Philippines - Third Education Project

Report No. 945a-PH Appraisal of a Third Education Project in the Philippines FILE C February 27, 1976 Education Projects Division East Asia and Pacific Region FOR OFFICIAL USE ONLY International Bank for Reconstruction and Development International Development Association This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EQUIVALENT US$1.,00 = Pesos 7.471 Pesos 1,000 US$133.85 NEASURES 1 m 1.09 yd 1 m2 = 10.76 sq ft 1 km2 * 0.38 sq mi 1 hectare 2.47 acres FISCAL YEAR July 1 - June 30 1/ To be changed to January 1, to December 31 in 1977.  FOR OFFICIAL USE ONLY PHILIPPINES THIRD EDUCATION PROJECT TABLE OF CONTENTS Page No. BASIC DATA GLOSSARY SUMMARY AND CONCLUSIONS I. INTRODUCTION .......................................... 1 II. BACKGROUND ............................................ 1 III. THE EDUCATION SECTOR ....... ..................... 3 IV. THE PROJECT ........................................... 8 V. PROJECT COST AND IMPLEMENTATION . ................ 16 VI. BENEFITS AND JUSTIFICATION ............................ 21 VII. AGREEMENTS REACHED .................. ...... ...... 23 APPENDICES 1. Summary of World Bank Group Education Projects 2. Textbook Development, Printing and Distribution 3. Educational Mass Media 4. Technical Assistance ANNEXES 1. Comparative Education Indicators 2. Total Expenditure on Education by Source 1973-75 3. Public Expenditure for Education by Government Level 1967-75 4. Education Expenditure of Special Education Fund (SEF) 1973-75 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.  -2- 5. Enrollment in Elementary & General Secondary Schools 1967-80 6. Public Elementary Teachers, 1972-83 7. Enrollment in Public and Private Vocational Schools and Universities 1967-80 8. Proposed Book Production Cycle 9. Phasing of Book Production by Subject and Grade 10. Projected Textbook Supply by Year and Grade, 1976-1983 11. Number of Textbooks and Teachers Guides (TG) to be Produced by Year of Manufacture/Distribution 12. Estimated Project Costs by Year and Category of Expenditure 13. Summary of Estimated Project Costs by Category and Purpose 14. Contingency Allowances 15. Summary of Estimated Foreign Exchange Costs by Categories 16. Responsibilities of Implementing Agencies 17. Forecast of Disbursements 18. Detailed Implementation Schedule 19. Schedule of Staff Appointments for the Textbook Board Secretariat CHARTS 1. Educational Pyramid, 1971 2. Structure of the Formal System of Education 3. Department of Education and Culture Organization Chart prior to July 1975 4. Department of Education and Culture Organi7ation Chart as of July 1975 5. Organization of Textbook Production & Distribution 6. Implementation Schedule  APPRAISAL OF A THIRD EDUCATION PROJECT THE PHILIPPINES BASIC DATA (1974) Population Estimated total 41.4 million Annual rate of growth 3-0% 2 Average density 140 per km Literacy of Adult Population 87% Elementary school enrollment as a percentage of population aged 7-12 104% Secondary school enrollment as a percentage of population aged 13-16 46% Higher education enrollment as a percentage of population aged 17-20 21% Expenditures on Education by Source US$ Million % National government 223 65 Local government 42 12 Student fees 80 23 345 100 Total national government expenditure for education as a percentage of total government expenditure 14.9% Total public and private education expenditure as a percentage of GNP 3.2%   GLOSSARY BETDECCO - Basic Education Textbook Development Coordinating Council CDC - Curriculum Development Center CLSU - Central Luzon State University DEC - Department of Education and Culture EDPITAF - Education Development Projects Implementing Task Force MIS - Management Information Service OPS - Office of Planning Services PCAT - Philippine College of Arts and Trades PCPM - Philippine Council for Print Media PIU - Project Implementation Unit PNC - Philippine Normal College RSTC - Regional Science Teacher Center SEF - Special Education Fund SSC - Social Studies Center of the Department of Education and Culture TPS - Textbook Production Service TG - Teacher Guide UNDP - United Nations Development Program UNESCO - United Nations Education, Scientific and Cultural Organization UJPSEC - University of the Philippines Science Education Center USAID - United States Agency for International Development   PHILIPPINES APPRAISAL OF A THIRD EDUCATION PROJECT SUMKARY AND CONCLUSIONS i. This report covers the appraisal of a third education project in the Philippines, for which a loan of US$25.0 million is proposed. The first lending by the Bank Group for education in the Philippines (Loan 393-PH, signed in 1964) provided US$6.0 million to the University of the Philippines at Los Banos for increasing the quantity and improving the quality of higher level agricultural manpower. The project was satisfactorily completed in 1972. An IDA credit of US$12.7 million was approved in 1973 (Credit 349-PH) to help finance a second project covering the construction of new facilities and equipment in science teacher training and in secondary and post-secondary agricultural education and technical training. The execution of this project is progressing satisfactorily and the project is expected to be completed on schedule. ii. With high literacy rates and enrollment ratios approaching 100% for the first eight years of schooling, the Philippines has one of the strongest education systems of any developing country in terms of enroll- ments. In addition, there is a comparatively well trained teaching force and generally adequate physical facilities. Despite these achievements, much improvement is needed in the quality of instruction. Curricula tend to be outdated and textbook development has been neglected. There is an average of only one textbook per subject for ten students, and 80% of available books are more than five years old. The chronic lack of teaching materials handicaps the relatively well trained teaching force and compels them to rely on rote teaching. The result is low quality of instruction as manifested in poor student achievement and high repetition rates. iii. The purpose of the proposed project is twofold: (a) to develop the institutional capacity for the continuous development and supply of relevant textbook material in the Philippines, and (b) to increase over the next four years the available supply of textbooks in public schools. In terms of institutional development the project would provide technical assistance, equipment and facilities to: (a) reorganize and strengthen the management functions of the existing Textbook Board; (b) strengthen five curriculum development centers to develop curricula, write, test and revise textbooks in the five principal subject areas; (c) establish 14 staff development centers and 34 devel- opment high schools for purposes of testing books and training teachers in their use; and  - ii - (d) establish a textbook distribution system consisting of one national and 107 provincial and sub-provincial warehouses. In terms of textbook supply, the project would finance the development of 75 new textbook titles and the manufacture and distribution of 27 million textbooks. This would be the first phase of an eight year government program to distribute 98 million new textbooks to public elementary and secondary schools by 1984. In addition, the project includes financing to develop a management information system in the Department of Education and to conduct a pre-investment study on the use of educational mass media. iv. Each textbook produced under the project would cost about US$0.79 in 1975 prices including costs of development, paper, printing and distri- bution. This is about 40% less than books currently being produced largely because of greater economies of scale envisaged under the project. The total cost of the project is estimated at US$51.6 million equivalent with a foreign exchange component of US$25.2 million, or 49% of the total cost. The proposed loan of US$25.0 million would finance the foreign exchange costs. v. The project implementation unit established for the second education project would be responsible generally for overall administration, financial control and liaison with the Bank and specifically for implementation of the physical facilities and technical assistance components of the project. The Textbook Board would be responsible for contracting for curricula development, manuscript writing, testing and revision, teacher training, paper procurement, printing contracts and distribution of books to schools. To expedite imple- mentation the new implementing rules for the Textbook Board have already been issued by the Department of Education. A condition of loan effective- ness would be appointment to the Textbook Board of key staff to implement the project. vi. Contracts would be grouped to the maximum extent possible. Civil works contracts exceeding US$500,000, paper contracts above US$100,000, and equipment and furniture contracts exceeding US$50,000 would be awarded follow- ing international competitive bidding in accordance with the Bank's guidelines. Local bidders would be allowed standard preferences. Contracts below these amounts and those for printing would be awarded on the basis of competitive bidding advertised locally in accordance with present Government procurement practices which are acceptable to the Bank. Foreign firms would be allowed to participate. vii. Disbursements would be made over a five-year period against: (a) 100% of the foreign expenditures of directly imported equipment, furni- ture and paper; (b) 100% of the ex-factory price of locally manufactured equipment, furniture and paper; (c) 71)% of the cost of imported and locally procured equipment, furniture and paper; (d) 100% of foreign expenditures or 60% of the expenditures for technical assistance; (e) 45% of the expend- itures for printing and delivery; (f) 30% of the expenditures for civil works, including related professional fees; (g) 15% of the expenditures for  - iii - textbook development and teacher training. It is proposed that costs incurred on the mass media preinvestment study between February 1, 1976 and loan signing would be eligible for retroactive financing up to a total of US$50,000 equivalent. viii. The proposed project would assist the Government in establishing the institutional framework needed for continuous curricula development and textbook production. The strengthened management of the textbook development process sought under the project should enable: (a) a reduction by about half in the time required to produce new books; (b) a threefold increase in the output of new book titles; (c) a tenfold increase in the capacity to produce new books; (d) a 40% reduction in the average cost per book; and (e) a substan- tial increase in the quality of books produced. The increased supply of 27 million books should enable the pupil/book ratio per subject to be reduced from 10:1 to 2:1. Not only would this help raise individual learning achievements, but the distribution of uniform textbooks equitably throughout the country would help equalize educational standards between urban and rural areas. ix. The proposed project constitutes a suitable basis for a Third Window Loan of US$25.0 million equivalent to the Republic of the Philippines with a term of 25 years, including seven years of grace, and interest at 4-1/2% per annum.   I. INTRODUCTION 1.01 The Bank Group made its first loan for education in the Philippines (Loan 393-PH) in 1964 to assist with the financing of a development program for the University of Philippines College of Agriculture at Los Banos. The main objective of the project was to increase the quantity and improve the quality of higher level agricultural manpower. The loan of US$6.0 million helped finance construction of buildings, procurement of equipment, curricu- lum improvement and staff development. The project was satisfactorily com- pleted in 1972, within the original cost, 30 months behind the original schedule due mainly to delays in provision of Government counterpart funds. The project performance was subsequently audited by the Operations Evaluation Department. 1/ An IDA credit of US$12.7 million was approved for a second project in 1973 (Credit 349-PH) to help finance the construction of facilities and equipment for (a) a curriculum development center and four science teaching centers; (b) 13 agricultural high schools and two agricultural colleges; and (c) ten regional skill training centers and three technical institutes. The execution of this project is progressing satisfactorily, and the project is expected to be completed on schedule. These projects are described in further detail in Appendix 1. 1.02 This report presents the findings of an appraisal mission 2/ which visited the Philippines during June/July 1975 to appraise a third education project. The project consists of textbook production, distribution and re- lated teacher training, the establishment of an educational management in- formation system, and an educational mass media pre-investment study. The project request was prepared by the Government with the assistance of the UNESCO/IBRD Cooperative Program. Since the proposed project was large and complex, it was agreed during appraisal to limit the project to four years of textbook production and distribution, rather than eight years as originally requested, and to consider a second textbook project at a later stage. II. BACKGROUND 2.01 Geography and Population. The Philippines consists of an archi- pelago of several hundred islands stretching from north to south over 1,500 kilometers between the Pacific Ocean and the South China Sea. The total land area is 297,000 sq kms. Most (80%) of the population of 41.4 million (1974) is concentrated on the two main islands of Luzon and Mindanao. Migration I/ "Project Performance Audit Report: The Development Program of Univer- sity of the Philippines College of Agriculture (Loan 393-PH)", Memo- randum to the Executive Directors, July 30, 1975. 2/ Messrs. A.H. ter Weele (mission leader and educational planner), V.C. Demetriou (architect), S. Futagami (mass media specialist), J.P. Jallade (economist) and P.H. Neumann (educational publisher, consultant).  - 2 - tends towards these two islands, especially towards Central Luzon where the city of Manila is located. Population density averages 140 per sq km. The population increased at an annual rate of 3% during the 1960s, but is believed to be growing currently alt about 2.8%, reflecting in part the impact of family planning programs. The climate is tropical, with humidity high, especially during the June-September rainy season. Severe typhoons are frequent. Transport is difficult due to rough terrain and the need to combine water and land transporl; for most surface shipments. Much transport is suspended during the season of rains and typhoons which flood roads and make travel by boat dangerous. 2.02 Language. There are eight dominant local languages in the Philip- pines spoken by 86% of the people, and some 80 dialects spoken by 14% of the people. Two vernaculars, Cebuano aLnd Pilipino, are each the mother tongue of 20-25% of the population. Filipino, or Tagalog, is the closest to a national language, being understood by about 60% of the people. The per- centage of Pilipino speakers has increased steadily since its introduction in public schools in the 1950s when about 37% of the population could speak the language. The distribution of the Pilipino language is not yet uniform throughout the country. A majority of the population speaks Pilipino in Manila and surrounding provinces and the island of Mindoro, compared with only about 15% in the southern provinces of Mindanao and the Sulu Archi- pelago. English is the most important non-local language, known by about half the population and used in about half of all publications. English is the chief language of government, business and industry, mass media, schools and universities. Scientific and technical knowledge is communi- cated mainly through English. With few exceptions, the distribution of English is relatively uniform throughout the country. The language policy of the Government is to develop a bilingual nation able to communicate in Pilipino as well as English. 2.03 Education and Health. With about one quarter of the total popu- lation (over 10 million persons), earolled in schools and universities, the Philippines ranks high among developing countries in terms of educational development. Census responses indicate 87% of the adult population are literate but this figure may exaggerate actual functional literacy. The availability of health services in ithe Philippines is approximately typical for a country at its level of income, but the urban/rural distribution of services is highly uneven. Malnutr:Ltion among infants and children is a serious problem, and the Government has launched a program aimed at remedying the situation. 2.04 The Economy. In 1973, agriculture accounted for 35% of output, and employed 53% of the active population. Manufacturing accounted for 21% of output, and 11% of employment. Services accounted for the remain- ing 44% of output and 36% of employment. The growth in real GNP, which had been about 5%-6% during the sixties, doubled to 10% in 1973, slowed to 6% in 1974 and is expected to be 5% in 1975. CNP per capita was US$310 in 1974. Approximately 10% of the labor force in urban areas is openly unemployed. An additional 15% of the labor force is underemployed. Post- war economic growth has not changed the historic pattern of highly skewed  distribution of income. The Goverment is taking steps to distribute the benefits of growth more widely, through increased irrigation, feeder roads, water supply and health facilities. 2.05 Recent Trends. The Philippine economy is vulnerable to increases in the world price of oil and to world-wide inflation and recession, since imported oil accounts for more than 90% of the country's energy requirements and international trade for more than 40% of its GNP. However, the 1973 boom in the price of a number of export commodities such as coconuts, sugar and forestry products has meant that the country has been able to maintain a relatively satisfactory rate of growth despite the tumultuous events in the world economv of late 1973. Inflation became a major problem in 1974 (consumer prices increased by 40%) and led to a deterioration of real in- comes, but it was reduced sharply (to 10%) in 1975. III. T1E EDUCATION SECTOR Summary Evaluation 3.01 The most striking feature of the Philippine education system is its high enrollment ratios at all levels. In quantitative terms, the coun- try has achieved: (a) universal enrollment at the elementary level and an enrollment ratio of 46% at the secondary level (Chart 1); (b) one of the highest tertiary level enrollment ratios (21%) in the world (Annex 1); (c) high percentages of qualified teachers (more than 95% of elementary school teachers are certified, and three-quarters of those have university degrees); (d) reasonable pupil/teacher ratios (31:1 in public elementary schools and 35:1 at the secondary level); and (e) an adult literacy rate of 87%. 3.02 Despite these quantitative achievements, the educational system still has the following key weaknesses: (a) ineffective management due to an uncoordinated bureaucracy, inadequate planning, and a lack of statistics to guide decision-making; (b) outdated curricula which do not reflect scien- tific, economic, or political developments of the past decade; and  (c) a serious lack of textbooks and other teaching aids (in the average subject, there is one book for every ten pupils). As a result of the shortage of texitbooks and other educational materials the well qualified teaching staff is hmndicapped in its work. Reliance must be placed on learning by rote to an undesirable extent. The result is low qual- ity which is manifested in poor exalmination performances, and high dropout and repeater rates at the upper stages of each cycle. 3.03 Educational Structure and Administration. The Philippines education system (Chart 2) is comprised of a six-year elementary level (sub-divided into a four-year primary and a two-year intermediate cycle), a four-year secondary level and a four-year tertiary level, followed by further post-graduate pro- grams. Thus the combined elementary-secondary program is ten years long. 3.04 The formulation of educational policy lies formally with the National Board of Education, chaired by the Secretary of Education and Cul- ture. Administrative responsibility for public schools and non-chartered colleges, as well as supervision oil private schools, rests with the Depart- ment of Education and Culture (DEC'). The DEC was reorganized in July 1975. Under the reorganization, three bureaus by types of school (public, vocational and private, Chart 3) have been replaced by three integrated bureaus organized by level of education (elementary,. secondary and higher education, Chart 4). Staff services such as the Office of Planning Services have been strengthened. The previous three parallel field organizations have been consolidated into a single organization comprised of 12 regions. The consolidation of the field organizations is a distinct improvement over past practices. Establishment of 12 regional bureaus could speed up decision making on local matters if accompanied by decentralization of authority as planned. 3.05 Reorganization is one step to improving educational administration and planning. To be effective, it must be accompanied by an improvement in data collection. Educational managers presently lack the regular flow of up-to-date information which is necessary if they are to Improve their decision-making. Basic educationaL statistics are inaccurate and out of date. Extensive data were collected during the 1970 Presidential Survey, but have not been updated since. Moreover, reorganization of the DEC into 12 regional bureaus means that staitistics must now be aggregated by region. 3.06 Elementary Education. E:Lementary enrollment is universal, although there is much repetition and dropout (about 15% of each class) and many first graders (40%) are over the prescribed seven year old entering age. Most (95%) of pupils attend public schools (Annex 5). The teaching force is generally well trained. More than 95% of the 230,000 public elementary school teachers (Annex 6) are officially classified as fuLly qualified and about three-quarters of these are four-year college graduates. Most of the remainder are graduates from two-year normal colleges or from agricultural and arts and trades col- leges. The pupil/teacher ratio is low (31:1 in public elementary schools), and school facilities are adequate. One of the most serious problems is the  -5 . lack of textbooks (para 3.13). There are few books, and most of those avail- able are located in urban schools and are over five years old. 3.07 Secondary Education. About 461 of the secondary school age group attend school, somewhat more than half of these (52%) in private schools. About 6Z of the total secondary students are enrolled in 900 vocational- technical schools (Annex 7). Growth of enrollment was 10% p.a. during the 1960s. It has declined to 6% p.a. for the period 1970-1975 since the Govern- ment has not invested in public secondary school construction. On the whole, opportunities for secondary schooling are reasonably well distributed, with participation rates varying from 22% in Western Mindanao and 24% in Eastern Visayas to 46Z_in Ilocos and 54Z in Southern Tagalog. Pupil/teacher ratios are reasonable (34:1 in private schools and 38i1 in public schools) and teachers well-qualified (about 95% are college graduates in education). However, as in primary schools, instructional materials are in short supply and inadequate in content. 3.08 A 1970 presidential survey (para 3.17) recommended that curricula in general and vocational secondary schools be merged into a single program of study. The program would include compulsory courses for all students in agriculture, industrial arts, homemaking, fishing and business arts throughout the four years of secondary school. Survey courses in at least three of these areas would be provided during the first and second year. Pupils would pursue a variety of electives within these areas in some depth during the third and fourth years. Implementation of the reform is progres- sing slowly since most secondary schools have neither vocational facilities nor specialist teachers. DEC calculations suggest that the workshops re- quired to implement the reform would cost more to build and equip than the DEC can afford (about US$600 million). Moreover, provision of the many workshops and specialist teachers necessary to provide the range of choices required by the new curriculum would be uneconomic in all but a few large schools. Prior to any large scale investment in workshops or vocational teaching materials the reform should be reconsidered in light of the above, and curricula redesigned. 3.09 Higher Education. Higher education in the Philippines begins after 10 years of primary and secondary schooling rather than after 12 years as in many countries. Thus, although the participation rate is high (21%), it is not wholly comparable to other countries. Most students (93%) attend pri- vate institutions, and 40% are in Manila, although educational opportunities are substantial in other regions. Opportunities for women are excellent, and the participation rate for women is higher than that for men. The quality of higher education varies. Investments have improved the quality of graduates from selected institutions, but graduates from many institutions are poorly trained. Facilities, equipment, and instructional materials are good in a few select institutions, but they are typically scarce or non-existent. In the best institutions, 50% of the staff hold post-graduate degrees, but the staff in most institutions hold few post-graduate degrees. 3.10 Language Policy in Education. A new, bilingual education policy was announced in June, 1974. Prior to June 1974 the vernacular served as  -6- the medium of instruction in the first two grades and English thereafter. Under the new policy, English is the medium of instruction for all science and mathematics courses and Pilipino is the medium for all other subjects regardless of grade. The vernacular may be used as an auxiliary medium of instruction in the first two grades. This means that teachers in grades one and two may teach part of tihe time in a local dialect, but books and teaching materials are not written in the auxiliary medium. The Implemen- tation of this policy is to be phased over an eight-year period and be com- pleted by 1982. 3.11 One objective of the nmew language policy is to create a cohesive nation through development of a unifying national language (Pilipino) while maintaining the widely spoken non-national language (English) which is suited to mathematics and science. The policy seems to be a workable compromise to achieve both objectives. However, its Implementation will pose difficulties for a minority of the population in certain sections of the country (about 15%-20%, particularly in Southern Mindanao) which speaks little Pilipino at present (para. 2.02). In these sections of the country it will be necessary to accompany introduction of the bilingual education policy with intensive language training in Pilipino, and possibly to extend the period of adoption beyond the planned eight years. 3.12 Textbooks (Appendix 2). The Textbook Board within the administra- tive framework of the DEC (Chart: 4) controls textbook development. The Board invites submissions of textbook rmanuscripts from publishers and authors, and approves approximately three titles per subject at any grade level for use in public schools. Manuscripts are written largely by private publishers and individual teachers, and to a limited extent by curriculum centers such as the University of the Philippines Science Education Center, the DEC's Social Studies Center (both of wrhich are receiving assistance under Credit 349-PH), and the Language Study Center at the Philippine Normal College. Development of titles which would be unprofitable to private sector pub- lishers is undertaken by the DEC (e.g. teacher guides in secondary school vocational subjects are developed for the DEC by the Philippine College of Arts and Trades). The Textbook Production Service of the DEC contracts with private firms for printing of books under price guidelines set by the Price Committee of the Textbook Board. The Service also contracts with private freight forwarders for book distribution. Payment for books ordered cen- trally is made by the DEC and for books ordered locally by local government. The present policy of the Government is not to charge public school students for books. 3.13 The process for developing and distributing books has not proved satisfactory. The supply of books has been irregular, insufficient and the quality of the books is often poor. The development of new textbook titles for publication takes an average of six years. It is estimated that in the public schools in any one subject there is only one book for every 9.8 pupils in grades 1-4, one for every 11.5 pupils in grades 5-6, and one for every 8.5 pupils in secondary school. Another 50 million textbooks would be needed throughout the public school system to provide each pupil with one textbook on each subject. The main reason for the lack of textbooks is  - 7 - the absence of an institution to develop and supply textbooks to schools regularly. In 1967, at the end of a textbook project under bilateral assistance, 6-8 million books were being provided to schools annually. With- out an institution to continue supplying books regularly, however, the output rapidly declined to one million books in 1973 and 60,000 in 1974. 3.14 There are qualitative weaknesses in addition to quantitative short- comings. About 80% of the books are at least five years old, in poor condi- tion, and outdated. The books lack continuity in subject matter from grade to grade, since the Textbook Board has in the past selected single textbooks from series produced by different publishers. They are inconsistent in the level of language proficiency demanded of pupils, and they provide no rein- forcement in content between related subject areas. Most of these qualita- tive shortcomings are the result of lack of coordination between author teams, and the lack of any program of required testing of prototype books prior to their large scale purchase by the DEC. It is necessary to place all authority to direct and coordinate textbook development and testing into a single agency if these shortcomings are to be remedied. 3.15 Electronic Media. Radio broadcasts are used in elementary and adult education, in-service teacher training and in agricultural extension (Appendix 3). Despite the variety of educational radio and television activities, little is known about their success and they appear to have had only a marginal impact which may be attributable to their unsystematic use and lack of follow up. Given the potential for widespread quality im- provement in education through the use of mass media, particularly in rural areas, the Government plans to undertake an evaluation of results achieved thus far and the possible role of modern technology in Philippine education. 3.16 Educational Financing. The total amount of funds (public and private) allocated to education in 1975 is estimated at P 3,000 million (3.2% of GNP), two-thirds from the national government. National govern- ment expenditures devoted to education increased by 215% between 1968-74 from P 941 million to P 2,019 million (Annexes 2 and 3). Despite this in- crease in absolute terms, the share of the national Government expenditures devoted to education decreased from 32% to 15% over the same period. Two factors contributed to the relative decline: the total government budget increased steeply (460%) and increases in teacher salaries were restricted. Most (85%) of the national government expenditure on education is devoted to elementary schools, which are the responsibility of the national government. Public secondary schools are supported by local government finance which varies according to the income of the region. One consequence of this is a substantial variation in the quality of instruction according to the income of the locality. Another characteristic of educational financing is that 90% of public operating expenditures on education pay for salaries and other personnel costs. Hardly any provision is made for textbooks and other supplies. However, a Special Education Fund was created in 1973 and between 1973 and 1975 increased the funds available for textbooks from P 6.8 million to P 21.5 million (Annex 4).  -8- 3.17 Development Priorities. During the 1960s, Government policies emphasized improvements in the training of middle and higher levels of agri- cultural, industrial, and scientific manpower. A new national education development strategy for the period 1973 to 1982 was developed by a 1970 Presidential survey of the educaition sector. The survey proposes that priority be given to improve educational quality, to strengthen educational administration, to redress imbalances of educational opportunities between rural and urban areas, and to increase Governmental control over tertiary level schooling. Improved educational quality is to be achieved by updating curricula, integrating academic and vocational studies of the secondary level, and producing textbooks based on the updated and revised curricula. Also, the Government is to investigate ways in which it could use satellite com- munication and other mass media to improve quality. Educational administra- tion is to be strengthened through reorganization of the DEC (para 3.04), better planning, and provision to managers of a regular flow of up-to-date information. The imbalance of educational opportunities between rural and urban areas is to be redressed through construction of new secondary schools in rural areas. Increased Government control of tertiary level schooling is to be achieved by introducing a program of certification and by increasing the Government's financial participation in tertiary level schools. The strategies to improve educational quality and to strengthen administration are generally sound. The strategies to redress educational imbalances at the secondary level and to increase Government control over education at the tertiary level would generate recurrent costs which the Government probably could not afford. 3.18 Presidential Decree No. 6-A (of 1972) established the machinery to implement the new development strategy. It authorized the appropriation of P 50 million per annum for a period of 10 years for development projects. It established a Special Education Committee (comprised of the Secretary of Education and Culture, the Secretary of Finance and the Commissioner of the Budget) to administer the fund, and the Education Development Projects Im- plementing Task Force (EDPITAF) to implement projects. Thus far, the Gov- ernment has succeeded in its reorganization plans, and in establishing EDPITAF as a strong agency capable of implementing the Government's reform projects. It has also begun a program of curriculum development in math- ematics, science and social studie!s and is compiling educational statistics for the years 1971-1974. Little progress has been made in provision of more and better textbooks. IV. THE PROJECT 4.01 The overall purpose of the project is to develop the institutional capacity for the continuous development and supply of relevant textbook mate- rial in the Philippines. This involves two aspects: (a) the establishment or strengthening of local Institutions to develop and distribute textbooks, and (b) the production and distribution of 27 million textbooks as the first phase of a program to introduce 98 million new textbooks into public primary and secondary schools by 1984.  4.02 In terms of institutional development the project would provide technical assistance, equipment and facilities: (a) to expand the functions of the Textbook Board for management of textbook development at all stages; (b) to establish or extend five curriculum development centers to develop curricula, write, test and revise textbooks in five primary and five secondary school subjects; (c) to establish 14 staff development centers and 34 development high schools as a network for testing books and training 250,000 teachers in the use of the new textbooks; and (d) to establish a distribution system consisting of one national and 107 provincial and sub-provincial ware- houses for transporting books from printers to schools. In terms of textbook supply, the project would help finance the development of 75 new textbook titles and the manufacture and distribution of 27 million textbooks. 4.03 In addition to the textbook component, the project would help: (a) establish an educational management information system to provide educational managers with a regular flow of up-to-date information, and (b) finance a pre-investment study on use of educational mass media, particularly satellite communication. Textbook Production and Distribution (Proposed Outlay: US$35.3 Million) 4.04 Management of Textbook Development. A key objective of the proj- ect is strengthening the textbook development process. This would be accom- plished by expanding the functions, staffing and facilities of the Textbook Board (para 3.12). The Board would continue to exercise its present func- tion of approving manuscripts of textbooks for use in public schools. In addition, it would assume major new responsibilities for integrated manage- ment of all textbook development activities from initial planning of text- books through the manufacturing and distribution of textbooks to schools. New responsibilities of the Textbook Board would include contracting for curriculum development and textbook writing and testing, and working with curriculum developers and author teams to develop outlines of textbooks and textbook series, their specifications, and scope and sequence charts. The Board would provide curriculum developers and author teams with profes- sional editorial advice and support in areas such as photography, design, typesetting and printing of prototype editions for testing purposes. It would monitor contracts at prescribed stages, supervise testing and revisions, and coordinate the work of various author teams. Books developed under con- tract to the Board would receive automatic approval for use in public schools.  - 10 - An advisory council (the Basic Education Textbook Development Coordinating Council-BETDECCO) would be formecl to advise on priorities for development of textbooks. In addition, the Textbook Board would take on the new function of textbook manufacturing and distribution. To accomplish this change the Textbook Production Service of the DEC would be transferred to the Board (para 4.11). 4.05 To perform its major new functions effectively, the Textbook Board requires (a) a new Departmental order establishing administrative guidelines, (b) a full-time professional secretariat comprised of senior editors, design- ers, production staff and teacher trainers (details of staffing are provided in Chart 5), and (c) centralized facilities to service curriculum development centers in design, typesetting and small scale printing. Bank financing would be provided for technical assistance, furniture and equipment for offices and for a shop to do printing, design work and typesetting for the secretariat of the Textbook Board. 4.06 During negotiations agreement was reached on reorganization of the Textbook Board, a schedule of staff appointment to its secretariat and amendments to the implementing rules of the DEC for the Textbook Board. These rules have been issued formally by the Secretary, DEC. These amended rules and regulations cover the organization and operating procedures for the expanded responsibilities of the Board. In particular, the rules and regulations permit the Board to contract with private publishers for manu- script development. Agreement was also reached on the composition of the textbook advisory council (BETDECCO), including representation of the pri- vate publishing industry. Assurances were obtained at negotiations that the Government would maintain at all times (a) BETDECCO with composition and functions acceptable to the Bank and (b) qualified and experienced personnel within the secretariat of the Textbook Board, including the following key personnel: a director, editor-in-chief, head of production unit, and head of the manufacturing unit. Appointment of these key personnel would be a condition of effectiveness of the project. 4.07 Curriculum Development/Nanuscript Writing. The textbook development cycle (Annex 8) would be comprised of one year for planning and writing, one school year for testing and revisions, and the following year for printing, binding and distribution. Although private publishers would be allowed to participate, most curriculum development and manuscript writing would be con- ducted by five designated curriculum development centers under contract to the Textbook Board, as follows:  - 11 - Subject Area Designated Curriculum Development Center Science & Mathematics University of the Philippines Science Education Center Social Studies Department of Education and Culture Social Studies Center Languages Philippine Normal College Language Studies Center Vocational Arts Philippine College of Arts and Trades Practical Arts Center Homemaking, Fishing, Central Luzon State University Agriculture Rural Studies Center The Science and Social Studies Centers are currently receiving assistance under Credit 349-PH. The Language Studies Center is receiving no assistance but has experience in curriculum development and textbook writing in both English and Pilipino. The Practical Arts and Rural Studies Centers would be established as part of the project. At the request of the Textbook Board the centers would (a) develop curricula, (b) write manuscripts, (c) test and revise prototype books, and (d) train teachers in the use of books. Since curricula in vocational arts, homemaking, fishing and agriculture must be redesigned prior to any large scale investment in related teaching materials (para 3.08), the Practical Arts and Rural Studies Centers would focus on development of experimental instructional materials. The Science, Social Studies and Language Centers would produce 39 textbook titles and 36 associated teacher guides between 1976 and 1980. Of these, 11 textbook titles and their associated guides are presently being field tested, and development of another 11 titles and associated guides is well advanced. By 1980 the three centers would have another 21 textbook titles and 14 associated teacher guides in various stages of development (Annex 9). Bank financing would be provided: (a) to construct the Language and Vocational Studies Centers, since the Normal College and the College of Arts and Trades cannot provide them with adequate facilities; (b) to help furnish and equip all five curriculum centers; and (c) for contracts to develop curricula and write manuscripts. 4.08 Testing. The second year of the textbook development cycle would be devoted to testing of about 2,500 prototype textbooks in representative classrooms. Testing would be conducted during a full school year in one classroom in a minimum of 40 representative schools. The purpose of the testing program would be to afford a reasonable opportunity to revise and improve the textbooks before full scale production. Testing would often result in development of two or more versions of a textbook, each version suitable for pupils of different abilities and backgrounds. Bank funds would be used to help finance the testing of prototype textbooks. Assurances were obtained during negotiations that prototypes of all titles to be printed  - 12 - under the proposed project would receive a full year of tryout and subse- quent revision prior to wide scalet distribution. 4.09 Teacher Training. Under the project 250,000 teachers would be trained in the use of textbooks. Training would be provided through a net- work of project curriculum development centers (para 4.07), regional staff development centers, and development schools. At the national level, the five project curriculum development centers would provide training in their respective areas for the staff of 14 regional staff development centers attached to teacher training institutions. Nine of the staff centers would be expansions of existing Regional Science Teaching Centers (four of which have been established with the assistance of Credit 349-PH) and five new centers would be established as part of the project. The 14 staff development centers would provide training for the staff of 34 development high schools and primary schools. Staff of the development schools would in turn conduct short courses (about three days) for teachers in their regions. Each of the development high schools would be provided with the laboratory equipment necessary to upgrade teachers in laboratory work in which most of them are weak. The staff development centers and development high schools have been selected for their geographic spreaLd, their high quality, and the willingness of their staff to participate in the project. The network of staff develop- ment centers and development schools would also be used to support the manus- cript testing (para 4.08) program of the curriculum development centers. 4.10 Bank financing would be provided to help pay teacher stipends at teacher workshops and provide equipment for the 14 staff development centers and the 34 development high schools. Assurances were obtained during nego- tiations that prior to carrying out a detailed teacher training program is methods of using textbooks in classroom teaching, the Government would send its proposed program to the Bank for review, and would provide adequate language instruction for teachers and students in regions where testing of textbooks indicates that such instruction is required (para 3.10). 4.11 Management of Textbook Manuufacture and Distribution. The Textbook Production Service of the DEC, responsible for textbook printing and distri- tion, would be transferred to the Textbook Board (para 4.04). Given the larger scale of operations proposed, however, the staffing for book produc- tion would need to be expanded by aclding specialists in textbook printing and binding, paper procurement and sitorage, and textbook distribution. (Details of staffing are provided in Chart 5.) The manufacturing unit of the Textbook Board would purchase paper in bulk, let contracts for the printing and binding of books, monitor the contracts, and manage all aspects of distribution of books from printers to schools. Bank financing would -- help to provide appropriate technical assistance and to furnish and equip office space.  - 13 - 4.12 Paper, Printing and Binding. The Government has developed an eight-year program for increasing the supply of textbooks in public pri- mary and secondary schools as follows: Primary School Secondary School Total ----