National Public Investment System of Costa Rica

Country
Investment Map Training Methodologies Projects Bank Legal Framework Processes Stakeholders Instruments Formulation Planning Cross-cutting Processes Budgeting Evaluation Cross-cutting Processes Ex-ante Evaluation Selection Execution Ex-post Evaluation Other Stakeholders Public Investment Policy Cycle Staturory Governing Body Executive Decree 34694-PLAN-H of Costa Rica Law No. 5525 of National Planning of Costa Rica Public Investment Unit, Ministry of National Planning and Economic Policy (MIDEPLAN) Ministry of Finance Office of the Comptroller General of the Nation National Public Administration Steering Financing Coordination Information Project Management Cycle National Development and Public Investment Plan for the Bicentennial

 

Stakeholders

Statutory Governing Body:

Executive Decree 34694 establishes the Ministry of National Planning and Economic Policy (MIDEPLAN) as the statutory governing body of the National Public Investment System (SNIP). Among its main functions, it gives advice and technical support to the Presidency of the Republic and is in charge of formulating, coordinating, following up on and assessing the government’s strategies and priorities. The Public Investment Unit is part of MIDEPLAN and is in charge of implementing the SNIP, managing the public investment projects bank, preparing methodologies and instructions and advising the ministries and other government bodies on the formulation, assessment and follow-up of public investment projects.

Related Entities:

Among the related entities, the Ministry of Finance and the General Comptroller of the Republic are worth mentioning. Both mainly participate in assigning resources to investment projects and play an important role in the monitoring of budget execution.

Incorporated Entities:

The Ministries and other entities and institutions are responsible for the investment projects from the identification of the needs or problems that need solving, the formulation and ex-ante assessment of the projects, prioritization and selection, reporting the financial physical progress until carrying out the relevant ex-post assessments.

 

Legal Framework

The Costa Rica SNIP is ruled by different laws and Decrees, especially the Law on Planning (5525) published on May 18th, 1974 creating the National Planning System and establishing that the MIDEPLAN should ensure that public investment programs (including those of decentralized institutions and other organization ruled by public law) are compatible with the stipulations and priority order established in the National Development Plan (PND). It also mandates that no ministry, nor autonomous or semi-autonomous body can initiate procedures to obtain credits abroad without prior approval of the MIDEPLAN. On August 22nd, 2008 Executive Decree 34694-PLAN-H “Regulations for the Constitution and Functioning of the SNIP of General Regulations and Definitions” was published, which, as its name indicates, establishes the regulations and definitions for its functioning and appoints as the MIDEPLAN as the SNIP steering body. Its functions, described in the Decree, include the preparation of the National Public Investment Plan and determines the Public Investment Unit as the operative entity to carry out the functions necessary for the correct application of the SNIP. On July 20th, 2009 Executive Decree 35374-PLAN was published ruling the preparation of document “Technical Regulations, Guidelines and Procedures for Public Investment” which is used by all institutions covered by the SNIP, in the processes of project formulation, programming, budget assignation and execution and follow-up of the investment or capital expenses in the country. See the complete legal framework.

 

 

Methodologies

Through the Investment Unit, the MIDEPLAN has developed a set of general and specific methodologies for the most representative sectors in public investment that guide public officers in the formulation and ex-ante assessment of public investment projects”. It considers the assessment of the convenience to execute the projects based on financial indicators (TREMA, NAV, IRR), cost indicators (VAC, CAE) and economic-social indicators (ENPV, EIRR, R-B/C, R-C/E).

In order to respond to the specific requirements of the most representative sectors, methodologies have been developed too for training and education projects in the public sector, infrastructure in small irrigation areas, police equipment and operation, road infrastructure, final ordinary solid waste disposal, water pipelines and water sewage, construction and equipment of education centers. To facilitate the assessment calculations the document “Social Prices – Guide for their application” is available. To perform the ex-post assessments, there is the “Public Interventions Assessment Manual".

In accordance with the “Technical Regulations, Guidelines and Procedures of Public Investment”, investment projects must transversally consider the environmental and social impact, as well as the identification of potential risks by natural disasters, for which the “Natural Threat Analysis Methodology for Investment Projects” is used. See the list of methodologies (Available only in Spanish).

 

 

Public Investment Plans

The Bicentennial National Development and Public Investment Plan (2019-2022) is the result of a participative process of analyzing the country’s challenges by strategic areas, the establishment of goals and the definition of priority projects that may contribute to reaching the set goals. In accordance with Planning Law 5525 and Decree 37735-Plan the Ministry of National Planning and Economic Policy (MIDEPLAN) is in charge of preparing the PNDIP.

The plan is based on five pillars: Sustainable Development; Management for Results in Development (GdRD), Human Rights, Risk Management and Open Government. The general structure of the plan is divided into a general diagnosis, the vision of the country’s development materialized in a set of national goals and targets, goals of the strategic articulation areas at effect level and public interventions. A section of the document presents the connection between the PND goals and the Sustainable Development Goal.

The public investment projects are included in the plan in each of the strategic areas:

  • Innovation, competitiveness and productivity
  • Infrastructure, mobility and territorial organization
  • Human safety
  • Health and social security
  • Education for sustainable development and coexistence
  • Economy for stability and growth

In order to distinguish the investment projects, they are identified by an icon which is described at the beginning of each of the spreadsheets. The list of investment projects shows their name, their goal, an indicator to measure the goal’s scope, baseline (year 2017), annual targets, estimation of the annual total investment in millions of Colons and the source of resources. In most cases, the projects also have the Integral Investment Project Bank’s identification code. An additional spreadsheet shows the projects under PPP mode and they are registered in the BPIP.

The last section of the plan is dedicated to the 2019-2022 National Assessment Agenda presenting the investment projects to be assessed, the type of investment to be performed, the assessment calendar and a methodological description of the selection criteria for the projects selected for assessment. Apart from these specific project assessments, once per six month and once per year documents are prepared to assess the progress of the PNDIP.

 

 

Investment Project Bank

The Public Investment Project Bank (BPIP) is the public investment projects management platform managed by the public investment unit of the MIDEPLAN. The project bank gives updated information to make decisions on investment projects in the process of programming, budget and execution. It recognizes two types of investment projects: those that form fixed capital and those that do not. The BPIP is freely accessible for any user interested in information on the different investment project phases.

On the platform, users can generate reports and download public investment databases identified per entity, region, province, canton, district and national coverage. Project files can be consulted as they contain general information, such as the name of the project, the executory unit, sector, institutional target, description, goal, expected results, direct and indirect beneficiaries, influence area, project stage, sources of financing, total investment amount, investment programming, physical-financial progress, human resource requirement, disaster risk analysis, environmental analysis, ex-ante assessment indicators, institutional implementation risk and related investment projects or programs.

There is also a Costa Rica Investment Map, which is a platform to locate the public investment projects as per their geographical location and showing the details on the physical and financial progress of the projects, photos, the general goal and the expected products once the projects have been finalized. In each of the project profiles, citizens can include publicly visible comments.

 

 

Training

The MIDEPLAN offers a broad range of courses given remotely as well as presence-based. The section on training on the MIDEPLAN website shows the updated training calendar, a description of the contents, participation requirements, etc. The training program covers relevant topics for the three systems the MIDPLAN is the steering entity of National Public Investment System, National Assessment System and National Planning System. In addition to the current offer, the public entities and bodies can request a training in specific topics of interest. For this, the MIDEPLAN makes forms available on which the entities can send their requests.

 

 

Project Management Cycle

In accordance with the effective regulations, the APN bodies identify the investment needs, formulate projects and perform their ex-ante assessment. For the ex-ante assessments several financial indicators, cost indicators and economic-social indicators are taken into consideration. Additionally, a risk analysis is performed and a strategy to mitigate them. In accordance with the nature of the investment projects, some may also require environmental and social impact studies. All projects must identify the intervention goal, the benefiting population, product indicators, result indicators, investment programming throughout the project’s life cycle and sources of financing. Once the investment projects have the documentation requested in accordance with the standards and methodologies developed by the MIDEPLAN, these projects can be registered in the BPIP. The projects registered in the BPIP are considered a priority by the APN bodies and, as they have the support of the Public Investment Unit of MIDEPLAN, can be included in the national budget.

During the implementation phase, the executory entities report on the physical-financial progress of the projects. To facilitate and make the projects transparent, MIDEPLAN has developed platforms such as the BPIP, Mapa Inversiones and the System for Project Management of International Cooperation. These systems are related to the platform “Losses Caused by Natural Phenomena”, which registers public infrastructure that has been affected by natural disasters. In order for this information to remain updated, those responsible for the projects receive alerts that tell them they are reaching the deadline to update the information of the investment project. Once the project has been finished, this must be communicated to the Public Investment Unit and all documentation delivered as per the effective regulation. The preparation of the ex-post assessments of the projects is done by the institutions that execute them. Should they require support or guidance on the assessment, the entities can request this from MIDEPLAN, specifically from the Assessment Unit and the Public Investment Unit; they can also use the tools prepared by the MIDEPLAN for these purposes (see methodologies).

 

 

Public Investment Policy Cycle

As of 2019, the Public Investment Plan and the Development Plan are incorporated into one single document, resulting in the 2019-2022 National Bicentennial Development and Public Investment Plan (PNDIP). This multiannual plan contains the most relevant public investment projects to be executed in this period, including those of external financing and under the public-private alliance model. Annually, the public entities, through their respective Institutional Planning Units (UPI), present their public investment plan in accordance with the budget limit communicated by the Ministry of Finance and the General Comptroller of the Republic to each of the entities. So as to guide the process of the project included in the annual budget, the MIDEPLAN prepares the document “Technical and methodological guidelines for planning, budget programming, follow-up and strategic assessment in the public sector in Costa Rica". This document establishes the processes, dates and methodologies in force to present public investment projects.

Once the projects contained in the investment program meet the requirements mentioned in the guidelines in force, the UPI of each of the entities proceeds to register them in the BPIP, for which an official letter from the Jerarca (highest authority of the entity) is required, the pre-investment studies and annexes in accordance with the type of project and the endorsement and technical opinion of the Minister of the Sector endorsing that the project meets the regulations in force and is in line with sectoral strategies. With all the documentation the entities send their investment programs, duly registered in the BPIP and endorsed by the Investment Unit, to the Ministry of Finance and the General Comptroller of the Nation to be included in the budget. Immediately after, the Budget Bill by the Ministry of Finance is sent to the National Assembly for discussion and approval.

During the public investment program execution phase, the public entities and institutions register the physical-financial progress of the projects in the BPIP. Based on this information, each semester the MIDEPLAN’s assessment unit prepares the “Result Balance of the PNDIP”, which is available for consultation for transparency in the execution and progress of the public investment budget and of the PNDIP as a whole. This document is also used by the Ministry of Finance and the Comptroller to decision-making on the budget limits of the next cycle. Thanks to the platforms managed by MIDEPLAN’s investment unit, any interested person can monitor the execution of the public investment budget through the BPIP.

 

Latest update: July 1, 2021