Ukraine - Education Development

Report No. PIC1248 Project Name Ukraine-Education Development Project Region Europe and Central Asia Sector Education Project ID UAPA34586 Borrower Ukraine Implementing Agency Ministry of Education Responsible Official: Mychailo Zgurovsky, Minister Evgeniy E. Beskletny, Project Director pr. Peremogy 10, Kyiv Ukraine 2137 Telephone: 380-44-216-2800 Telefax No. 380-44-274-1049 Date PID Prepared June 5, 1995 Date Initial PID Prepared October 31, 1994 Projected Appraisal Date June/July 1995 Projected Board Date November/December 1995 I. Country and Sector Background: Ukraine's social sector faces formidable challenges in the years immediately ahead. The implosion of the Ukrainian economy has had devastating effects on the country and the well-being of its people. The economic crisis will also put pressure on the quality and coverage of social programs over the next five to eight years. Real GDP during the period 1990-93 dropped by aost 40% and declined even more in the early part of 1994. Prices have continued to increase since Ukraine declared independence, with the annual inflation rates increasing from about 90 percent in 1991 to aost 5,000 percent in 1993. At the same time, real wages were falling -- by about 60 percent in 1993 alone. Although there appears to be some improvement during recent months, the situation is still critical. II. These conditions have had a tremendous impact on the social sector, especially on health and education. For example, life expectancy at birth, a broad but slow moving indicator of quality of life, declined from 67 in 1989 for men to 64 in 1992, and from 75 to 74 for women during that same period. Living conditions have worsened considerably over the past two-three years, for the entire population. As an outgrowth of these conditions, many school facilities are suffering from a lack of adequate maintenance and many students, especially at the upper grade levels, are without textbooks and school supplies. Teacher and school administrator salaries and benefits are at an all-time low, forcing many of them to seek second and third jobs, frequently reducing their effectiveness as teachers. Many are leaving the education system to look for a better life. III. Nevertheless, there is a common hope and expectation that in time the situation will improve. Ukraine has embarked upon a profound  course of political and economic transformation of its society, demonstrated by its efforts to form a democratic nation and a market economy. As a result, longstanding features of the education and training system are being reviewed and changed to fit the new structure and shape of Ukrainian society. This project supports some of those initial changes and approaches to meeting the country's new needs. IV. Project Objectives: This project would assist the Ukrainian Government in improving management effectiveness under tight fiscal constraints, while building an education capacity to prepare students at general and vocational secondary and higher education levels for functioning effectively in, and contributing to, a market-oriented society. This would be accomplished by strengthening sectoral management and broadening the scope of the country's education programs, on a pilot basis initially, to include curriculum and materials development and classroom instruction on the underlying principles and functioning of market economies. At the same time, it would establish a framework and institutional capacity for longer term systemic reforms. The project would have four sub-objectives, one for each project component, as indicated below: A. General Secondary Education: to develop and implement on a national pilot basis a series of upper secondary school courses designed to enhance the employability of students and to improve their ability to find jobs and function effectively in a market economy; B. Vocational Secondary Education: to modernize vocational education and training in selected vocational schools, on a pilot basis, so the institutions can adapt to changing needs of the economy, and so their students will be equipped with a broader range of knowledge and skills for responding flexibly to changes in the labor market; C. Higher Education: to develop a capability in Ukraine's higher education system for producing highly trained individuals with the leadership and technical skills essential for the country's move toward a market-oriented economy; and D. Education Management and Finance: to strengthen the Government's capability to design and implement sectoral reforms and to improve education quality and relevance through studies and training in sectoral and financial planning and management, all within tight fiscal constraints. V. Project Description: This proposed project, to be implemented by the Ministry of Education (MOEd), would meet priority needs of the several levels and types of education and training under administration of the MOEd. This project is seen as a limited first intervention in the education sector of Ukraine, focusing on specific identified needs, while building a base for future reforms. The lower primary school grades are not included in the general education component, except for the provision of textbooks, because these grade levels are being relatively well protected from the effects of the economic crisis, i.e., textbooks, materials, and supplies are provided to the lower grades as - 2 -  a priority over the higher grades. VI. The project would be organized and implemented as four inter- related components: (i) general secondary education, (ii) vocational secondary education and training, (iii) higher education; and (iv) education management and finance. Although three levels/types of schooling are involved here, several common needs extend throughout all of them. These needs are primarily to improve and re-orient selected aspects of curricula for greater relevance to further education and employment, and the new economic environment; to increase availability of and access to textbooks and other needed learning materials; to re- direct teaching methodology toward more application of information; and to strengthen educational management and finance as a means to improving effectiveness and efficiencies in the education system. VII. Special emphasis would be given to cost-recovery measures, particularly in the vocational and higher education institutions. Some such measures have already been implemented in these particular program areas, e.g., both types of institutions may accept up to 20 percent more students than the official capacity of their programs and charge the unit cost of the program to the students admitted on this basis. Vocational schools contract with the Ministry of Labor (MOL) to retrain displaced workers and with enterprises for upgrading their staff. Vocational schools also operate businesses and charge fees for services to supplement budgets for operational costs. The cost-recovery mechanisms planned, or already in place, in the vocational and higher education system are expected to make the education and training programs more demand-driven, i.e., client/student willingness to pay. In addition, higher education is currently undergoing a study of funding resources and possibilities, including the payment of full tuition by the beneficiaries and/or employers (public and private) of the graduates. VIII. The sectoral improvements supported by the project would help students develop skills for living and working in a democratic and market-oriented society, including: critical thinking and problem- solving skills at all levels, understanding of the principles of free choice and market economies, and basic occupational/career skills. It would seek to accomplish this at a time when resources are tightly constrained, by encouraging efficient use of education budget allocations. Because of these common concerns at all levels, and the need to re-orient all aspects of education to the new political and economic environment, system enhancements at all three levels, including management, are being considered together as one integrated package for this initial project operation. The various project components would be oriented toward the immediate pressing needs of the sector as described below. IX. Component (i), general secondary education, would open up a new and practical approach to education in Ukraine, equipping upper secondary students with life skills that can serve them well in aost any future endeavor. The project would strengthen and broaden the general secondary education system and establish curriculum design and quality standards comparable to those of OECD countries. This component would focus on the upper grades, at the interface between school and - 3 -  employment, and therefore in greatest need of assistance during this economic transition. The lower grades, as indicated previously, are not included, except for textbooks as these grades are not suffering the effects of economic malaise to the same extent as the upper grades. X. A basic economics course would be integrated into the general secondary school core curriculum of required subjects. Special employment and market-oriented courses in such areas as word processing, financial accounting, business English, spreadsheets and data bases, and small business organization and management would be added to the optional portion of the curriculum to be offered as electives. These elective courses would enhance the students' employability and their ability to function in a market economy. This component would be implemented initially as a pilot effort involving, in each of the oblasts and three major cities which function as geo-political units, 3 secondary schools, to be selected on the basis of criteria agreed with the Bank. XI. Technical assistance would be provided for developing the curricula and materials required for this effort and for their introduction into the selected pilot schools. The curricula and materials to be developed, and the required teacher training, would be made available over time to the rest of the country as additional resources become available. Both this component and component (ii) below (para. 12) would include: technical assistance for curriculum and instructional materials development in the areas described; the provision of textbooks and other necessary learning materials; required teacher retraining, to focus on technical content, improved teaching methodology, and the development of skills for assessing student acquisition and application of key concepts and critical information; and the provision of instructional equipment for the project supported schools. XII. Component (ii), vocational secondary education. Reform and modernization of vocational education in Ukraine is an important component of this project. The reform would emphasize developing among vocational students more general learning skills and broader based technical skills, enabling them to respond flexibly to changes in their future employment circumstances. The reform would also include delinking vocational schools from single enterprises or sectors and developing broader occupationally relevant curricula which provide students with a wide range of job options. The delinking would enable schools to focus on more generalized clusters of job skills (rather than on specific sectors) and provide flexibility to graduates for adapting to changes in job requirements. This will also give training institutions the opportunity to shift their focus to the changing demands of the labor market. XIII. This project component would therefore focus on upgrading the vocational education system with broad-based, demand-driven training programs that meet the skill needs of the developing labor market. The project schools would implement comprehensive programs for broad clusters of related occupations to improve program efficiency and prepare students with a broader range of knowledge and skills for responding more flexibly to changes in job demands. In addition, special emphasis would be given to involving the private and public sector employers more directly and broadly in the planning and - 4 -  implementation of training programs. Implementation of this component would be carried out by selected local staff and administrators of the eight model schools, with leadership and guidance from the Project Directorate, international consultants, and industry representatives. The implementation would require retraining of about 240 teachers (an average of 30 per center). The teacher retraining would be provided by the local staff who develop the curricula and instructional materials, with planning and organizational assistance from the counterpart consultants. XIV. This vocational education component, to be implemented as a pilot effort, would support the formation, from existing schools in selected local areas, of eight model vocational school complexes (no more than one per oblast). Each of the complexes would comprise one or more (up to 3-4) vocational schools in relatively close geographical proximity, with occupationally related programs. The programs offered in a given complex would train for the unique skill needs of the particular region, e.g., construction, transportation, agriculture, food processing, culinary arts, tourism, manufacturing and machine trades, etc. The existing programs of the selected schools would be updated, consolidated, and re-oriented into occupational clusters designed to meet the modern-day employer demands of the area. Technical assistance and instructional equipment would be provided to support this effort as indicated above (para. 11). The newly developed curricula and programs would eventually be extended to other parts of the country, as additional resources become available. XV. Component (iii), higher education, would establish and/or upgrade market-oriented degree programs in the four disciplines of economics, business and financial management, commercial law, and computer (informational) sciences, as requested by university rectors, in up to six universities, selected on the basis of criteria previously agreed with the Bank. These programs would focus on preparing individuals at undergraduate and graduate levels for leadership roles in the emerging market-oriented economy. The programs assisted under this component would also provide public education in economics and the other project disciplines, including seminars and outreach programs through the mass media, for managers and other higher-level workers, e.g., engineers, lawyers, scientists, financial analysts, etc. Curricula and instructional materials for the four programs would be prepared by program staff/teams in the project institutions, with assistance from international consultants and, to the extent possible, from enterprise representatives. This project component would include: technical assistance for curriculum and instructional materials development; provision of textbooks and other learning materials; re-training and upgrading of program teaching staff; and the provision of instructional equipment. In addition, the programs would develop twinning arrangements (professional linkages) with foreign universities having expertise in these areas. XVI. Component (iv), educational management and finance. This component is basically an institution-building effort with the main goal of strengthening organization and management of the education system and improving efficiency and cost effectiveness in its overall operation. In this context, the component would include several interrelated - 5 -  project tasks: (a) establish an Education Reform Commission; (b) improve MOEd organizational structure and management performance; (c) enhance MOEd management training capability; (d) expand the Ministry's MIS; and (e) strengthen the MOEd Educational Assessment and Evaluation Center. The project would finance technical assistance for the studies and for curriculum and instructional materials development; the cost of textbooks and other teaching materials; teacher retraining; and computer-aided instruction. Additional Items of a System-Wide Nature XVII. Educational Assessment and Evaluation Center. Activities under this component would strengthen and further develop the Ministry's Educational Assessment and Evaluation Center which serves all segments of the education system. In carrying out its mandate, the Center would focus on the following functions: (a) developing institutional and program accountability; (b) monitoring educational equity; (c) supporting teachers' efforts to diagnose and respond appropriately to students' learning difficulties; (d) measuring students' aptitudes and achievements; (e) assessing education system performance; and (f) helping departments in the Ministry to assess and improve pilot programs/courses. The Center has already established a network of individuals in each oblast education administration department to help coordinate and implement the various aspects of the assessments program. These oblast staff, at the present time, devote only part of their total effort to this function. They would be brought together about twice each year to review program issues and plans for continued program expansion and development. XVIII. Textbooks. Support would be provided for financing the costs of printing selected textbooks, translation rights for selected foreign- published books and their publication in the Ukrainian language, professional journal subscriptions, reference and documentation materials, and outright acquisition of existing high priority books. In addition, authors would be commissioned to write new books which would be published after screening and approval by the textbook evaluation panel. In all cases, the purchase of books and other materials with project loan funds would be accomplished through a competitive bidding process in accordance with Bank Guidelines for Textbook Procurement. XIX. The proposed project loan would finance the initial publishing and purchase of selected priority textbooks for the various grade levels. This financing, to be distributed over the four-year period, would, at the same time, help to start up the new textbook financing system. The financing system would be based on cost-recovery from students/parents who would pay a user fee of about 30% of the new book replacement cost. Students from families who could not afford to pay the book cost would be assisted through the special school fund set up for such situations. XX. Assuming that the books would last four years, this approach to textbook financing would generate resources to replace the books when they wear out and also to expand the approach more broadly over time. The book replacement cost (and user fee) would be determined at the beginning of each school year, adjusted each year for book production - 6 -  costs determined by competitive bidding. The 30% user fee would, over the four-year period, generate an additional 20% of the book value to cover book losses and to extend the approach to other books. The oblast administration under this plan would purchase the books from the publishers who would deliver them to the oblast distribution centers. The schools would collect the user fees at the beginning of the school year and turn them over to the oblast administration which would already have placed their orders for books to be published and purchased the following year. The collected user fees would be paid immediately as an advance to the publishers who would immediately purchase paper, ink, supplies, etc. for the next series of books, in order to prevent inflation from eroding the value of the funds. XXI. A Project Directorate has been established in the MOEd to coordinate and support implementation of the project components. The Project Directorate (PD) comprises the Project Director (reporting to the Minister) and directors of the four MOEd departments in which project components are to be implemented. The directors will be accountable for successful implementation of their respective components and, as a group, for the project as a whole. Operating within the Directorate and reporting to the Director, will be an implementation staff to include a project accountant, a procurement officer, and four sub-sector specialists (one appointed from each implementing department) who, under leadership and guidance from the Project Director, will devote full time to managing implementation of their respective department's component. Because this would be the first World Bank financed project for the education sector and for the MOE, provision would be made in the project for support for a project implementation advisor who would be recruited to assist the Project Director during the first three years of project implementation. XXII. Costs and Financing: The proposed project is still under preparation and development and is thus subject to adjustments in scope and consequent costs. Therefore, the currently estimated costs may change from the present figures. The total project cost estimate at present is in the order of US$50 million, with a foreign exchange component, the basis for a possible loan, of about $38 million. The project would require a government allocation in counterpart funds of about US$12 million over a five-year period, although this will mainly entail reassignment of existing staff and reallocation of certain already budgeted funds. Bilateral donor support is expected to cover part of the country's share of technical assistance project costs. Interest has been expressed by some bilateral agencies in assisting with certain parts of the project, although nothing is firm yet. XXIII. Project Implementation: This proposed project (except for the textbook element) would be implemented on a pilot/demonstration basis in selected areas throughout the country, but the results would be extended over time to the rest of the country as additional resources become available. Due to the urgency of the textbook situation (few textbooks printed over the past three years), this element of the three school- related components would be implemented on a broader, national scale, with the over-riding goal of reforming national and regional policies and procedures for textbook procurement, financing, and distribution. Textbook production and distribution under the project would be turned -7 -  over to the private sector, with the publishers eventually responding to orders placed by the oblast administrations. Parents/students would be required to pay user fees for use of the textbooks provided to the students. The textbook procurement activities supported by the project would be managed by the Ministry's Textbook Administrator under leadership and guidance of the Project Directorate. XXIV. The remainder of project implementation would be carried out by the PD, which comprises directors of the four departments with project components and an implementation staff of four technical specialist (general educator, vocational educator, higher education specialist, and a representative from the management and finance department) assigned from each of the four line agencies responsible for the various project component areas. There would also be a project accountant, a procurement officer, and possibly one or two support staff. The PD, whose Director reports directly to the Minister, would be responsible for general management of project implementation, including technical and logistical support. Project support would also be provided for an experienced externally recruited project advisor, plus office equipment for the PCU. XXV. Sustainability. The project was initiated and has been developed by the Ministry of Education, and the national and local governments have been supportive from the beginning. The project design and implementation plans originated from the Ukrainian proposals and involved significant bottom-up participation and ownership from all levels of the education sector. The textbook program and the Assessment and Evaluation Center would be virtually self-supporting. The estimated recurrent expenditures under the project are the Government's contribution and do not constitute an unbearable burden since most of them are already planned to be expended for existing staff, facility space, utility costs, etc. Many of these expenditures are already part of the budget outlays and would be internal transfers. XXVI. Lessons Learned from Past Operations in the Country/Sector. This proposed project would be the first education operation in Ukraine. The Bank's only previous experience was the excellent but necessarily cursory treatment of the education sector in the social sector study completed in 1993. However, based on past experience with other countries, special attention has been given in preparation of the project to ensuring beneficiary participation in project design and preparation. In addition, because this is a first project for the education sector in Ukraine, a project implementation advisor would be employed by the Ministry and placed in the PD to assist with implementation concerns (para. 21). Further, to ensure appropriate visibility for the project within the Ministry and faster problem resolution, it was agreed that the Project Director, and head of the of the Project Directorate would report directly to the Minister, at least in the beginning phase of implementation. XXVII. Poverty Category. This project does not focus directly on poverty alleviation. However, it is expected that the integration of occupationally related courses into general education curricula, and the revamping of vocational education to make both it and general education more relevant to the identified needs of the labor market, will improve - 8 -  employment potential for those leaving the school system, thus helping to reduce, if only slightly, the problems of poverty. Also, the worker retraining programs contracted by MOL to the MOE vocational education system will help in the war against poverty by getting more people back to work. XXVIII. Environmental Aspects. This proposed project includes no major construction nor use of disposable chemicals. Its focus will be mainly on curriculum, textbook, and other instructional materials development, plus teacher education and management development. It therefore is judged to fall under the Environmental Category C. xxix. Womens' Category. Since most of the general education faculty are women, the project would proportionally benefit this group. Furthermore, education access is relatively gender neutral in Ukraine. Therefore, the new curriculum would only enhance equitable occupational access to women in the market economy. XXX. Project Benefits. The project, by establishing a framework for a new and improved approach in educational programming and curriculum development, is expected to ultimately benefit the entire education system. The direct and immediate beneficiaries of the project would be the students and teachers in the eighty selected general secondary schools, eight integrated vocational education complexes, and six selected universities. It is expected that the project would improve education and training for about 9,000 to 10,000 students per year in the different programs and levels, with coverage expanding far beyond this number as the pilot activities are subsequently extended to other parts of the country. XXXI. Project Risks. There are three major risks in this project. First, due to the country's fiscal crisis, the Government may not provide the necessary resources to support project activities. To minimize this risk, the Government has been asked to commit itself to, and allocate in the coming budgets, the amount required to finance counterpart costs, including recurrent expenditures. Second, changes in the political and administrative leadership in the education sector can hamper future actions necessary to complete project implementation. This risk is minimal since the project design and preparation of the implementation plans involved significant involvement from all levels of the education sector. Furthermore, to ensure and maintain a sense of project ownership, the program departments would each have representative serving in the PD to carry out the implementation. Finally, the MOE's inexperience with project management in general and Bank assisted projects in particular could hamper smooth project implementation. This last risk is reduced by including in the project design a series of education management and financial reviews/studies of the MOE at the beginning of the project and incorporating their recommendations into the project managerial training to quickly build up management skills and capabilities at the different levels. In addition, a project implementation advisor would be included in the TA to assist the PD in assuring effective project implementation. Task Manager: Lloyd D. Briggs, EC4HR 9  (202) 473-2326 (tel) (202) 522-1179 (fax) Contact Point: Public Information Center The World Bank 1818 H Street N.W. Washington D.C. 20433 Telephone No.: (202)458-5454 Fax No.: (202)522-1500 Note: This is information on an evolving project. Certain components may not necessarily be included in the final project. - 10 -