Philippines - National Extension Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No.2049-PH S L < w4 tZ k,,D ,. PHILIPPINES NATIONAL EXTENSION PROJECT STAFF APPRAISAL REPORT October 24, 1978 Projects Department East Asia and Pacific Regional Office 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 EQUIVALENTS US $1.00 = Pesos (P) 7.4 P 1.00 = US$0.135 WEIGHTS AND MEASURES = METRIC SYSTEM 1 hectare (ha) = 2.47 acres 1 kilometer (km - 0.62 miles 1 square kilometer (sq km) = 0.3881 square miles 1 meter (m) = 39.37 inches 1 cubic meter (cu m) = 35.31 cubic feet 1 millimeter (mm) = 0.039 inches 1 kilogram (kg) = 2.2 pounds ABBREVIATIONS BAECON - Bureau of Agricultural Economics BAI - Bureau of Animal Industry BAEx - Bureau of Agricultural Extension BPI - Bureau of Plant Industry BS - Bureau of Soils FMT - Farm Management Technician HMT - Home Management Technician MOA - Ministry of Agriculture NFAC - National Food and Agriculture Council NCP - Nutrition Center of the Philippines NNC - National Nutrition Council NTC-RD - National Training Centers for Rural Development PTC-RD - Philippine Training Centers for Rural Development RYDO - Rural Youth Development Officer GOVERNMENT OF THE PHILIPPINES FISCAL YEAR January 1 - December 31  FOR OFFICIAL USE ONLY PHILIPPINES: NATIONAL EXTENSION PROJECT STAFF APPRAISAL REPORT TABLE OF CONTENTS Page No. 1. BACKGROUND. . . . . . . . . . . . . . . . . . . . . . . . . 1 The Rural and Agricultural Sector . . . . . . . . . . . . 1 Agrarian Reform . . . . . . . . . . . . . . . . . . . . . 2 Food Production Programs. 2 Nutrition Programs. 3 Experience with Past Lending . . . . . . . . . . . . . . 4 2. THE PRESENT EXTENSION SYSTEM . . . . . . . . . . . . . . . 6 Ministries and Agencies Providing Extension . . . . . . . 6 Extension Services of the Ministry of Agriculture . . . . 8 Status . . . . . . . . . . . . . . . . . . . . . . . . 8 Problems .9 Activities. 9 (a) Farm Management Technicians . . . . . . . . . . . 10 (b) Home Management Technicians . . . . . . . . . . . 10 (c) Rural Youth Development Officers . . . . . . . . 11 (d) Livestock Officers . . . . . . . . . . . . . . . 11 Coordination of Extension with Local Programs 12 3. THE PROJECT.12 3. TEPOET . . . . . . . . . . . . . . . . . . . . . . . . 1 Objectives ..12 Project Identification/Preparation . . . . .12 Project Components . . . . . . . . . . . . . . . . . . . 13 (a) Organizational Program . . . . . . . . . . . . . . 13 (b) Vehicles, Equipment and Buildings . . . . . . . . . 13 (c) Extension Methodology . . . . . . . . . . . . . . . 13 (d) Staffing Program and Training . . . . . . . . . . . 13 (e) Studies/Consultant Services . . . . . . . . . . . 14 Detailed Features ..14 Vehicles and Communications . . . . . . . . . . . . . . . 14 Audio-Visual Training and Demonstration Aids . . . . . . 16 Office, Printing and Reproduction Equipment . . . . . . . 17 Civil Works . . . . . . . . . . . . . . . . . . . . . . 18 Staffing and Training . . . . . . . . . . . . . . . . . 19 4. PROJECT COST AND FINANCING ... . . . . . . . . . . . . . 21 Cost Estimate .... . . . . . . . . . . . . . . . . . . 21 Financing . . . . . . . . . . . . . . . . . . . . . . . 22 Procurement .23 This report is based on the findings of a mission composed of Messrs. Forno and Luhman and Ms. Sjamsu (Bank) and Messrs. Rohde and Jessup (consultants) who visited the Philippines from February 20 to March 10, 1978 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- Page No. Disbursements . . . . . . . . . . . . . . . . . . r Accounts and Audit . 24 Environmental Effects . . . . . . . . . . . . . . . . . . Wt Role of Women .. . . ............ . ..... 24 5. PROJECT IMPLEMENTATION . . . . . . . . . . . . . . . . . . 25 Ministry Reorganization . . . . . . . . . . . . . . . . . Organization of the Extension Service . . . . . . . . . . 27 Operations of the Extension Service . . . . . . . . . . . 27 Responsibilities . . . . . . . . . . . . . . . . . . . . 27 Extension Methodology . . . . . . . . . . . . . . . 28 Preparation of Demonstration Materials . . . . . . . . . 29 Links with Research . . . . . . . . . . . . . . . . . . 29 Salaries and Allowances ... . . . . . . . . . . . . . . 30 Vehicle Plan .... . . . . . . . . . . . . . . . . . . 31 Monitoring and Evaluation . . . . . . . . . . . . . . . . 31 6. BENEFITS, JUSTIFICATION AND RISKS . . . . . . . . . . . . 32 Benefits . . . . . . . . . . . . . . . . . . . . . . . 32 Justification . . . . . . . . . . . . . . . . . . . . . 33 Risks .. . 34 7. AGREEM1ENTS REACHED AT NEGOTIATIONS ..34 LIST OF TABLES IN THE MAIN TEXT Table No. 2.1 Main Agencies Providing Agricultural and Nutritional Supporting Services . . . . . . . . . . . . . 5 3.1 Vehicles and Communication Equipment . . . . . . . . . . . . 15 3.2 Audio-Visual Equipment . . . . . . . . . . . . . . . . . . . 17 3.3 Office and Printing Equipment . . . . . . . . . . . . . . . 18 3.4 Technical Staff Build-up . . . . . . . . . . . . . . . . . . 20 3.5 Main Training Program . . . . . . . . . . . . . . . . . . . 21 4.1 Project Cost . . . . . . . . . . . . . . . . . . . . . . . . 22 4.2 Financing . . . . . . . . . . . . . . . . . . . . . . . . 23 LIST OF FIGURES Figure 2.1 Existing Organization of the Ministry of Agriculture 7 Figure 5.1 New Organization of the Ministry of Agriculture 26 ANNEXES 1. Project Cost Phasing 36 2. Training Needs and Costs 39  - 3 - Page No. ANNEXES (continued) 3. Estimated Schedule of Disbursements 40 4. Economic Analysis 41 5. Documents in Project File 42 LIST OF M4APS IBRD - 13155R The Philippines   PHILIPPINES NATIONAL EXTENSION PROJECT I. BACKGROUND 1.01 The project is designed to accelerate and sustain technology trans- fer (a) to promote further production increases in the main food crops and expand livestock production; (b) to improve the quality of rural life through higher incomes, better nutrition and improved home management; and (c) to reduce rural unemployment by assisting out-of-school youth establish backyard livestock enterprises. Together these activities are directed towards increasing farm income, improving rural family life and reducing rural unemployment. The Ministry of Agriculture (MOA),I1 would be the key executing agency. The Rural and Agricultural Sector 1.02 Some 31 million people or 70% of the Philippine population live in rural areas where social services are poor, economic activities limited, agricultural productivity often low and underemployment high. The rural population is growing at 2.7% per year, reflecting a natural increase of about 3.2% and an annual rate of migration to the cities of 0.5%. By 1985, rural-urban migration is expected to reach 1.1% per year, placing considerable strain on urban infrastructure and services. 1.03 Agriculture is the predominant sector in the Philippine economy, accounting for about 30% of gross domestic product and over one-half of total employment. Small farms provide the main income for 65% of the rural population. Other sources of income include forestry, fishing, mining, small-scale manufacturing and service industries. Farming is chiefly oriented towards food grain production (60% rice and 40% corn) for domestic consumption, while coconuts and sugar are the main export crops. Although agriculture is still by far the largest export sector, the contribution of agriculture (including forestry) to export earnings has fallen from more than 70% in the early 1970s to less than 60% in 1977, largely due to the rapid growth of nontraditional manufactured exports. 1.04 Agriculture's performance was exceptionally strong in 1976, when pro- duction increased by 7%, compared with the trend growth rate of 4.5%. Rice and corn production were both at record levels. The agricultural terms of trade improved by 18% during the period 1970-74, declined slightly in 1975 and recovered to the 1974 level in 1976. Domestic rice, corn and sugar prices are largely administered, while coconut prices tend to fluctuate with the world market. Government price intervention for rice was able to cushion the impact on consumers of the 1972-73 crop damage and the peak world prices /1 Prior to the shift in Government to a Parliamentary System in June 1978, government agencies were organized into departments with the senior staff position being that of Department Secretary.  - 2 - of 1973-74, while at the same time allowing the farm-gate price for paddy to rise with the trend in international prices. As a result of price adjustments made in the last two years, domestic prices for major crops are in line with world prices. 1.05 Because of these favorable developments in production and prices, the growth of rural family incomes has exceeded that of urban incomes in the last four years. The ratio of the average rural income to the average urban income rose from 0.48 in 1971 to 0.57 in 1975, and the share of family incomes received by the poorest 40% of families increased from 12% to 15% during the same period. However, about 40% of all rural families earn incomes below the level required to ensure adequate nutrition and provide essentials for accepted minimum standards of living. 1.06 Government efforts to assist the rural poor have largely concen-- trated on the agricultural sector, and have been directed at achieving Agrarian Reform and rice and corn production increases. Recently, however, there has been strong Government support for nutrition programs, with the realization that widespread malnutrition exists among children in the country, despite the apparent successes in the food production programs. The achieve- ments of the main government programs in the rural areas, together with the outlook for the future are summarized below (paras. 1.07 to 1.11). 1.07 Agrarian Reform. For historical reasons, land ownership in the Philippines is inequitably distributed. The land transfer program, which has been in operation for five years and covers rice and corn growing areas, pro- ceeded quite rapidly when larger landholdings were the focus of concentration, but progress has been slower recently as the focus has been on a larger number of medium-sized holdings, which often belong to middle-class landowners. As of June 1977, an estimated 120,000 tenants, or 30% of the total tenants under the program, had recived Certificates of Land Transfer which established their claim to the land. Despite the difficulties in the process of implementation, the transfer program remains an important part of the Government's rural development strategy, and is the responsibility of a separate ministry, the Ministry of Agrarian Reform (MAR). 1.08 Food Production Programs. Shortly after the declaration of Martial Law in October 1972, three intensive food production programs were launched by the then Department of Agriculture. These were (a) the Masagana 99 Program (signifying a target rice yield of 99 cavans or 4.4 ton/ha), (b) the Masagana Maisan Program, (or "bountiful harvest" corn production program) and (c) the Gulayan Sa Kalusugan Program (vegetables for better health). The effectiveness of the Masagana programs has recently been reviewed by the Bank (Report Nos. 2177-PH and 2192-PH). For rice there have been signifi- cant production improvements. Since 1973, when the Philippines had a net rice deficit of around 600,000 tons, production has increased to a point where the country was approximately self-sufficient in the crop year 1976/77, and had a marketable surplus in excess of 100,000 tons in 1977/78. Although much of  the production increase in the past four years has resulted from favorable weather, the Masagana 99 Program has certainly had a significant impact on farmer adoption of improved rice varieties and cropping practices. It is likely that for the next four to five years the country will be marginally self-sufficient (with perhaps small surpluses for export) in good crop years, and will be in a deficit position following years of bad weather. However, beginning in the mid-1980s, the Philippines appears likely to move to a persistent surplus position in rice. This will largely result from the substantial increases in irrigated area which are now under development, and from Government efforts to improve the quality and coverage of its extension service and other supporting services to farmers. 1.09 Production of corn in the Philippines still falls far short of demand. Although the country is self sufficient in white corn for human consumption, its imports of yellow corn are usually around 160,000 tons annually. These imports represent about 80% of the corn used by commercial feed millers. Between 1961-77, corn production grew at an average annual rate of 5.7% of which 3.3% was due to an area increase and 2.4% due to yield increases. In the last five years, however, production increases have been due mainly to increases in cropped area. This contrasts with the recent production increases for rice which have resulted largely from higher yields. Despite government efforts to promote feed grain production through its Masagana Maisan programs, yields of yellow corn, which account for 8-9% of total production, have declined on average by 6.5% per year. Much of the decline has been due to a downy mildew disease which is now being intensively studied by plant breeders and other researchers in the country. However, even with the existing corn varieties in the Philippines, much could be done to boost yields through better farming practices. Traditionally corn is grown by poorer farmers with less arable farms. A well oriented extension force could have a significant impact on corn yields through imparting improved, but simple cultivation practices. 1.10 Nutrition Programs. Since the establishment of the National Nutrition Council (NNC) in 1974, together with its secretariat, the Nutrition Center of the Philippines (NCP), well formulated programs of nutrition monitoring, preventive and remedial activities have been devised. The involvement of several government agencies and various private concerns in the implementation of NCP programs, however, makes coordination difficult. The Ministry of Agriculture is the main agency responsible for promoting the preventive and technical aspects of the NCP program, while the Ministries of Health (DOH) and Social Services (DSSD) are primarily concerned with monitoring and remedial activities. The programs of the NCP have drawn widespread attention to the nutritional problems existing in the Philippines, particularly in infants among the poor and in the rural areas. This has become very evident as a result of a nationwide, multiagency effort coordina- ted by the NCP, wherein every preschool child is regularly weighed as a measure of the overall effectiveness of nutrition programs, and as a means of identifying localities with below average levels of nutrition. Initial data collected on about a third of the country's pre-school children suggest 60% suffer from varying levels of protein-calorie malnutrition.  - 4 - 1.11 The nutrition programs make extensive use of public media, ranging from radio and television to sophisticated advertising techniques, comic books and simple posters. A remedial program of the NCP, which relies heavily on promotion by extension workers, involves the sale at very low cost (P 0.5 each) of nutritious, locally prepared weaning foods, popularized under the name of Nutripak. Some 90 packaging plants now operate and sell more than 14,000 Nutripaks a week. While this is not meant to be a solution to the problem on a widescale basis, it does focus attention of parents on the need for nutrition rehabilitation of children in their own homes. Another important program has been the organization of interdisciplinary nutrition committees at the regional, provincial, municipal and village (barangay) levels, to stimulate local interest and to enable the national programs to be tailored to local needs. In conjunction with these committees, a Barangay (village) Nutrition Scholar's program is in effect to train volunteers to carry out simple, nutritional surveillance of children. The network of nutrition committees form the focal point for the dissemination of informa- tion and back-up support by the Ministry of Agriculture's nutrition extension force. Experience with Past Lending 1.12 The proposed project would be the first Bank project directly assisting the Ministry of Agriculture (MOA), apart from US$0.8 million pro- vided under the Fourth Education Loan (1374-PH) for mobile audio-visual equipment. A number of previous Bank loans for agriculture and rural development in the Philippines have relied on support from the Ministry of Agriculture, particularly the extension services. To the extent that staff, facilities and equipment were available, the support from the MOA has been satisfactory. However, during implementation of the past several irrigation loans, it has become evident that improvements in agricultural extension services would further enchance the benefits expected from these projects. 1.13 The proposed project would rely heavily on the National and Rural Training centers (NTC-RD and PTC-RD) provided under the Fourth Education Project (1374-PH). Much of the in-service and pre-service training of extension staff would be done there since progress in establishing the training centers and in drawing up curricula has been satisfactory. An important contributing factor to the generally high level of agricultural expertise in the Philippines has been the first and second education projects (Loan 393-PH and Credit 349-PH), which financed training and development at the University of Los Banos (UPLB) Agricultural College, and two regional agricultural colleges, as well as equipment for 13 agricultural high schools. 1.14 The nutrition aspect of the proposed project also ties in with the first Bank-assisted population project (Loan 1035-PH) under which some 200 rural health units have been constructed and a large number of midwives trained for rural areas. There are now some 1,500 rural health units in the country as well as a growing number of locally operated nutrition centers. The extension service to be supported under the proposed project would provide the technical back-up support for those rural centers and provide the link between day-to-day operations and the programs and technology developed by the Nutrition Council of the Philippines (NCP).  Table 2.1: MAIN AGENCIES PROVIDING AGRICULTURAL AND NUTRITIONAL SUPPORTING SERVICES Approx. no. Department/ of field agency staff /a Main function of field staff Ministry of Agriculture (MOA) Bureau of Agricultural Extension for farm improvement, Extension (BAE) 8,600 home management and youth development. Bureau of Plant Industry (BPI) 2,700 Research and regulatory work on pests and diseases. Bureau of Animal Industry (BAI) 1,700 Extension on animal health and husbandry to commercial scale livestock enterprises. Bureau of Soils (BS) 550 Research on soil and fertilizer require- ments. Ministry of Agriculture: Attached Agencies Philippines Coconut Authority (PCA) 220 Extension on coconut and intercrops. Philippines Tobacco Authority (PTA & PVTA) 200 Extension on tobacco production. Philippines Cotton Growers Assn. (Philcotton) 170 Extension on cotton production. Philippines Sugar Ind. Authority (Philsucom) 15 Extension on sugar cane production. National Grains Authority 460 Assist in marketing of food and feedgrains. Ministry of Agrarian Reform (MAR) 3,140 Assist land reform beneficiaries (withdrawing from agricultural exten- sion work under PD 980.) Ministry of Local Government and Community Development (MLGCD) 2,670 Provide a very limited amount of agricultural and nutrition services. Also locally coordinate services of other agencies. Ministry of Natural Resources (MNR) Bureau of Forest Development (BFD) 1,780 Forest regulatory, research and extension work. Bureau of Fisheries and Aquatic Resources (BFAR) 560 Extension on fish production and handling. Ministry of Education and Culture (MEC) 6,520 Mainly school and community education. Ministry of Health (MH) 13,300 Rural health, medical, dental, and nutrition services. Ministry of Social Services (MSSD) 2,100 Social welfare including nutrition services. National Irrigation Authority (NIA) 5,740 Regulate and maintain irrigation water supply and provide a water advisory service in irrigated areas. Farm Systems Dev. Corp. (FSDC) 460 Provide agricultural extension as part of cooperative development. National Banking Agencies and Rural 830+ Provide agricultural extension as part of Banks credit services. /a Includes field supervisory staff.  2. THE PRESENT EXTENSION SYSTEM Ministries and Agencies Providing Extension 2.01- At present, about 15 government ministries and agencies and some 50,000 government staff provide varying forms of rural extension (see Table 2.1), although the borderline between truly agricultural extension and more general rural community development and service is difficult to define. In practice, however, the Ministry of Agriculture with a field staff of about 10,000 is responsible for the dissemination of technical information in the fields of crop and livestock production, home management, nutrition and rural youth development. Where staff of other agencies are involved in similar activities, a certain amount of overlap does occur. In most cases, however, informal agreements exist between staff of the different agencies as to their respective roles, although such roles may vary between agencies from region to region. With regard to nutrition, however, where the largest number of agencies are involved, the Ministry of Agriculture staff generally provide more of a technical support and education role. The actual implemen- tation of programs, such as the weighing and feeding of children is conducted by rural health workers from other government agencies or from the municipali- ties/ villages. Similarly, the distinction between the roles of field staff of the Ministry of Agriculture (MIOA) and of the National Irrigation Authority (NIA) is that the latter advise mainly on the efficient use of irrigation water and are responsible for ensuring the timely delivery of water. The fact that more efficient use is made of manpower and resources than the large number of involved agencies tends to suggest, is due to the relatively close coordination between staff at the field level on the various local Action Committees (see para. 2.09). 2.02 Agricultural extension per se has developed quite strongly along commodity lines. Coconuts are handled by the Philippine Coconut Authority (PCA), sugar by the Philippine Sugar Commission (Philsucom), cotton by Philcotton, and tobacco by the Philippine Tobacco (and Virginia Tobacco) Administration (PTA and PTVA). All are either attached agencies or under the administrative supervision of the Ministry of Agriculture (see Figure 2.1). Extension services for other crops, mainly cereals (rice and corn), fruit and vegetables are handled by the Bureau of Agricultural Extension (BAEx). Animal production is serviced by the Bureau of Animal Industry (BAI). Both BAEx and BAI are line agencies of the Ministry of Agriculture (see Figure 2.1). 2.03 With so many agencies presently involved in extension and such a wide range of functions (see Table 2.1), it is inevitable that some rivalries and confusion do exist among staff of various agencies, as to where their responsibilities end and those of others begin. Discrepancies between salaries and/or allowances paid to staff of different agencies, and even within the same agency, for doing essentially the same job add to the problem. In part this situation has inadvertently arisen as a side effect of the quite successful intensive food production programs of Government, which have been coordinated by NFAC - the National Food and Agricultural Council. Although essentially a policy-making body comprised of representa- tives from all ministries and agencies dealing with the rural sector, NFAC  PHILIPPINES NATIONAL EXTENSION PROJECT Figure 2.1 Existing Organization of the Ministry of Agriculture Office of the Minister MAIN ATTACHED AGENCIES & AGENCIES UNDER ADMINISTRATIVE SUPERVISION . National Grain' Philippine* Cocount| Phil/Virginia' Philippine* PalaYan NG Authority Coconut Investment Tobacco Admin. Cotton Bayan Nati. (NGA) Authority (PCA) Company (PTA) & (PVTA) CorprOTiON) Advisory Committee (PH ILCOTTON) Philippi ne- Philippine'. National- Presidential* National Food- Sugar Agricultural M eat Committee on and Agricultural Commission Training Inspection Agricultural Counc'i (PHILSUCOM) Council Commission Credit STAFF UNITS Computer ~~~~~~~~~~~~~~~~~~~~~~~~~~Financial Agrarian Reform Compuier Administrative Planning and U nit CetrService Service Management Servi ce LINE BUREAUS Bureau of Bureau of Bureau of Bureau of Bureau Agricultural Agricultural Animal Plant of Economics Extension Industry Industry Seeds (BAECON) (BAE) (BAI) (BPI) (BS) Field Staff Field Offices Field Offices Field offices Field Offices World Bank -19233  - 8 - has become increasingly involved in implementation of the food programs, largely because the extension agencies had insufficient resources to implement the programs themselves. Consequently NFAC has (i) borrowed staff, mainly from BAEx and BPI (i.e. Bureaus of Extension and Plant Industry); (ii) given them more liberal living and travel allowances; (iii) provided them with extension guidelines and technological back-up support and (iv) concentrated them on the priority food production program areas. While undoubtedly this has contributed, in the short run, to above average production increases in parts of the country, it has tended to erode the responsibilities and capa- bilities of BAEx. 2.04 Mindful of the proliferation of extension services and the discrep- ancies in compensation, Government has recently initiated a number of actions to help remedy the situation. For example, agricultural extension services provided by the Ministry of Agrarian Reform (DAR) are being phased out under Presidential Decree 980. Likewise, the Presidential Letter of Instruction (LOI) No. 599 recognizes the importance of the extension worker in assisting the rural population, and calls for a revision of salary scales. Also under LOI 599 a Steering Committee has been formed to draw up plans on how Govern- ment might achieve its long-term objective of having at least one extension worker in every barangay (village). Government's request for Bank assistance in strengthening the extension services of the Ministry of Agriculture, the lead agency responsible for extension, forms a major part of Government's strategy to streamline its extension services in rural areas. Extension Services of the Ministry of Agriculture 2.05 Status. The status of the extension service in the Philipines is quite unlike that of other countries where the Bank has assisted extension. The most notable features are the size of the extension force and the academic qualifications of personnel. Within the Ministry of Agriculture there are about 8,600 extension staff, of whom more than 90% have tertiary level degrees, mainly Bachelor of Science in Agriculture. If those performing agriculture extension are related to the number of rice and corn farmers in the Philippines, there is a ratio of one extension worker to 270 farmers. This should be a near optimum ratio and certainly is far superior to that in countries such as Indonesia, Thailand and India where ratios are of the order of 1:1,000 to 1:6,000. 2.06 Another notable feature is the relatively high standard of agri- cultural research in the Philippines, and the availability of generally well formulated packages of technology, particularly for rice, and to a lesser extent for corn. For the past 40 years, the University in Los Banos (UPLB) has been internationally recognized as a center for tropical agriculture training and research. It has been strengthened through three Bank education loans (see para. 1.13) as well as various other sources of aid. Its capacity has been further strengthened by the establishment of the International Rice Research Institute (IRRI), adjacent to the university complex. Furthermore, the agricultural research done at UPLB, IRRI and the various Ministry of Agriculture and private research stations are coordinated and evaluated by the Philippine Council for Agricultural Resources and Research (PCARR). Major functions of PCARR are the formulation of research programs and the packaging of technology for promotion by the extension service. Likewise as  - 9 - discussed in para. .010, the Nutrition Council of the Philippines, together with such groups as the Food and Nutrition Research Institute (FNRI) are particularly competent in drawing up programs and technology packages suitable for National programs. 2.07 Problems. Despite the apparently favorable number of extension staff and the level and type of technology available, average rice and corn yields in the Philippines are low and serious nutritional problems exist. A number of institutional problems are recognized by Government as affecting their extension effort; viz: (a) field staff lack practical training and knowledge of extension methodology; (b) there is a serious shortage of equipment and facilities for field level training of staff and for demonstrating improved technology practices. This is compounded by very inadequate budgetary allowances for the printing or reproduction of leaflets, demonstration slides, cassettes, etc. which are generally of high quality and available from various sources; (c) the majority of extension workers have to rely on public transport for mobility, which together with the unnecessarily large amount of report writing requirements, results in technicians spending only 30 to 50% of their time with clientele; (d) the links between research and extension are poorly developed due largely to the absence of sufficient subject matter specialist (SMS) positions in the extension service; (e) the emphasis of extension workers on those farmers participating in the Masagana, rice and corn production programs has concentrated the service on a very small proportion of farmers. As the number of farmers participating in the Masagana programs has declined over the past 4 years, the coverage of the agricultural extension service has also decreased; and (f) the present organization of the Ministry of Agriculture does not permit clear lines of command from the National level down to the field. While the Bureaus of Agricultural Extension (BAEx) and Animal Industry (BAI) are mainly responsible for extension, the more research and regulatory oriented Bureaus of Plant Industry (BPI) and Soils (BS) also do some extension work. Coordination between Bureaus is poor since even in the country's 12 regions and 73 provinces, the staff of each Bureau report to different Directors/ supervisors. Consequently under the present organization, the extension force of the Ministry of Agriculture is fragmented and its limited resources inefficiently used. 2.08 Activities. The extension staff of the Ministry of Agriculture are divided into four main groups, each with quite separate activities, i.e. (a) farm management; (b) home management; (c) rural youth development; and (d) livestock development. The main activities of technicians in each of these groups are discussed below.  - 10 - (a) Farm Management Technicians (FMTs). These comprise the majority of the extension force and number about 5,300. While primarily they are responsible for promoting food crop production throughout the country, their activities in recent years have been focused largely on the governments main food production programs, i.e. Masagana 99 for rice, and Masaganang Maisan for corn. To a large extent therefore, the activities of a great number of the FMT's have been under the direction of the National Food and Agriculture Council (NFAC), rather than under the Bureau of Agriculture Extension (BAEx) (see para. 2.03). Under the program of NFAC, FMT's are responsible for assisting farmers to (i) prepare farm budgets and loan applications; (ii) ensure the timely availability of input supplies; and (iii) provide suitable technology packages and supervise their adoption. The FMT is also responsible for informing the bank concerned of the time and estimated amount of grain harvested, and for periodically reminding the farmer of his repayment obligations. The latter function is encouraged by the rural banks who are authorized by NFAC to pay extension workers a small amount for every production loan taken out. Also, the financing institution has the authority to use extension workers in the collection of loans from farmers. This activity would be phased out under the project since the emphasis on debt collection conflicts with the role of the extension worker as a "friend" of the farmer who is able to advise him on how to improve his production. As the number of farmers in arrears has grown under the Masagana program, the coverage of the FMT's has shrunk. Once in arrears, a farmer cannot obtain another bank loan. Concomitantly, he usually no longer is visited by the extension worker. The problem of poor mobility is particularly accute among the FMTs. Also there is a need for a major revision in the mode of operation of FM4Ts. Apart from a need for greater supervision and more regular and practically oriented training, greater use needs to be made of contact farmers, rather than the present system of individual contact with those farmers still actively participating in the Masagana programs. There have, however, been pilot schemes to try out the more regular training and visit (T&V) system which uses contact farmers and which has been used quite successfully in other Bank projects (see Bank Publication on the T&V system of May 1977). A slight modification of this sytem would be adopted under the proposed project. (b) Home Management Technicians (HMTs). The majority of these are women, and number about 1,200 in total. Whereas the role of the HMTs was previously oriented around teaching food preparation, sewing and home budgeting, their activities are becoming more directed to the implementation of nutrition programs. With the inception of the Malnutrition Prevention Project (MPP) in 1976, jointly developed by the extension service (BAEx) and the Nutrition Center of the Philippines, increasing numbers of HMTs are being given well-defined work programs and highly specific objectives in  - 11 - the field of nutrition, home garden food production, family planning and child development. The main objective of these HMTs involved in the nutrition program is the early prevention of mal- nutrition through close interaction with mothers during pregnancy and in the first year of child life. The early results of the program are already very good (see Annex 6). However, coverage is still very limited. Each HMT serves roughly one municipality (c. 30,000 people), which may comprise up to 30 barangays (villages). Usually the HMTs are able to concentrate on only 3 to 5 villages in their area due to time constraints. Their coverage could be greatly enhanced through better mobility, much less emphasis on report writing and through the availability of teaching/extension equipment and materials (leaflets, etc.). This would allow more group contact and reduce the need for individual contact. An increase in EMT numbers is also needed. (c) Rural Youth Development Officers (RYDOs). These extension agents number about 500 and have as their primary job, the organization of youth into 4-H youth clubs. Food production and nutrition training activities are the focal point of 4-H club activities. There are about 5,000 4-H clubs in the Philippines with a membership of about 150,000. Recently the focus of the youth clubs has been on out of school youth who number about 7.6 million in the 10 to 24 age group. Of the 6 million out of school youth in rural areas, about 51% are idle, 41% are engaged in housekeeping and about 8% are temporarily unemployed. Plans are now underway to modify the 4-H club activities through the formation of new groups to be called "Anak Bukid" (young farmers), through which technical and financial assistance will be given for individual youths to set up and operate livestock units along sound commercial lines. A major attempt is being planned to combat rising rural unemployment through the "Anak Bukid" program. The general problems of the extension service also confront the RYDOs, i.e. inadequate mobility and lack of demonstra- tion equipment. There is also a need for the number of RYDOs to be roughly doubled. (d) Livestock Officers. Under the present extension system in the Philippines, there is no formal livestock extension service. The Bureau of Animal Industry (BAI) which is responsible for the livestock subsector, is mainly involved with research, quarantine immunization and other regulatory type functions. In the perfor- mance of these duties, however, BAI's field staff of about 1,700 (of which 250 are veterinarians) do perform some extension type work. However, generally only the medium-scale livestock producers are frequently contacted by BAI. Therefore, technicians spend relatively little time with the small backyard producers who have a few chickens or pigs, and who are estimated to comprise 80% of the farmers in the country with livestock, and who supply an estimated 60% of total consumption. Under the project, therefore, there would be two important changes regarding livestock extension. Firstly, FMTs would receive basic livestock training to enable them  - 12 - to advise farmers on simple livestock husbandry and health matters. Secondly, a livestock extension force comprising initially about 500 technicians would be established to provide a regular extension service to the small to medium scale commercial Livestock enterprises. 2.09 Coordination of Extension with Local Programs. The Philippines is divided into 73 provinces, roughly 1,500 municipalities and about 35,000 barangays (villages). There is also a plan to divide t-he country into 13 regional planning bodies. At each of the existing levels, there is a well coordinated Action Committee with representatives from aill government agencies and the private sector. At the provincial level, the governor chairs the committees, while at the municipal and barangay (village) level, the committees are chaired by the mayor and barangay captain respectively. The action committees coordinate all government and private programs in their area, and where necessary, subcommittees are formed to specifically tailor national programs to local needs. 2.10 With regard to both agriculture and nutrition, there is particularly close coordination, and it is largely due to the effectiveness of these action committees that the problems of overlapping functions aetween govern- ment agencies are not as great as the number of agencies involved would seem to indicate. Clearly there are differences in the degree of coordination between provinces, municipalities and barangays, but the system generally works well. Some provinces, however, have recruited their o9Tnv small staff of agriculturists to complement the nationally paid extension staff. While generally this does not conflict with the national extension efffort, the much higher level of salary paid to provincial agriculturalists does cause some bad feeling. Under the project steps are taken to resolve this and other staff compensation problems. 3. THE PROJECT Objectives 3.01 The Government of the Philipires has requested Banl'K assistance inI its renewed efforts: (a) to promote further production increases in the main food crops and expand livestock production; (b) to imp--cve the quality of rural life through higher incomes, better nutrition and general home management; and (c) to reduce rural unemployment by assisting out-of-school youth establish backyard livestock enterprises. The project N;.-ould be implemented over four years by the Ministry of Agriculture. It would largely involve the strengthening of the extension service -t:--ough the provision of facilities, equipment, technical staff increases and training. It would also involve changes in the organization of the Ministry of Agricul- ture and in the levels of compensation paid to field staff. Project Identification/Preparation 3.02 At the request of government, a Bank mission reviewed the extension  13 - services in the Philippines In February/March 1977, immediately following a Bank-organized, international workshop on the training and visit system of agricultural extension, which has proven particularly successful in India. The workshop WaS held in the Philippines at the International Rice Research Institute (IRRI). After subsequent discussions between government and the Bank, the Ministry of Agriculture took over preparation of the project with the help of consultants from the University of Los Banos (UPLB), and the Philippine Training Center for Rural Development (PTC-RD). The latter was established and funded under the Bank's Fourth Education Loan (1374-PH). 3.03 The project was appraised in February/March 1978. At the same time, Bank missions reviewed with government the overall rice and feedgrain situation, as well as the status of agricultural supporting services. The outcome of these studies and ongoing discussions with government should provide a sound base on which to build an extension service geared to assisting the rural poor and expanding food and feedgrain production. Project Components 3.04 Components of the proposed project are as follows: (a) Organizational Program. Implementation of an improved organiz- ational structure for the Ministry of Agriculture which includes the establishment of a more unified extension service and close coordination between research and extension (see paras. 5.01 to 5.05). (b) Vehicles, Equipment and Buildings (i) Provision of equipment and materials for extension services including: (a) vehicles for transporting staff and materials (paras. 3.05-3.08); (b) communications equipment (para. 3.09); (c) audio-visual aids and other demonstration and training equipment and materials (para. 3.10 to 3.12) and (d) office, printing and photographic equipment and supplies (para. 3.13). (ii) Construction of about 500 rural extension centers and renovation of existing facilities for extension services (para. 3.14); (c) Extension Methodology. Introduction and implementation of sound extension methodology, with particular emphasis on close supervision, regular training of extension workers and regular visits (see para. 5.08-5.10). (d) Staffing Program and Training. Implementation of a staffing and training program to increase the number of trained extension staff,  - 14 - including the provision for additional subject matter specialist positions and for a staff of livestock extension technicians (para. 3.15 to 3.18). (e) Studies/Consultant Services. (i) 36 man-months of consultant services to conduct a review of rural technicians and extension workers salaries and incentives, for the Ministry of the Budget, ,wLih a view to more equitably compensating such staff and --- identifying overlapping extension services provided by different agencies (para. 5.16); (ii) 24 man-months of consultant services to deve'lo more effec-.ive monitoring and evaluation procedures to evaluate (a) individual performance of extension wokers and (b) effectiveness of extension services provided (para. 5.20); a--, (iii) 6 man-months of consultant services to assist the Ministry of Agriculture in upgrading the capabilities -if their Drocure- ment division and to advise on the suitabili-- of various types of equipment to be procured under the :--oect (para. 5.0G5 Detailed Features 3.05 Vehicles and Communications. One of the most serious constraints facing the Ministry of Agriculture's extension technicians. is their lack of mobility and infrequent contact or communication wit' supervisors and back-up support staff. Instructions or information from the National or Regional offices frequently take a week or more to reach technicians. It may then be a week or more before technicians can act on the advice received, due largely to their dependence on public transport. BAEx presently has only 52 vehicles in running condition for the entire Bureau, and there are no vehicles less than 10 years old. Likewise only about 23000 extension technicians have motorcycles. Even these, however, are not fully utilized because of inadequate travel allowances (see para. 5.14). 3.06 The project, therefore, would concentrate heavily c- improving the mobility of staff and on improving means of communication. Items to be provided are listed in Table 3.1 and cost estimates are gi-Ver. in Annex 1. Regional offices in particular would be supported by the provison of jeeps (4-wheel and 2-wheel drive) pick-ups and vans to enable subject matter specialists to get into the field for training and supervisory purposes, and to facilitate the supply of demonstration material (seed or fertilizer kits, leaflets, etc.) to technicians. Cars would be provided fc- -le Regional Directors and their two assistants who would be required to -ravel between the main provincial centers in their region, as well as between the various regions or national offices. In line with the reorganizatio- of the MOA along Regional lines (see para. 5.01), the National offices of BAEx and BAI would be provided with less vehicles than the Regional Off