Haiti - Fifth Education Project

Doamuntof The World Bank FOR OFFICLAL USE ONLY M1IeRFiOF2HJ!K (cH FV RMeport No. P- bbub-HA RepwtN P-5505-HA PL33blL / uXJ00:13 / / LA:31iK MEMORANDUM AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT OF SDR 9.4 MILLION TO THE THE REPUBLIC OF HAITI FOR A FIFTH EDUCATION PROJECT MAY 16, 1991 This document has a resatited dibtrilutlon and may be used by recipients only In the performance of their ffieal dties Its contents may not otherw be dicosed witbot Wird BU authoriaion  CURRENCY EQUIVALENTS Currency Unit s Gourde (G) G 1 - US$0.20 G 5 - US$1.0 The Gourde has since 1919 been pegged to the US dollar at the above rate. WEIGHTS AND ]MEASURES Metric System km - kilometer (lkm - 0.62 miles) m = meter (Im - 3.28 feet) m2 - square meter (1m2 - 10.76 ft2) FISCAL YEAR October 1 - September 30 ACADEMIC YEAR October 1 - June 1 ABBREVIATIONS AND ACRONYMS FONHEP Fondation Haitienne de 1' Enseignement Priv6 (Haitian Foundation for Private Education) IDA International Development Association INFP Institut National de Formation Professionnelle (National Institute for Vocational Training) IPN Institut P6dagogique National (National Pedagogical Institute) LSMS Living Standards Measurement Survey MENJS Ministare de 1' Education Nationale, de la Jeunesse et des Sports (Ministry of Education, Youth and Sports) NGO Non-Governmental Organization PIU Project Implementation Unit UNDP United Nations Development Program UPEF Unit6 des Projets d'Education et de Formation (Basic and Vocational Education Project Implementation Unit) USAID United States Agency for International Development  FOR OFFICIAL USE ONLY 111TH tDUC&TION PROJECT Cradit ad Pro-'cu SuMary Zorrlowrs Republic of Baiti PeZgfijlarles Ministry of Education, Youth, and Sports (MENJS), Haitian Foundation for Private Education (PONEMP), and the Ministry of Economy and Finance. Aggoue 2SDR 9.40 million (US$12.61 million equivalent) Temts: Standard IDA terms, with 40 years maturity On lendine Torm:s Not applicable Financing Plan: Government of Haiti US$ 1.90 million IDA USS12.61 million Total US$14.51 million Economic Rate of Returns Not applicable Staff Aporaisal Renortt No. 9418-hA IBRD No. 22879 This document has a restricted distribution and may be used by recipients only in the terformoi se of their official duties. Its contents may not otherwise be disclosed without World Bank tuthert'ston.  NEMORANDU MAND RECOMMENDATION OF THE PRESIDEm OF TIE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EMECUTIVE DIRECTORS ON A PROPOSED CREDIT TO THE REPUBLIC OF HAITI FOR THE FIFTH EDUCATION PROJECT 1. The following memorandum and recommendation on a proposed development credit to the Republic of Haiti for SDR 9.40 million (US$12.61 million equivalent) is submitted for approval. The proposed credit would be on standard IDA terms with 40 years' maturity and help finance the Fifth Education Project for Haiti. 2. Background. Haiti, with a population of about 6.3 million, is the poorest country in Latin America, and its economic and social development faces major challenges. The per capita GNP has decreased every year since 1980 and was US$400 in 1989. Recent political crises and civil disturbances, which resulted in the suspension of vital external aid in 1987-90, have further weakened the country's fragile economy. Social indicators reflect the depressed environment: The infant mortality rate is 116 per 1,000 live births, and about 65 percent of adult Haitians are illiterate. Between 25 and 30 percent of the labor force is unemployed. 3. Despite a comprehensive educational reform launched in 1982, basic education in Haiti faces major deficiencies due to low school enrollments, poor quality of education, and inefficient resource management. Haiti nearly doubled enrolliseits during the 1980. to one million students (evenly distributed by sender), but students enrolled in grades one to six represent only about 50 percent of the corresponding age group. The private sector has absorbed the bulk of rising demand for basic education, with an increase of its enrollment share from 40 percent in 1973 to 72 percent in 1989. However, quality remains poor across the system, especially in underfinanced private rural schools. About 80 percent of teachers in rural areas do not have the required ten years of formal education. The delivery of inservice training that could improve instructional quality has been hampered by the low level of teachers' formal educat n. Inspectors and advisors do not provide instructional supervisiou in a periodic and organized fashion. Only about 25 percent of children in rural schools have access to textbooks or to other educational materials. Although several commercially developed textbook series exist, textbook provision is sporadic and inconsistent due to high costs and lack of agreement on curricula. Not only are ;eachers unable to teach clearly defined material, they cannot monitor student progress due to a lack of achievement tests. Often instruction takes place in dilapidated buildings vithout basic furniture and equipment. Sector policies to address these problems hive been developed in the past, but their implementation could not be sustained in Haitil's bleak economic environment. A realistic needs assessment is necessary in the areas of instructional quality, educational finance, organizational structure, and school construction and maintenance in order to develop a workable sector policy and investment program for the medium term. 4. It is estimated that families finance 25 percent of the overall cost of public primary schooling. In 1987, the Government increased its public expenditure on education from 1.5 to 2.7 percent of GDP. Salaries in the  Ministry of Education, Youth, and Sport (MENJS) were brought in line with the rest of the civil service. Without improved inservice training, supervision, or instructional materials, however, the increased expenditure did not yield better accessibility or quality of public education. The salary expenditure rose to 93 percent of the MENJS budget, leaving no budgetary margin for operation, materials, or maintenance. Poor budgeting practices and personnel record-keeping in the MENJS also result in wastage. Despite the educational opportunity provided by the expansion of low-cost private-sector schools, teacher salaries at these schools (US$50 against US$175 per month in the public sector) reflect the generally low qualifications of private-school teachers. To address the quality issue of private education, the Haitian Foundation for Private Education (FONHEP) started an instructional and salary support program to private rural schools with financing from the United States Agency for International Development (USAID) in 1986. 5. Since 1976, IDA has financed four operations in the education sector. The first and second projects (Credit 618-HA, US$5 million, 1976; and Credit 770-HA, US$10 million, 1978) sought to increase access to basic and nonformal education. The third and fourth projects (Credit 1305-HA, US$9 million, 1983; and Credit 1592-HA, US$10 million, 1985) supported respectively the first and second stage of the 1982 educational reform vith curriculum changes, training, and increased access to basic education. Although the scope of some projects was reduced after the civil disturbances of 1987, objectives have been mostly met, with delays of no more than a year. Lessons learned from previous projects, mainly centering on implementation and procurement, have been taken into account in the design of the proposed project. Notwithstanding the recent political and economic instability and current financial constraints, several factors are favorable to the improvement of the quality of basic education in Haiti today: (a) Haiti has many dedicated educators with good expertise; (b) the unabated demand for education even among the poorest rural families has been associated with the development of a responsive and cost- effective private sector; (c) the recent evaluation of the 1982 reform provides well-defined and broadly accepted areas for further sectoral development; (d) a successful experience with public subsidies to private rural schools initiated under the Fourth Pro,ect has helped identify options for an improved partnership and future investment; above all (e) the Goverrment's support which had been lacking since the launching of the reform can now be harnessed for the benefit of the sector; and (f) the United Nations Development Program (UNDP) and other agencies and donors are committed to supporting the development and implementation of a realistic sector policy. 6. Rationale for IDA Involvement. A popular election was held for the first time in Haiti in December of 1990. The elected Government has the difficult task of resuming the management of public affairs, restoring essential political and social stability and minimum confidence in the public sector, arresting the financial and economic deterioration, and promoting policies that will lead towards the resumption of growth. The current IDA goal is to ensure continued sectoral dialogue with the Government, maintain the quality improvement benefits of the four previous projects and take advantage of the existing opportunities for sector modernization and integration. The proposed Fifth Education project would therefore be a transitional irolect with limited scope and duration. It would set the conditions and carry out technical preparation for future lending that would seek to strengthen and expand basic education within an integrated  public/private financing and management framework. IDA involvement would be supported by various positive developments in the sector, particularly the Government's emphasis on poverty alleviation and basic education for all, and its genuine interest for private sector participation in educational development. 7. Proiect Obiectives. The project would seek to maintain the gains made in basic education through the first four IDA projects and to prepare for future development. It would finance transitional measures to support long-term improvements in the access to, and quality and efficiency of, basic education with emphasis on the first four years of schooling, and on the rural and poorest schools. Specifically, the project would seek to: (a) prepare recommendations for sustainable soector nolicies and investment protram development which would be implemented in the future; (b) consolidate benefits of prior investments in aualitv improvement in the public and private sectors; and (c) improve the resource manatement capacity of MENJS and FOHEP. 8. Proiect Description. The project would serve both the public and private sectors and would include three components: (a) sector Policv and investment program develooment (US$0.69 including contingencies) through well targeted diagnostic studies and corresponding follow-up measures to improve primary-level curricular and instructional delivery, sector financing, institutional setup, and primary school construction and maintenance; needs assessment would be initiated through a Living Standards Measurement Survey (LSMS) under the responsibility of the Ministry of Economy and Finance, to be used in education and other social sectors; (b) primary-education qaglity imorovement (US$10.87 including contingencies) byt (i) training 42 private- sector pedagogical advisors who would render technical support at the school level and providing 42 motorcycles to these advisors; (ii) training 42 public- sector pedagogical advisors and providing travel allowances to 80 public- sector pedagogical advisors until September 19931 (iiI) providing inservice training to approximately 6,400 public and private teachers, 700 private school principals, 20 public trainers of trainers, 28 regional directors and specialists who would provide instructional support during and after the life of the project; (iv) providing textbooks and teachers' manuals in the basic subjects in grade 2-4 for a total of about 70,000 low Income students in schools with limited resources; (v) developing end-of-cycle (4th grade) achievement tests, and administering them to 500 schools in 1992 and 2500 schools starting in 1993; (vi) reconstructing or rehabilitating a total of about 48 public and private dilapidated schools with limited resourcest (vii) providing furniture, equipment, and instructional materials to the rehabilitated or reconstructed schools and to 70 other priority schoolst and (viii) continuing and expanding a technical support program including teachers' salary supplements, in private schools which agree to comply with 101BP performance criteria and to be monitored; (c) resource manasement (US$2.95 including contingencies) includings (i) technical assistance to MENJS for updating management, budgeting, and monitoring personnel systems; (ii) equipment and technical assistance for rationalizing the administrative and accounting procedures of MENJS1, FOBHP, and participating schools; and (III) partially financing the project administration for both public and private sector participants. The project would be implemented through a project implementation unit (PIU) in MtNJS as well as through 1OHEP and the Ministry of Finance. The total cost of the project is US$14.51 million equivalent. A cost breakdown and financing plan are shown in Schedule A.  Amounts and methods of procurement as well as the di6bursement schedule are shown in Schedule B. The implementation and disburemuent schedule, spanning over four years have been appraised conservatively and correspond to the timing of the proposed short transitional project. The timetable of key events of project pro'essing is summarized in Schedule C. The status of IDA operations in Haiti is shown in Schedule D. A map is attached. The Staff Appraisal report No. 9418-HA, dated May 16, is also attached. 9. Agreed actions. Durina neaotiations. it was agreed that: (a) NENJS would maintain during project implementation a PIU executive director, controller, and a procurement/disbursement specialist with qualifications and experience satisfactory to IDA; (b) FONHEP would maintain, during project implementation, its present staffing structure unless otherwise agreed with IDA, as well as a technical staff and a controller, who would be counterparts of the PIU's staff, with qualifications and experience satisfactory to IDA; (c) a Coordinating Committee would be maintained throughout the project implementation period, and its composition would remain as agreed; (d) the Government would follow the plan for executing the diagnostic studies and for submiting the resulting recommendations and program to IDA as agreed, sad the Coordinating Committee would be maintained throughout the project life; (e) HENJS would send to IDA no later than December 31, 1991, the action plan to eliminate redundancies in its payroll which will spell out the mechanism for eliminating such redundancies and for reducing the ratio of salaries/other operating expenses in a way satisfactory to the Association, by June 1992; MENJS would execute the agreed plan as scheduleds and the ratio of salaries/other operating expenses agreed to be reached in June 1992 would be held constant thereafter; (f) each year during the execution of the project, and no later than three months prior to the beginning of the next fiscal year, HENJS would submit to IDA for review and comments the public sector education budget, and conduct with IDA an annual project progress review with respect to project execution; (g) the Government would maintain the allocation for recurrent costs in MENJS's budget in real terms at no less than the FY91 level of Gourdes 3,900,000; (h) the Government and FORMHP would provide the counterpart staff members and facilities to administer an end-of-cycle test; (i) FONHEP and MENJS would agree by June 1993 on effective community-based methods to conserve and reuse IDA-financed textbooks; (j) the Government would assume the travel costs of the 80 public-sector pedagogical advisors starting in October 1993; (k) MENJS and FoNHIP would apply the agreed eligility criteria for the training pedagogical advisors, the rehabilitation and reconstruction of schools and the support to private schools; and (1) FO8E0P and the PIU would send quarterly reports to IDA about their project-related activities. A condition for Board presentation would be that the Minister of Education, Youth, and Sports would sign a Policy Letter spelling out policy objectives and a program of action to improve the education sector. Conditions of effectiveness would be that: (a) the Coordinating Committee would be established under terms and conditions satisfactory to IDAt (b) a Subsidiary Agreement satisfactory to IDA would be signed by the Government and POEEP; and (c) the Government/FONHEP would open and maintain two project accounts for the PIU and FONHEP in Gourdes with an initial deposit of US$0.23 million equivalent in each to be made by the Government. 10. Benefits. The project's main benefits would be the consolidation of the gains of the previous education projects with respect to the 1982 education roform, quality improvement, and the encouragement to the private sector to  participate in on Integrated sector development effort. The pros ct would also prepare and carry out the preliminary measO%res noeded to support future landing with far-reaching modernization and efficiency objectives. The leading role of POQEIP and the participation of IGOs which operate private schools would contribute to Improve donor coordination and to alleviate sOme aspects of poverty. A large numbor of private- and public-sector personnel vould bo trained or retrained, Including 42 educational advisors and 6,400 teachers. Also, 70,000 low-income studonts would gain access to textbooks. Female students would benefit from increased access to education. Attention to *oil erosion in schools would prevent environmental dam&g-. 11. 31gkg. The project faces major risks. They are associated with the possibility of continued financial distress, economic instability, and an uncertain sociopolitical envirorment. Political events in recent years have eroded the sector's implementation capacity: little progress has been achieved through the four education projects in the development of the institutional capacity of the MBNJS. These risks have been minimized in four ways: (a) the transitional character of the project, its small size and short time-frame would facilitate project executions (b) the participation and strengthening of the private sector would help ensure continuity and timely project execution; (c) the replacement of the existing project implementation unit staff with fewer and better-qualified employees would facilitate the management and coordination of the project; and (d) the maintenance of the Coordinating Committee would ensure that the project receives adequate support from the relevant partners in the sector and from the donor community. 12. Recommendation. I am satisfied that the proposed credit would comply with the Articles of Agreement of the Association and recommend that the Esecutive Directors approve the proposed credit. Barber B. Conable President Attacbments Washington, D.C. May 16, 1991  -6- SCHEME A Page I of I am n M- ucTIN "Am Stlmated Costs and taancims Plan Ketimated Costs$ Al k2alrenea ot-l ----US$ million----- Policy Development 0.17 0.47 0.64 Quality Improvement 6.58 3.23 9.81 Resource Managemeat 2.62 0.14 2.76 Base Costs 9.37 3.84 13.21 Physical Contingencies 0.31 0.19 0.50 Price Contingencies 0.46 0.34 0.80 Total Project Costs 10.14 4.37 IA.51 at The project is exempt from taxes and duties Local