Philippines - Second Vocational Training Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No: 20376-PH IMPLEMENTATION COMPLETION REPORT (23920) ON A CREDIT IN THE AMOUNT OF US$ 36.0 MILLION TO THE REPUBLIC OF THE PHILIPPINES FOR THE SECOND VOCATIONAL TRAINING PROJECT MAY I5, 2000 Human Development Sector Unit East Asia and Pacific Region 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.  ClJRRENCY EQUIVALENTS (Exchange Rate Effective August 31, 1991) Currency Unit = Philippines Peso (P) P1 = USS 0.036 US$ 1.00 = P28 FISCAL YEAR January I December 31 ABBREVIATIONS AND ACRONYMS ADB Asian Development Bank CTMD Curricula and Training Materials Development DACUM Developing a Curriculum method - DACUM DBM Department of Budget and Management DCA Development Credit Agreeement EDCOM Congressional Commission on Education GES Guidance and Employment Services LGUs Local Government Units METP Monitoring and Evaluation for Training Performance MPPC Manpower Platning and Coordination MTR Mid-Term Review NGO Non-Government Organization NMIS National Manpower Inforrnation System NMYC National Manpower and Youth Council NSCP National Skills Certification Program PMU Project Management Unit POS Peoples Organizations PSALM Policy Oriented Sector-Focused Area-Based Labor Market Driven Approach SAR Staff Appraisal Report SIC Strengthening Institutional Capacities SS Sector Studies TAC Training Assistance Contract TCS De-yeloping the rraining Cointract Scheme TDIS Training Delivery System for the Infornal Sector TDP Trainer Development Program TESDA Technical Edcuation and Skills Development Authority TVET Technical and Vocational Education and Training UEFE Upgrading of Existing Facilities and Equipment VTI Vocational Training Institute VTP II Second Vocational Training Project Vice President: Jemal-ud-din Kassum Country Manager/Director: Vinay K. Bhargava Sector Manager/Director: Alan Ruby Task Team Leader/Task Manager: Ompom Regel  FOR OMCIAL USE ONLY CONTENTS Page No. 1. Project Data 1 2. Principal Performance Ratings I 3. Assessment of Development Objective and Design, and of Quality at Entry 1 4. Achievement of Objective and Outputs 3 5. Major Factors Affecting Implementation and Outcome 7 6. Sustainability 8 7. Bank and Borrower Performance 9 8. Lessons Learned 10 9. Partner Comments 11 10. Additional Information 22 Annex 1. Key Performance Indicators/Log Frame Matrix 23 Annex 2. Project Costs and Financing 27 Annex 3. Economic Costs and Benefits 29 Annex 4. Bank Inputs 30 Annex 5. Ratings for Achievement of Objectives/Outputs of Components 32 Annex 6. Ratings of Bank and Borrower Performance 33 Annex 7. List of Supporting Documents 34 This document has a restricted distinbution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed witou World Bank authorizaon.   Project ID: P004538 Project Name: SECOND VOCATIONAL TR Team Leader: Omporn Regel TL Unit: EASHD 1CR Type: Core ICR Report Date. May 15, 2000 1. Project Data Name: SECOND VOCATIONAL TR L/C/TF Number: 23920 Country/Department: PHILIPPINES Region: East Asia and Pacific Region Sector/subsector: EV - Vocational Education & Training KEY DATES Original Revised/Actual PCD: 09/10/89 Effective: 12/11/92 Appraisal: 04/05/91 MTR: 02/03/97 Approval: 06/18/92 Closing: 12/31/97 12/31/99 Borrower/lmplementing Agency: Government of the Philippines/NMYC - National Manpower and Youth Council (92-94); TESDA - Technical Education and Skills Development Authority (95-99) Other Partners: None STAFF Current At Appraisal Vice President: Jemal-ud-din Kassum Guatum Kaji Country Manager: Vinay K. Bhargava Callisto Madavo Sector Manager: Alan Ruby Bradley 0. Babson Team Leader at ICR: Omporn Regel ICR Primary Author: William Cooper 2. Principal Performance Ratings (HS=Highly Satisfactory, S=Satisfactory, U=Unsatisfactory, HL=Highly Likely, L=Likely, UN=Unlikely, HUN=Highly Unlikely, HU=Highly Unsatisfactory, H=High, SU=Substantial, M=Modest, N=Negligible) Outcome: S Sustainability: HL Institutional Development Impact: SU Bank Performance: S Borrower Performance: S QAG (if available) ICR Quality at Entry: Project at Risk at Any Time: No 3. Assessment of Development Objective and Design, and of Quality at Entry 3.1 Original Objective: The projectfs development objectives were to: (a) strengthen institutional capacities in policy fonnulation, planning, management, research and evaluation of non-formal vocational training and employment services;- (b) improve training quality and cost recovery; (c) upgrade training facilities; and (d) develop an investment strategy and identify investment needs for technical education and vocational training. Embedded in these objectives were  social targets including gender and poverty concerns and private sector contributions to training. 3.2 Revised Objective: The objectives remained unchanged and the design was not formally modified. However, the scope of some project components was expanded (in some cases significantly) as a result of the 1994/95 transfer of responsibility for project management from the National Manpower and Youth Council (NMYC) to the newly created Technical Education and Skills Development Authority (TESDA). A major consequence of this change was an increase in the institutional development program (in particular the size and outreach of the NMIS) to support TESDA's responsibility for both formal and non-formal training. The establishment of TESDA in 1994 with a broadened mandate included the transfer of over 100 TVET programs in technical secondary schools to its jurisdiction. This, in turn required major adjustments in the focus of the project to accommodate the needs of this formal sector of TVET. Also, new initiatives evolved over time, such as entrepreneurship programs and rural sector manpower development which the project supported. These initiatives were consistent with the project's development objectives and were accommodated within the existing design as described in the Development Credit Agreement. The credit agreement was amended twice: (i) in September 1994, to establish a Special Account of US$ 2.0 million; and (ii) in July 1995, to finance the upgrading an additional training center. The Closing Date was extended twice, in 1997 and 1998, respectively. The first one-year extension was necessary because the Government reorganized the NMYC (the original implementing agency) into the more comprehensive TESDA. As a result, project implementation was delayed. The second extension was important to enable TESDA to respond to the financial crisis by supporting sustainable programs and support services aimed at providing employment creation and entrepreneurship opportunities for unemployed youth, displaced workers and women. These programs and services were consistent with the original project objectives and description but the activities carried out focused on the impact of the crisis. 3.3 Original Components: Four investment programs supported the project's main objectives, as follows: Program I - Institutional Development: (i) strengthening institutional capacity through a program of management development (SIC); (ii) establishing market-oriented capacities for manpower policy, planning and coordination (MPPC); (iii) developing and installing a national manpower information system (NMIS); and (iv) conducting sector and pre-investment studies (SS). Program 2 - Improvement of Training Quality: (i) improving the national skills certification program (NSCP); (ii) strengthening the trainer development program (TDP); (iii) supporting curricula and training materials development (CTMD); (iv) strengthening vocational guidance and employment services (GES); and (v) monitoring and evaluation of training performance (METP). Program 3 - Development of Training Capacity: (i) upgrading of existing facilities and equipment (UEFE); (ii) developing the training assistance contract program (TAC); iii) developing the training contract scheme (TCS); and (iv) expanding training delivery systems for the informal sector (TDIS). Program 4 - Studies: aiming at defining strategy and investment plan and establishment of sectoral information to rationalize and improve technical and vocational education and training system; and determining the feasibility of establishing sector specific and advanced technology training centers. Assessment of Project Objectives and Design: Development objectives supported the Government's 1991 policy on manpower development and were in line with the 1991 World Bank policy paper on Vocational and Technical Education and Training. Objectives were very broadly stated and unfortunately not expressed in terms of - 2 -  output/outcome indicators (an abbreviated set of outcome indicators was developed after the 1997 mid-term review, and an impact evaluation study was added in 1998). With respect to design, the project was too complex, too ambitious, and seriously challenged the management capacity of the implementation agency. The large number of consultants used and the wide scope of the institutional development program contributed to implementation delays and necessitated a first two-year extension of the closing date. The second one-year closing date extension was granted in 1998 to redeploy funds to enable TESDA to respond to the financial crisis by supporting sustainable programs and support services aimed at providing employment creation and entrepreneurship opportunities for unemployed youth, displaced workers and women. These programs and services were within the original project objective and description but the activities were focused on the impact of the financial crisis. 3.4 Revised Components: 3.5 Quality at Entry: Not available. 4. Achievement of Objective and Outputs 4.1 Outcome/achievement of objective: The project achieved its development objectives and is expected to maintain them after the project is closed. The justification for this assessment is based on (i) satisfactory project outputs, as summarized below; (ii) sustained Government commitment throughout project implementation; (iii) good private sector participation in technical and vocational education and training (TVET) activities; and (iv) an effective implementation agency. Based on these factors, the overall outcome of the project is rated satisfactory. 4.2 Outputs by components: Program I - Institutional Development (ID) The scope of the ID program as implemented was considerably larger than that originally designed for NMYC, and supported all TESDA operations, offices and staff. The ID program was complex and not easy to organize and manage. Initially ad-hoc, staff development programs became structured in 1995 when a comprehensive training program was adopted. The NMIS was expanded from the original design. Its successful implementation is a major accomplishment of the ID program. The outcome of the ID program is rated as fully satisfactory. fa) Strengthening Institutional Capacity (SIC): Designed to train about 300 NMYC operational staff (SAR target), the component was expanded to meet TESDA's manpower needs of about 2,000 persons at central, regional and provincial levels, as well as private sector partners. Initially slowed down by the NMYC/TESDA transition, the project eventually trained or upgraded over 10,000 TESDA staff which exceeded by far the SAR target of 300 (ref. Annex 1: Key Performance Indicators). SCI program offerings contributed significantly to satisfying TESDA's needs to upgrade the technical knowledge and skills of its personnel. A systematic monitoring and evaluation mechanism was developed and is now fully functional. The component's objective of strengthening institutional capacity has been fully met. (b) Manpower Policy, Planning and Coordination (MPPC): This component was adjusted to strengthen TESDA's capacity for manpower policy development and planning, data analysis and system coordination. At project completion, the following was achieved: (i) a manpower planning system (the Policy Oriented Sector-Focused Area-Based Labor Market Driven approach - PSALM approach) was put in place; (ii) a reliable manpower data bases for planning and investment priorities were established; (iii) approximately 900 Technical Education and Skills Development Committee members at the regional and provincial levels were trained in management, -3 -  investment programming and strategic planing; and iv) more than 2,000 TESDA staff and staff of public and private training institutions were trained, mostly through short-duration seminars. The focus of training was broad-based and included manpower-planning concepts; policy formulation; labor market analysis, cost-benefit analysis, finance and budget review; and TEVT system development and operation. Collaboration with other government agencies and the private sector was strengthened through this component. A consultancy by an ILO expert was effective in developing a workable policy planning framework. (c) National Manpower Information System (NMIS): The final NMIS design was expanded from the original limited concept of a manpower data base serving NMYC, to an integrated information system serving TESDA's requirements for the administrative management of the TEVT system and for data collection and dissemination on TEVT programs and operations. It has been installed and tested, and currently links TESDA's Manila headquarters with 15 regional offices (a decision to include provincial offices was taken only in late 1998, contributing to the second extension of the project closing date). About 90% of total TESDA personnel received IT training. The NMIS is networked with associated agencies such as the Commission on Audits and the Department of Labor. About 2,500 system users throughout the TESDA network have been trained. Data encoding is still ongoing and the system is expected to be fully on stream in early 2000. TESDA's website is fully operational. Factors that might hinder the realization of bringing the system fully on stream in early 2000 include: i) Lack of coherent support from agencies such as the National Computer Center, the Commission On Audit and the Department of Budget and Management; ii) The absence of guidelines for the implementation of the proposed TESDA reforms for middle level education and training (UTPRAS and TOQCS); and iii) inadequate support from end-users. Program 2 - Improvement of Training Quality This program has been implemented as originally designed, with only minor changes in scope or content. The overall outcome of this program is satisfactory. (a) National Skills Certification Program (NSCP).: This program has: (i) published 240 occupational trade categories; (ii) set skills standards for more than 270 occupational titles; (iii) set up and accredited 15 skills testing centers; (iv) trained over 5,000 trade testing officers in TESDA and industry, and accredited 2,500 of them; and (v) tested over 340,000 workers and certified about 200,000 of them. With respect to NSCP, achievement is impressive as shown by: improved attitude of workers and employers towards the certification program, improved capability of central/regional program implementors and industry partners to carry out skills certification program, and the development of quality and quantity skills standards. At project completion, the NSCP was fully institutionalized within TESDA and is expected to continue as a regular program activity. (b) Trainer Development Program (TDP): Designed to improve the quality of vocational instructors (trainers), the TDP has successfully: (i) conducted an inventory of vocational trainers and set up a data base; (ii) developed job standards and trainer training programs; and (iii) conducted skills upgrading training for about 14,000 trainers which absorbed most of the resources allocated for this component. Responsibility for trainer training has been fully decentralized to the regional TESDA offices and guidelines for course offerings to address regional market needs have been developed. The TDP is fully integrated within the TEVT system and is expected to be sustained as a regular TESDA activity. (c) Curriculum and Training Materials Development (CTMD): The original objective of this component was revised and limited to the production or adaptation of curricula for about 20 vocational training programs. Existing curricula and course materials for seven generic programs have been reviewed and updated; nine dualized programs (combining in-school and in-plant training) have been developed; and training regulations have been issued for five industrial sectors. The component provided for upgrading and maintenance of CTMD equipment to improve production capacity, and the adoption or development of additional curricula and training materials. In addition, CTMD staff has been trained in curriculum development (Developing a Curriculum method - DACUM). This output covers only a relatively small portion of the total requirement of curriculum and materials development and CTMD activities will need to be continued beyond the project through outsourcing the development of the courses to commercial providers. Adequate institutional capacity (facilities, equipment and staff) has been - 4 -  established and the focus has shifted to materials development and production in line with the objective of this component. (d) Guidance and Employment Services (GES). This program has been successfully implemented. Its main outputs include: (i) established 15 Placement Assistance Centers; (ii) developed and disseminated high quality guidance support materials which involved the provision of career information, career planning, employment search and guidance for successful technical and vocational careers; (iii) effectively trained about 2,400 staff of regional and provincial training centers in advocacy promotion and guidance services; (iv) assisted some 200,000 TEVT graduates with job placement, referral or further training; (v) established an awards program for TEVT graduates; (vi) established a " work ethics and values" training program to train GES facilitators in TESDA's regional and provincial centers; and (vii) published "Blue Collar Magazine" and its dissemination to TESDA's regional and provincial offices. (e) Monitoring and Evaluation of Training Performance (METP): A system-wide monitoring and evaluation instrument has been developed and linked to the NMIS. The program is designed to be institutionalized within technical-vocational education and training schools and training centers, both private and public. The METP was in its initial stage in 1999. Since then, the instrument has been revised and guidelines prepared and disseminated to TESDA's 15 regional offices for implementation. So far, only six regions have implemented and provided the Central Office with data. Follow up with the remaining regions is being carried out. Objectives of this program have been partially achieved due to: i) the limited capacity of TESDA's regional and provincial staff to conduct the METP activities as a result of TESDA's recent reorganization; ii) absence of the system for statistical analysis of data because NMIS which provides the backbone of METP is not yet fully operational; and iii) the relative complexity and comprehensiveness of the METP framework developed by consultants. Program 3 - Development of Training Capacity This program was slightly modified from its original version to make a clear distinction between programs to develop the training capacities of post-secondary vocational institutes (TAC) and those supporting enterprise-based training programs (TCS). The outcome of the training capacity-building program is satisfactory. (a) Upgrading of Existing Facilities and Equipment (UEFE): This component was implemented with only minor changes from the original plan. The physical facilities of 28 regional and provincial training centers were rehabilitated and/or extended and upgraded with workshop equipment, tools, vehicles and furniture. In addition, the national training center in Manila was upgraded and its capacity expanded. A comprehensive maintenance program for TEVT facilities has been developed and installed in the TESDA centers. The facilities upgrading program has been satisfactorily completed. (b) Training Assistance Contract Scheme (TA:C) This component was designed to assist in developing the training capacities of public and private vocational training institutions (VTI). The program focused on upgrading the skills of almost 13,000 VTI-based technical/vocational trainers, supervisors, administrators, and non-academic support staff. Generally, skills upgrading programs consisted of short-duration training sessions (1-6 weeks). Leadership in technical education was also developed through post-graduate studies in local universities for senior VTI staff. This program has been highly successful and is considered one of the better-implemented examples of capacity building in the region. However, its measurable impact on the training capacity build-up is uncertain. (c) Training Contract Scheme (TCS): The objective of this program was to strengthen the capacity of small and medium enterprises to undertake employee training on their own. The success of TCS was partly attributed to the fact that the program was recasted within the context of a more comprehensive Industry Capability Build Up Program (ICBP), which is industry-led and addresses the needs of 15 export growth sectors. Under the project, the TCS has addressed the manpower development needs identified in the ICBP, the export development plans of the Department of Trade and Industry and the technology development plans of the Department of Science and Technology. The TCS has supported enterprise-based training through staff and program development; has strengthened the dual training system (enterprise/training institution), and has trained over 20,000 industry-based trainers. The Industry Board (IB) representatives endorsed TESDA's TCS program which has had a very positive - 5-  impact on improving the productivity of workers in the various sectors. A consensus emerged that cooperative initiatives between the enterprise, labor, training providers and TESDA was imperative for the establishment of sector-specific training centers. The IB representatives emphasized that the TCS should continue to be an important "window" for enhancing the training capacity of the centers. This program is considered highly successful and is well received by industry. (d) Training Delivery System for the Informal Sector (TDIS): This component was not implemented as originally planned but was redefined to: (i) institutionalizing community-based programs; (ii) developing the capacity of the LGUs to design, deliver and monitor training programs; (iii) develop a national network of Community Training and Employment Coordinators CTECs; and (iv) define a framework through which LGUs, NGOs and GOs can share and coordinate their responsibilities in promoting grass roots employment and economic revenue generating initiatives. It focused on the need for livelihood, basic skills and entrepreneurship training of women, out-of-school youth and under-employed and unemployed adults. It was rated among the most successful TESDA programs during the 1997 Mid-Term Review. The TDIS was extended with an added focus on community-based training and (micro) enterprise development (CBTED) in response to the 1997-98 Asian crisis and Government's " pro-poor pro-market" stance. The National Training and Development Center for Women also refocused its training programs to support this thrust. CBTED is designed to encourage and support grass-roots generated proposals leading to enterprise formation with the involvement and co-operation of Local Government Units (LGUs), non-government agencies (NGOs), Peoples Organizations (POS) and business and other organizations. Specific accomplishments include over 1,200 LGUs provided with funds for equipment; outreach training courses for regional staff and about 50 NGOS, and an extensive and on-going series of training and motivational programs for more than 1,600 Community Training and Employment Coordinators (CTECs). Nineteen enterprise-creating pilot programs selected from over 150 locally generated proposals were successfully implemented by the closing date. These programs demonstrated a high initial success rate and long-term sustainability. TESDA intends this to be one of its integrated core activities. Program 4 - Studies (SS) A series of sector studies were conducted beginning with: i) the preparation of implementing rules and regulations of TESDA; ii) the preparation of background papers on the Philippines TVET system (1994); iii) transfer of responsibility for industrial skills development from the government to the private sector (1995); iv) a study on the economic feasibility of industrial branch specific training facilities and advanced training centers (1995); v) a study on the role of industry boards in TESDA (1996); vi) an integrative study (1998); vii) a TVET financing study (1998); viii) a TVET sector review (1998); (ix) a review of TESDA Act and other relevant laws (1998); x) a transparency and internal control study (1998); xi) a study on overseas employment and its impact on technical education and skills development (1999); and (xii) an evaluation of VTP 11 (1999). The studies were of high quality and the output of this component exceeds original objectives. 4.3 Net Present Value/Economic rate of return: Net Present Value was not worked out in the SAR, therefore it cannot be calculated at the completion of the project. 4.4 Financial rate of return. As in 4.3 4.5 Institutional development impact: Because of the complexity of the project, the assessment of the project's impact on TESDA is relatively difficult. The initiatives under subcomponent I (institutional development) have had the highest impact on TESDA. There is strong evidence that this subcomponent has strengthened TESDA's capacity for manpower policy formulation, as well as for the planning, coordination, delivery and monitoring of TESDA's services. In all - 6 -  the provinces surveyed, the regional and provincial training centers were actively providing a wide range of TESDA-supported services to industry. In the second subcomponent (improvement of training quality and cost recovery) however, evidence of the impact of the project is mixed. While TESDA's guidance and employment services appear to be generally well received by workers and employers, there appears to be a lack of employers' acceptance of the benefits of the TESDA-endorsed skills certification of workers, limited adoption of TESDA-developed curricula and training materials, and lack of evidence of the benefits and impact of training of trainers' programs. The impact of the training capacity development initiatives (in subcomponent 3) is positive. TESDA's capacity for the development and management of skills programs in enterprises as well as in the informal sector have been strengthened and improved as a result of the project. There is no evidence, however, that TESDA has been successful in affecting improvement in the delivery of technical education and skills development by private service providers. 5. Major Factors Affecting Implementation and Outcome 5.1 Factors outside the control of government or implementing agency: Stagnant economy: The project was negatively affected by the stagnant economy during the early years of implementation (1993-1995) which in particular constrained the Government's ability to provide counterpart funding and slow employment creation, constraining the placement record of graduates from the training centers. In addition, the Asian Financial Crisis in 1997-98 further impacted on the Government's already difficult financial position and led to across-the-board reductions in budget allocations for most departments (including TESDA) and a slowdown in most project activities. To catch up on these delays and help achieve the project's development objectives, the Bank agreed to extend the project closing date by two years. 5.2 Factors generally subject to government control: Implementation delays due to: - delays in ratification of the Credit Agreement as a result of the national election which led to a six-month delay in project effectiveness. - the reorganization transition from NMYC to TESDA (1994-95). This transition was prompted by the recommendations of the Congressional Education Commission (EDCOM) in 1994 to establish TESDA with a mandate to cover TVET programs in all three sectors: formal, nonfonnal and informal. TESDA control over the curricula and programs of technical secondary schools (and technical programs in some general secondary schools) in the formal sector has contributed to the prolonged confusion about its mission and culture during the transition period. Cash flow problems due to low level of budgetary allotments and slow release of project funds by the Department of Budget and Management (DBM). This problem was partly resolved through the establishment of the Special Account in the amount of US$2.0 million in 1994. 5.3 Factors generally subject to implementing agency control: Procurement delays. Implementation was delayed by about two years as a result of cumbersome procedures especially for consultant contracts; delays in preparing or approving specifications; and re-tendering. Limited implementation capacity. Project activities ran in parallel with other ongoing TESDA programs that strained existing staff, causing delays. - 7 -  Financial management: Accounting problems, including claims for reimbursement of tax components; unfunded liabilities; delays in audit report submissions 5.4 Costs andfinancing: Despite some delays during the start-up phase resulting from: i) rigidities in the budget process, ii) the lack of a Special Account in the original project design, and iii) slow progress on components with which NMYC was unfamiliar, namely institutional strengthening, policy studies and long-term training, the project was successfully completed. There was no cost overrun. Audit reports, including separate opinions on SOEs, were submitted throughout the implementation period. Other covenants were in full compliance. Disbursement were satisfactory, although there were disbursement lags throughout the implementation period due partly to the delays mentioned above and the relatively slow processing of large procurement packages. The total actual disbursements were XDR 24,396,450.96 or about 96 percent of the original credit amount. The amount of credit cancellation was XDR 2,003,549.04 or about 7 percent of the original credit amount. 6. Sustainability 6. 1 Rationale for sustainability rating: Prospects for sustaining the project's outcomes are likely. At the policy level, the Government remains strongly committed to the promotion and development of high-quality technical and vocational training, in full partnership with employers. Successful initiatives supported under the project, such as in-plant training, community-based programs in entrepreneurship and special programs for women are expected to be vigorously pursued under upcoming projects, with earmarked funding from Government resources. At the institutional level, TESDA and its regional offices, under strong leadership, have acquired the technical capacity to efficiently implement sector investments while assuring the quality and relevance of its programs. The NMIS, installed under the project, will be a particularly effective tool for TESDA to support the future development of the TVET sector. Notwithstanding the positive factors mentioned above, there are a number of risks that could affect the sustainability of TESDA activities in the future. These include: the possibility that TESDA would receive low levels of yearly budgetary allotments from DOF for its operations and a slow release of funds by the DBM. It must also be noted that there is a continuing need for rigorous procurement and financial management. This is likely to happen, at least in the medium term, because donors are continuing to fund projects through TESDA and these functions will remain in place. However, in the long termn, procurement and financial management issue may become a limiting factor for the sustainability of this effort. 6.2 Transition arrangement to regular operations: Most programs supported by the project are fully integrated activities within the TESDA structure and are expected to continue without any special provisions (other than budget allocations). It is expected that responsibility for operating and managing training institutions will increasingly be transferred to the regional TESDA offices, and to the private sector, with TESDA focusing on policies, development strategy and quality assurance. This is a positive move which is fully in line with the recommendations of the Education Sector Study conducted jointly by the ADB and the Bank in 1999. Furthermore, this will further strengthen the TVET system and help sustain the project's achievements. An impact evaluation study was added to the project. The results of this study were consolidated to improve existing monitoring and evaluation mechanisms and to make them a more permanent feature of the TVET system. -8 -  7. Bank and Borrower Performance Bank 7.1 Lending: Identification was based on good economic and sector work. The main elements of project design also took account of lessons learned under the first Vocational Training Project. Project development was consistent with the Government's TVET sector policies and in line with the Bank's policy paper on TVET. Preparation and appraisal teams were adequately staffed and appraisal was thorough and comprehensive. But the appraisal team over-estimated the Borrower's implementation capacity and produced a project that was too complex, too ambitious, and severely strained the capacities of the implementation agency. Design shortcomings include the absence of a special account that delayed payments to contractors (this was corrected in 1994 through a Development Credit Agreement amendment) and the lack of perfonnance indicators that made project tracking difficult (indicators were eventually added after the 1997 Mid-Terrn Review). 7.2 Supervision: Implementation progress was adequately reported and project performance realistically rated. Problems were correctly identified and promptly addressed, and covenants were strictly enforced. Staff gave significant advice and showed considerable flexibility in solving implementation problems, including a reduction in the recovery rate of the advance to the special account at the end of project implementation to lessen shortage of funds and to ensure successful completion of project activities. Supervision missions, at six-month intervals, were generally adequately staffed but in the early years of implementation did not include financial expertise. This was corrected in 1997 when the Resident Mission Manila assigned procurement and finance officers to work with supervision missions and assist the Borrower in these areas after mission departure. On balance, more frequent supervision and more attention to project finance and procurement, particularly during project start-up, would have reduced implementation delays. The only significant deviation from Bank policies concemed Credit disbursements for taxes that were erroneously included in withdrawal applications. This was corrected and the Bank has been fully reimbursed. Despite the high turnover of task managers, supervision was of consistently high quality and the good working relationship between the Bank and the Borrower was not affected, and therefore there was no adverse effect on the development outcomes of the project . The mid-term review was conducted, with excellent input from the Borrower. 7.3 Overall Bank performance: Overall, the Bank's performance is rated satisfactory Borrower 7.4 Preparation: The Borrower (NMYC) participated actively in project identification, preparation and design and made significant contribution to the soundness of its concept and scope. 7.5 Government implementation performance: Government was (and remains) strongly committed to TVET sector development, as evidenced by the adoption of its basic training policy prepared under the auspices of NEDA (1991). This commitment was reinforced by the creation (1994) of a separate agency (TESDA) responsible for all formal and non-formal technical and vocational education, and the presidential appointment of its director-general. Provision of project funds by the DBM was occasionally delayed, particularly at the end of the budget cycle. There is no evidence of direct Government intervention in operational decisions. -9-  7.6 Implementing Agency: The NMYC/TESDA transition in 1994/95 slowed implementation as adjustments were made in some project components and TESDA geared up to handle its responsibilities. In retrospect, these delays were unavoidable. There were weaknesses in procurement (inadequate bid document preparation, cumbersome procurement procedures) and financial management (treatment of taxes, reconciliation of project accounts). Audit reports prepared by the Commission on Audit (some of them qualified) confirmed these shortcomings. These weaknesses were effectively addressed during implementation. However, additional procurement, financial management and audits will continue to require attention by TESDA management beyond the life of this project. Despite some initial delays in project implementation mainly due to the time needed during the start up phase to set up the necessary systems and procedures, the management and coordination of this complex project, involving a large number of institutions and a wide range of activities, was well handled by TESDA/PMU. Procurement of equipment was achieved as scheduled, following Bank Procurement Guidelines. TESDA was timely in its submission of the seventeen progress reports during the entire period of July 1992 and October 1999, providing the necessary data base for effective Bank supervision missions. The objective of the project have been fully met and all components have been well implemented. Contribution to the ICR was fully satisfactory. Moreover, cooperation with Bank missions during the whole project cycle was commendable. Based on these positive achievements, TESDA has proven to be an effective implementation agency, with strong leadership and committed staff at all levels. Overall, performance of the implementing agency - NMYC (1992-94), TESDA ( 1995-99) - was satisfactory. 7. 7 Overall Borrower performance. Overall, the Borrower's performance is rated satisfactory. 8. Lessons Learned Key lessons learned from this project are: Assessing Project Outcomes. As with many projects of that era, this was an input-oriented operation that did not lend itself easily to the assessment of improvements in the quality and relevance of vocational training. A future operation should establish a Performance Management Framework to provide early and continuous assessment of both outcomes and impact of the project on all stakeholders. This should include evaluations to measure the effect of investments in capacity building, improved training facilities and better-trained staff, and the cost effectiveness of public sector training. Clarity of Project Implementation Procedures. It is important that project implementation norms and procedures be fully understood and accepted by local authorities at the time of project preparation, and that project management staff be fully trained at the outset to properly apply administrative and financial management procedures, including procurement and disbursement. No specific provision was made in this project to strengthen financial management and procurement functions and supervision missions did not focus, at least in the first 3 or 4 years, on capacity building in these areas. In future operations, special care should be taken during project preparation and appraisal to include measures to strengthen these functions within the project design. Project Design. The project design was complex, with fourteen separate components, and led to many unavoidable implementation delays. The design of future projects should be straightforward to ensure successful implementation. Emphasis should also be placed on careful assessment of experience and capacity of the implementing agency and capacity building measures should be fully in place at an initial stage of implementation. The Mid-Term review for this project was successfully carried out and allowed opportunity for corrective actions to be taken during the second phase of implementation. Role of the Resident Mission. The effectiveness of supervision improved when Resident Mission staff - 10-  were assigned to support project implementation, not only during supervision but more importantly as an ongoing activity. This was particularly helpful in the finance and procurement areas but could be usefully extended to the more substantive aspects of a project as, in this case, technical education and vocational training. Training Relevance. The training activities for TESDA personned funded under the project should be more focused and targeted to capability building based on career development plans. Greater effort should also be placed on the demand-driven approach in designing skills upgrading programs. Closer collaboration/linkages between TESDA and the private sector could lead to effective development of occupational skills standards and competency assessment instruments. 9. Partner Comments (a) Borrower/implementing agency: I. INTRODUCTION This Report is intended as a GOP submission to complement the Implementation Completion Report (ICR) being prepared by the World Bank in connection with the Second Vocational Training Project (IDA Credit No. 2392 PH). The main contribution of this Report lies in the greater amount of detail and attention given to the analysis of institutional factors that hampered the smooth implementation of the project. Likewise, this Report indicates the institutional learning that the various sub-component focal teams have gained in regard to the design, implementation and management of a project of this nature and scope. II. BACKGROUND OF THE PROJECT In response to the perennial problems of unemployment and underemployment in the Philippines, the government through TESDA developed and implemented the Second Vocational Training Project (VTP II) from I December 1992 to 31 December 1999 with a US$36.0 Million financial assistance from the World Bank and GOP counterpart of US $5.8 Million. Its objectives were translated into the following major components and sub-components. SUB-COMPONENTS GENERAL OBJECTIVES COST (based on SAR) (in US$M) Strengthen capabilities in policy formulation, planning and Institutional Development management of non-formal 11.4 vocational training and employment. a. Strengthening Institutional Enhancing capability of TESDA to 2.6 Capacity (SIC) manage and administer Secretariat functions b. Manpower Policy, Planning and Enhancing capability of TESDA 6.4 Coordination (MPPC) member agencies on manpower policy, planning and coordination c. National Manpower Information Enhancing capability of TESDA on 2,4 System (NMIS) the development and establishment of computer network-based information system Strengthen training support services Improvement of Training Quality and develop mechanisms towards 8.8 & Cost Recovery equitable cost sharing and training cost recovery. -I11-.  a. National Skills Certification Enhancing the 2.4 Program (NSCP) promotion/installation of a national certification program b. Curriculum and Training Enhancing capability of curriculum l.9 Materials Development (CTMD) and training materials development c. Trainers Development Program Enhancing evolvement and 3.4 (TDP) implementation of trainers development plan; establishment of Area Trainers Training Centers; and institutionalization! licensing scheme for trainers d. Guidance and Employment Enhancing vocational guidance and 1.0 Service (GES) placement system e. Monitoring and Evaluation Enhancing training center 0.1 Training Program (METP) management and operations SUB-COMPONENTS GENERAL OBJECTIVES COST (based on SAR) (in USSM) Improve facilities and programs for Training Capacity Development non-formal vocational education and 23.1 training by upgrading TESDA training centers; providing incentives for the private sector to assume greater role in skill development; improving apprenticeship program; and supporting rural skills and livelihood training program for women as well as unemployment and out-of-school youth. a. Upgrading Existing Facilities Upgrading of RMTCs and PMTCs 10.5 and Equipment (UEFE) facilities and the National Skills Training Center to produce 2nd and 3rd class levels of skilled manpower b. Training Contract Scheme (TCS) Enhancing capabilities of industries 1.2 to undertake training c. Training Assistance Contract Enhancing capabilities of VTls to 3.8 (TAC) deliver relevant voc-tech programs d. Training Delivery System for the Establishing training and delivery 4.7 Rural Informal Sector (TDIS) system in the rural areas which shall be devolved to the LGUs. d.I Community-based Training and Enhancing support for the 2.9 Enterprise Development development and implementation of (CBTED) regional micro-enterprise pilot projects thru training and related ___support services - 12 -  Define strategy and investment plans Studies and establish sectoral information 0.7 to rationalize and improve technical and vocational education and training system; and determine the feasibility of establishing sector specific and advanced technology training centers. a. Sector Studies (SS) Enhancing the conduct of sub-sector 0.7 studies/feasibility works on TVE and training programs for the establishment of advanced and sector-specific training centers Crosscutting Concerns 1.0 a. Women Economic Empowerment Enhancing empowerment of poor 0.3 (WEE) and displaced women workers thru center/region based training, counseling and services leading to employment. _ b. Project Management Unit (PMU) Enhancing the capability of the 0.7 Secretariat to better manage VTP 11 implementation It is noted that the Project was originally scheduled for completion in 1997 but was extended in 1998 and finally restructured in 1999. When VTP 11 was restructured, however, it was expanded to cover a crosscutting concern on gender sensitivity. Hence, the sub-component Women Economic Empowerment (WEE) was born together with the implementation of an off-shoot of the original TDIS, the Community-based Training and enterprise Development (CBTED). These were the central focal sub-components under the Restructured VTP II. 111. ASSESSMENT OF THE PROJECT A. OVERALL PERFORMANCE In general, VTP II implementation has been rated by the World Bank as "Satisfactory". The Bank's rating of "Satisfactory" was concurred by the NPCTs. Based on individual perspectives, NPCTs gave the project an average Project Achievement Rating of "Satisfactory" with a numerical equivalent of 3.67 (using a scale of 1-5 with 5 as Highly Satisfactory). A separate rating was likewise done by the NPCTs on Project Performance for which the average rating was "Satisfactory" with a numerical equivalent of 3.34 (using a Scale of 1-4 with 4 a Highly Likely/Highly Satisfactory). The Financial Performance of the Project was likewise rated as "Satisfactory" with the Bank, particularly its Country Mission, extending significant level of assistance, notably on the procedures of procurement and disbursement of goods and services. During the World Bank's periodic appraisal, input indicates clear cooperative efforts from the review mission members who are equipped with consistently high quality of supervision. For the Borrower, an indication of strong, active participation and contribution from the various national project component teams (NPCTs) and project support units (PSUs) was noted dovetailing the guidance, integrative and coordinative capability of the project implementing office. - 13 -  On the Project Cost Component, the percentage of appraisal is indicated at a 90.33% utilization level with the high factor attributed to the Institutional Development component. For the Project Cost by Procurement Arrangement, the level is in the vicinity of US $30.47 million incurred from major deliveries of goods and services by the last remaining years of the project. This is 27% below the appraisal estimate (or US $41.80 million). On Project Financing by Component, the loan amount and the government counterpart had utilization levels of 86.06% and 99.71% respectively. The three (3) major contributory components consisted of Institutional Development, Development of Training Capacity and Improvement of Training Quality. There is a difference of US $5.02 million or (14%) between the Bank's appraisal estimate and actual/latest estimate. It should be noted that as of this reporting date, financial reconciliation is being undertaken by TESDA and that the above figures may change. B. NPCT OUTPUT/ACCOMPLISHMENTS AND IMPACT The "Satisfactory" rating given by the various NPCTs reflects their realization that more could have been done for the Project. Also, some outputs were not in accordance with the desired outcomes/key indicators specified in the SAR. Following are the major output/accomplishments of the various NPCTs and the impact of these output. SUB-COMPONENT MAJOR OUTPUT/ACCOMPLISHMENT IMPACT (1992-1999) SIC * Trained 10,376 personnel (including Rate of attrition improved from 18%-20% overseas) to 6%; mobility rate improved from 12% * Developed DACUM/job analysis for staff to 52%; impact evidence strong positions o Developed framework of SIC Plan MPPC * Trained 6,373 TESDA employees and Strengthened capability on manpower TESD local stakeholders policy, formulation, planning and * Developed PSALM manual, ROs coordination; more responsive policies database, RIPPs and PIPPs and TESD and plans; impact evidence strong capability building * Established 165 RTESDCs/PTESDCs * Prepared training cost-outcome analysis manual NMIS * Established TESDA LAN and WAN: Could not yet provide much information CO-80%, ROs-70% and POs-36% vital to policy formulation and decision * Developed MIS (system design) - 98% making; some evidence of impact * Trained IT: 1,265 graduates (Stage 1); 20 IS coordinators (stage 2) and 175 AS (Stage 3) * Completed 1999 data encoding: mission critical 96%, admin system - 85% and RO - 20% - 14 -  NSCP * Trained 485 competency-based TESDA certificates regarded by workers developers; 280 coaches/experts; 35 as achievement in itself; however, COs/ROs staff on workers guilds; 4,906 employers do not necessarily prefer PTT officers; 471 STT officers and 969 TESDA certified workers over OSS develop. :s; 2,487 PTTOs, 15 non-certified; some evidence of impact RTESDCs/PTESDCs/ public and private VTls * Accredited 28 testing venues * Established 35 workers guilds * Published 240 occupational trades * Developed/revised 270 OSS * Tested 342 workers * Certified 195,359 workers SUB-COMPONENT MAJOR OUTPUT/ACCOMPLISHMENT IMPACT (1992-1999) CTMD * Trained 124 facilitators, trainers and R/PTESDCs are using TESDA curricula developers and 146 technical staff in their training programs; however, * Printedl000 pieces TRS and 7,000 copies for most TVET providers including TESDA 35 occupational titles; distributed 1,500 supervised schools are using copies of TRs self-designed curricula and training * Reviewed/updated 7 generic courses materials; some TVET providers ate * Developed QSS standards for Maritime using minimum TRs course sector; TRS (76 occupations) and 640 requirement; some evidence of impact learning guides (16 occupations) * Converted developed curricula/training materials into CD ROM (7 generic trades) * Dualized 25 curricula occupations * Established training resource center (TRAMCEN) * Procured various hardware equipment, softwares and books/resource materials TDP * Developed module for teachers/trainers under Most graduates/trained workers believed dual approach; trainer job standard; that trainers were very knowledgeable; guidelines for course offering based on skills number of trade test passers among priorities; and trainer program TESDA-trained workers TESDA implementation framework supervised schools/private VTls * Included TVET teachers category in the remained low; little evidence of impact Metro Bank search for best teachers * Trained and skills upgraded 13,591 trainers and administrators * Established trainer database * Completed studies on Trainer Population of the Philippine Association of Private Technical Institution (PAPTI); and on Establishment of Trainer Development Academy - 15 -  GES * Launched/conducted in 1997 the search for Most RIPTESDC s and TVET providers PRMOFWA; achieved 83% and 100% for have guidance and employment services regional and national categories respectively in place, however, average placement, * Updated/repackaged career materials job referral and OJT rate is 24.4% only; * Promoted skills thru subscription and monitoring of graduates is very minimal dissemination of Blue Collar Magazine (380,050 copies from 1993-1998); career guidance materials (18,425 copies from 1997-1998); and promoted non-traditional trades thru Oras ng Kababaihan (TV program) * Trained 3,394 participants from TVET sector; LGUs and industry sectors * Provided clients with career guidance - 490,980; placement - 96,542; job referrals - 125,291; and OJTs - 25,201 * Completed study of the guidance placement system of NMYC * Procured LCD Display Unit METP * Prepared/disseminated among 15 ROs M&E Only 6 regions furnished data on TVET system manual METP; all TVET providers, except for few TESDCs have yet to undertake METP; little evidence of impact UEFE * Procured ICB 11 and III and books/resource 14 RMTCs, 13 PMTCs and 2 NITVET materials and delivery 100% completion centers now conducting skills training * Rehabilitated/upgraded/expanded physical in high value added manufacturing and facilities of 28 RMTCs, PMTCs and 2 services; has enabled TESDA to catch NITVET centers, 100% completion up on training capacity; strong evidence * Developed national maintenance of VTs of impact facilities and equipment, TEMMS, disk and operators manual/instructions SUB-COMPONENT OUTPUT/ACCOMPLISHMENT IMPACT (1992-1999) TCS * Assisted 100 focal organizations, 7 148 firms conducting training of own industry boards and 41 industry workers and subsidizing 30% of training associations cost; regional industry boards and * Trained 20,259 trainers associations had taken over a significant part of training functions; strong evidence of impact TAC * Trained in various skills and non- skills Various skills and non-skills upgrading upgrading 12,592 tech-voc teachers; programs effected 55% of total number of effected 1.5% decrease in unemployment formal TVET teachers; training capability rate per student-graduates of TAC build-up of TVET providers could not be beneficiary teachers determined - 16-  TDIS * Printed and disseminated 3,865 copies of Created enabling environment and CTECs directory awakened entrepreneurial spirit; initiated * Procured books and resource materials LGUs and NGOs involvement in worth P572,000 community-based enterprise development * Completed CTECs impact evaluation programs; strong evidence of impact * Trained in TPPMCBT 104 regional officers, staff, 260 participants from POs, SHGs and TVET schools, 47 PESO managers, 53 NGOs and 1,611 CTECs; 17 TDIS implementors in UNDP DCTP, I NPCT member in micro-enterprise and 30 CTECs for ARMM; 30 pax attended TRUGA and 595 CTECs in enskilling CBTED * Operationalized CBTED guidelines and No impact yet PWGs (69) * Availed local consultancy services for documentation of best practices, MEFs and M&E of IEDP and SZOPAD-MNLF * Conducted enskilling courses (18 in 14 ROs) at 30 pax * Conducted 2 national conferences for CBTED regional focal persons and SCCPD-TESDA Joint Consultative * Conducted experts meetings; national consultancies on distance training, system methodologies and devolution Assisted in the form of skills training - 19 Regional and 78 provincial models, 24 SZOPAD-MNLF CBTED projects and ZONTA * Provided common service facilities/equipment for 19 regional models and 24 SZOPAD-MNLF CBTED projects WEE * Trained 100 pax in skills and Impact is yet to be determined empowerment and 1,500 pax in entrepreneurship * Completed situational ana!ysis study PMU * Completed Staff development in project Anchored VTP II completion smoothly implementation (2 courses) * Conducted superviion various phases of project implementation * Procured equipment and consultancy services for smooth project implementation PSU * Availed staff development (FISFAP), Services provided inadequate equipment and consultancy services * Monitored fund utilization C. LESSONS LEARNED One of the major lessons learned is the need for performance indicators in the Project design. VTP 11 had these indicators only in 1997. Moreover, a project logical framework, identification of outcomes and benchmarking - 17 -  would have greatly assisted project planning and implementation. The NPCTs have likewise identified invaluable lessons which they have learned in the course of project implementation. They have likewise identified possible action points for each issue/concern so that management and implementation of future projects could be improved. These are as follows: ISSUES/CONCERNS RECOMMENDATIONS 1. General/Project Management a. Absorptive capacity of National and * Mix co-location & contractuals for program implementation Regional Component Team and coordination arrangement, respectively * Manpower needs reviewed vis-a-vis regular and special project assignments b. Efficiency/effectiveness of * Co-location for program implementation co-location arrangement * Contractuals for administrative/finance support coordination * Team composition maintained c. Fast tumover of staff and * Continuity and familiarity in project management managers * Effecting appropriate work turnover plan d. Unclear roles across implementing units * Role delineations among PMU and PlUs in Executive Offices, Regional Offices e. Perceived over-centralization of authorities in * Delegation of authority ODG (1992-1998) * Responsibility coupled with authority and accountability * Approved framework at project start 2. Monitoring/Evaluation a. Lack of performance indicators * Output indicators defined at project start in 1992 b. METP not adopted * Simplified built-in M&E with clear outcomes * Motivation required for adoption * Integration between METP and NMIS 3. Financial a. VTP II perceived to be financier rather than * Proper orientation of project implementors and beneficiaries catalyst or partner of reform b. Unclear mix of regular and loan * Clearer delineation of funds use: funds for regular operations * Fund 101 - regular operations * Fund 102 - institutional development c. Delayed access to financial * Strengthen FISFAP for use by decision-makers information by management - 18 -  d. Delayed fund reconciliation * Reconciliation starts by 2nd year of implementation * Closer collaboration between IA and COA * Agreements to be set on government/ commercial accounting requirements e. Problems on tax/withdrawal * Periodic WB/GOP staff training Application f. Inadequate financial management * Separate loan management unit at IA 4. Programs a. Training did not always match * Need more focused and targeted capability building based on needs TNA and career development plans 5. Policy/Research a. Absence of clear policy research * Need clear policy research agenda at project start Agenda b. Inability to transform research * Need clear articulation from research to policy to programs studies into policies and to execution/ implementation programs 6. Procurement a. Slow procurement * Periodic staff training on procurement of goods and services requirements * Reduce bureaucratic requirements * Include after-sales service in contracts * Set up procurement support unit (PSU) b. Inadequate oversight * Strengthen Procurement and Services Division (PSD) management * Adopt contract management scheme IV. RECOMMENDATIONS FOR FUTURE PROJECTS Based on the foregoing findings, the following are recommended to sustain gains achieved under the Project and correct gaps/issues in project implementation. This will further strengthen TESDA's capability and readiness to effectively manage upcoming foreign-funded projects: 1. Policy Directions * Provide targeted priority assistance and other resources to SIC, NSCP and TDIS. * Review TESDA's direction vis-a-vis major issues/concerns and challenges confronting it at this time and review TVET reforms vis-a-vis TESDA's direction. * Review TESDA's "housekeeping" rules and practices particularly at the ODG and OCSA and check inter-office relationships at CO and between CO, ROs, POs and Tls. * Institute measures and mechanisms to avoid the perennial problems of delayed releases of funds. * Sustain the relentless effort of pursuing foreign funds and prepare adequately and accurately for the implementation and management of upcoming foreign-funded projects. Consider the lessons learned from VTP 11 and observe the proposed options and strategies. - 19 -  * Have executive will to pursue/implement plans and reformns and make systems work. 2. Proposed Resolutions and Options Some concrete options for each sub-component are presented below: 2.1 Institutional Development a. SIC * Development of career pathing at CO, ROs, POs and TESD centers * Installation of measures to ensure sustainability of staff development program b. MPPC * Re-assessment of PSALM approach of planning and updating of database under regular activities of ROs and POs * Preparation of more sector studies * Strengthening of capability build-up for POs and R/PTESD Centers on planning by mentoring, coaching or secondment of R/PTESD Centers administrators c. NMIS * Full scale operation and utilization of the system by decision makers and development of executive information system * Review of the whole NMIS concept and system by a really competent 3rd party before plunging into hardware, systems and staff upgrading activities * Linkage with relevant GOP agencies like NSO, NSCB, DOST, DOLE, DTI, NEDA , etc., and integration of FISFAP/INFODOS * Periodic upgrading and preventive maintenance of computers and enhancement of on-line system for CO, ROs and POs * Executive will to make systems work 2.2 Improvement of Training Quality & Cost Recovery a. NSCP 3 Upgrading or revision of trade test packages and inclusion of more trade areas o Formulation of mechanism to fast track development and validation of assessment packages o Policy of moving into assessment and certification instead of direct training and selling of materials to recover part of the cost * Translation of test packages into dialects * Installing measures to ensure sustainability of pool of accredited assessors * Full implementation of TOQCS * Strengthening of linkage with industry associations to eventually transfer the implementation of TOQCS. b. CTMD * Pilot testing of one true/model CBTESD program to show its viability prior to full scale development of more TRs * Development of more TRs that are competency-based and revision of TRs based on technological advancement * Distribution of available materials to recover reproduction cost - 20 -  * Inventory of existing materials, off-the shelf procurement and adoption of more measures to fast track CTMD * Training on curriculum and training materials development should involve direct implementers (TC trainers) c. TDP * Development of private financing scheme using regular funds * Establishment of National Institute for TVET out of existing resources of NITVET and external financing * Updating of inventory/profile of trainors * Preparation of impact evaluation studies every after 5-10 batches d. GES * Expand career guidance initiatives to first year high school students * Continue close linkage with PESO, PHILJOBNET, etc., and explore more partnership with industry * Sustain RM award as part of regular activities, providing full support to its implementing arm (Galing Pinoy Foundation) * Scout for new publisher of BCM (probably PIA). e. METP * Full implementation of impact-driven M&E system linked with NMIS and prioritization of M&E projects * Adoption of more measures for METP and ROs utilization * Education drive among TVET schools, ROs and POs on M&E activities using regular funding and more staff training in conducting various kinds of research works 2.3 Training Capacity Development a. UEFE * Development of equipment acquisition plan based on requests and specifications of ROs, POs, R/PTESDCs and TESDA schools * Full implementation of a maintenance management system and regularize preventive maintenance program to be monitored by NITVET 3 Explore co-management scheme with industry to maximize use of workshops * Development of standards n/s layouts, space requirement, systems, etc. b. TCS * Assess P1 - P12 capability of partners and include ICBP in regular activities of ROs * Expand co-management of training programs with industry * Institutionalize DTS by pursuing linkage-building with industry and providing incentives for training dualization * Review DTS implementation vis-a-vis industry's concerns and adopt more creative options in lieu of DTS * Strengthen the Apprenticeship system. c. TAC * Installation of measures to ensure sustained training of public and private TVET school teachers - 21 -  * Linkage with DA to avail of AFMA budget for agri-fishery TVET school teachers program * Development of institutional development/action plans by TAC beneficiaries regarding application of training received as well as transformation/reengineering that occurred and adoption of annual/periodic perfornance evaluation. d. TDIS * Sustaining the pool of CTECs and harnessing the trained ones * Full implementation of CBTED projects and other rural development projects * Inclusion of community-based training in municipal development Plans. 2.4 Crosscutting Concern a. WEE * Adopt co-management scheme to reduce overhead/admin cost, thereby enhancing expansion of WEE programs * Establishment of pilot women development centers for gender equity and entrepreneurship in coordination with other GOP agencies engaged in GAD. b. PMU (for future projects) * Co-location scheme for the implementation/operation aspect of projects but centralized monitoring and evaluation by a strong PMU * Adoption of project benefit M&E, i.e., not just quantity of output but more on quality prior to project implementation; key performance indicators should be clearly specified * Preparation of cost-benefit analysis for each project component in future projects a Preparation of impact evaluation study at the end of the project with transition plan as part of its recommendation * Sufficient number of competent technical and support staff at PMU * Permanency of PMU head and personnel during project implementation * Creation of electronic filing system backed up by systematic record keeping system to ensure continuity of projects as planned in the event that PMU personnel be re-assigned or promoted * Designation of Regional PMUs * Strengthening of newly created IDFO in bridging completed and follow-up projects. c. PSU (for future projects) * Strengthening of PSU to fast track financial management and procurement activities of the project * Organization and performance review of PSU to ensure appropriate and effective support * Staff development relative to FAPs implementation. (b) Cofinanciers: (c) Other partners (NGOs/private sector): 10. Additional Information - 22 -  Annex 1. Key Performance Indicators/Log Frame Matrix Outcome I Impact Indicators: : . I _ .. ^ A: _ _ _ . ' u !-0 4 .1 11 0 Outcome indicators which were not included in the design of the project and for which no base line data existed indude: a) improvement in the intemal and external efficiencies in the design and delivery of training and skills development programs by public and private providers; b) improvement in the satisfaction of employers with trained workers; c) increased productivity of trained workers; d) increased eaming of trained workers; and e) reduction in unemployment of trained workers. Output Indicators: The design of this project, as indicated earlier, involved an agency, the National Manpower and Youth Council NMYC, which was involved in the management as well as the delivery of skills development programs in the non formal sector. The original design of the project and the related supervision framework focused on the use of input/output indicators of quantifiable factors such as the number of people successfully completing training in a given program, the quantity of equipment procured or training materials purchased, the number of workshops implemented, centres upgraded, and number of categories of skills standards compiled. Base line information was established for these indicators and supervision missions continued to report on the progress achieved using these indicators. This approach continued after the establishment of TESDA in 1994 with an expanded mandate, and supervision missions including the midterm evaluation mission reported on the progress in the project using the existing indicator framework. I. Institutional Development a. Strengthening Institutional Capacities Train 300 NMYC central and regional staff in a. Over 10,000 TESDA staff trained (575 (SIC). management functions. executives, 1,370 managerial, 6,170 technical, 2,260 administrative). b. Approximately 1,000 training programs conducted. c. About 280 ongoing scholarship and 26 Ateneo Graduate School graduates. -23 -  b. Manpower policy, planning, and Implement staff training program: coordination (MPPC). a. Policy analysis and coordination. a. Market-onented planning methodology established (PSALM approach). b. Manpower planning and training needs b. Planning data bases established (NMIS analysis. linked). c. Resource allocation and management. c. Training program on TEVT planning and organization conducted. d. Private sector training and incentives. d. About 2,000 TESDA staff trained in various operational areas. e. Cost effectiveness analysis. f. Cost and impact evaluation. c. Developing a National Management a. Develop and install NMIS computer a. NMIS installed in TESDA HQ and Information System (NMIS) network at central and regional NMYC networked to 15 regional offices. offices. b. Train policy analysts, computer b. About 2,500 system users trained. programmers and data processors. c. Consultancy Services. c. TESDA Web Site developed and published; Installabon/development and operationalization of softwares. d. Procurement of Equipment. d. Procured 76 micro computers, 8 printers and 54 notebooks. d. Project Management Unit (PMU) Supervision of project implementation. a. Coordinated 19 implementation review/supervision missions. b. Coordinated 6 annual implementation planning workshops. c. Coordinated 14 semester implementation workshops. d. Implemented SWIG, CPM, FISFAP and SOLOMON IV. e. Monitored consultancy services for VTP II integration and evaluation. 2. Improvement of Training Quality a. National Skills Certification Program a. Consolidate existing trade standards. a. Skills standards for about 250 (NSCP) occupational titles set . b. Train testing officers. b. 5,000 officers tested, 2,500 accredited. c. Set up central test bank. c. 240 trade categories established. d. Equip testing centers. d. Central test item bank established. e. 15 skills testing centers established and accredited. - 24 -  b. Trainer Development Program (TDP) a. Conduct needs analysis. a. Analysis conducted. b. Set up licensing and qualification system. b. Job standards and qualifications developed . c. Private sector financing of trainer training. c. 14,000 trainers attended training courses of varying duration. d. Trainer training/skills upgrading. d. Total output of trainers reached 13,591. c. Curricula and Training Materials a. Produce andlor adapt training curricula a. Updated 7 curricula. Development (CTMD) for 20 vocational programs. b. Develop, print and distnbute training b. Dualized 9 curricula. materials. c. Train staff in curriculum and materials c. Developed training regulations in priority development. areas (49 occupational titles) and 640 learning guides. d. Commercial printing of training regulations. d. Trained about 140 CTMD staff. e. Procured and distrbuted multiple training materials. f. Printed 3 occupational titles and 430 copies of trade regulations in Info Tech and metals. d. Guidance and Employment Services Upgrade 70 staff in GES delivery. a. Trained about 56 placement and guidance (GES) officers, 200 regional and provincial line officers and 45 facilitators. b. Developed and disseminated career guidance materials. c. Placed 90,000 graduates in jobs Provided referral assistance to 125,000 graduates . e. Monitoring and Evaluation of Training Develop and implement systems to monitor a. M&E system has been developed and Performance (METP) and evaluate performance of facilities, staff partially implemented. and students. b. Instruments to measure intemal and extemal efficiencies have been designed. 3. Development Training Capacity - 25 -  a. Upgrade existing facilities (UEFE) a. Upgrade 28 regional and provincial a. Upgraded 15 regional, 13 provincial and training centers. one national training center. b. Implement facilities maintenance system. b. Installed maintenance system and trained staff in its use (1998). a. Support Training Assistance Contract b. Expand enterprise-based training (TCS & Scheme (TAC). a. TAC: upgraded skills of 2,670 TAC) industry-based trainers (1992-94) and upgraded skills of 12,800 staff of post-secondary vocational training institutes (1995-99). b. Support Training Contract Scheme (TCS). b. TCS: 300 senior staff trained in enterprise-based training program development, delivery and quality control; over 20,000 industry-based trainers trained. a. Support local communities to deliver and a. Trained 1,229 LGUs, 1,621 CTECs and c. Training Delivery System for the Rural deliver skills training and entrepreneurship 222 local staff Informal Sector (TDIS) development programs. b. Provide equipment and training materals. b. Implemented 16 pilot projects in Community-Based Training & c. Train staff. Entrepreneurship Development (CBTED) c. Implemented and evaluated two women's programs. a. Investment strategy for developmnent of the formal TEVr system a. Sector review, ten-year strategy, and 4. Sector Studies (SS) five-year investment plan (1998). b. Feasibility study of sector-specific & advanced training centers. b. Investment Strategy for the formal TVET study completed (1994) and feasibility study on TVET investment needs completed (1994). c. Numerous other studies. End of project - 26 -  Annex 2. Project Costs and Financing Project Cost by Component (in US$ million equivalent) ._ Appraisal ActuaVLatest Percentage of Estimate Estimate Appraisal Project Cost By Component US$ million US$ million Institutional Development 9.50 17.97 163.16 Improvement of Training Quality 7.00 5.58 64.29 Development of Training Capacity 16.00 22.24 109.88 Sector Studies 0.60 0.24 30 Total Baseline Cost 33.10 46.03 Physical Contingencies 8.70 Total Project Costs 41.80 46.03 Total Financing Required 41.80 46.03 Project Costs by Procureme nt Arrangements (Appraisal Estimate) (US$ million equivalent) Procurement Method Expenditure Category ICB NCB Other' N.B.F. Total Cost 1. Works t 0.00 2.50 0.10 0.00 2.60 (0.00) (2.00) (0.10) (0.00) (2.10) 2. Goods 10.10 1.10 2.80 0.00 14.00 (8.90) (0.90) (2.40) (0.00) (12.20) 3. Services 0.00 0.00 15.80 0.00 15.80 (0.00) (0.00) (15.80) (0.00) (15.80) 4. Training 0.00 0.00 5.90 0.00 5.90 (0.00) (0.00) (5.90) (0.00) (5.90) 5. O & M 0.00 0.00 0.00 3.50 3.50 (0.00) (0.00) (0.00) (0.00) (0.00) 6. Miscellaneous 0.00 () () () 0) (0.00) Total 10.10 3.60 24.60 3.50 41.80 (8.90) (2.90) (24.20) (0.00) (36.00) Project Costs by Procureme t Arrangements (Actual/Latest Estimate) (US$ million equival nt) Procurement Method Expenditure Category ICB NCB Other2 N.B.F. Total Cost 1. Works 0.00 2.40 0.00 0.00 2.40 (0.00) (0.90) (0.00) (0.00) (0.90) 2. Goods 7.70 2.19 0.86 0.00 10.75 (7.40) (2.00) (0.10) (0.00) (9.50) 3. Services 0.00 14.60 0.00 0.00 14.60 (0.00) (1.77) (0.00) (0.00) (1.77) 4. Training 0.00 2.50 0.00 0.00 2.50 - 27 -  (0.00) (3.80) (0.00) (0.00) (3.80) 5. 0 & M 0.00 0.00 0.00 0.22 0.22 (0.00) (0.00) (0.00) (0.00) (0.00) 6. Miscellaneous 0.00 ()____________________________ _ () ) ()0 (0-00) Total 7.70 21.69 0.86 0.22 30.47 _ (7.40) (8.47) (0.10) (0.00) (15.97) Figures in parenthesis are the amounts to be financed by the Bank Loan. All costs include contingencies. 2I Includes civil works and goods to be procured through national shopping, consulting services, services of contracted staff of the project management office, training, technical assistance services, and incremental operating costs related to (i) managing the project, and (ii) re-lending project funds to local government units. Project Financing by Cormonent (in US$ million equivalent) Percen tage of Appraisal ApE EXpraisal Es te1 ActV u/Latest Estiate i BkX0 Gosvt :A iC:oF i Bank 0 :Govt : CoF k Bank Govt. CoF. Institutional Development 9.00 3.90 10.80 4.70 120.0 120.5 0.0 Improvement of Training 7.60 1.30 4.50 59.2 0.0 0.0 Quality DevelopmentofTraining 18.80 1.40 15.50 2.08 82.4 148.6 0.0 Capacity Sector Studies 0.60 0.10 0.18 30.0 0.0 0.0 TOTAL 36.00 7.00 31.00 7.00 86.1 100.0 0.0 -28 -  Annex 3: Economic Costs and Benefits These were not calculated for this project. - 29 -  Annex 4. Bank Inputs (a) Missions: Stage of Project Cycle No. of Persons and Specialty Performance Rating (e.g. 2 Economists, I FMS, etc.) Implementation Development Month/Year Count Specialty Progress Objective IdentificationlPreparation 3 Technical Education Nov 1989 - Oct 1991 Specialist/Education Specialist! Engineer Appraisal/Negotiation April 1992 4 Technical Education Specialist/Education Specialist/Engineer/ Architect Supervision July, 1992 2 Technical Education HS HS Specialist/Architect Nov, 1992 2 Technical Education HS HS Specialist/Architect May, 1993 2 Technical Education S HS Specialist/Operations Officer Nov, 1993 3 Operations Officer/Procurement S HS Specialist/Policy Advisor June, 1994 3 Technical Education S S Specialist/Education Specialist/Procurement Specialist Sept, 1994 3 Technical Education U S Specialist/Education Specialist/Procurement Specialist April, 1995 3 Technical Education S S Specialist/Education Specialist/Procurement Specialist Sept, 1995 2 Education Specialist/Architect S S Education S S March, 1996 3 Specialist/Procurement Specialist/Operations Officer Mid Term Review 2 Technical Education S S Feb, 1997 Specialist/Procurement Specialist May, 1997 1 Technical Education Specialist S S Nov, 1997 3 Technical Education S S Specialist/Procurement Specialist/Architect - 30 -  June 1998 5 Technical Education S S Specialist/Architect/Operations Officer/Procurement Specialist/Financial Management Specialist Sept, 1998 5 Technical Education S S Specialist/Operations Officer/Procurement Specialist/Financial Management Specialist/Informal Sector Specialist March, 1999 5 Technical Education S S Specialist/Operations Officer/Procurement Specialist/Financial Management Specialist/Informal Sector Specialist ICR Completion 5 Technical Education S S Oct, 1999 Specialist/Operations Officer/Procurement Specialist/Financial Management Specialist/ Informal Sector Specialist (b) Staff Stage of Project Cycle Actual/Latest Estimate No. Staff weeks USs (,000) Identification/Preparation 64.9 156.2 Appraisal/Negotiation 63.3 148.7 Supervision 127.22 271.06 ICR 10.00 20.00 Total 265.42 595.96 - 31 -  Annex 5. Ratings for Achievement of Objectives/Outputs of Components (H=High, SU=Substantial, M=Modest, N=Negligible, NA=Not Applicable) Rating JMacro policies O H OSUOM ON * NA