Morocco - Education Sector Reform Project

The World Bank FOR OFICAL USE ONLY Rqt No. 12558 PERFOIANCE AUDIT REPORT MOROCCO EDUCATION SECTOR REFORM PROGRAM (LOAN 2664-OR) NOVEMBER 30, 1993 MICROGRAPHICS Report No: 12558 Type: PPAR Operations Evaluation Department 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 EXCHANGE RATES (Annual Averages) Name of Currency (abbreviation) Dirbam (DH) Year 1985 (Appraisal) US$1 = DH 10.1 1986 9.1 1987 8.4 1988 8.2 1989 8.5 1990 &2 ABBREVIATIONS ESRP Education Sector Reform Program GDP Gross Domestic Product MOE Ministry of Education OED Operations Evaluation Department PAR Performance Audit Report PCR Project Completion Report PIF Project Implementation Index File SAR Staff Appraisal Report FISCAL YEAR January 1 - December 31 FOR OFFICIAL USE ONLY THE WORLD BANK Washington, D.C. 20433 U.S.A. Office of Director-oeneral Operations Evaluation November 30, 1993 MEMOPANDUM TO THE EXECUTIVE DIRECTORS AND THE PRESIDENT SUBJECT: Performance Audit Report on MOROCCO Education Sector Reform Program (Loan 2664-MOR) Attached is the Performance Audit Report on MOROCCO - Education Sector Reform Program (T.oan 2664-MOR) prepared by the Operations Evaluation Department. The audit agrees with the Project Completion Report that program shortfalls were largest in the two key areas, primary and university education: in the first case, an insufficient understanding of the determinants of demand for education in rural areas led to sizeable under-enrollment/excess capacities. In the second case, the pressure for entrance into university had been misjudged, and the policy of strict entrance control was abandoned after only one year. Thus, education expenditure growth continued unabated. Because it failed to reach its targets in most areas, the program is rated as unsatisfactory. Its institutional impact is, however, substantial. Attachment This document has a restricted distribution and may be used by recipients only In the performance ot their o. clat duties. Its contents may not otherwise be disclosed without World Bank authorization. FOR OFFICAL USE ONLY PERFORMANCE AUDIT REPORT MOROCCO EDUCATION SECTOR REFORM PROGRAM (LOAN 2664-MOR) TABLE OF CONTENTS Pa No. PREFACE ....................................................... i BASIC DATA SIEET ................................................. iii EVALUATION SUMMARY ............................................. v L PROGRAM BACKGROUND ................................... 1 I. PROGRAM OBECTIVES AND CONTENT ........ 2 III. IMPLEMENTATION .................. 6 IV. PROGRAM OUTCOMES ...................................... 8 1. Primary Education ......................................... 8 2. Lower Secondary Education .................................. 12 3. Upper Secondary Education .................................. 13 4. Hligher Education .......................................... 13 5. Overall Resource aaims .................................... 14 V. FINDINGS, ISSUES AND LESSONS ............................. 14 1. Fmdings ................................................. 14 2. Issues and Lessons ......................................... 18 a. DivergenceofViews .................................... 18 b. Models, Projections and Information Base .................... 18 c. Size of Facilities ....................................... 20 d. Performance Indicators .................................. 20 e. Information Flows ...................................... 21 This document has a restricted distribution and may be used by ecipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. Table of Contents (Cont'd) Pae No. TABLES 4.1: Major Primary Education Parameters .......................... 9 4.2: Primary Education Intake Rates, 1985186 to 1989190, by Location and Gender ........................... 10 4.3: Primary Education Survival Rates Grades 1 to 5 by Location and Gender, 1984-85 vs. 1989-90 ..................................... 10 4.4: Repeater Rates in Primary Education by Grade, Location and Gender, 1985 and 1989 (percentages) .................... 11 5.1: Enrollments by Major Education Levels 1984/85 and 1989/90 ................................... 15 ANNEXES 1. Primary Education, Initial and Total Enrollments, 1984/85-1990/91 ...................................... 25 2. Lower and Upper Secondary Education Entrance and Total Enrollments 1984/85 - 1990/91 ........................ 27 3. Higher Education Entrants and Total Enrollments 1984/85 to 1989/90 ..................................... 29 4. Ministry of Education Recurrent Budget, by Subsector, 1984-92 .......................................... 31 PERFORMANCE AUDIT REPORT MOROCCO EDUCATION SECTOR REFORM PROGRAM (LOAN 2664-MOR) PREFACE This is a Performance Audit Report (PAR) for the Education Sector Reform Program in Morocco, for which a Loan in the amount of US$150 million equivalent 1/ was approved in March 1986. The Loan was closed on December 31, 1989, after a one-year extension of the Closing Date. The Loan was completely disbursed in March 1990. The PAR is based on a review of materials in Bank files, including the Staff Appraisal Report No. 5923-MOR of February 25, 1986, the President's Report No. P-4240-MOR of the same date, the Loan Agreement dated May 9, 1986, correspondence with the Borrower and internal communications, a consultant's report prepared upon Loan Closing, and the Government's and Bank's PCRs (the latter issued as Report No. 9568 dated May 17, 1991). This information was complemented by discussions with Bank Staff associated with the Program. An OED staff member visited Morocco in May 1992 to discuss the Program experience and outcomes with government officials and to visit a sample of schools. The reviewer would like to express his appreciation to the Borrower and Bank staff who gave generously of their time and knowledge to explain this ambitious and complex operation to him. Following standard OED procedures, copies of the draft PAR were sent to the Borrower on May 27, 1993. No comments were received. 1/ All references to the Bank's Loan amount in the ten and tables of this renort are in USS eanienent. PErFORMANCE AUDIT REPORT MOROCCO EDUCATION SECTOR REFORM PROGRAM (LOAN 2"64-MOR) BASIC DATA SHEET KEY PROJECT DATA Item Appraisal Estimate Actual Total program cost (US$ m.) 1,809.0 2,283.0 Difference (percent) +24.8 Loan amount (US$ m.) 150.0 150.0 Disbursed 150.0 150.0 Cancelled 0 0 Date physical components completed 12/31/88 12/31/89 in months since Loan Signing 32 44 Proportion of time overrun - 38 Institutional performance Satisfactory ESTIMATED AND ACTUAL CUMULATIVE DISBURSEMENTS (US$ million equivalent) Fq5Eld wf 87/1 SZ/i aw an aS* aSts 9w na Appraisal Appraisal Estimates 36.5 69.0 101.0 136.0 145.0 150.0 150.0 150.0 150.0 Actual Disbursements 0 28A 54.8 61.4 702 92.7 92.7 10.6 150.0 Actual as% of estimated 0 41.2 S43 45.1 4&4 61.8 61.8 69.0 100.0 disbursements STAFF INPUTS se of Prje cycle FY4 FY5 FYa6 Fys7 FYW F FrM0 TOrM. Preparation 26.6 33.3 59.9 Appraisal/Negotiations 17.7 42.1 59.8 SupervisIo 18.6 26.8 10.3 2.1 2.3 60.1 TOTALs 26.6 2. 607 26.8 13 OTHER PROJECT DATA Item Appraisal Estimate Actual Identification 1984 Preparation 1984-85 Appraisal Mission May 1985 Negotiations January 1986 Board Approval March 1986 Loan Effectiveness June 1986 September 9, 1986 Loan Closing December 31, 1988 December 31, 1989 Closing of Accounts June 30, 1989 March 28, 1990 -iv- MISSION DATA Montb/ No. of Staff Report Type of Mission Year Staff (Specialties) Weeks Date Rating Identification 10/83 2 (ECLO) 4 n.o.f. - Preparation 03/84 4 (ECLO,EP.TE) 5 n.o.f. - Pre-Appraisal 12/84 3 (EC,EPLO,TE) 9 n.o.f. - Appraisal 04/85 7 (EC,EPGE,AC,TE) 4 n.o.f. _/ - Subtotal 32 Supervision I 10/86 5 (TE,GELO,EP,EC) 7 11/19/86 2 I 01/87 1 (TE) 1 02/10/87 n.a. W 04/87 3 (EPTE,EC) 3 04/24/87 1 IV 07/87 2 (EP,TE) 2 07/24/87 na. V 11/87 2 (EP,TE) 3 12/11/87 1 VI 03/88 3 (EP,AC,GE) 5 04/11/88 1 VII 06/88 2 (AC,EP) 2 07/11/88 n.a. VIII 11/88 2 (EP,GE) 2 12/01/88 2 IX 04/89 2 (EP,GE) 3 05/11/89 2 X 10/89 2 (EP,GE) 3 1127/89 2 PCR 07/90 1 (EC) n.o.E - 32 a/ Issues Paper dated 06/18/85 on file. Key to abbreviations: AC: Architect EC: Economist EP: Education Planner GE: General Educator LO: Loan Officer TE: Technical Educator ALLOCATION OF LOAN PROCESS (in US$'000) Category Original Allocation Actual Expenditure (1) Civil Works 22,300.0 22,627.2 (2) Equipment, furniture and materials 4,800.0 14,935.7 (3) Fellowships 28,100.0 30,820.8 (4) Training 78,100.0 80,812.8 (5) Consultants' services 1,000.0 803.5 (including architect services) (6) Unallocated 100 Total 15g 0 1000 -v- PERFORMANCE AUDIT REPORT MOROCCO EDUCATION SECTOR REFORM PROGRAM (LOAN 2664-MOR) EVALUATION SUMMARY 1. Introduction teacher training expenditures. These invest- ments were accompanied by a- wide array of 1. The Education Sector Reform Program supporting policy measures (which were (ESRP), supported by Loan 2664 of FY86 in itemized in a policy statement by the Govern- the amount of US$150 million equivalent, was ment) in three broad areas: the seventh World Bank Group operation in Morocco's education and training sector. It * reallocation of resources away from the was part of a wider Bank strategy to support higher levels of education towards basic government efforts aiming at structural adjust- schooling; ment and balance-of-payments improvements, at reducing the fiscal deficit and at addressing 0 increases in education efficiency: reduc- poverty and income distribution issues through tion of repetition and dropout rates with increased access to basic services for disadvan- a view to accelerate student flows through taged population groups. the system; and 2. Program Objectives and content * better cost controL which was to be pursued through measures such as a 2. The Loan contributed to the financing tightening of fellowship criteria and of the first two-year phase of the ESRP which increases in teaching loads for university had three central objectives: teachers. * improving educational opportunities by 4. The Loan was to be disbursed in two widening access to basic (primary and tranches of equal size, the release of the lower secondary) schooling; second one depending on the outcome of a midterm review. * raising the internal efficiency of educa- tion; and 3. Implementation Experience * containing the growth of educational 5. Program execution suffered initial expenditures through more stringent cost delays mainly due to the difficulties of control. organizing the large and widely dispersed construction program. However, by mid-1987 3. The main components included a large a review mission concluded that sufficient construction program for basic education facil- progress had been made to justify the release ities; provision of equipment, furniture and of the second Loan tranche (which occurred in education materials; university feliowships; and September 1987). * vi - 6. At about the same tine- and not between projected and actual figures were known to the Bank until the visit of a mission smaller). in November/December 1987-a Royal Decree removed the 2 percent limit on university 9. In upper secondary education, actual intake growth (which had been one of the results came closest to expectations: not only main cost containment measures agreed upon), did enrollments not rise but actually dropped leading to a jump in admissions of almost 30 below the 1984/85 level. Rigorous intake percent. This limit had been seen by the Bank control over- compensated for more sluggish as a centerpiece of the ESRP and of the student flows than anticipated, resulting in gradual restructuring of Morocco's education stabilized output (Baccalaurat) numbers by system. Its removal led the Bank to withdraw the end of the 1980s. from the envisaged participation in Phase II of the Reform Program through a follow-up 10. This helped contain to some extent the Loan. Henceforth, the Bank reverted to a expansion of higher education, which rose policy of supporting individual subsectors nevertheless by more than half between through specific investment projects. The 1984/85-19G9/90, or at 9.4 percent annually. Rural Primary Education Project (1980) and However, a combination of efficiency and cost- the Rural Basic Education Development control measures has kept the share of higher Project (1991) continue to address the needs education expenditures in the total Ministry of of basic education development. After a one- Education budget almost constant at about 16 year extension, Loan 2664 was closed on percent over the period 1989-92, compared to December 31, 1989, three months later, the a level of 17 to 18 percent at the beginning of Loan funds were fully disbursed. the Program. 4. Results 11. The share of education expenditure in the Government's recurrent budget continues 7. In general, the Program outcomes have to cause concern. The 1985 level of 28.6 been disappointing. Primary and lower percent has always been surpassed in the years secondary education intakes increased but not since, and reached a record figure of 35.4 nearly as much as had been anticipated at percent in 1991. To sum up, the three major appraisal. Total primary enrollments actually aims of the ESRP-enhancing access and declined until 1988189, and have recovered equity at the bottom of the education system, only slowly since then. This was in part due to improving efficiency throughout the sector, accelerated student flows within the primary and controlling the growth of expenditures-- cycle, brought on by a tightening of rules remain as the major tasks for future educa- concerning grade repetition and a less tional development. stringent promotion policy. As regards rural enrollments, particularly those of girls, the available data reveal even less progress. Since 5. Sustainability new enrollments did not keep pace with expec- tations, the new classrooms were not fully used 12. The Program's modest achievements in and the student/ teacher ratio declined to a primary and lower secondary education appear low 24.2 (instead of increasing to 31.8 as assured. The Bank's two follow-up operations expected). of 1989 and 1991 should permit continuous development towards improved access and 8. In lower secondary education, similar efficiency, with a strong accent on equity enrollment shortfalls occurred, and the objectives. The considerable amount of improvements in student flows did not meet institution building in education planning expectations (although the discrepancies which has occurred under the ESRP, -vn. particularly in school-mapping, should permit particular-were clearly underestimated, and a better spatial targeting of investments. the changes aimed for in the ESRP proved to have too fragile a basis of support both in the 13. In upper secondary and higher educa- Government and society in general. The tion, continued efforts will be needed to central message for future endeavors contain enrollment growth, improve internal encompassing the whole education sector and efficiency and keep recurrent expenditures at aiming at major structural changes would be sustainable levels. Effective cost control at all moderation in the aims and speed of the education levels will be a precondition of any process of change. major advancements towards basic education for all children. 15. More specific lessons refer to the proper use and limits of projection models 6. Main Findings and Lessons such as the one underlying Loan 2664, and the choice of a manageable set of appropriate 14. The disappointing results summarized performance indicators which should not only in Section 4 above derived in part from a still include sectoral and subsectoral student stock incomplete understanding of what determines and flow parameters but also monitor the the effective demand for basic education, direct impact of investments as evidenced by particularly among rural and poor populations classroom occupancy rates, teacher use, etc. and for girls in traditional societies. The Finally, in operations with a substantial policy absence, at the start of the program, of an content and partial or complete delinking of efficient planning framework led to invest- loan funds flows and investments, a continuous ments resulting in temporarily underused facil- process of communications between Borrower ities. Finally, the difficulties in achieving a and Bank and meticulous documentation is greater degree of control over central aspects needed to maintain accountability and of higher education-access and funding in transparency. PERFORMANCE AUDIT REPORT MOROCCO EDUCATION SECTOR REFORM PROGRAM (LOAN 2664-MOR) L PROGRAM BACKGROUND 1.1 During the early 1970s, an increase in phosphate prices had enabled Morocco to embark on an ambitious public investment program which boosted annual GDP growth to 7.5 perent, well above the level of 4 percent which had been recorded during the previous decade. However, as the phosphate market weakened by the middle of the 1970s, an increased petroleum import bill affected the balance of payments, and the public investment program and a rise in military expenditures put increasing strain on the budget, resulting in a higher level of foreign borrowings. 1.2 By 1983 Morocco was facing a large external payments gap. During that year, a standby agreement with IMF was concluded which supported a stabilization program; a foreign debt rescheduling agreement followed. At the same time the Government started, with the assistance of the Bank, a major adjustment effort to bring about a shift to an outward-oriented development strategy. The first Bank-supported adjustment loans were for Industrial and Trade Policy Adjustment (1984) and Agriculture (June 1985). Other prospective areas for adjustment operations were public enterprises and education. 1.3 Following Independence in 1956, Morocco's education system had gone through a period of prolonged expansion moving from the lower to the higher levels. Besides enrollment growth, the Government pursued two other main objectives: the gradu-l replacement of foreign by Moroccan teachers, and the development of technical education and vocational training in response to the perceived manpower needs of the economy. 1.4 In the early 1980s, Morocco's education system consited of a five-year cycle of primary education (with about 2.5 million students in 1980/84), followed by a four-year lower secondary cycle (710,000 students), a three-year upper secondary cycle (325,000 students) and higher education of varying duration (100,000 students).J/ The combined primary and lower secondary schooling cycles were also referred to as basic education, with nominally compulsory attendance (which was not enforced). 1.5 Between 1966 and 1985, the Bank had supported the development of Morocco's education and training system through six projects with a total Credit/Loan amount of US$230.8 million. They covered all levels from primary to university education and also some training activities outside the Ministry of Education (MOE). 1.6 The country's rapid educational growth was, however, exacting a high price in terms of resources required. The right of all secondary school graduates to pursue higher education, the y SAR, Basic Data Sheet; Annex Table I gives different figures for the three lower levels. -2- generous fellowship policy at that level and the absence of university fees (except for modest boarding charges) meant that educational expansion at the lower levels of the system would impose an increasing financial burden on the Government. 1.7 - At the same time, low efficiency at primary and secondary levels meant that budget resources did not achieve commensurate levels of output. Repeater and dropout rates were high and consequently, promotion/graduation rates low. IU. PROGRAM OBJECTIVES AND CONTENT 2.1 The Government and the Bank had, since 1981 through a program of sector survey work and special studies and through policy discussions, aimed at developing a sectoral approach which would simultaneously address the system's weaknesses. The outcome of this work was the Governments Education Sector Reform Program (ESRP) of which Loan 2664 financed a two-year slice. 2.2 The ESRP aimed at a basic restructuring of educational priorities, as outlined in the Government's Statement of Education Sector Policy (SAR, Annex 1). Its main features were: - introducing a nine-year program of basic education with significant equity-oriented capacity expansion; - raising the internal efficiency of education; and - controlling public expenditures on education by reducing unit costs, aiming at a greater degree of cost recovery (particularly in higher education), and involving the private sector in education and training. 2.3 The ESRP comprised a large number of measures which are detailed in para. 3.08 of the SAR. Its main features can be summarized as follows: (a) Access and equity In basic education: (i) a large school building program, with a focus on disadvantaged rural areas; (ii) the introduction of a school lunch program to encourage rural attendance; and (iii) an increased assignment of female teachers to rural areas (in the hope of encouraging girls' enrollments) and some provision of housing for rural teachers.2] Z/ The Intention at appraisal was to build half of the primary classroomns in rual areas and to provide one housing unit for every new rural classuon and one canteen for every eight new rural classrooms (SAR, Annex 0, p. 2). -3- (b) Internal efficlency (i) increasing promotion rates in basic schooling through direct administrative measures, such as putting a limit on grade repetitions / and setting mandatory promotion rates; (ii) in upper secondary education, similarly to basic schooling, introduction of repetition limits and of managed progression rates; and (iii) in higher education, a ceiling on repetitions and the introduction of a credit- hour system to facilitate promotion (replacing entire semester repetition with failed course repetition). (C) Cost Control (i) reducing unit costs in school construction and reinforcing school maintenance services to prevent rapid deterioration; (ii) restructuring fellowships for studying abroad to essential specializations which were not represented in-country and introducing teacher-trainee stipends equal to university fellowships to replace the previous system of pre-service salaries; (iii) reducing the scale of boarding in universities; (iv) increasing minimum teaching loads for university staff by two hours per week; and (v) introducing, over the medium term, university registration fees and increasing existing room and boarding fees to achieve at least partial cost recovery. 2.4 The following investments were to be undertaken during the two-year Phase I of the ESRP (1986 and 1987): (a) 2,961 primary classrooms in 1986 and 2,890 in 1987, Le., a total of 5,851 (SAR, para. 4.21);4/ (b) 1,725 lower secondary classrooms in 1986 and 3,031 in 1987, i.e., a total of 4,756 (SAR, para. 4.21); (c) to expedite program implementation, reimbursement for an unspecified number of primary and secondary classrooms for contracts awarded after January 1, 1983 but for which payments were made after Loan signature (SAR, para. 4.10); gr The relevant directives had already been issued prior to the start of the program (in October 1983). 4 The relevant SAR numbers were not consistent: SAR p. 19, FN I mentioned an average yearly building program of 2,900 primary and 2,300 lower secondary classrooms, ix,, tota of 5,800 and 4600 respectively, for the Phase I period. The Performance Indicators referred to classroom requirements of 3,061 in 1986/87 and 2,870 in 1987/88, Le., a total of 5,951 for primary schools, and of 1,725 and 2,851 lower secondary classrooms, respectively, L, a total of 4,576 (SAR, Annex A, Attacbment 2, Table 3, p. 1). Finally, Annex F, Table 4 of the SAR indicates annual construction programs of 2,821(2,135) for primary and of 1,786 (2,136) for lower secondary schools for 1986 (and 1987, respectively), i., totals of 4,956 (primary) and 3,922 (secondary). -4- (d) equipment, furniture and educational materials; (e) university fellowships in Morocco and abroad; (t) teacher training expenditures (salaries, benefits, stipends, educational materials); and (g) other recurrent program costs (mainly salaries). 2.5 The proposed Bank Loan was to contribute to the financing of these components except for university fellowships in Morocco and for other program costs. Its contribution to the entire Phase I cost was slightly over 8 percent, and to its estimated foreign exchange costs, 60 percent.5 2.6 The choice of lending instrument remained open until after appraisal.6/ The original intention of the Government and the Bank was to support the ESRP through an adjustment opera- tion was abandoned when it was realized "that use of Bank funds to finance imports destined for the education sector would result in disbursement of only a small part (about US$15 million) within a two-year period. Only by disbursing against a positive list of general imports to the economy at large could the loan be fully disbursed in two years. The principal disadvantage of this approach is that it would result in disbursement of only a portion of the loan within the education sector, thus delinking disbursements from the objectives of educational reform."2 2.7 What was chosen instead was a hybrid form of sector investment which had elements of adjustment lending (Statement of Policy; tranching) but disbursed against statements of expenditure or full withdrawal documentation, depending on category of expenditure and amounts involved (SAR, para. 4.13). 2.8 In opting for such a policy-based lending operation, the Bank staff involved in the preparatory work selected a new vehicle for education lending which had already been introduced in other sectors, and which appeared to hold great promise for addressing on a broad front sectoral shortcomings while promoting further educational development. However, the choice of country for this novel undertaking must be considered unfortunate: not only was Morocco's education system beset by serious and enduring structural imbalances, but its size was such that a major financial effort was required in order to accumulate a "critical mass" of sectoral interventions. In the event, Loan 2664 became the Bank's second largest operation in education worldwide up to that date, an undertaking with high stakes as well as risks. 2.9 The presentation of program costs in the SAR (pp. 28-32) only comprised cost data by educational level and type of expenditure. No information was given, here or anywhere else in Nf In addition, an amount of US$14 million equivalent reimbursable under the Bank's Fourth and Fifth Education Projects fell into Phase I and was counted as part of the ESRP, the nature of these investments being in line with the objectives of the ESRP (SAR, para. 4.09, FN a). * Even In the final version of the SAR, several Annmmes (f I and J) still ued the designation "StructWral Adjustment Loan," and at the Board Meeting two Executive Directors considered L-2664 ecplicitly an adjustment operation. The only reference toa possible choice between lending instrumentswas In the Decision Memorandum (where one paragraph was devoted to this question-see pars. 2.8 above). y/ Decision Memorandum, August 13, 1985, pam. 6. the report, on unit capital costs and physical quantities involved8/ the requirements given in the performance indicators referred to different time slices (three academic years) than in the cost tables (two calendar years). In addition, the cost data were far too aggregated to permit a linking with the performance indicators. 2.10 This meant that the cost data given in the SAR were not reproducible, and that subsequent outcomes could not be evaluated in terms of their actual and expected unit cost. In other words, the SAR did not give any information as to how many classrooms and other facilities; sets of furniture, equipment and materials; years of foreign fellowships; or teacher-trainee years were to be financed from the relevant allocations in the Loan Agreement. With just two tables specifying the quantities of the various inputs and their unit costs added to the voluminous (ca. 150 pp.) SAR, the report would have become the self-contained reference document for implementation it should be, and would have assured accountability and transparency. Without this information (and with physical implementation data collected during supervision missions focussing on the civil works category), monitoring was limited to what information there was on student stocks and flows (which anyway could not be expected to yield much insight, given the brevity--2.5 years--of the planned implementation period). Thus, by necessity, an ex-post evaluation has to content its!f mostly with comparing the various structural data (intakes, promotion, repetition, dropout rates, etc.) with appraisal expectations. 2.11 The Loan funds were to be released in two tranches of US$75 million each, the first at effectiveness, the second upon an interim review to be carried out by December 1986 which was to establish whether reform implementation had advanced satisfactorily (SAR, para. 4.24). The criteria by which progress was to be determined were the following: - availability of 2,600 new primary classrooms at the beginning of the 1986/87 school year, i.e., in September 1986; - continuation of the supply program for educational materials; - start of a series of studies concerning new educational activities; - an increase in grade 5 promotion rates to about 54 percent on average at the end of the 1985/86 school year (up from 47 percent in 1984/85); - a reduction in average upper secondary entrance rates from about 50 percent to 45 percent; - a reduction of the growth in higher education admissions to a maximum of 2 percent (1986/87 vs. 1985/86); - progress with legislation encouraging private sector education; - a continuation of university fellowship restrictions (either a halving or complete cancellation of fellowships for repeaters); and 8/ Surprisingly, even the two Annexes (F and 0) dealing with school construction contained only two items relating to costs: the average outlays for building sites (p. 114) and several maintenance budgets for one location (p. 117), neither of which was of any relevance for determining unit costs of civil works to be financed through the Loan. -6- a maintaining of the recently increased teaching loads for university teachers (at least 20 percent over the 1984/85 academic year figures).9/ 2.12 Program progress was to be monitored with the help of a complex system of performance indicators which were to be collected annually and which were derived from a projections model including student flows, input requirements and budget parameters. There was a total of 159 indicators relating to efficiency parameters (promotion, repetition and dropout rates), enrollment parameters (new intakes, repeaters and total enrollments), school parameters (schools, classrooms, teachers, administrators), and cost parameters (unit cost). The efficiency indicators applied for each grade/study year of the four educational cycles (primary, lower secondary, upper secondary and for each of the three largest fields of higher education (literature, sciences, and law/economics). In addition, simplified enrollment indicators (new intakes and total enrollments) were to be provided for the other three fields (engineering, medicine and Islamic studies) and for total enrollments in higher education (SAR, Annex A, Attachment 2). 2.13 The Commission de la r6forme 6ducative in MOE had the general supervision over implementation. It was assisted by an MOE Reform Implementation Task Force in the areas of coordination of work within MOE, liaison with the Bank, and monitoring and reporting. The commission in turn reported to an Interministerial Steering Committee (chaired by the Minister of Economic Affairs, with the Ministers of Education, Finance, Public Works and Vocational Training, and Planning being its members). 2.14 The Loan was estimated to be disbursed in about 2 1U2 years after effectiveness which was expected for June 1, 1986. Loan Closing was planned for December 31, 1988 and the closing of accounts six months later. III. IMPLEMENTATION 3.1 The Loan became effective with a three-month delay (on September 9, 1986). From the beginning, disbursements fell behind the over-ambitious schedule: for June 1986, disbursements in the amount of US$36.5 million had been expected (based on the assumption that the Borrower would make extensive use of the possibility of retroactive financing of foreign fellowship and teacher training costs incurred after September 1, 1985, and of submitting reimbursement requests for civil work contracts paid for since June 1, 1986 but incurred prior to the start of the ESRP (para. 2.4 (c) above). However, the complexities of processing and aggregating the individual items had been vastly underestimated; in the event, six months after effectiveness (by March 9,1987), only US$33.2 million, or 91 percent of the June 1986 target, had been disbursed. 3.2 Another source of delays derived from the slow start of the construction program. The size of the annual civil works program had been based on classroom construction volumes in the recent past while ignoring that these figures referred mainly to urban construction and that civil works in remote rural areas interested few large-volume contractors. For the sake of timeliness and cost, MOE decided to switch from the masonry construction originally envisaged to prefabricated classrooms, for which annual production capacities were significantly lower and concentrated on two 9f For practical reasons, and in view of wide variations in initial workloads, actual increases were a uniform two hours per week for each category of university teacher, leading to relative increases vaying from about 14 percent (for assistants) to 25 percent (for full professors). -7- enterprises. Thus by September 1986 the year 1 construction program was under way but was not expected to be completed until spring (i.e., ready for occupancy the following school year). 3.3 Similar delays in starting the program of studies forced the Bank to postpone the mid- term review (which was to decide on the release of the second tranche) by more than half a year. The review mission took place between June 23 and July 14, 1987. By that time, 2,275 primary classrooms of the 1986 program of 2,600 had been completed.0/ The 1987 program of 1,722 prefabricated classrooms was expected to be finished by the end of the year. Since work on the studies had made sufficient progress and 3,000 primary schools had been equipped with materials, the physical investment conditions were deemed to have been met The six policy measures were also implemented: primary to lower secondary promotion rates averaged 55 percent in June 1986 (against a target of 54 percent), the average upper secondary entrance rates had been reduced to 44 (target 45) percent, the recent policy measures governing fellowships and universities teaching loads were being observed, and a law promoting private education had been passed. 3.4 As for the 1986 university admissions, the target of a 2 percent growth limit had been exceeded (2.4 percent), but the mission pointed out that in absolute terms this only amounted to 167 extra students.lj Based on these observations, the mission recommended the release of the second tranche (which took place in September 1987). 3.5 A mission to pre-appraise Phase II of the ESRP (for which the Bank had envisaged assistance) and for a simultaneous review of the new batch of performance indicators for Phase I arrived in Rabat in early November 1987. They were informed that a recent Royal Decree, in the wake of a 27 percent increase in upper secondary school (Baccalaur6at) graduates at the end of the 1986/87 school year, had lifted the 2 percent limit on university entrance expansion agreed with the Bank. This resulted in an estimated 25 percent jump in admissions,I which in effect removed a key element from the ESRP. The Bank felt that this development made further processing of a Phase II Loan impossible and reverted henceforth to its former approach of supporting specific investment projects in selected subsectors (primary and lower secondary education to start with). 3.6 Since this policy change was a key event in the implementation history of Ioan 2664, it will be dealt with in detail in the following Section. During the rest of the implementation period, the Bank's supervision work had mostly the character of customary investment project supervision, with an emphasis on physical progress, procurement and disbursements. At the same time, upstream work for the two successor projects (the Rural Primary Education Project of FY89 and the Rural Basic Education Development Project of FY91) claimed an increasing share of field work undertaken. 3.7 The rest of the implementation process was uneventful: after a one-year extension of the Closing Date to December 31, 1989, the last disbursement took place on March 28, 1990; no cancellations were required. I 'The figure of 2600 primay classrooms had been set in Schedule 6of the Lan Agreement as threshold fora satisfactory civil works performance. However, it should be noted that this 88 percent target achievement included 628 masonry classrooms belonging to the 198145 Investment program (para. 2.4 (c) above). Tus, Implementation of the 1986 primary classroom building program had fallen mor than one tid short of its target. fL/ Applying the 19845 baseliae unit cost given in the performance indicators, this amounted to an additional budget load of about DH 1.5 million, or some USS160,000 equivalent, a very modest increase. w The eventual growth rate was 29.8 percent. -8- 3.8 Actual Phase I Program costs were estimated at US$2,283 million, almost 25 percent above the appraisal estimate. Loan 2664 covered about 7 percent of this amount. IV. PROGRAM OUTCOMES 1J 4.1 The three broad objectives of the Reform Program were to improve educational equity by expanding primary (Grades 1-5) and lower secondary (Grades 6-9) education, with an emphasis on rural areas; to improve educational efficiency by speeding up student flows; and to contain expenditure growth, both by reducing unit costs (efficiency enhancement) and by direct control measures (cost recovery and access limitation). 1. Primary Education 4.2 The SAR expected initial intakes to increase from 405,600 14/ in 1984/85 to 549,100 in 1989)90, or from about 60 percent of the seven-year old age group to 82.6 percent, and total primary enrollments, from 2,303,000 to 2,665,000. This represented annual increases of 6.2 percent for new entrants in Grade I and of 3 percent for total primary enrollments. The Program had identified rural children and particularly rural girls as disadvantaged groups on whom to focus efforts. The SAR did not contain separate projections by location and gender; the only measure of relative progress was a projection of net enrollment ratios from 1984/85 to 1995/96. 4.3 However, actual enrollments dropped from 2,200,000 in 1984-85 to 2,085,000 in 1989/90 (Annex 1). For rural students the decrease was from 1,057,000 to 834,000 which was only partly made good by a rise in urban enrollments from 1,144,000 to 1,251,000. New Grade 1 intakes moved from 346,000 in 1983/84 to 424,000 in 1989/90 and 446,000 in 1990/91 vs. an expected growth to about 524,000 and 550,000 (Annex 1). Rural populations suffered disproportionately: their Grade 1 intakes dropped by 11 percent from 1987 to 1988, whereas urban intakes rose by 2 percent. Similarly, rural dropouts in 1988/89 averaged 28 percent for grades 1 to 5, whereas urban dropouts were a mere 1 percent. 4.4 A disaggregated analysis for rural and urban girls and boys based on data for the period 1988-90 suggests the following access, survival (from grade 1 to grade 5) and Grade 5 enrollment rates:.L ly This chapter draws on a penetrating analysis of the Program outcomes undertaken for the Bank by a consultant (Led6oppem du *t6w uca f meain 1985-1990 ea la rAzUadn des objectifs du pe "actserie 2664-MOR 1990). Unfortunately, the idings of that report appear to have been ignored in the preparation of the PCR (Report No. 9568, 1991), and the consultant's report could not be found In the files for Loan 2664. J/ The projected and actual enrollment figures by Grade are given in Ante 1. 5I Le ddoppean.. p. 5. These are gross access and enrollment rates relating total intakeseorolmments to the estimated 71yar old cohorts. The survival rates have been derived from a vertical analysis of efficiency indicators In two years (198889 and 1989/90), rather than a horizontal analysis following of a cohort through the entire cycle (which the data did not permit). A somewhat cruder analysis, telating average Grade S enrollments in 1988/89and 1989/90 to average Grade I enrollments in 1984/85 and 1985/86, yields survival rates of about 55, 92 and 73 percent for rural, urban and total enrollments, respectively. -9- Table 4.1: Major Primary Education Parameters (in percent of relevant age groups) g/ Initial Intakes Survival Rates Enrollment Rates into Grade 1 to Grade 5 Grade 5 Urban Areas Girls 85.0 ca. 99 84.0 Boys 89.8 ca. 99 89.0 All 87.4 ca. 99 86.0 Rural Areas Girls 32.1 39.7 12.7 Boys 65.0 54.7 35.6 All 48.9 50.0 24.5 All Students 63.8 77.5 49.4 (SAR Projections, (81.3) (87.6) (71.2) 1988-89) 1t Grade 1: 7 years old; Grade 5: 11 years old; survival rates: in relation to intake cohort. 4.5 The table shows the presence of three distinct groups, urban students (with only minor differences between the genders) being clearly ahead, rural boys in an intermediate (though rather unfavorable) position, and rural girls lagging far behind. 4.6 However, an analysis over time shows some modest progress in access up to 1987/88 which was then annulled the following year and from which rural enrollments had not recovered by 1989/90:6 IS Le ddloppaenst.., p.8. - 10- Table 4.2: Primary Education Intake Rates, of 1985/86 to 1989/90, by Location and Gender 1985/86 1986/87 1987/88 1988189 1989/90 Urban Girls 79.3 84.0 85.3 83.9 85.6 Urban Boys 83.7 88.6 89.5 90.0 89.8 Rural Girls 31.9 32.7 34.1 29.9 32.4 Rural Boys 65.2 67.8 69.2 61.0. 64.8 All Students 61.3 64.2 65.6 61.7 64.1 (SAR Projections) (64.3) (70.3) (78.0) (81.3) (82.6) At In percent of 7-year age group. 4.7 Similarly, survival rates through the primary cycle and dropout rates showed some improvements over the period of the ESRP:17/ Table 4.3: Primary Education Survival Rates W Grades 1 to 5 by Location and Gender, 1984-85 vs. 1989-90 Average 1984-85 Average 1989-90 Urban Girls 87.9 ca. 99 Urban Boys 89.2 ca. 99 Rural Girls 51.7 39.7 Rural Boys 63.7 54.7 All Students 72.3 77.5 (SAR Projections, (72-3) (88.5) 1984-85 and 1989-90) J/ in percent of 7-11 years age group. 17/ It is possible that the rural situation is not quite as somber as depicted in these figures. Dropouts may reenter primary schooling at a later date. In addition, the possibility of sonme rural-urban migration (which would narrow the gap between the two groups) has to be considered. However, the available data do not permit a more detailed analysis. - 11 - 4.8 However, these advances are uneven, with urban students moving close to a situation where dropouts up to Grade 5 were negligible and rural students losing ground. The gains of the entire system, though, were still well behind appraisal expectations.1/ 4.9 Grade-specific dropout rates from Grade 1 to 5 improved slightly over the period 1985 to 1989, from a cumulative 26.7 percent to 22.5 percent. Again a deterioration in the situation of rural students (from 483 percent to 60.3 percent for girls and from 363 percent to 45.3 percent for boys) was more than compensated for by improvements in urban areas, where dropouts almost disappeared. 4.10 Repeater rates were the only performance indicators in primary education showing consistent improvements, as indicated by Table 4.4.19/ Table 4.4: Repeater Rates in Primary Education by Grade, Location and Gender, 1985 and 1989 (percentages) Grade 1 Grade 2 Grade 3 Grade 4 Grade 5 1985 1989 1985 1989 1985 1989 1985 1989 1985 1989 Urban Girls 17.0 15.1 16.2 13.2 17.6 14.2 15.6 12.1 28.5 11.4 Urban Boys 17.6 16.5 19.0 16.5 21.2 18.5 19.5 16.9 30.3 14.7 Rural Girls 17.4 14.0 14.6 11.3 15.5 10.6 14.0 &4 29.6 10.5 Rural Boys 18.5 15.7 17.9 13.5 19.1 13.9 17.7 12.9 30.8 13.6 All Students 17.8 15.6 17.3 14.0 18.8 15.1 17.3 13.5 21.1 12.3 (SAR Projections, (193) (10.0) (18.3) (10.0) (19.0) (10.0) (16.2) (12.0) (27.8) (10.0) 1984-85 and 1989/90) 4.11 It is not known to what extent the improvements in repeater rates mean improved learning or are rather the result of a stricter enforcement of existing directives about grade repetition limits and more lenient promotion practices (which would not necessarily reflect changes in the quality of education given). 4.12 To sum up, during the ESRP, some improvements in primary education performance did take place but they lagged well behind the appraisal expectations (see Annex 2). The setback in 1988/89 (from which only repeater rates were excepted) is now slowly being overcome. As for Igf Le ddoppemot., p. 9. The rates are derived form vertical (Le., across-grade) averges for twe adjoining years, rather than a folow-up of an entrance cohort through the Grades, which the available data did not pertn. 19/ Le dVedoppMaent.., p. 10. -12- specific groups, rural students, and particularly girls, are still at a great disadvantage, the efforts of the Program notwithstanding. However, as mentioned before (FN 17), rural-urban migration may have exaggerated the extent of the discrepancies between the performances of the two groups. 4.13 Teacher training exceeded the projections in the SAR: total stocks increased from 76,800 in 1984/85 to 80,905 in 1987/88 and 83,616 in 1989/90 (vs. a projected slight increase in teacher numbers-76,800 and 78,611).2Q/ The student/teacher ratios declined from 28.7 to 24.2 instead of increasing to 31.8. Thus, paradoxically, the Loan, through its support for training teachers in excess of immediate needs, contributed to a lowering of cost efficiency. Recurrent expenditure per student was about DH 1,040 for 1987/88. This compares to (actual) 1984/85 unit cost of DH 959, and a projected 1987/88 figures of DH 780.21/ 2. Lower Secondary Education 4.14 At this level, data limitations make an urban-rural breakdown impossible. Because of the dearth of lower secondary schools in rural areas, substantial numbers of rural students move to urban areas to attend secondary schools. Reliable figures do not exist for the entire period 1984/85-1989/90, but for the three school years 1987/88 to 1989/90, Grade 6 urban school intakes from rural areas were estimated at 49,000, 45,000 and 60,000 students, respectively, with rural school Grade 6 intakes of 21,845 in 1988/89 and of 23,213 in 1989/90 (which meant gross primary-secondary transition rates of 39.7 percent and 61.8 percent, respectively, for rural students). 4.15 Lower secondary enrollments increased from about 730,000 in 1984/85 to over 1,040,000 in 1989/90, Le., at an annual rate of 7.4 percent (Annex 2). This compares to an SAR projection of 10.5 percent growth per year, yielding a 1989/90 enrollment estimate of 1.2 million. During this period the apparent transition rates from Grade 5 to Grade 6 changed from about 50 percent to 75 percent Enrollments of girls expanded at a slightly lower rate than those of boys (5.1 percent vs. 5.4 percent per year). Of particular interest was the fact that the apparent transition rates from primary to lower secondary education were somewhat higher for girls than for boys throughout the period. This difference has also been observed in other countries; it can be explained by the fact that due to lower primary entrance enrollments, girls (particularly from rural backgrounds) who do enter and stay in primary education are likely to come from more supportive families, and may be more industrious and gifted than their less strictly selected male co-students. 4.16 Student flows over the review period improved considerably: a vertical analysis of 1989/90 data suggested an improvement in survival rates between Grades 6 and 9 from 78.5 percent (1985) to 86.4 percent, just below the SAR target of 88.4 percent for 1989/90. 4.17 As for repetitions, there was little change in the average rates over the period (from 10.4 percent to 10.9 percent, compared to a target rate of 9.7 percent for 1989/90). However, for the last grade (9), the situation deteriorated markedly, with the rate increasing from about 33 percent to 44 percent2l This development has to be seen as the result of greater selection pressure for upper secondary education. This tightening of the lower-upper secondary transition may also be responsible for the rise in dropouts (brought about in part by repeated grade failures leading to students' exclusion from school). The SAR foresaw a similar if less pronounced development, Mf No teacher projections beyond this point were given in the SAR List of Perfomance Indicatom 231 SAR, Annex A, Attachment 2, Table 3; all figures in constant January 1986 prices. ZY Le ddvloppanemt..., p. 19. - 13 - projecting an increase in Grade 9 repetitions to 25 percent in 1989/90 and to a plateau of 40 percent from 1994/95 onwards, whereas dropouts in Grades 7 and 8 were expected to drop to 3 percent.2-/ 4.18 To recapitulate, the improvement of lower secondary education performance indicators also lagged behind appraisal projections, but to a lesser extent than at the primary level. As to student/teacher ratios, there was practically no difference between the 1984/85 and 1989/90 figures (20.5 vs. 20.7, after an intermittent rise to 21.8). Because of the aggregation of budget data for lower and upper secondary education, no unit cost could be calculated separately for this level. 3. Upper Secondary Education 4.19 It was at the upper secondary level where program implementation remained closest to the expectations expressed in the SAR. Grade 10-12 enrollments were projected to rise from just under 300,000 in 1984/85 to 320,000 in 1989/90, but actually dropped to 295,000 (Annex 2). Enrollment expansion at this level was thus effectively controlled; apparent transition rates from lower to upper secondary education fell from 52 percent in 1985 to about 39 percent in 1989, compared to 50 percent and 40 percent, respectively, in the SAR projections. However, since repetition rates in 1988/89 were higher than projected (27.6 percent vs. 23.5) and dropouts much lower (20.4 percent vs 36.8 percent), the number of graduates from this level (with assured access to higher education) stabilized only towards the end of this period. 4.20 With enrollments stagnating and a simultaneous increase in teacher numbers (from about 17,300 in 1984/85 to almost 19,000 in 1987/88 and 22,100 in 1989/90), the student-teacher ratio dropped from an already low level of 17.3 to 16.2 to 13.3. The SAR by contrast had expected a stagnation of teacher numbers at about 17,300 and a small improvement in the ratio (to 17.6). 4.21 Expenditure per pupil for the entire secondary level was about DH 2,200 in 1987/88, compared to an actual figure of DH 2,400 in 1984/85 and an expected value of DH 1,900 for 1987/88 (all in constant January 1986 prices). 4. Higher Education 4.22 The SAR projected that with intake growth limited to 2 percent per year, first year enrollments would rise from about 40,400 students in 1984/85 to 44,600 in 1989/90, and total student numbers from 119,000 to 168,000, or by 7.1 percent a year. 4.23 With the removal of the 2 percent ceiling in 1987, initial enrollments expanded by nearly 30 percent from about 43,000 in 1986/87 to almost 56,000 the following year; however, since then, due to a tight control of upper secondary enrollments and graduate numbers, university enrollment growth has slowed down and new intakes actually declined (from about 56,000 in 1987/88 to 52,600 in 1989/90) (Annex 3). Since the numbers of "candidats libres" (Baccalaureates who qualified outside the school system) dropped from almost 10,000 in 1987 to 1,300 in 1987/90, the simultaneous rise in upper secondary graduate numbers has been neutralized. If intakes were to stay in the 50,000 to 55,000 range for several more years, total enrollments, which had reached almost 2Y Grade 6was epected to showa similar pattern of increasing repetition and dropout rates from 1990/91 onwards, sinceat that point the edsting system of 5+3+3 years of education was to change to a 6+3+3 years system which made Grade 6 the last year of primary education and the transition point to lower secondary schooling with its attendant student losses. - 14- 200,000 in 1989/90, would level out.2a/ Furthermore, the increase in weekly teaching loads, the halving of foreign fellowship numbers (from about 19,500 in 1984/85 to 10,000 in 1989190) and the freezing of the nominal amounts of in-country fellowships have meant a cushioning of the budgetary impact of higher education expansion. The subsectors share in the total MOE budget has been steady at about 16 percent over the four years 1989-92, and the 1989/90 per-student cost of about DH 7,900 (or less than US$1,000 equivalent) was moderate by comparison both with historical figures and with other countries. S Overall Resource Claims 4.24 One of the main concerns expressed in the SAR was the high share of budget resources allotted to the education sector; in 1985, 28.6 percent of the total recurrent budget had gone to education. It was hoped that by improving the system's internal efficiency and by slowing down enrollment growth at the higher levels, recurrent budget growth could be contained while at the same time freeing funds to improve access to the lower levels. The SAR authors estimated that with the Reform the recurrent education budget would grow from DH 6,689 million in 1984/85 to DH 6,922 million in 1989190, but to DH 8,229 million without the Reform (all figures in constant January 1986 prices).25 The actual constant 1986 price figure for 1989 came to DH 8,079 million, almost identical with the without-Reform scenario. For 1990, the (deflated) recurrent budget had already passed the without-scenario projections by DH 100 million. In every year since 1985, MOE's share in the Government's recurrent budget has been exceeding the initial level of 28.6 percent (Annex 4). Thus, both in terms of enrollment restructuring and improved resource use, the hopus expressed in the SAR had not been fulfilled. V. FINDINGS, ISSUES AND LESSONS 1. Fladings 5.1 Table 5.1 presents the main outcomes of the Program in terms of enrollment changes at the four levels of education. It is immediately apparent that at the two opposite ends of the educational ladder where results were thought to matter most--in primary and higher education- undesirable discrepancies between expected and actual results were largest. A Hwewr,with Grade 12 emolaentsaccording to more recent (May 1991) MOB projections, expected to increase by almost 60,000 students, or 66 percent, between 1990/91 and 1999f2000, this seems a remote possibility. Z5 SAR, pd 17, Table 3.2. Table 5.1: Enrollments by Major Education Levels 1984/85 and 1989/90 (in '000) 1984185 1989/90 Actual Projected Actual Difference Primary Entrance 346.3 V 549.1 423.9 -23 Total 2,405.71/ 2,664.7 2,085.1 -22 Lower Secondary Entrance 189.7 341.9 245.6 -28 Total 729.7 1,261.6 1.042.2 -13 Upper Secondary Entrance 88.8 105.2 101.9 -3 Total 299-3 319.5 294.8 -8 University Entrance 40.4 44.6 52.6 18 Total 126.5 167.9 198.1 18 1/ 1983/84. 5.2 Lower education enrollment growth was also well behind expectations (and will be for some time because of its dependence on prior expansion of primary schooling), although the various student flow parameters (passing, repetition, dropout) showed modest improvements throughout the basic education cycle (Grades 1-9). 5.3 Upper secondary education development stayed closest to appraisal expectations, which is an important positive result because it contains the demand for higher education (which that subsector itself failed to bring about internally, be it through entrance exams, more severe screening over the duration of the university course, or increased cost recovery through fees). However, it remains to be seen whether this indirect form of access control to higher education can be maintained over an extended period. With the MOE expecting Grade 12 enrollments to rise to almost 150,000 students by the end of the decade, in order to prevent rapid higher education growth the screening during upper secondary education will have to be so rigorous that a separate entrance exam for higher education may become a more acceptable alternative. 5.4 As for the specific aspects of the Program listed in para. 2.3 above: (a) classroom construction: between 1984/85 and 1987/88, the total stocks of primary classrooms increased by 6,379, from 46,318 to 52,697. This compares to a performance target of 7,172 (7,898 with replacements, for which actual figures were unavailable). For lower secondary classrooms, the PCR gave a figure of 1,123, compared to a performance target of 6,869 (7,089 with replacements); Loan 2664 helped finance 3,369 primary classrooms; -16- (b) school lunch program: Loan 2664 contributed to the construction of 1,009 canteens (performance target 1,075). Due to the decentralized management of these facilities, no data were available concerning the number of beneficiaries. However, the increase in budget allocations for school meals from DH 10 million (1983) to DH 20 million (1988) 26 suggests a sizeable program expansion, interim price increases notwithstanding; (c) teacher housing. Loan 2664 helped finance 1,827 primary teacher houses in rural areas; the performance indicators foresaw 1,793.Z7/ To what extent these housing units were used by female teachers is not known, nor was the urban/rural breakdown for female teachers avail- able.? However, between 1986 and 1989 the total number of female primary teachers increased by more than 3,300, from about 25,800 to 29,100, raising their percentage from 31.3 to 34.8; (d) managed promotion rates: the SAR stated that "most students who currently repeat are, according to consistent reports of teachers and school directors, capable of performing adequately in the next class, (and that) this increase by fiat in promotion rates in the short term is not expected to erode educational quality."29/ While it is impossible to arrive at firm conclusions without application of criterion-referenced (i.e., related to specific learning targets) achievement tests, the fact that repeater and dropout rates decreased more slowly than expected, may have in part been brought about by the failure of students thus promoted to meet the learning targets in the next higher grade; (e) higher education: the effect of the ceiling on repetitions and of a credit-hour system on student flows could not be documented from the available data.30 However, the fact that between 1984/85 and 1989/90 new intakes rose by 5.4 percent annually whereas enrollments net of new intakes increased by 10.6 percent, suggests a slow-down rather than quickening in student flows through higher education; (f) reduction of unit cost in school construction: the introduction of prefabricated facilities brought a reduction in unit cost of about one third for general classrooms.)J/ Allowing for the somewhat smaller size of primary classrooms (the data available referred to secondary facilities) results in a unit cost of about DH 50,000, compared to DH 75,000 for conventional facilities, a sizeable saving; (g) school maintenance service: both from the PCR (Part I, para. 12) and from the reviewer's own observations (which were confirmed by MOE officials), it seems that the prefabricated facilities, particularly the first annual lot, have some flaws which require higher repair and maintenance. Ai the end of Phase I, the problem of insufficient funds had not abated. The two follow-up proje-ts of 1989 and 1991 are giving this aspect particular attention; 6/ SAR for Rural Primary Education Project (1989), Annem 10. 27/ lle SAR did not provide data on either the number of female teachers or their distribution. 2/ It appears from the forgoing figures that construction of canteens and housing units was well above the ratios mentioned in para. 2.03, FN 2 above. ;I SAR, para. 3.08 a (ii). However, the possibility of remedial instruction was envisaged. at The Government's PCR acluded this subsector altogether from its analysis of the ESRP aperience, an indication that higher education had been separated from the rest of the Program. IJ MOE, Codtr compards des consmucdow en dur et en pr4fabWieA Cas diwn Mdarwllon de collfge. Rabat: 1990, pp. 8 and 17-25. - 17 - (h) restructuring of foreign f Iowships: this policy has been successful; between 1984/85 and 1989/90 the number of foreign fellowships holders was cut almost by half, from 19,458 to 10,629, the total amount of foreign fellowship allocations in the budget falling from DH 170 million to DH 110.4 million; (i) reducing boarding in universities: contrary to SAR expectations, construction of boarding facilities continued, mainly to provide a minimum of lodging space in the four new campuses opened in 1989/90; on balance, the number of places increased by more than 1,600 between 1987/88 and 1989/90. The percentage of boarding students went from 12.2 percent in the first year to a peak of 15.9 percent in the second and dropped slightly to 15.7 percent in the last year; (j) progressive cost recovery through registration fees and room and boarding fee increases: there are modest fees (frais de scolarit6). Prices for room and boarding have been held low in view of the constancy of nominal fellowship amounts for almost ten years. 5.5 Finally, the development of private education has been disappointing: between 1987/88 and 1989/90, private primary enrollment increased from about 74,300 to 78,100 (and the share in total enrollments from 3.4 to 3.6 percent). In lower secondary education, private enrollments dropped from 37,000 to 13,450 (3.7 and 1.3 percent, respectively). In upper secondary education, the figures were 143,500 and 119,550 (4.1 and 3.4 percent, respectively). The reasons for this reversal must be economic: to compete with Government schools, secondary schools must be of good quality, hence expensive, and in times of economic hardship, few parents can afford the resulting fees. The Moroccan development confirms the historical experience of a number of industrialized countries 2/ and the contemporary experience of many developing nations: that it is easier to pursue educational expansion and reform, including changes in financing arrangements in times of plenty than of want. 5.6 The question of sustainability of the gains made under the program is mainly of relevance to the limited achievements in primary and lower secondary education. With some excess physical capacities and teachers available and the two successor projects (Rural Primary Education Project of FY89 and Rural Basic Education Development Project of FY91) giving further support both for expansion and improvements of the two subsectors, a continued development appears assured. Unfortunately, a large study program containing twelve different studies, which could have given valuable guidance to further development efforts in the sector, remained fragmentary and produced few tangible results, despite a total cost of US$2 million and sizeable financing (US$0.8 million) from Loan 2664 (PCR, Part I, para. 24, and Le dveloppement..., p.13). 5.7 In contrast to the inchoate planning framework for physical investments under the Education Sector Reform Program, the allocation of investments under the two successor projects seems much better defined, which is the result of substantial institution building in the field of educationai planning, particularly in school mapping. These advances have to be seen as the major outcome in institution building of the ESRP. }ff 14 Zymelman. Why Educadon Fuincing Mhods Change An Histoical Penpeadve. World Bank/Education Department. Washington, D.C.: World Bank, 1982, p. 220/1. "Extension of education to large segments of the population can only be accomplished when the Government plays a central role I financing the expansion. In generaL big expansions of education occur only during periods of economic prospeity" and ".. educational reforms are attempted during periods of economic growth." - 18 - 2. Issues and Lessons 5.8 The project experience permits a number of conclusions about the design and execution of sector-wide projects with substantial policy content. a. Divergence of Views 5.9 A review of the files and discussions with Government officials and Bank staff conveyed the impression that almost from the beginning, the Borrower and the Bank had different concepts and hopes for this operation. 5.10 The Government's interest was in a large and fast-disbursing loan to support the main thrust of the Program, expansion of basic education./ The Bank's concept had a different emphasis, trying to incorporate not only a range of specific investments but also numerous measures to contain costs at all levels of education, in order to facilitate financing the expansion of basic education. Developments were to be measured against a broad array of short-term targets. Whether the Government was fully convinced of the realism of those targets, and of the social and political feasibility of some of the measures proposed, particularly in higher education, is doubtfuL3/ While discussing the draft PCR in early 1991, the main author of the SAR pointed out that this important aspect of the Reform depended largely on the personal intervention and support of the then Minister of Education, and that with his departure from the Ministry, the chances for a continuation of this policy were much diminished. One may, however, raise reasonable doubts whether the measures proposed by the Bank for higher education had sufficient support to be maintained. One example may illustrate that: during negotiations, the Moroccan delegation opposed the inclusion in the Loan Agreement of a covenant which would have pursued a policy of progressive cost recovery through gradual fee increases on the grounds that this was not possible given the "difficult measures" that had already been taken (presumably this referred to the reduction/abolition of scholarships for students who had failed a year)..5/ This experience should have tempered any premature optimism about the short-term possibilities of reducing the budget load and curbing the expansion of the subsector. The subsequent reversal of the agreed policy of enrollment growth control may thus well be interpreted as the confirmation of a deep-seated reluctance to adopt drastic policy measures in higher education which had already been apparent at negotiations. b. Models, Projections and Information Base 5.11 The experience of Loan 2664 raises a number of conceptual as well as practical points. First the role of models underlying the projections of enrollments, student flows, necessary physical resources, budgetary implications, etc.: such models are excellent didactic devices to demonstrate the interdependency of the many variables which determine the physical and monetary dimensions of an education system, and to demonstrate to senior administrators and policy makers possible outcomes of specific actions. However, using it to establish "perfomance targets" (SAR, para. 3.04) is fraught with a large degree of uncertainty even if certain parameters (such as promotion or repetition rates, 3/ The eventual Loan amount US$150 million had come as a disappointment to the Government who had throughout'the preparation period tried to argue the case for a US$300 million operation. El In its comments on the Program experience (Part 11 of the PCR), the Government-albeit with hindsight-saw as "the Bank's main weakness ... its launching of a program that was too ambitious, overly broad in scope and hard to supervise..." (PCR, Part U, para. 13). El Procts verbal des n6gociations (January 31, 1986). - 19 - or transition rates to the next higher levels of education) can be determined through administrative flat, others, such as dropouts or initial intakes (i.e., effective demand) can not. Thus, as is usually the case with projections, the results can only be as good as the underlying assumptions (which in turn depend upon the quality and completeness of the available information). 5.12 It was not surprising, then, that enrollments and other performance indicators would show considerable discrepancies between expected and actual values from the very beginning of the Program which over time often tended to widen rather than being compensated in part by reverse developments in later years. This suggested errors in the assumptions underlying the model rather than random fluctuations around reasonably reliable projections, 5.13 Actual development of primary enrollments contradicted one basic premise of the Program, namely, that the lack of classroom space was mainly responsible for the disappointing development of primary intakes.V/ A closer look at the data presented in the SAR should have raised serious doubts about this claim: between 1981 and 1983, 9,544 new primary and 6,015 lower secondary classrooms were delivered to MOE (SAR, Table 4.6). At the--then--standard size of 40 places per classroom, this would have permitted enrollment increases by some 380,000 students in primary and by 240,000 in lower secondary between 1980/81 and 1984/85 (even without the often observed use of classrooms, particularly in urban areas, in more than one shift).37 In actual fact, enrollment growth was about 200,000 and 100,000 students, respectively (SAR, Annex Table 1). 5.14 A second, related point concerns the determinants of girls' access to primary education. The SAR identified, correctly, "rural parents' reluctance to send their daughters to school" as the main obstacle to higher female enrollment rates in rural areas (SAR, para. 2.09) but arrived at a policy conclusion which was not backed up by data: "enrollment of girls in rural primary schools is positively related to the number of female instructors" (SAR, ibid.), and that an increased assignment of female teachers to rural areas was "constrained by the lack of suitable housing" (SAR, ibid.). This argumentation ignored the irregular development of both rural and urban female primary enrollments between 1966/67 and 1983/84 (which suggests the presence of additional and possibly, more powerful factors). Secondly, it overlooked the simple fact that female teachers are more likely to be found in larger primary schools which tend to be in rural centers rather than remote villages. People in these areas are probably more supportive of girls' education. In addition, such centers constitute more compact catchment areas for schools. Insofar as parental concern for their daughters' safety focusses on their daughters' way to and from school (over which female teachers cannot watch), shorter distances would cause them less worries, hence may increase their willingness to enroll their daughters regardless of the teachers' gender. However, even if female teachers would help promote girls' enrollment, provision of adequate teacher housing may not be sufficient to attract them: several Moroccan educators with whom the OED staff discussed this issue felt that unmarried female teachers might not be acceptable in remote rural areas, and that the husbands of married female teachers might find it difficult to obtain suitable employment (unless they were fellow teachers). 5.15 While the assumed link between more female teachers and increased girls' enrollment in rural areas might have held intuitive appeal, other socio-cultural factors which would be subject St In retrospect, the main author of the SAR argued that "we (the appraisal team) never claimed or meant to imply that school availability was the sole constraint on school attendance" (Memo of February 27, 1991). However, the SAR was coming close to that position, by stating that "(t)he main reason for the low observed levels of enrollments is inadequate school capacity" (SAR, para. 2.08). M7 At the beginning of the project, the average utilization rate was 1.6 in primary and 1.2 in lower secondary schools. -20- to only gradual modification, and in addition economic considerations are bound to play a much larger role than in-school determinants. One of the two follow-up projects is espousing the latter position: the SAR for the ongoing Rural Primary Education Project of 1989 deems that "(p)articipation of school-aged children, particularly girls, is likely to improve if school-related expenses borne by the family decrease' (SAR, para. 2.06) and suggests a one-year rental of textbooks instead of a straightforward purchase. Again, this argument ignores the influence of non-economic inhibiting factors and of the possibility that among economic factors, opportunity costs may play a larger role than the relatively modest direct costs of textbooks38/ However, the organization of information campaigns in rural areas, also envisag,J under that project, may hold better long-term promises. c. Size of Facilities 5.16 A third point relates to classroom size: the building program was based on a standard classroom of 40 places. However, as the performance indicators (SAR, Annex A, Attachment 2, Table 3) show, average actual class size in primary education in 1984/85 was only 31.3 students, and average rural class sizes were certainly even lower. It is not surprising that a staff who had visited rural schools in late 1987 had found occupancy rates of one half or less..39 Field visits by the OED staff in 1992 to a number of rural schools suggested some improvements in classroom utilization, but there was not one single instance of a classroom filled to capacity. It remains to be added that the schools were in areas which were neither very remote, sparsely populated or impoverished. It is thus reasonable to conclude that the primary classroom construction program financed by the Loan has resulted in the creation of (at least temporary) excess capacities.49 5.17 The subsequent Rural Primary Education Project took this experience into account by introducing standard 25 place primary classrooms for rural areas.43 Whether this amounts to an over-correction remains to be seen. A priori, there would seem to be a case for more than one classroom size for rural areas, depending on the size of the village where the school is to be located and of the expected catchment area.4/ d. Performance Indicators 5.18 The experience with performance indicators conveys another lesson; their large number was already mentioned (para. 2.11 above). However, in view of the prominence of budgetary considerations in the program design, it is surprising that monetary performance indicators were limited to four unit recurrent cost figures (one for each education level). In addition, one distorting 38 7llis is not to argue against the provision of cheaper textbooks to rural areas; on the contrary, the proposal has sufficient merit on equity and efficiency grounds and does not need an unproven specific effect on girls' enrollments as additional justification. &I "... in most classes, there were more empty desks than children" (Memo dated February 27, 1991). Ile Loan financed a total of 3,369 primary classrooms; 1,009 canteens; 1827 staff houses; and 822 water reservoirs. At the standard size of 40 places per classroom, this would have, even without use in more than one shift, permitted an enrollment expansion by about 135,000. gQ Moroccan officials took the practical view that in the longer run, most classrooms would be fully utilized; however, this does not do away with the fact that underused inputs (which also include insufficiently used teachers) mean a misallocation of previous investments. II/ According to the SAI. However, during the review of this PAR it transpired that the change is not being implemented. The reasons for this reversal could not be ascertained. g/ Moroccan officials also criticized that the standard prefabricated classrooms built under the ESRP failed to take into account the range of climatic zones existing in Morocco, resulting frequently in unsatisfactory physical conditions. Other shortcomings of the prefabricated facilities are listed in the PCR (para. 12). -21 - factor had entered the system of indicators even before its inception: in 1984/85 the MOE had barred 6-year old children from enrollment in Grade 1, reversing that decision the following year. This resulted in a sudden decline and, one year later, a steep increase in Grade 1 intakes which was to distort subsequent promotion/repeater/dropout rates 43/ and which continues to produce a data discontinuity which will last to the middle of the 1990s (at least until the beginning of upper secondary education). 5.19 In retrospect, it would probably have sufficed to limit the numerous student enrollment and flow parameters to the entrance and exit (transition) points, i.e., Grades 1, 5-6, 9-10, 12 and 13 (initial year of university) plus cycle totals and averages. This would have reduced the number of indicators by more than half. 5.20 On the other hand, given the untested nature of some of the hypotheses underlying the investment program (e.g., the determinants of rural demand for primary education or of girls' enrollments), it would have been worthwhile to include, for a few typical socio-economic settings, occupancy rates for the new classrooms, the response of female teachers to the availability of staff housing and the sensitivity of girls' enrollments to the presence of female teachers.a 5.21 It is significant that, although some supervision reports refer to a discussion of performance indicators, the files do not contain one single complete set of (actual) indicators after the base year 1984/85. The three annual progress reports by MOE, for 1987, 1988 and 1989 presented 21 indicators each (student stock and flow figures in primary and secondary education) and the Government's PCR contained a total of about 50 parameters (mostly on student flows). The explanation lies in the fact that MOE's capability to process large amounts of data developed only during Phase I, which meant that the indicator system exceeded the possibilities then existing. 5.22 To sum up, the system of performance indicators appears to have been too detailed for easy and regular updating and analysis, but at the same time lacking in items referring to the financial aspects of the Program and to disaggregated (or localized) impacts of the various investments undertaken. e. Information Flows 5.23 Finally, communications and documentation were areas which left to be desired both in the upstream and downstream phases of the Loan. The most obvious example is the sequence of events which led to the change in higher education admissions policy in 1987. The May/June 1987 supervision mission had reviewed the previous year's admissions figures and concluded that in this area the Program was substantially proceeding as planned, which, together with other progress observed, led to the recommendation to release the second tranche of the Loan. Actual tranche release took place in September. In that month, the Government requested financing a minor equipment purchase for newly established acad6mies (decentralized administrative bodies which, among other things, are overseeing exams). In an internal memo discussing this request the hope was expressed that the acadmies would help establish a more rational university admissions policy. 4Y It is possible to correct to some etent for this irregularity by using two-year or, as the PCR does, three-year averages. Nowew, these substitute indicators are by necessity imprecise. 4f Similar data were to be recorded during Program implementation as part of MOE monitoring--see SAR, para. 4.09 (c) (i). Howver, the files do not mention any results of such monitoring efforts, or whether they took place at all. Obviously, the Bank at this point was unaware that a reversal of the previous policy of strict admission control had already occurred or was under way.45@ 5.24 The first mention in the files of this policy change is in the back-to-office report of the November/December 1987 supervision mission, and even then only the bare fact is recorded. From conversations with Bank staff working on the operation at the time it appears that there were intensive discussions as to the appropriate reaction to this unilateral decision. In the event, apart from discontinuing work on a Loan which was to support Phase II of the ESRP, no further steps were undertaken, and even disbursements on foreign university fellowships, i.e., in the subsector where the policy reversal had occurred, continued.!1 A letter from the Operations Division Chief to the Minister of Education concerning the policy change in higher education was referred to, but not contained in, the files. 5.25 One explanation for the delayed and muted reactions of the Bank during this phase of the Program and the scant documentation in the files may be the 1987 reorganization of the Bank which fell in that period.47 While there is no specific reference to that factor in the files, staff present during that period readily admit that this discontinuity on the Bank's side had a negative effect on the implementation of this and other operations. Another major consideration was the desire to keep the core of the ESRP intact. 5.26 However, incomplete documentation was a problem not only during this period but throughout the project cycle. For example, the first mission connected with this operation is only referred to indirectly but not documented. Basic materials such as the Initiating Brief or back-to- office reports for several upstream missions are lacking; similarly, there is little discussion of the internal considerations which gave this operation its specific hybrid character (Loan 2664 had been originally conceived of as an adjustment lending operation but had subsequently been given features characteristic of an investment project).4/ The complete lack of unit cost data and the scarcity of information on physical inputs in the SAR has already been noted (para. 2.8 above). 5.27 Throughout program implementation, policy discussions during supervision missions (which surely must have occupied a good portion of the mission members' time) were hardly touched upon in the relevant reports. Neither were advances in physical implementation covered very well, with the exception of civil works. At the end of the Program, the apparent loss of the consultant's evaluation report (p. 11 above, FN 9) was a major gap in documentation. 5.28 It is worth noting that the total volume of operational files for this Loan is only about one quarter of the amount of documentation usually available for an investment project. Given the gf The exact date of this decision and other background details could not be established, but given the approach of the new academic year, the most likely moment was during the month of September. It is not dear why the coverage of this important event in Moroccan newspapers was not noticed in the Bank, where national newspapers from Borrower countries are regularly read. Ef Disbursements on foreign university fellowships continued, with one payment of almost US$3 million in September of 1988 and five disbursements totalling more than US$4 million in early 1990. The long time lag for the last group suggests that they may have been add-on items rather than commitments going back to 1987. 437 In the 1992 cohort of PCRs for projects in the human resources sector, there are at least three cases where temporary shortcomings in project supervision arc seen as a consequence of the 1987 reorganization and its attendant uncertainties and disruptions. gf Even in the final version of the SAR, several Annees (H, I and J) still used the designation "Structural Adjustment Loan," and at the Board Meeting two Executive Directors considered L-2664 explicitly an adjustment operation. The only reference to a choice between lending instruments was in the Decision Memorandum (where one paragraph was devoted to this question-see para. 2.6 above). -23 - size of the Loan and its importance as an innovative form of lending in the sector, this should be grounds for concern. In operations where the documentary link between financing flows and specific physical investments is weak (as it was here) or non-existent (as in adjustment lending proper), it is all the more important to provide detailed documentation on all policy aspects as they evolve during implementation, as well as on the impact of the investments financed on the achievement of specific policy objectives. Not to do so reduces the accountability for such operations to little more than the recording of disbursements. -25- ANNEX I Primary Education, Initial and Total Enrollanents, 1984/85 - 1990/91 (in thousands, rounded) 1984185 1985/86 198687 1987/88 1988/89 1989/90 1990/91 Grade 1 Intakes Projected 406 440 475 499 524 549 576 Actual 346 V 448 403 419 401 424 446 Total Eurollments Grades 145 Projected 2,303 2,306 2,355 2,438 2,548 2,665 2,770 Actual 2,200 2,203 2,149 2,103 2052 2,085 Z117 A/ Refers to 198384; 1984/8S intake was 302 because of temporary exclusion of 6-year olds consequentdy, 1985186 intakes showed a bunching. *27- ANNEX 2 Lower and Upper Secondary Education Entrance and Total Enrollments 1984/85 - 1990/91 (In thousands, rounded) 1984/85 1985/86 1986/87 1987/88 1988/89 1989/90 1990/91 Grade 6 Intakes Projected 189.7 210.4 233.6 259.6 283.6 341.9 388.1 Actual 189.7 219.6 240.0 261.3 238.7 245.6 277.0 Total Enrollments Grades 6-9 a/ Projected 729.6 795.8 870.7 960.5 1,062.9 1,200.6 1,341.5 Actual 729.7 802.8 888.5 971.9 1,001.3 1,042.2 1,082.9 Grade 10 Intakes Projected 88.8 89.5 90.1 90.9 94.4 105.2 115.8 Actual 88.8 93.3 90.5 101.9 88.9 90.5 95.7 Total Enrollments Grades 10-12 Projected 199.7 297.9 302.6 303.1 306.4 319.5 341.7 Actual 299.3 310.2 313.7 307.7 289.4 294.8 315-3 a biog* From 1990/91 onwards, Grade 6 was included in the primary education cycle, but for reasons of comparability has been reported as part of lower secondary education in this Annex - 29- ANNEX 3 Higher Education Entrants and Total Enrollments 1984/85 to 1989/90 (in thousands) 1984/85 1985/86 1986/87 1987/88 1988/89 1989/90 Total Enrollments (all three cycles) Actual et 126.5 143.0 149.3 169.3 187.6 198.1 Enrollments (First and Second Cycles) Projected 119.2 129.9 140.4 151.4 161.0 167.9 Actual 119.4 134.6 139.3 157.3 173.4 183.0 New Entrants Projected 40.4 41.2 42.0 42.9 43.7 44.6 Actual 40.4 41.2 43.1 55.9 54.9 52.6 a/ No projections were made. -31- ANNEX 4 Ministry of Education Recurrent Budget, by Subsector, 1984-92 (in DH billion) Total Share of MOE Year Primary Secondary Higher Total MOE Govt. (In percent) 1984 2.0 2.6 0.9 5.5 18.3 30.0 1985 2.1 2.9 1.0 6.1 21.3 28.6 1986 2.3 3.1 1.2 6.5 22.1 29.6 1987 2.4 3.2 1.2 6.9 23.7 .29.1 1988 2.6 3.4 1.3 7.2 25.1 28.8 1989 3.3 4.4 1.5 9.2 28.8 31.8 1990 3.5 5.0 1.7 10.2 30.3 33.6 1991 9.0 1.7 10.8 30.4 35.4 1992 10.0 1.9 11.9 33.6 32.0 Note: Discrepancies in totals due to rounding.