2. Report describing the role carried out and support provided for estimation,  development, pilot-testing of the “hybrid PMT model”  (referring to Task 2).

Deliverable 3. Report describing for support process and finalization of the “Hybrid PMT Model” (referring to Task 3).  

E. CONSULTANT’S QUALIFICATIONS/ SELECTION CRITERIA

Education: A suitable candidate should have an advanced degree in social sciences (preferably economics), Master or PhD. 

Experience: Incumbent should have a minimum of 5 years experience in the following: 

- Experience in poverty analysis and monitoring

- Experience in the analysis of household survey data (statistical modeling and econometrics)

- Should be very familiar with the administrative data sources in Mongolia as well as with the ongoing developments of the data available through the Khur platform; and

- Good management and communicating skills. 

Language skills: Excellent command of spoken and written English.

Computer literacy: Candidate should be familiar with data management software such as STATA, and have access to statistic software.

Other: Excellent interpersonal skills with the ability to function effectively and collaboratively in a team environment.

F. SUPERVISION AND REPORTING

The consultant will report directly to the Director of Policy, Planning Department (PPD).  The consultant may be requested to provide information to the MLSP’s Working Group and will carry out tasks in liaison with the work of the Working group. The consultant will work on a day-to-day basis under the guidance of the Director of PPD on technical matters related to the assignment. Work progress will be presented during the working group meeting or other meetings as needed.   

The Director of PPD shall evaluate the performance on the agreed deliverables and approve the invoices for the delivered outputs. 

The consultant will prepare a 3-5 pages summary report detailing the achievements and impediments in executing the entire assignment effectively, at the completion of the consultancy assignment.  The MLSP and SFFS PIU will provide input to the evaluation of the consultant’s performance. 

G. INSTITUTIONAL ARRANGEMENTS

The MLSP will provide office space for the consultant to work with the international consultant and technical working group as well as the MLSP officials.  The consultant will have access to all necessary data and information.  

H. CONTRACT DURATION

The expected commencement date of the contract is January 2020.  The contract will have a duration of 4 months through, April 2021.

Based on the evolving needs of the Client and the performance of the consultant, the contract may be extended if needed. If any task is not finished and approved by the Client within the agreed-upon timeline, the consultant should complete the task/s without any additional cost.

If you possess the above qualifications, please submit following documents via email to procurement@sffs.mn:

    1. Cover letter indicating why she/he considers her/himself suitable for the position.

    2. Detailed CV highlighting relevant skills/experience.

    3. Copy of diplomas or certificates; and,

    4. 2 reference letters from previous last two employers no later than 17:00, January 6, 2021.

Consultant will be selected in accordance with the Individual Consultant Selection Method set out in the Procurement Regulations: The following is the link to the World Bank’s website:

https://policies.worldbank.org/sites/ppf3/PPFDocuments/Forms/DispPage.aspx?docid=083b3f94-a932-4395-a410-834f8bc14f8c

The submitted documents will not be returned to the applicants. Please be noted that incomplete applications would not be considered for evaluation. Only selected candidate will be contacted.

Address for submission of Expression of Interest: Attention to Ms.Ariunaa G, Procurement Specialist, Strengthening Fiscal and Financial Stability Project, Address: Room #204, Negdsen undestnii 8/2, 4th khoroo, Chingeltei District, Ulaanbaatar, Mongolia. Tel: 70120582 or via email to: procurement@sffs.mn