Uganda - Fourth Education Project

Document of The World Bank FVOR OMCLIL USE ONLY C-rZ- IS46Q U* Rgopt No. P-4860-UG MEMORANDUM AND RECOMMENDATION OF THE PRE SIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT OF SDR 17.1 MILLION TO UGANDA FOR A FOURTH EDUCATION PROJECT October 1988 Population and Human Resources Division Eastern Africa Department This docuent has a restircted distribuion and may be used by recipients only In the perfomnance of their efal dutes. Its contet may not oterwse be discosed without Wodd Bank athoriztion.  CURRENCY EQUIVALENTS Currency Unit - Uganda Shillings (USh) USh 150* - US$ 1.00 USA 1 = USS 0.0066 ABBREVIATIONS MOE - Ministry of Education TF - Textbook Fund GOVERNMENT Or UGANDA FISCAL YEAR July 1 to June 30 * As of July 1, 1988  FOR OMCLFCL USE ONLY UGANDA FOURTH EDUCATION PROJECT CREDIT AND PROJECT SSUARY Borrower: Uganda Beneficiaryt Ministry of Education Amountt SDR 17.1 million (US$ 22 million equivalent) Terms: Standard, with 40 years maturity Onlendina Terms: Not applicable Finan.ing Plan: Government - USS 5.9 million IDA - USW22.0 million Total - US$27.9 million -Economic Rate of Returns Not applicable Staff Appraisal Report: No.7387-UG IBRD No. 20789 IThs document has a sticd dibuionand may be Wd by nreiients only in the pofonnance of thirofficid dute Its contents may not odrwis be attued witot Word Bank authorton.  34.AORANDUM AND RECOMMENDATION OF THE PRESIDENT OF THE INTERNATIONAL DEVELOPMENT ASSOCIATION TO THE EXECUTIVE DIRECTORS ON A PROPOSED CREDIT TO UGANDA FOR A FOURTH EDUCATION PROJECT 1. The following memorandum and recommendation on a proposed development credit to Uganda for SDR 17.1 million (USS 22.0 million equivalent) is submitted for approval. The proposed credit would be on standard IDA ternms vith 40 years maturity and help finance a fourth education project. 2. Background. Over the last seventeen years IDA has had a continuing dialogue with the Ministry of Education in Uganda and has made three credits to the sector based on an overall strategy aimed at achieving a balanced and comprehensive education sector which in turn matches the manpower needs of the country. The First Education Credit concentrated on the expansion of secondary education, the Second Education Credit aimed to increase the supply of technical specialists and the Third Education Credit assisted in the rehabilitation of facilities and the provision of educational materials. But two decades of economic stagnation, political instability and civil insurgence have left the education system, although expanded and operating, at a much lower level of quality at all levels. Some of the most acute symptoms of decline in educational quality include: the almost total absence of textbooks and instructional materials; a deteriorating teacher morale and productivity; an exodus of senior experienced teachers, inspectors and headmasters towards better employment opportunities inside or outside the country; and a general lack of school maintenance. These symptoms can be related to a number of critical issues which need to be addressed on a sector wide basis. To name a few: (a) poor management and financial control as evidenced by large discrepancies between the number of teachers actually on post and those on the payroll; (b) excessively high unit recurrent costs, particularly in secondary schools, teacher training colleges, and technical institutions; (c) gross inefficiencies at all levels as evidenced by small and unviable institutions that do not allow for economies of scale in their operations; (d) declining real incomes of the teaching force; and (e) absence of clear policy and strategy for the controlled expansion and the qualitative improvement of the sector. 3. Revitalization of the system requires a combination of measures: (a) improvement of quality; (b) greater cost-effectiveness and improved financial controls; (c) improved staff morale; and (d) certain increases in parental and community financial support, hopefully combined with a greater voice over the efficiency of the institutions' operation. These measures are more than Government can undertake without external financial assistance. The proposed strategy, to be supported by this project, would consist of external assistance to non-salary expenses (textbooks, supplies, equipment, school maintenance and rehabilitation), together with support for upgrading of key functions (pedagogical advice, management capabilities). This would help restore morale in the teaching force and a will to manage at all levels, which in turn could be reinforced by shared oversight of the operation of particular facilities coupled with provision  -2- of additional parental or community financial contributions. In parallel, studies to improve cost-effectiveness would be carried out; and the !esulting actions plans would be launched over the next few years. Once these measures are implemented, the system would have a sound basis from whlch to expand. The proposed strategy would also pave the way for a future sector adjustment operation, hopefully to be supported by IDA and other donors. 4. Project objective. The objectives of the project are to: (a) maintain the momentum of the Government's educational rehabilitation efforts at the primary education level and ensure their sustainability; (b) assist the Government in initiating, on a limited (pilot) basis, a revolving Textbook Fund (TF) for the replenishment of instructional materials on a permanent basis; (c) strengthen key institutions under the Ministry of Education (MOE) involved in improving and monitoring educational quality and in project implementation; and (d) help prepare a sector loan to implement the Government's emerging educational strategy. 5. Proiect description. The proposed project has three components: (a) provision of textbooks and instructional materials to approximately 3,400 primary schools not assisted under the Third Education Project (Cr. 1329-UG); (b) assistance for institutional and policy development, including (i) the setting up of a pilot textbook fund financed by contributions from parents and from MOE and intended to replenish textbooks in self-selected areas which had benefited from the Third project; (ii) strengthening of the inspectorate (training, technical assistance, transportation, vehicle maintenance); (iii) support for the National Curriculum Development Center and the Science and Technolegy Equipment and Production Unit (technical assistance, training, initial operating costs); (iv) strengthening of the Project Implementation Unit; (v) support to the Education Policy Review Commission to help finalize its work and organize a follow-up donors' conference; and (c) the carrying out of studies primarily to complenent ongoing policy work on cost-effectiveness. The project, to be disbursed over a five-year period has an estimated total cost of $27.9 million equivalent, 67Z of which is foreign exchange. A breakdown of costs and the financing plan are shown in Schedule A. Amounts and methods of procurement and of disbursements, and the disbursement schedule are shown in Schedule B. A timetable of key project processing events and the status of Bank Group Operations in Uganda are given in Schedules C and D, respectively. The Staff Appraisal Report No. 7387-UG dated October 19, 1988, is attached. A map is also attached. 6. Rationale for IDA involvement. The proposed project is primarily a follow up on the Third Education Project to continue the rehabilitation of primary schools and supply them with didactic materials and textbooks. It would also build upon IDA's sector work in education finance to prepare the groundwork for a more extensive sector operation aimed at system-wide improvements. IDA's comparative advantage is primarily one of providing continuitys regarding project concept, procurement and distribution mechanisms, and overall management. It also is one of building upon the Sub-Saharan Africa report on education to help attract donor support to the sector.  -3- 7. Agreed Actions. During Negotiations, Government provided IDA with names of the districts selected according to agreed criteria for participation into the TF and provided assurances that participation of schools from those districts will be c.1 a voluntary basis. Government also agreed to present for IDA's review by May 31, 1989 a detailed plan for the operation of the TF, including (a) specific arrangements for the collection of TF funds, (b) arrangements for the provision of adequate foreign exchange for the acquisition of educational materials with TF funds, (c) detailed criteria for monitoring and evaluating the TF scheme with a view of making appropriate recommendation regarding the replicability of the scheme nation-wide, and (d) the level of the Government's contribution to the TF. Other agreements reached during negotiations for improving the quality and cost-effectiveness of the educational system include preparation of action plans to (a) eliminate discrepancies between the number of teachers paid and those actually teaching (by December 31, 1989), (b) to bring teacher training and technical institutions to more economical size (by December 31, 1990), and (c) to improve the relation between school size and curriculum offerings (by December 31, 1990). Other covenants relate to provision of semi-annual reports; adherence to acceptable LCB procedures; estaklishment of a special account; and auditing arrangements. As a condition of disbursement for operating costs related to the Inspectorate, the Government agreed to provide a three-year annual program (updated annually) and an annual performance report for the Inspectorate. 8. Benefits. The proposed project would extend the benefits of the Third Education Project to another 3,400 primary schools; introduce a realistic textbook funding mechanism; strengthen the institutional and policy capability of the Ministry of Education and improve the morale of the teaching force, headmasters and inspectors; and pave the way for a longer term adjustment and revitalization of the education system. 9. Risks. Regarding the textbook component, since procurement, distribution and other implementation arrangements under the Third Project (Cr. 1329-UG) are expected to be retained, the principal risk concerns the medium term: i.e.. sustainability of the mechanisms to purchase and f.nance textbooks and instructional materials. The proposed pilot TF scheme is intended to put in place an affordable cost-sharing mechanism building upon the long tradition of community and parent participation in primary education. It would also encourage sustained Government budgetary contribution. Regarding security conditions which have improved considerably, experience under the previous project has demonstrated that considerable obstacles can be overcome by committed staff and parents. There are no special risks related to the other project components. 10. Recommendation. I am satisfied that the proposed credit would comply with the Articles of Agreement of the Association and recommend that the Executive Directors approve the proposed credit. Barber B. Conable President Attachments Washington, D.C. October 19, 1988  4- SCHEDULE A UGANDA FOURTH EDUCATION PROJECT Estimated Costs Local Fcreign Total (US$ million) 1. Primary School Improvement 0.1 12.01 12.01 2. Institutional and Policy Development 3.80 3.25 7.05 3. Pro-Investment Studies 0.03 0.30 0.33 4. PPF 0.03 0.28 0.31 Total Base Cost 3.96 15.74 19.70 Contingencies 5.28 2.92 8.20 Total Project Cost 9.24 18.66 27.90 Financing Plan Government 5.90 - 5.90 IDA 3.24 18.76 22.00 TOTAL 9.14 18.76 27.90 t  -5- SCHEDULE 8 Page 1 of 2 UGANDA FOURTH EDUCATION PROJLrCT Procurement method and Disbursemints (US$ million) Procurement Method Total ICB LCB Other N.A. Cost Textbooks - - 9.23 - 9.23 (9.23) (9.23) Instructional Materials and Office and Teaching 3.00 0.10 - - 3.10 Equipment (3.10) (0.10) (3.10) Motor bicycles and Spare Parts - 0.15 - - 0.15 (0.15) (0.15) Vehicles - 0.13 - - 0.13 (0.13) (0.13) Sbipping and Consolidation 3.43 - - - 3.43 (3.43) (3.43) Technical Assistance and Fellowships - - 2.60 - 2.60 (2.60) (2.60) Workshops and Seminars - - - 1.20 1.20 (0.33) (0.33) Incremental Operating Costs - - - 8.06 8.06 (3.03) (3.03) --------------------------------------------------------------------__--- TOTAL PROJECT COSTS 6.43 0.38 11.83 9.26 27.90 (6.43) (0.38) (11.83) (3.36) (22.00) *Numbers in parenthesis are the respective amounts to be financed by IDA.  -6- SCHEDULE B Page 2 of 2 Disbursements Category Amount I (US$ Million) 1. Textbooks 7.68 10O2 of Foreign Expenditures 2. Instructional Materials & Teaching and Office Equip. 2.58 10O2 of Foreign Expenditures and 802 of Local Expenditures 3. Vehicles Motorbicycles and Spare Parts 0.25 1002 of Foreign Expenditures 4. Technical Assistance 1.58 10O of Foreign Expenditures 5. Training Abroad 0.28 100S of Foreign Expenditures 6. Overseas Shipping & Consolidation 3.00 1002 of Foreign Expenditures 7. In-Country Workshops and Seminars 0.27 5OZ of Total Expenditures 8. Operating Costs 0.52 30S for Inspectorate; rest 152 9. Project Preparation Facility 0.31 Total Baseline Cost 16.47 Uhallocated 5.53 Total Project Cost 22.00 Estimated Credit Disbursements (US$ Million) IDA FISCAL YEAR FY89 FY9O FY91 FY92 FY93 Annual 4.60 7.10 5.20 3.10 2.00 Cumulative 4.60 11.70 16.90 20.00 22.00  SCHEDULE C UGANDA FOURTH EDUCATION PROJECT Timetable of Key Project Processing Events (a) Time taken to prepare: 5 months (b) Prepared by: Governmnt tc) First IDA mission: November/December 1987 td) Appraisal mission departuret Hay 1988 te) Negotiations: September 1988 (f) Planned date of Effectiveness: February 1989 (g) List of relevant PCRs and PPARs: (i) PPAR No. 1456 (First Education Project, February 17, 1977. (ii) PCR No. 4730 (Second Education Project, October 5, 1983). (iii) Draft PCR Unesco March 1988 (Third Education Project).  SCHEDULE D Page 1 of 2 TEE STATUS OF BANK GROUP OPERATIONS IN UGANDA A. Statement of Bank Loana and IDA Credits as of March 30, 1988 Loan or Undis- Credit No. Year Borrower Purpose Bank IDA bursed One (1) Loan and fourteen (14) Credits fully disbursed 8.40 283.43 1248-UG 1982 Uganda Industrial Rehabilitation 35.00 12.21 1328-UG 1983 Uganda Agricultural Rehabilitation 70.00 21.19 1329-UG 1983 Uganda Third Education Project 32.00 .19 1434-UG 1984 Uganda Second Technical Assistance 15.00 6.32 1445-UG 1984 Uganda Third Highway 58.00 42.12 1510-UG 1985 Uganda Water Supply and Sanitation Program 28.00 8.55 1539-UG 1985 Uganda Agricultural Development 10.00 8.31 1560-UG 1985 Uganda Second Power 28.80 26.66 1561-UG 1985 Uganda Petroleum Exploration Promotion 5.10 4.74 1803-UG 1987 Uganda Fourth Highway 18.13 18.13 1824-UG 1988 Uganda Forestry Rehabilitation 12.87 12.36 A034-UG 1988 Uganda Non-Sector Specific (Econ. Recov. Cr./SAF) 24.01 11.28 1844-UG 1988 Uganda Non-Sector Specific (Econ. Recov. Cr.|SAF) 65.00 43.89 1869-UG 1988 Uganda South West Ag. Rehab. 10.43 10.43 1893-UG 1988 Uganda Sugar Rehabilitation 25.96 25.96 Total 8.40 721.73 252.34 of which has been repaid 6.88 4.45 Total now outstanding 1.52 717.28 IDA amount sold: 17.50 of which has been repaid: 17.50 TOTAL NOW HELD BY BANK AND IDA 1.52 717.28 TOTAL UNDISBURSED 0.00 252.34  -9- SCHEUDLE D Page 2 of 2 B. STATEMENT OF IFC INVESTMENTS March 30, 1988 Amoznt in US$ Millions Fiscal Oblipor Type of Business Loan Equity Total 1965 Mulco Textiles, Ltd. Textiles 2.79 .71 3.50 1972 Tourism Promotions Services Tourism 1.11 - 1.11 1983 Toro and Mityana Tea Food and Co., Ltd (TAMTECO) Food 1.62 - 1.62 Processing 1983 Sugar Corp. of Food and Uganda Food 8.00 - 8.00 Processing 1984 Uganda Tea Corp. Ltd. Food and 2.81 - 2.81 Processing 1984 Development :'inance Company of Uganda Development - 0.38 0.38 Finance Total gross commitments 16.34 1.09 17.42 now held by TFC Total undisbursed (including participants portion) 3.92 0.27 4.19 Sourcet IFC Disbursements Section  UGANDA FOURTH EDUCATION PROJECT umbe - Mojor Roads ~---Railroads 30 Rivers Ca mp o District Capitols District Boundaries International Boundaries - Pbkwach 0 25 5,0 75 100 KILOMETERS -i / 0 20 40 60 MltES - Jo o<I~0mie HOSMAW / ,r *Ip s* BUNDIBUGYO "p. KABARO *//~~~~~~~~n ' -00~ ) t BUSI4E~~~~~~~~~~~~~~~~~~~~~~~~~~~~~NYI RMBARA RUNGIRI KAALE '< ~~~~~T i '.. 30, RWANDA 31 ap. 3