As ADB began to use single-tranche operations, the PBL policy focus shifted to public sector management (PSM), as it did at other MDBs.37
 Nearly two-thirds of PBL operations by value approved from 2008 to 2017 supported PSM reforms, and nearly half of all evaluated PBL since 2008 supported PSM reforms. Hence, PSM became the dominant sector supported by PBL.38

The performance of PBL supporting PSM reforms increased sharply over the evaluation period. From a success rate of 37% in 1999–2007, PBL-supported PSM reforms climbed to 88% in 2008–2017. One explanation for this is that those PBL operations that supported PSM concentrated on public expenditure and financial management (PEFM) with policy actions that were within the direct control of finance ministries, the major stakeholder in the PBL design. Of the 49 PVRs, 26 supported PEFM, whereas in the previous cohort only seven were PEFM-related. Furthermore, the types of reforms supported, while important for longer-term growth and development, became less politically controversial because they focused on technical areas that were within finance ministries’ scope of work, e.g., reforms concerning budget preparation, the introduction of medium-term fiscal frameworks, and treasury management, which match the existing functions of finance ministries. PBL that supports the restructuring of state-owned enterprises, reductions in subsidies, or the adjustment of tariffs in energy or water are generally more politically charged and difficult to achieve, with the locus of action being in ministries or units outside the finance ministry’s scope of influence.

• 37
  
  The use of single-tranche loans was recommended by IED in its 2001 evaluation (footnote 6). These were first used in Viet Nam in a programmatic series to support a World Bank poverty reduction credit support series.
• 38
  
  Its share of PBL approvals doubled from one-third of PBL approvals in 2000–2007 by value (30% by number) to nearly two-thirds from 2008–2017 (57% by number).