Colombia - Antioquia Basic Education Project

Document of The World Bank Report No. 17113 CO PROJECT APPRAISAL DOCUMENT ONA PROPOSED LOAN IN THE AMOUNT OF US$40.0 MILLION EQUIVALENT TO THE DEPARTMENT OF ANTIOQUIA IN THE REPUBLIC OF COLOMBIA FOR A BASIC EDUCATION PROJECT October 17, 1997 Human and Social Development Group Colombia, Venezuela and Ecuador Subregion Latin America and the Caribbean Region  CURRENCY EQUIVALENTS Currency Unit = Peso (As of May 9, 1997) (As of October 8, 1997) US$1.00 = 1150.00 Pesos US$1.00 = 1244.00 Pesos FISCAL YEAR ACADEMIC YEAR 1 January - 31 December 1 February - 30 November ABBREVIATIONS AND ACRONYMS CAS Country Assistance Strategy CMU Country Management Unit DNP National Planning Department (Departamento Nacional de Planeacion) EDI Economic Development Institute FER Regional Education Fund (Fondo Educativo Regional) FIS Social Investment Fund (Fondo de Inversion Social) FMM Financial Management Manual FSD School Management Accounts (Fondo de Servicios Docentes) IBRD International Bank for Recontruction and Development ("World Bank") ICFES Secondary School Existing Exams ICN National Investment Budget (Ingresos Corrientes de la Nacion) ICR Implementation Completion Report IEC Information, Education and Communication JUME Municipal Education Board (Junta Municipal de Educaci6n) LCSHD Latin America and the Carribean Social and Human Development Group MIS Management Information System MOE Ministry of Education NEBI Unattended Basic Education Needs (Necesidad Educativa Bdsica Inmediata) PEI School Education Project (Proyecto Educativo Institucional) PEM Municipal Education Plan (Plan Municipal de Educaci6n) POA Annual Investment Plan (Plan Operativo Anual) SEDUCA Departmental Secretariat of Education and Culture of Antioquia (Secretaria Departamental de Educacion y Cultura de Antioquia) SIP School Improvement Plan TTA Training and Technical Assistance Vice President: Shavid Javed Burki, LAC CMU Director: Andres Solimano, LCC4C Manager: Julian Schweitzer, LCSHD Education Specialist Donald Winkler, LCSHD Sector Leader Constance Corbett, LCC4C Task Manager: Joel Reyes, LCC4C  COLOMBIA ANTIOQUIA BASIC EDUCATION PROJECT Table of Contents Page BLOCK 1: PROJECT DESCRIPTION ......................................................................................... 2 1. PROJECT DEVELOPMENT OBJECTIVES ..................................................................................................... 2 2. PROJECT COMPONENTS ...................................................................................................... 2 3. BENEFITS AND TARGET POPULATION ..................................................................................................... 3 4. INSTITUTIONAL AND IMPLEMENTATION ARRANGEMENTS ...........................................4............... 4 BLOCK 2: PROJECT RATIONALE ......................................................................................... 6 5. CAS OBJECTIVES SUPPORTED BY THE PROJECT. 6 6. MAIN SECTOR ISSUES AND GOVERNMENT STRATEGY. 6 7. SECTOR ISSUES TO BE ADDRESSED BY THE PROJECT AND STRATEGIC CHOICES. 9 8. PROJECT ALTERNATIVES CONSIDERED AND REASONS FOR REJECTION .10 9. MAJOR RELATED PROJECTS FINANCED BY THE BANK AND/OR OTHER DEVELOPMENT AGENCIES 12 10. LESSONS LEARNED AND REFLECTED IN THE PROJECT DESIGN ...................................................................................... 13 11. INDICATIONS OF BORROWER COMMITMENT AND OWNERSHIP ..................................................................................... 15 12. VALUE ADDED OF BANK SUPPORT ..................................................................................................... i 5 BLOCK 3: SUMMARY PROJECT ASSESSMENTS ......................................................................................... 13 13. ECONOMIC ASSESSMENT ............. ........................................................................................ 16 14. FINANCIAL ASSESSMENT ..................................... 16 15. TECHNICAL ASSESSMENT ............. ........................................................................................ 16 16. INSTITUTIONAL ASSESSMENT ..................................................................................................... 16 17. SOCIAL ASSESSMENT ...................................................................................................... 17 18. ENVIRONMENTAL ASSESSMENT ..................................................................................................... 17 19. PARTICIPATORY APPROACH ..................................................................................................... 17 20. SUSTAINABILITY ...................................................................................................... 18 21. CRITICAL RISKS ...................................................................................................... 19 22. POSSIBLE CONTROVERSIAL ASPECTS ..................................................................................................... 20 BLOCK 4: MAIN LOAN CONDITIONS ................................ 21 23. EFFECTIVENESS CONDITIONS ..................................................................................................... 21 24. OTHER ................................................... ................................................. 21 BLOCK 5: COMPLIANCE WITH BANK POLICIES .......................................................................................... 21 ANNEX 1: PROJECT DESIGN SUMMARY ..................................................................................................... 22 ANNEX 2: DETAILED PROJECT DESCRIPTION ..................................................................................................... 25 ANNEX 3: ESTIMATED PROJECT COSTS ..................................................................................................... 34 ANNEX 4: ECONOMIC PRINCIPLES THAT GUIDE PROJECT DESIGN ................................................. ..................................... 35 ANNEX 5: FINANCIAL SUMMARY ..................................................................................................... 41 ANNEX 6: PROCUREMENT AND DISBURSEMENT ARRANGEMENTS ...................................................................................... 47 ANNEX 7: FINANCIAL MNAGEMENT ARRANGEMENTS .......................................................... ........................................... 51 ANNEX 8: DESCRIPTION OF IMPACT AND PROCESS EVALUATION TORS ........................... ................................................. 55 ANNEX 9: INSTITUTIONAL ASSESSMENT SUMMARY ..................................................................................................... 58 ANNEX 10: PROJECT PROESSING BUDGET AND SCHEDULE ..................................................................................................... 59 ANNEX 11: DOCUMENTS IN THE PROJECT FILES ..................................................................................................... 60 ANNEX 12: STATEMENT OF LOANS AND CREDITS ..................................................................................................... 62 ANNEX 13: COLOMBIA AT A GLANCE ...................................63   INTERNATIONAL BANK FOR RECONSTRUCTION AND DEVELOPMENT INTERNATIONAL DEVELOPMENT ASSOCIATION Latin America and the Caribbean Regional Office LCSHD Project Appraisal Document COLOMBIA - DEPARTMENT OF ANTIOQUIA Basic Education Project Date: October 15, 1997 [ ] Draft [x ] Final Task Manager: Joel Reyes, LCSHD CMU Director: Andres Solimano, LCC4C Project ID: CO-PA-6891 Sector: Education Lending Instrument: Specific Investment Loan PTI: [x] Yes [ ] No Project Financing Data [x] Loan [ Credit [] Guarantee [] Other [Specify] Amount: US$40.0 million W ..W f ....................................................................................................................I...................... ..............................................................................I.................. Proposed Terms: [] Multicurrency [x] Single currency Grace period (years): 6 [ Standard Variable [] Fixed [x] LIBOR-based Years to maturity: 15 *Commitment fee: 0.75% Service charge: 0.0% * subject to partial waivers annually approved by the World Bank Board Financing plan (US$m): Source Local Foreign Totsd Departmental Government 5.4 0.6 6.0 Municipal Governments 31.6 2.4 34.0 IBRD/IDA 37.0 3.0 40.0 .......................................................................................................................................................................................................................................................... Borrower: Government of the Department of Antioquia, Colombia Guarantor: Government of Colombia, Ministry of Finance Responsible agency(ies): Departmental and Municipal Secretariats of Education Estimated disbursements (-Bank FY/US$M): 1998 1999 2000 2001 2002 2003 *FYExtendsfromJuly(prioryear)toJune Annual 2.50 8.50 11.00 12.00 5.00 1.00 Cumulative 2.50 11.00 22.00 34.00 39.00 40.00 For Guarantees: [ Partial Credit [ Partial risk Proposed coverage: Project sponsor: National Government of Colombia Nature of underlying financing: Terms of financing: Principal amount (US$) Final maturity Amortization profile Financing available without guarantee?: [ Yes [X] No If yes, estimated cost or maturity: Estimated financing cost or maturity with guarantee: E.pecte.. effectiveness.date:.January.28,.1998.Closing.date:.June.30,.200............3........................................................I............................................................. Expectd effctiveess dae auary 28 98Closing date: June 30, 2003 I  Project Appraisal Documehl ANTIOQUIA, COLOMBIA Antioquia Basic Education Project Block 1: Project Description 1. Project development objectives (see Annex 1 for key performance indicators): The project development objectives are to: (i) contribute to the Department's goal of improving student learning, access and school retention among the rural and urban poor and at-risk-of-violence communities; (ii) improve the capacity of schools/communities, municipalities, and the department to effectively provide their respective education services; and (iii) provide lessons for a national strategy to support municipal and departmental education management and investments. 2. Project components (see Annex 2 for a detailed description and Annex 3 for a detailed cost breakdown): Cost Incl. Component Category Contin- % of gencies Total (US$M) SCHOOL (COLEGIO) AND COMMUNITY STRENGTHENING * Educational 49.0 61% COMPONENT would finance (through nonrefundable financial transfers) Inputs the development and implementation of school improvement plans (SIPs). * Institutional School staff and community members prepare the SIP; the School- Building Community Board approves it. The Municipal Education Board approves * Other - financing of SIP and evaluates the impact after its implementation, under generally established criteria. To address equity and institutional capacity concerns, information and technical assistance efforts will support weaker schools and communities to develop and implement their own SIPs. Municipalities will provide counterpart funds for SIPs. MUNICIPAL EDUCATION MANAGEMENT AND INVESTMENTS * Physical 20.0 27% COMPONENT would finance municipal education plans to: (i) improve (access) education management capacity; (ii) increase education access; and (iii) * Technical provide educational resources within the municipality (for example, a town Assistance library or a children museum). The Municipal Education Board (JUME) * Institutional prepares investment proposals. The Departmental Secretariat of Education Building (SEDUCA) approves proposals, and evaluates impact after implementation, * Other (e.g., under a generally established criteria. Information and technical assistance Contracts with efforts will develop institutional capacity as needed. The overall project will Nongovem- be studied through its implementation phases in order to gather information mental Organi- for later applications. zations) DEPARTMENTAL EDUCATION SERVICES COMPONENT will: (i) * Institutional 11.0 12% strengthen, through training and technical assistance, the nonmanagerial building functions of the Departmental Secretariat of Education (for example, * Project consulting, communications and ex post evaluation); (ii) consolidate and management integrate the existing computerized systems and tools for education * Other (e.g., evaluation; (iii) provide a communication network between three levels -- Information, the Departmental, Municipal, and Jefes de Nu~cleo (local education Education and administration offices) -- under the most appropriate technology for each Communica- municipality (e.g., electronic mail, faxes, telephone); and (iv) finance a tion Department-wide communication strategy to disseminate project objectives, Campaigns) as well as the lessons learned for implementation of a national strategy to strengthen departmental and municipal management of education. Total 80.0 100% .......................................................................................................................................................................................................................... 2  Project Appraisal Document ANTIOQUIA, COLOMBIA Antioquia Basic Education Project 3. Benefits and target population: The project is expected to produce social, economic and institutional benefits related to a specific targeted population. a) Social Benefits * Increased access to preschool and lower secondary education in the municipalities most in need in the Department; * Increased learning and achievement of 5-13 year olds in participating communities; * Motivated parents, teachers and students, who integrate in-school teaching and learning with community outreach events; and * Reduced violent behavior and loss of children and youth to illicit activities. b) Economic Benefits * Increased self-financing capacity of education investments at the municipal level; * Improved efficiency and effectiveness through participation of the private sector and NGOs in the provision of educational services; and * Economic gains through the use of computer and telecommunication technology in those municipalities and schools where a minimum of acceptable quality in educational services and available financial resources exists to sustain investrment. c) Institutional Benefits . Improved effectiveness of delivery of educational services by transferring the daily management and supervision of education from the departmental to the municipal level and by moving decisionmaking closer to the school and community (parents, principals, teachers and students); * Reduced budgetary constraints of centrally controlled financial mechanisms (e.g., disbursements) for municipal and school level educational services and investments; * Increased municipal and community commitment to improve the quality of education provided by their schools; * Integrated systems and tools for monitoring and evaluating the delivery and impact of educational services at the school/community, municipal and departmental level; and . Effective and relevant educational policies and strategies at the municipal, departmental and national levels. d) Target Population: School (Colegio)/Community Level * 1,200 schools (960 rural and 240 urban) and 219,520 direct beneficiaries: (i) 201,600 basic education students (57,000 rural and 144,000 urban); (ii) 5,120 teachers (1,920 rural and 3,200 urban); and (iii) 12,800 parents (3,702 rural and 9,088 urban). Municipal Level * (i) 80 municipalities and 19,730 direct beneficiaries of which: (i) 2,000 staff from municipal Secretarias de Educacion and Juntas Municipales de Educaci6n (JUME); (ii) 130 Jefes de Nzicleos. Educativos; (iii) 9,600 new students in the education system (through classroom construction and NGO contracts); and (iv) 8,000 new secondary students in rural areas (through tutorial rural strategies -- Sistema de Aprendizaje Tutorial, or SAT). Departmental Level * 115 staff from the Departmental Secretariat of Education (Pedagogical and Technical Divisions). 3  Project Appraisal Document AN7TIOUIA, COLOMBIA Antioquia Basic Education Project ..................... ........................... .............................................I.................. ................. .......................... ..................................... .......................... .......................... ......................... 4. Institutional and implementation arrangements: Implementation period: Five years (1998-2002). Executing agencies: SEDUCA: Coordination and Administration . The Departmental Secretariat of Education (SEDUCA) will coordinate overall project administration, including the promotion, appraisal, cofinancing and ex post evaluation of municipal investment subprojects. * SEDUCA Directors' Committee, headed by the Secretary of Education, will represent each of their respective pedagogical and technical divisions and will be responsible for the project. * A small administrative team, the Technical, Administrative and Financial Directorate (Direcci6n Financiera FER), will support the administrative processes (e.g., disbursements, procurement) between the World Bank and the Department. Direccion Financiera FER will report to the SEDUCA Directors' Committee. Project Oversight * The Secretary of Education will liaise with the Governor of Antioquia, the Departmental Secretariats of Planning and of Finance, and with municipal mayors to define any policy issues arising from, or related to, project implementation. * SEDUCA Directors' Committee and representatives of municipal and school govemments, with Bank concurrence, will: (i) approve and adopt policies and procedures governing school/community and municipal subprojects; (ii) annually review the operations and impact of the project; and (iii) coordinate with the central government, and other local governments, the dissemination of lessons learned arising from project implementation and subsequent policy implications. Municipal Secretariats of Education, Municipal Governments, and Schools * Municipalities, schools, and community organizations will manage the daily implementation of their own subprojects. * Municipal Secretariats of Education, through an agreement with SEDUCA, will directly manage and monitor municipal investments and will coordinate the promotion, appraisal, cofinancing, and ex post evaluation of school/community strengthening subprojects. * As mandated by national education laws, existing school, community and municipal organizations that will play a key role in project execution include: * Junta Municipal de Educacion (JUME), the Municipal Education Board, will play a key role with the Municipal Secretariat of Education in coordinating the School and Community Strengthening Component; * Consejo Directivo, the School-Community Board (with representation of teachers, parents and the community), will be headed by the school principal and will have legal status to manage school funds (Fondos Docentes); * Consejo Acadimico, a pedagogical school committee, will provide representation for teachers from various curriculum disciplines; * Asociacion de Padres de Familia, Parents Associations, will plan, implement, and manage their own subprojects to support their respective schools; and * Personeros Estudiantiles, the student rights committees and associations, will represent the interest of students in the previously mentioned committees. 4  Project Appraisal Document ANTIOQUIA, COLOMBIA Antioquia Basic Education Project Implementation Guidelines and Procedures: SEDUCA designed flexible procedures that would guide subproject appraisal, implementation, and evaluation. The operational manuals and standard agreements (Convenio del Colegio y Convenio SEDUCA) will guide the respective functions and responsibilities at the departmental, municipal, and school levels. The legal ratification of the operational manuals and the submission for Bank review of the standard agreements are conditions of project effectiveness. The operational manuals provide a transparent guide for all executing agencies. The content of the manuals includes: (i) general information and promotion; (ii) subproject presentation and appraisal; (iii) technical, social, institutional, and financial feasibility criteria and tools; (iii) administrative, procurement, and financial management; and (iv) supervision, monitoring, and evaluation. Finally, SEDUCA would distribute, upon request from participating municipalities, technical assistance documents and guides, including standards and quality criteria for the hiring of consultant services, technical standards for infrastructure investments, and guides for subcontracting education services with NGOs. Accounting, financial reporting, and auditing arrangements (see Annex 7): SEDUCA will keep project accounts and provide financial reports to the Bank. Municipalities and schools participating in the project will maintain their own respective accounting and financial files. Administrative, procurement and technical audits, in addition to community oversights (veedurias), will provide feedback on implementation procedures of municipal and school/community subprojects, and on physical progress (including construction, services provided, and goods delivered). Communities will be informed of the objectives, activities, and financial resources provided by the project for their schools/communities and municipalities (e.g., through periodic newsletters, bulletins, and/or other publications). For overall project implementation, external audit reports prepared by an independent auditor acceptable to the Bank would be submitted annually in accordance with Bank standards. Project Implementation Cycle: The project will be executed through a learning cycle. The three learning phases are: experimentation, demonstration, and generalization. SEDUCA will be responsible for documenting the lessons learned during implementation and providing appropriate adjustments and policy guidance. Although the project expects to intervene in approximately 80 municipalities during its implementation life, participation will be gradual to support the learning cycle, as indicated in Annex 2, Component 2. Municipalities, within each socioeconomic level, will be selected competitively. The selection criteria will include educational needs, as well as regional representation. The first pilot municipalities will also be selected by their institutional capacity to analyze the strengths and weaknesses of their subprojects, and to disseminate lessons to other municipalities. Monitoring and evaluation arrangements (see Annex 8): The project includes a process evaluation and a summative evaluation (impact). The process evaluation will provide information for changes required between each project implementation phase. At the departmental level, SEDUCA will be responsible for overall monitoring of project processes. The evaluation process will not imply micro-managing nor overseeing compliance with procedures. Project monitoring will focus on outputs/results and will attempt to learn from these and adjust project design accordingly. Municipalities and schools, in turn, will also monitor their own subprojects. Impact indicators include student leaming and learning-related independent factors (such as school climate and changes in teaching and learning attitudes). To guarantee enough time to assess project impact, the impact evaluation in terms of student learning will take place during the latter implementation phase of the project and within the Implementation Completion Report (ICR). SEDUCA and the Bank would jointly conduct a Midterm Review of the project and subprojects by December 1999. 5  Project Appraisal Document ANTIOQUIA, COLOMBIA Antioquia Basic Education Project Block 2: Project Rationale 5. . . CAS Report #P6070-CO 16/12/93 and New CAS, Report #41960- A beie)sprd ero CO 6/11/97 (Presented Concurrently with this Project to the Board). Colombia's Country Appraisal Strategies (CASs) of 1993 and 1997 recognize that the country's still unequally low levels of educational attainment and coverage, primarily in poor and rural communities, adversely affect development in this country. The 1997 CAS puts a stronger emphasis on successfully implementing Colombia's decentralization and community participation policies. In the education sector, the focus is on expanding access and improving quality through education services provided at the municipal level, and with increased school autonomy and greater community and private sector participation. By transferring education responsibilities to the departments and municipalities, decisionmaking at the local level can more accurately reflect the needs of the users, adequately attend to regional diversities, and also increase accountability. As one of the two pilots testing decentralization strategies at the departmental and municipal levels, the project provides decentralization design and implementation lessons from the ground up as input for a national decentralization strengthening strategy. The project fully supports the CAS objectives. ............................................................................................................................................................................................................................................................ 6. Main sector issues and Government strategy: National Policies: Local Government and Community Management of the Education System a) National and local governments emphasize social programs, as reflected in the national development plan (Salto Social), and the national education plan, (Salto Educativo). The Salto Social's objectives include social development, the competitiveness of the economy, the environment, and decentralization and institutional strengthening. The Salto Educativo calls for the transferring of education management responsibilities to departments and municipalities To enable regional governments to operate in the new decentralized environment, the national government fully supports strengthening the capacity of local education agencies as part of its strategy to improve access and quality of education. By making education management local, the possibilities for resource mobilization, cost sharing, and greater community and parental involvement are enhanced. Decentralization Background b) The decentralization process in Colombia was initiated in 1968 through an effort to deconcentrate the Ministry .f Education (MOE) to local organization, though MOE maintained veto power over them. In 1971, an education tax allowance (the Situado Fiscal) earmarked national government expenditures and sales taxes for educational purposes. The Regional Education Funds (Fondos Educativos Regionales, FER) were institutions created as a hybrid system intended basically to deconcentrate the payroll of national and nationalized teachers, with a highly centralized control of how the funds could be used. Teacher qualification committees (Juntas de Escalafon Departamental) followed to guarantee minimum standards. Since the 1980s, the stated policy objective has been to give local governments the power to manage their educational systems. Local fiscal autonomy however, was not supported until the late 1980s when new measures began to increase local revenues (tax and nontax). The law requiring the election of mayors to increase their accountability to the community facilitated fiscal decentralization. The Constitution of 1991 increased local responsibility in the delivery of social services and distributed administrative functions at different levels. Municipal governments have experienced a sharp increase in local revenues -- from 2 percent of gross domestic product (GDP) in 1980 to 3.5 percent in 1994. Original Decentralization Implementation Strategy c) While important decentralization advances took place, the central government had continued to control partially the national education investment budget. The cofinancing system remained overly centralized and bureaucratic, citing low local capacity to justify restraining funds and slowing disbursements. Also, large institutional development investments provided only centrally delivered training and sporadic technical assistance. Local processes of leadership, autonomy, participation, and innovation went largely untapped. This incompletely implemented decentralization strategy did not contribute to improving the quality indicators of the education system: an average Colombian student still takes seven years to complete the first five years of primary school. While 87 percent of students complete all five grades, 19.5 percent do so only after repeating three or more grades. Only half of those 6  Project Appraisal Document ANTIOQUIA, COLOMBIA Antioquia Basic Education Project students entering sixth grade reach the eleventh grade five years later, and most of them are from wealthier families. The results from the first national assessment of primary education indicates that most third and fifth graders are not achieving at grade-level in reading comprehension and mathematics. New Decentralization Implementation Approach d) Attempting to find new alternatives to successfully achieve the objectives of local government and community management of the education system, the central government initiated a process of transferring fiscal management to Departments and large municipalities (populations over 100,000). This process is called "certification." In this context, certified local governments are fully responsible for planning education investments, managing the situado fiscal (mostly funds for recurrent costs and teacher salaries), identifying additional sources of investment financing, and implementing and evaluating their own improvement projects. e) Moreover, to strengthen local management and decisionmaking, the national government is supporting the provision of multilateral funds directly to local governments. It is expected this strategy also would improve the efficiency of investments supported by international development organizations. A municipality and a department were selected to participate in a pilot program and the World Bank was approached to support this innovation. This pilot operation, directly designed and implemented by local governments, would provide lessons to a nationwide system of technical and management capacity strengthening and decentralized financing of capital investments. The key criteria used for selection of the participating local governments included: financial indebtedness capacity, regional and socioeconomic representation, and political commitment. Financial sustainability was weighted heavily, since the central Government seeks to encourage fiscal discipline at the local government levels. Socioeconomic representation guaranteed equity considerations. Political will is key to any major sector reform and learning strategy. The Department of Antioquia, in the central region of Colombia, and the Municipality of Pasto, in the Andean Highlands, were selected. Main Sector Issues in the Department of Antioquia General Situation f) The Department of Antioquia and its capital city, Medellin, have been cultural and economic leaders in Colombia. Antioquia has improved extensively its infrastructure, roads, and communication systems. For example, Medellin is the only city in Colombia with a Metro system -- which is proving to be financially sustainable. At the same time, the Department is also one of the most afflicted by poverty and violence. Out of approximately 5 million, 27 percent of the population live under the poverty line and 5 percent more in extreme poverty. The extreme violence is reflected in its high mortality rate due to homicide: 206 per 100,000 inhabitants. In 1993, homicides was the leading cause of death with almost 10,000 killings. Education Statistics g) The deteriorating social fabric has affected the education system. Antioquia's public education graduates are achieving under the national averages: 74 percent of its eleventh graders receive low scores in the secondary school exiting exam (ICFES) in comparison to a national average of 54 percent. Only 12 percent of eleventh graders achieve high scores, while the national average is 17 percent. Of 100 children who enroll at the primary level, only 59 percent complete primary education. Only 35 percent of these children finish without repeating a grade. Dropouts and repetitions have an impact in the efficient use of education resources. It requires 7.3 school years for each student to finish 5 grades of primary education, and 17 years to complete the ninth grade. Other factors associated to low achievement and high dropouts and repetitions include the status of teacher development, teaching content, educational materials, infrastructure, management, and participation. Teaching Staff h) Almost 70 percent of teachers in Antioquia have completed preservice training (teacher preparation at the secondary level and/or university). However, there is a deficit of teachers in certain teaching areas (e.g., science, mathematics,). In-service teacher training does not necessarily focus on classroom application. Nevertheless, isolated training courses and irrelevant topics still provide teachers with escalaf6n credits (option for higher pay scale). As a result, the Escalaf6n system is being reformed to guarantee relevant training and classroom application. Additionally, the 7  Project Appraisal Document ANTIOQUIA, COLOMBIA Antioguia Basic Education Project national and local government are piloting nonsalary incentives programs, which have yielded early results. Curriculum i) School curriculum was designed and programmed centrally in Bogota, the nation's capital. The selection, procurement and delivery of textbooks (and other instructional materials) was also centralized. The content of what was taught in the classroom was often unrelated to the realities and needs of the diverse communities in Colombia. The Department of Antioquia, itself, is very heterogeneous: the Afro-Colombian culture of the coasts, the coffee producers of the midlands, the isolated rural/peasant towns, and the violence prone communities of UrabA and Magdalena Medio. Thus, during the 1990s, decentralized decisionmaking on curriculum issues has been increasing. The national and local education policies aim to provide a margin of choice for curriculum content. The basic curriculum areas will be maintained and strengthened, but local governments have the opportunity to add content areas relevant to their socioeconomic and cultural backgrounds. School Infrastructure j) School infrastructure is insufficient and deteriorating. Urban areas, especially in the Metropolitan Area formed by 10 adjacent municipalities, experience a high deficit of school slots for students. Over 500 primary and secondary urban schools have double and triple usage (morning, afternoon, and nights). Low scores in ICFES exams can be correlated with students in the afternoon and night shifts. Students graduating at the primary level may not find a place at lower secondary, and similarly between lower and upper secondary. School access is even lower in rural areas. While urban public education coverage is 88 percent, it is only 53 percent in rural areas. Most critically, in 1994, rural preschool coverage was only 19 percent, lower secondary 23 percent, and upper secondary 7 percent; urban percentages were 65 percent, 97 percent, and 59 percent, respectively. Management of the Sector k) The Department of Antioquia and its municipalities seek to implement successfully their respective education management responsibilities (identified in the Constitution of 1991 and the Laws 60/93 and 115/94). That is, (i) the Nation formulates education policies and provides general financing, technical assistance, and national evaluations; (ii) the Department of Antioquia plans and cofinances education development objectives, manages nationally provided fiscal resources (the situado fiscal) for municipalities with low capacity, and assists municipalities in managing their own education services; (iii) the 125 Municipalities would execute and manage the educational policies, cofinance local investments, and monitor and support their schools; and (iv) Antioquia's 6,700 schools and their communities are entitled to develop and implement their own development plans and construct complementary course contents specific to their communities. Additional education management subdivisions in Antioquia include 9 subregions and 239 local administrative offices, or nicleos. I) The execution of the respective education management roles described above is still incipient at each level in Antioquia, though some advances have been made. The Department has been certified to administer its situado fiscal. To further the decentralization process within the Department, Antioquia aims at increasing the education management capacity of all its municipalities. Three municipalities (Bello, Itagui, and Medellin) can be certified by the Nation to autonomously manage their own situadofiscal. Antioquia would delegate the management of teachers, curriculum and school infrastructure, and the respective financial resources, to most of its municipalifes. Although, teacher training has remained a departmental level responsibility, the Department will provide its municipalities with the opportunity to identify their own training needs and interventions. Initially, 53 municipalities have been confirmed to initiate the delegation process. Finally, apart from the situado fiscal, the national government also transfers complementary investment funds (Ingresos Corrientes Nacionales, or ICN), directly to all municipalities. Municipalities must invest at least 30 percent of the ICN in education. 8  Project Appraisal Document ANTIOQUIA, COLOMBIA Antioquia Basic Education Project ..........................................................................I................................................................................................................................................................................. 7. Sector issues to be addressed by the project and strategic choices: A recent study of decentralization in Colombia (Decentralizaci6n de los Servicios de Educaci6n en Colombia, DNP 1997) confirms the need to strengthen school autonomy and the role of municipalities in education management. The project would be instrumental in testing mechanisms to build the capacity of municipalities to manage the education sector; provide schools with the autonomy and capacity to plan, implement, and evaluate their own education development efforts; and improve the allocation of fiscal resources at the local levels. In addition, the project will provide crucial investments in the Department of Antioquia to address its own issues of education quality and efficiency (see section 6 above). This investment, thus, serves two major purposes: (i) a full- fledged education development intervention in Antioquia and a pilot operation to strengthen decentralization nationwide. The specific sector issues addressed are: At the School Level a) (i) increasing community participation in school activities and vice versa (i.e., schools involved in community events); (ii) improving the skills of administrative and teaching staff; (iii) complementing course contents with topics related to the culture and socioeconomic needs of each community; (iv) providing financing for self-identified improvements in school infrastructure and instructional materials; and (v) improving teachers' status, morale and effectiveness in the classroom At the Municipal Level b) (i) strengthening the management capacity of municipal level education offices; and (iii) increasing coverage (mainly at the preschool and lower-secondary level) through altemative strategies based on municipal needs (e.g., school cunstruction, contracts with NGOs and/or rural strategies). At the Departmental level c) Strengthening the new role of the Department's Secretariat of Education as strategic planner, advisor, and facilitator; improving departmental collection and analysis of education statistics; and promoting education reforms and positive behavioral and attitudinal change through a department wide information, education, and communication campaign in alliance with the media and pro bono recognized role models (actors, athletes, singers). Strategic Choices: d) The project design process considered four key strategic choices: (i) national versus local responsibility for project design, financing, and implementation; (ii) centralized (at the departmental level) versus decentralized (municipalities and schools/communities) decisionmaking; (iii) public (SEDUCA) versus private provision of services (NGOs, Universities and Firms); and (iv) low (information sharing and consultation) versus high (self- management and decision control) participatory approaches. National versus Local Projects e) Projects to support local governments have been implemented by central institutions. However, centralized channels were overly bureaucratic. Top-down mechanisms from a distant central government have diluted the expected impact of investments. The alternative choice considered was to finance and prepare projects directly with approved decentralized local governments. This approach provided the opportunity to implement a strategy that aims at enhancing responsiveness, client orientation, and innovation. Centralized versus Decentralized Decisionmaking f) The choices for decisionmaking vacillated between (i) local needs assessment by municipalities and schools, but specific interventions defined at the departmental level (including procurement and contracting); and (ii) full responsibility at the municipal and school levels in managing their own specific project outputs and services and final allocation of resources. In line with the decentralization policies and its own objective to strengthen municipal and 9  Project Appraisal Document ANTIOQUIA, COLOMBIA Antiouia Basic Education Project community management of schools, the project opted for the latter alternative. Public versus Private Provision of Services g) Initial consideration was given to the provision of technical assistance, training, and other services by the Departmental Secretariat of Education. However, the experience in Colombia and elsewhere recommended a wider choice of service providers, including the private and NGO sectors. Antioquia's universities, foundations, NGOs, and consulting firms have the experience and capacity to provide a full range of services at the school/community, municipal, and departmental levels. Moreover, in various instances, these institutional actors have formed public- private alliances to combine their own strengths effectively. Low versus High Participatory Approach h) Participation has been key to project preparation and implementation. However, there were still choices as to the level of participation expected of municipalities, schools, and communities. The choices included emphasis on (i) information sharing and consultation (surveys, focus groups, public notices, town meetings, and incorporation of opinions) or (ii) collaboration and empowerment (self-management and decisionmaking). The latter choice was selected. i) Change management experiences within organizations and larger systems have shown that successful reforms are correlated to high participation of local stakeholders, managers, and staff in planning, decisiomnaking, implementation, and evaluation of their own initiatives and activities. Additionally, a successful management change effort must provide the-needed financial resources to promote innovation and team and knowledge building. Promotion and implementation of changes in management policies and procedures must be accompanied by direct access to resources. i~ ..................................:............................................................................................................................................................................................... 8. Project alternatives considered and reasons for rejection: Identification of Municipal Level Educational Investments (Necesidades Educativas Bdsicas Inmediatas -- NEBIs) Alternatives Rejected: Financing education investment needs in specific municipalities already identified by the Department (called NEBIs). NEBIs included: (i) investing in the creation of additional school places for poor preschool children and sixth graders in high-quality, nonprofit and religious schools; (ii) constructing and rehabilitating school buildings in rural areas; (iii) piloting the national reform of teacher training secondary schools and university programs; and (iv) laying the basic infrastructure for information systems between municipalities and the department. This alternative was rejected because the department identified specific investments for its municipalities, thus, not allowing municipal capacity building in planning and implementing their own education investments. Alternative Selected: Financing quality investment subprojects identified and prepared at the municipal level. The investments would still focus on financing the above-mentioned NEBIs. However, the decisionmaking on the specific mix and amounts would remain in the municipality. Increasing Student Access Alternatives Rejected: * Financing the construction of already identified schools in various municipalities in Antioquia. * Continuing to finance school vouchers already being provided by the Department. These alternatives were rejected because they did not provide municipalities with the choice of the most 10  Project Appraisal Document ANTIOQUIA, COLOMBIA Antiogula Basic Education Project compatible strategy to increase student access. For example, school vouchers could not be used in rural and isolated communities because of lack of private service providers; these municipalities could opt instead for rural strategies such as Escuela Nueva and the Sistema de Aprendizaje Tutorial (a secondary education rural tutorial program). Similarly, larger municipalities with budget constraints may opt to finance school places with nonprofit private schools rather than making large capital investments in school constructions and incurring mandatory recurrent costs. Alternative Selected Through the financing of Municipal Education Investment Plans provide choices and municipal decisionmaking as to the best strategy to increase school access. In addition, the Department will transfer technical know-how (e.g., criteria and manuals to subcontract student places with NGOs; mechanisms to assess the fiscal sustainability of school construction; and guidelines to establish rural education programs, such as Escuela Nueva and SAT). Educational Technology Alternatives Rejected * Finance an education technology program through a single source contract with a local university; and * Prefinance SEDUCA-specified technology training, computer equipment and software for schools. The alternatives were rejected because they did not take advantage of various high quality educational technology programs in the country. Further, the type and amount of investments at the school and municipal level was already identified at the Departmental level. Alternative Selected: Offer a choice of a special education technology program that offers financing, technical assistance, minimum quality standards, selection criteria, and choice of different quality education technology programs already offered by NGOs, universities and the public sector, including SEDUCA's own program. School-Level Educational Inputs Alternatives Rejected: * Finance predetermined training programs in curriculum and management of schools, and * Centrally contracting school refurbishments and assessment of school needs. These two alternatives were rejected because they were not congruent with the capacity building objectives of the educational policies and of the project. Also, experience with centrally provided services -- albeit with local participation in needs assessment and planning (but with central implementation -- e.g., contracting, managing resources) -- was unsatisfactory. Economies of scale by procuring centrally were not achieved: inef5icient distribution; late use of inputs and even nondelivery implied higher costs. High unquantifiable costs were also incurred by loss of motivation of local actors and negative image of nondelivering projects. Community preinvestment in planing time and local inputs became unrecoverable (sunk) costs. Alternative Selected Financing demand-based school and community subprojects. The demand-based School-Community Strengthening Program will provide a flexible mechanism to finance investments needs as they arise during the reform period. In addition, commitment and community responsibility will be created by empowering schools and communities to manage their own resources and implementing their own projects. Community-based monitoring and clear and transparent procedures will minimize risks of misuse of funds and inefficiencies. 11  Project Appraisal Document ANTIOQUIA, COLOMBIA Antioquia Basic Education Project Project Management and Implementation: Alternatives Rejected: * Centrally managed project implementation (e.g., procurement, financing, monitoring). * Creation of a Project Implementation Unit to manage the project. These two alternative were rejected because of Colombia's poor experience with large project implementation units. These units become isolated and overcontrolling, and the project is hardly incorporated into the day-to-day operations of the executing agencies. Resistance and mistrust is felt by government staff who are not participating in project implementation and, thus, capacity-building in public agencies is not achieved. Moreover, the traditional rationale of economies of scale from centralized procurement management was not realized because of cumbersome procurement and financing procedures, controlled and understood only by a very small administrative elite hired within the PIU. Alternative Selected: Relying in the internal structure of SEDUCA and local municipalities to self-manage and coordinate the project. The project design introduces capacity-building investments not for large management reforms, but to strengthen the staff and management systems necessary to manage the project. This strategy, in turn, will contribute to SEDUCA's overall management efficiency. With the respective division of SEDUCA, a small administrative team will be created to support the added administration needs of managing a World Bank-provided loan (e.g., reporting, accounting, Bank procurement methods). All other management and technical assistance will be provided by the respective division of SEDUCA and the Municipalities. 9. Major related projects financed by the Bank and/or other development agencies (completed, ongoing and planned). Sector issue Project Latest Form 590 Ratings Bank Financed IP DO Completed * Establish diversified secondary schools * Education Project (Ln. 0552), closing date S 12/31/73. * Establish diversified secondary schools * Second Education Project (Ln. 0679), closing date 12/31/73. S . Strengthen rural primary education and * Rural Primary Education Subsector Project (Ln. decentralize and integrate social services 2192), closing date 03/31/89. S . Improvement and expansion of diversified * Third Education Project (Secondary) (Ln. 0920), secondary education closing date 03/31/82. S