Third Poverty Alleviation Fund (PPAF - III)
Funding Source:

The World Bank

Project Tenure:

July 2009 to March 2016

Financial Outlay:

USD 250 million

Overall Performance & Rating:

Highly Satisfactory


*Social mobilization and institutional building, * Livelihoods, Employment and Enterprise Development , *Micro-credit access, *Basic Services and Infrastructure, *Project Implementation Support

S. No.

PDO Indicators

Project Achievement


At least 60% of community institutions are viable and sustainable

Exceeded: 67% community institutions found to be viable and sustainable assessed by the maturity index indicators developed for the project.


At least 60% of community members report a minimum of 20% increase in household incomes and/or assets

Fully Achieved: 61% of community members reported an increase in average household income of 22% and a 29% increase in average personal income.


At least 33% of targeted community groups/institutions report improved access to municipal/local services

Exceeded: 76% community institutions reported to have improved access to municipal/local services as linkages were developed at the UC level.

The Pakistan Poverty Alleviation Fund III was built on eight years of previous experience with PPAF projects. It aimed to improve poverty outcomes through a consolidation and saturation approach in targeted areas, a stronger focus on the marginalized groups of the most vulnerable and poorest households including women, and through integrated approaches to livelihood enhancement that learn from other programmes in Pakistan and South Asia.


*Social mobilization and institutional building

The objective of this component was to target and empower the poor by supporting their organizations to build voice and scale for an effective interface with local government, government departments, other development programmes and markets.
The design specified that the social mobilization process would include formation of the three tiers of community institutions:
(i) Community organizations (COS)
(ii) Village organizations (VOs)
(iii) Third Tier Representative Organizations

* Livelihoods, Employment and Enterprise Development

The objective of the component was to develop the capacity, opportunities, assets and productivity of community members to reduce their vulnerability to shocks, improve their livelihood initiatives and strengthen their business operations. A number of innovations i.e. – Naukri ya Karobar (Employment or Enterprise) Centers, Youth Centers, Loan Centers, Production Centers – and efforts were made to reformulate and modernize the training program, develop market linkages, engage the private sector, and create synergies to ensure long term sustainability of the project interventions.

*Micro-credit access

The objective of this component was to improve availability and access of the poor to microfinance to enhance their capacities, productivity and returns from livelihood initiatives. In most areas, the intention was to improve access to existing micro-finance. This component included capacity building for selected MFIs to improve their ability to work in these least developed areas and provide training and technical assistance to improve existing systems, review and improve the current loan methodology and cost recovery as well as the lending mechanisms between MFIs.37 districts were identified for the component.

*Basic Services and Infrastructure

The component aimed to establish and upgrade basic services and community infrastructure for the poor and improve health and education facilities. Support was given for basic infrastructure, additional productive and integrated infrastructure projects and innovative interventions such as alternative energy projects.

*Project Implementation Support

The component was expected to facilitate various governance, implementation, coordination, monitoring and evaluation, learning and quality enhancement efforts that would contribute to effective and transparent project management. Project components were underpinned by two dimensions to ensure continuous process monitoring:

1) Assessment of community institutions and Union Council area organizations for their institutional growth, integrity and ability to meet indicators set for maturity, governance, transparency and participation.
2) Standard monitoring by PPAF to include an integrated Management Information System (MIS).