Philippines - Second Elementary Education Project

Document of The World Bank FOR OFFICIAL USE ONLY Report No: 16177 IMPLEMENTATION COMPLETION REPORT PHILIPPINES SECOND ELEMENTARY EDUCATION PROJECT (LOAN 3244-PH) December 30, 1996 Human Resources Operations Division Country Department I East Asia and Pacific Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. It contents may not otherwise be disclosed without World Bank authorization.  CURRENCY EOUIVALENTS Name of Currency = Peso (P) Appraisal Report US$1 = P 22.80 ICR (Date) US$1 P 25.80 FISCAL YEAR January - December PRINCIPAL ABBREVIATIONS AND ACRONYMS USED BEE Bureau of Elementary Education CCPAP Coordinating Council for the Philippines Assistance Program CHED Commission of Higher Education CY Calendar Year DBM Department of Budget and Management DECS Department of Education, Culture, and Sports DIP Drop-out Intervention Program DPWH Department of Public Works and Highways EDPITAF Educational Development Projects Implementing Task Force GoP Govemment of the Philippines ICB Intemational Competitive Bidding ICR Implementation Completion Report IMDC Instructional Materials Development Center LCB Local Competitive Bidding LET Licensure Examination for Teachers MIS Management Information System NEDA National Economic and Development Authority OECF Overseas Economic Cooperation Fund PBET The Professional Board Examination for Teachers PICU Project Implementation Coordination Unit PRODED Program for Decentralized Educational Development SAS Student Assessment System SAR Staff Appraisal Report SBP School Building Program SEEP Second Elementary Education Project SOE Statement of Expenditure SRA Social Reform Agenda TEEP Third Elementary Education Project Vice President: Marianne Haug, Acting EAP Director: Javad Khalilzadeh-Shirazi, EAI Division Chief: Sven Burmester, EAIHR Task Manager: Richard Meyers, Sr. Operations Officer  FOR OFFICIAL USE ONLY Table of Contents Preface ...................................................... i Evaluation Summary ..................................................... ii Part I: Implementation Assessment Project Background ...............................1....................... Project Context ..........................................1............ Project Objectives ......................................................2 Achievement of Project Objectives ......................................................4 Implementation Record and Major Factors Affecting the Project ..........................7 Project Sustainability ......................................................9 Bank Performance ..................................................... 10 Borrower Performance ..................................................... 10 Assessment of Outcome ..................................................... 11 Future Operation ......................................................11 Key Lessons Learned ...................................................... 12 Part II: Statistical Tables Table 1: Summary of Assessments .14 Table 2: Related Bank Loans/Credits .15 Table 3: Project Timetable 16 Table 4: Loan Disbursements: Cumulative Estimated and Actual. 17 Table 5/6: Key Indicators for Project Implementation and Operation. 18 Table 7: Studies Included in Project 20 Table 8a: Project Costs .21 Table 8b: Project Financing .22 Table 9: Economic Costs and Benefits .22 Table 10: Status of Legal Covenants .23 Table 11: Compliance with Operational Manual Statement .24 Table 12: Bank Resources: Staff Inputs .24 Table 13: Bank Resources: Missions .25 Annexes A. Aide Memoire .............................. 26 B. Borrower Contribution to ICR .............................. 32 This document has a restricted distribution and may be used by recipients only in the performance of their official duties. It contents may not otherwise be disclosed without World Bank authorization.   i IMPLEMENTATION COMPLETION REPORT PHILIPPINES SECOND ELEMENTARY EDUCATION PROJECT (Loan 3244-PH) PREFACE This is the Implementation Completion Report (ICR) for the Second Elementary Education Project (SEEP) in the Philippines, for which Loan 3244-PH in the amount of US$200 million equivalent was approved on July 3, 1990 and made effective on August 30, 1990. The US$200 million SEEP loan was closed on June 30, 1996, and was fully disbursed as scheduled on October 31, 1996 except for $53.92 which are being cancelled. The loan was extended three times from the original closing date of December 31, 1993. Total disbursements came to US$ 175 million (US$ 25 million was cancelled in 1995). Parallel financing was provided by the Overseas Economic Cooperation Fund (OECF) in the amount of US$ 145 million during the period of 1991-1996. The ICR was prepared by Ms. Mari Takahashi Parker, Consultant, under the supervision of Ms. Francoise Delannoy and Mr. Richard Meyers, EA1HR. The ICR was reviewed by Mr. Sven Burmester, Division Chief, EAIHR, and Mr. Walter Schwermer, Project Advisor, EA1DR. Mr. Serge Theunynck, Consultant, and Ms. Mari Takahashi Parker, Consultant, conducted the implementation completion mission. OECF's views were obtained during the mission. Preparation of this ICR began during the Bank's Implementation Completion Mission of November 1-15, 1996. It is based on material in the project files as wel' as information received during the completion mission. The Borrower prepared its report on the implementation of the project which is included in Annex B to the ICR.  I  ii IMPLEMENTATION COMPLETION REPORT PHILIPPINES SECOND ELEMENTARY EDUCATION PROJECT (Loan 3244-PH) EVALUATION SUMMARY Introduction The Second Elementary Education Project (SEEP) was the Bank's ninth education and training project in the Philippines. SEEP was prepared in 1988, just as a previous loan, the Program for Decentralized Educational Development (PRODED) was closing. SEEP was designed to build on this earlier effort, while simultaneously supporting the GoP's poverty alleviation efforts. The SEEP project was prepared during a recession, when all Government agencies suffered budgetary cut-backs. Initially, the project was conceived as supporting a broad range of educational activities. Given the shortage of funds available, however, the GoP decided to focus its investment on the construction of schools, the printing of educational materials and the production of classroom equipment. Thus a revised project design, prior to negotiations, provided budget support to the Department of Education, Culture, and Sports (DECS) subsector investment program and action plan during the recession years (CY1991-1993) with the expectation that the economy would pick up, and the Government would find it easier to meet its planned expenditure for levels of broad quality improvement initiatives in later years. Objectives The overall objective of the project was to increase equity, efficiency and quality in elementary education through assistance to the DECS subsector investment program and action plan for Government fiscal years 1990-1992. Specifically, the project aimed to: (a) provide essential school infrastructure and other physical resources equitably to support the three-year DECS physical investment program for elementary education; (b) improve the effectiveness of teachers and administrators; (c) increase the basic learning attainments of targeted groups; and (d) strengthen DECS institutional capacities in planning and management. Implementation Experience The SEEP loan was closed on June 30, 1996 and was virtually fully disbursed' as scheduled on October 31, 1996. The project was designed to disburse the Bank-financed US$200 million in three years (between 1990-1993). Two months before the closing date 1 Remaining balance $53.92.  iii of December 31, 1993, the project had disbursed only US$50 million (67% of estimated amount). The loan was extended for a year until September 31, 1994 and an additional US$75 million was disbursed, in part because of tighter supervision. As a result of the OECF offer of parallel finance in 1994 of US$145 million, the Bank agreed to extend the closing date for the second time to December 31, 1995; US$25 million was canceled at that time. The project was extended a third time to June 30, 1996 to permit full disbursement. Results The project was generally successful in meeting its objectives, particularly in terms of the satisfactory implementation of its physical components (construction of buildings, equipment and materials). The School Building Program substantially achieved its objectives. The original target was to construct about 26,500 new classrooms. DECS financed approximately 47,500 classrooms over the six years of implementation. This is almost twice the number of classrooms planned for at appraisal. Activities undertaken within the desk production subcomponent exceeded the appraisal target of 1.5 million desks in three years. The project obtained 2.5 million desks during the six years of implementation (0.4 million per year) and sustained an average production of 420,000 school desks per year. The original objectives included the production and distribution of 44 million textbooks, 146,000 teacher guides and 2.8 million copies of a range of reference material and charts. The subcomponent target was achieved; 83 million textbooks have been printed and 79 million have been forwarded to the Divisions. This represents 180 percent of the planned quantities and an annual average production of 13.8 million textbooks. In 1995, GoP issued Law No. 7836 to strengthen the regulation and supervision of the practice of teaching in the Philippines. The Professional Board Examination for Teachers Study, financed by the project, has had a significant impact on the future status of teacher training and teacher licensing by highlighting the issues and initiating a policy dialogue. The Drop-out Intervention Program subcomponents have been successfully completed and activities are being expanded under the DECS operating budget to address drop-out, particularly within the schools in economically depressed communities. A pilot study on drop-out prevention was conducted in 30 schools from five regions. Sustainability In view of the clear national priority now given to improving the quality of elementary education, there is little doubt that activities conducted under SEEP will be continued into the foreseeable future. The project was primarily budget assistance and the activities supported by the loan were the construction of classrooms, purchase of desks, textbooks, and equipment. Since these are standard items/annual expenditures in the  iv DECS budget, the sustainability of these subcomponents is not dependent on external financing. With the improvement of the economy, higher budget appropriations for these line items can be expected. Therefore there is a good reason to have confidence in the sustainability of the project. Findings and Lessons Learned Ensure that project components directly serve the project objectives. For all the emphasis given in the loan's objectives to the quality of elementary education, only about 4 percent of project costs went to cover the three components that address issues of school efficiency, quality, and equity. Involved Bank staff noted that because the proceeds from the Bank loan were not put into the educational quality improvement components (teacher training, national achievement tests and pilot drop-out interventions) supervision missions were less inclined to become involved with those components even though they had a more direct correspondence with the improvement of student learning and achievement. Sharing supervision responsibilities between Washington and the Resident Mission can be efficient and effective. During the project, staff from the Resident Mission and Headquarters participated in all missions, and several useful studies were produced. For the future, the development of a supervision management system within DECS would broaden the pool of shared information resources, lead to more collegial relationships between Bank and DECS staff and reinforce the Borrower's self-evaluation capacity. Management information, coordination mechanisms and financial accounting systems must be operational at loan effectiveness. The lack of fully functional systems compromised DECS ability to monitor ongoing activities, execute action plans, and plan supervision missions. Ongoing monitoring and evaluation is especially important in education sector projects. Unfortunately, despite the Bank's emphasis (recorded in project documents and aide memoires) on monitoring and evaluation down to the school-level, budgets and mechanisms for these activities were not forthcoming throughout the life of the project. In some cases information does not exist to show that the inputs even reached the targeted schools, much less that they were able to improve the quality of teaching and learning.   Philippines Second Elementary Education Project (Loan 3244-PH) Part 1. Project Implementation Assessment Project Background 1. The Second Elementary Education Project was the Bank's ninth' project in education and training in the Philippines. It followed the Third Education Project of 1976 (Loan 1224-PH), which successfully developed national capacities for producing and distributing educational materials, and the Sector Program for Elementary Education (Loan 2030-PH, 1981), which came to be known as the Program for Decentralized Educational Development (PRODED). PRODED introduced new policies and structures for financing and management, a curriculum reform with improved instructional materials, and staff development programs for the Department of Education, Culture and Sports (DECS). SEEP was prepared in 1988, just as PRODED was closing, to support the earlier effort by providing the elementary education subsector with a second phase of improving equity, efficiency and quality, while simultaneously supporting the GoP's poverty alleviation efforts. Bank sector work2 noted the considerable achievements of the Philippine educational system supported inter alia by the Bank financed educational loans, highlighting particularly enrollment rates comparable to those in developed countries, extensive private sector participation, and high female participation. Project Context 2. The Philippines experienced an economic recession between 1988 and 1993. The SEEP was prepared during the down-turn (in 1988), just after all Government agencies suffered budgetary cut-backs. Although the project was conceived as supporting a broad range of educational activities, given the shortage of funds available, the GoP decided prior to negotiations to focus its investment on the construction of schools, the printing of educational materials and the production of classroom equipment. It was hoped that SEEP would inject low interest foreign currency into the economy while maintaining the momentum of previously introduced educational improvements, without allowing the investment in elementary education to drop. The revised project design provided budget support to DECS' Subsector Investment Program and Action Plan during the recession 1 The eight preceding projects are: First Education Project (Loan 0392-PH, 1964); Second Education Project (Credit 0349-PH, 1973); Third Education Project ( Loan 1224-PH, 1976); Fourth Education Project (Loan 1374-PH, 1977); Mass Media Pilot Project (Loan S008-PH, 1978); Sixth Education Project (Loan 1786-PH, 1980); First Elementary Education Project ,alias Sector Program for Decentralized Elementary Education (Loan 2030-PH, 1981); Vocational Training Project (Loan 2200-PH. 1982) 2 Report No. 7473-PH, December 1988  2 years (CY1991-1993) with the expectation that the economy would pick up, and the Government would find it easier to meet its planned expenditure for levels of broad quality improvement initiatives in later years. The risks section in the SAR stated that: (i) implementation could be slowed due to delayed allocations of counterpart funds in GoP components, and (ii) changes in the project management structure and staffing could temporarily reduce implementation capacity on the ground. DECS was implementing a Bank financed project for the first time. SEEP was to be managed directly under the DECS instead of under EDPITAF (Educational Development Projects Implementing Task Force), a task force created specifically for implementing foreign funded projects. At project appraisal, the Bank sought assurances that funds for at least the start-up year had been secured and these would be released to DECS in an expeditious manner. Even given its relatively modest goals, it was believed that SEEP would at least support further institutional development in the DECS, which would allow it to formulate and implement better educational policies, including a more targeted poverty alleviation strategy. The project also permitted a continuing policy dialogue that could lead to further lending. A. Project Objectives Statement of Objectives 3. The objectives of the project were to increase equity, efficiency and quality in elementary education through assistance to the DECS Investment Program and action plan in the subsector for GoP fiscal years 1990-92. This was to be accomplished through short- and longer-term measures and investments which aimed to: (a) meet the subsector's requirements for essential physical resources, with an emphasis on improving their distribution to educationally and economically disadvantaged areas; (b) improve the professional competence of teachers and school administrators; (c) expand basic knowledge and skills among at-risk children and support a non-formal literacy program for out-of-school youths and adults; and (d) further develop DECS institutional capacities in the planning and management of the elementary education subsector as well as of the education sector as a whole. 4. Specifically, the project financed: (a) infrastructure for targeted schools including construction and rehabilitation (classrooms, workshops, and toilets), desks, textbooks, and school equipment to alleviate severe shortages; (b) in-service training at the regional level; (c) pilot drop-out intervention measures in selected low-income municipalities and a non- formal literacy program; (d) a new national elementary student assessment program; (e) an improved MIS; (f) an improved information dissemination system to strengthen DECS' capacity for planning and management of the sector; and (g) studies. Financing for infrastructure was approximately 96% of the base cost, training was 2%, and all other expenditures taken together were financed at 2% of the base cost.  3 Evaluation of Objectives 5. SEEP's objectives were consistent with the GoP's Education Sector Development Strategy3 and well in line with the Bank's Country Assistance Strategy. The objectives correctly identified persistent problems in the subsector: (i) inadequate physical resources, (ii) lack of overall school effectiveness, (iii) high drop-out rates, (iv) and the need to strengthen the planning and management capacity of the education system. The objectives were clear and important to GoP as well as its growing education sector. However, the proceeds from the Bank loan were intended largely for school construction, while the educational quality aspects of the project were to be financed by the GoP. The initial efforts of PRODED had focused on curriculum design, teaching methods and materials, and their pilot-testing. When achievements in these areas had been consolidated it would have been appropriate to shift attention to a nation-wide expansion and planned investment in physical infrastructure. With hindsight it is clear that the institutional capacities of the DECS operating units in planning, management, and program implementation for the elementary education subsector needed more ongoing support than they were provided and what had commenced with PRODED clearly required a more targeted Bank follow-up. Evaluation of Design 6. DECS was faced with two serious challenges: (i) that of accommodating a steadily increasing student population, and (ii) maintaining quality improvements in the elementary education subsector in the face of dwindling budgetary allocations. Simultaneously, DECS was in the process of taking active leadership at the World Conference on Education for All-conference initiatives addressed quality, efficiency and equity issues in elementary education. The GoP clearly needed budget support if it was going to maintain the dynamism which had only recently come to characterize the elementary education sector. The goal of disbursing the loan proceeds over the three year time slice was optimistic compared to the SAR's disbursement profile for education sector projects for the Philippines. However, the project preparation team noted4 that disbursement would be made as a percentage of the total elementary education investment program rather than against specific expenditure categories. Still, there is an element of "misfit" between what the Bank financed and what it hoped to accomplish. To some degree leaving the quality aspects of the project for Government financing constrained Bank efforts to ensure accountability. 3 The Ten Year Development Plan 4Minutes of the Preappraisal Review Meeting, September 8, 1989.  4 B. Achievement of Project Objectives 7. The project has been a qualified success. The implementation of the physical components (construction of buildings, equipment and materials) was particularly noteworthy; however educational quality improvements were not significant. The project objectives were to be attained through four project components, each with subcomponents/activities that were expected to be completed over the life of the project. Component one, Educational Infrastructure and Materials (US$349.8 million), encompassed the school building program, production of school desks, printing and distribution of textbooks, and the acquisition of equipment and instructional materials. Component two, Improving Teacher and Administrator Performance (US$5.8 million), included in-service training of teachers, principals and supervisors and a study of the quality of pre-service teacher training programs. Component three, Expanding Basic Education (US$5.7 million), was comprised of drop-out prevention measures, the evaluation of educational outcomes, and the expansion of literacy training. Component four, Strengthening Planning and Management (US$3.5 million), funded elementary student assessment, MIS, planning and budgeting methods, and the distribution system for organizational information. Achievements under each component are described below. Table 5 compares the appraisal estimates with the actual achievements of the project. 8. Component One. The School Building Program (SBP). This component substantially achieved its objectives. The original target was to construct about 26,500 new classrooms (over the three- year life span of the project) to reduce the existing shortage of classrooms and to accommodate enrollment expansion. The Bank and OECF loans have enabled DECS to finance approximately 47,500 additional classrooms over the six years of implementation. This is almost twice the number of classrooms planned for at appraisal although the pace of construction was slower than anticipated. Only 14,200 of these were financed under the Bank loan due to the agreement to reduce the scope of the SBP to 5 regions (NCR, CAR, Regions I to III); the others were financed under an OECF loan signed in 1994. In addition, about 5,000 classrooms were financed by other public sources5 and other donors6. The shortage of sanitary facilities was also ameliorated. The target for toilet construction was 2,800 units in three years. A total of 4,300 bathroom facilities were built in six years. 9. The other SBP inputs led to the replacement of 2,750 classrooms, only 28 percent of the 9,800 planned. The rehabilitation of 32,000 classrooms corresponds to 88% of the subcomponent objective of 36,400, and 44 percent of the planned annual average. This modest achievement of replacement and rehabilitation targets explains the ever-growing number of schools with a sub-optimal physical environment. Part of the original plan of work on the "rehabilitation back-log" has been funded and implemented by local Countryside Development Fund, Presidential Support Fund. Typhoon Resistant School Building Program, Educational Facilities Improvement Program funded by the Japanese Government and the Economic Support Fund (USA).  5 governments (because Government funds came so late) but many lacked sufficient funds to do the work properly. 10. Desks. Activities undertaken within this subcomponent were quite satisfactory. In comparison to the initial target of procuring and distributing 1.5 million desks in three years (0.5 million per year), the project obtained 2.5 million during the six years of implementation (0.4 million per year) and a sustained average production of 420,000 school desks per year. The new models (both centrally and regionally procured under SEEP) are reported by the field offices to be less durable and to require repair more often than their locally manufactured predecessors, however. Access (from the regional offices) was the key factor holding back the effective distribution of the desks to the remote schools-distribution was slightly (16 percent) below the 0.5 million planned average for the initial three years of the project. 11. The number of desks produced during the project was, in principle, enough to overcome the initial backlog estimated at two million desks at appraisal, and to accommodate the enrollment increase during the project period of 1. 1 million additional pupils (who require 0.55 millions desks). However, given a desk life of no more than 15 years, at least one third of the initial stock of three million desks had to be replaced in the meantime, and were not. On this basis, one can consider that the initial desk deficit, estimated at 40 percent has been reduced by only about half 12. Textbooks. The original objectives included the production and distribution of 44 million textbooks, 146,000 teacher guides and 2.8 million copies of a range of reference material and charts. On the production side, the subcomponent target has been achieved. The Instructional Materials Development Center (IMDC) printed 83 million textbooks and forwarded 79 million to the Divisions. This represents 180 percent of the planned quantities and an annual average of 13.8 million textbooks, corresponding to 94 percent of the annual SEEP average target. However, the objective of increasing the student to textbook ratio from 2:1 to 1:1 by 1992 has not been achieved. Informed practitioners believe that the current ratio of students to textbooks is 3:1. The physical quality of the textbooks was not good (thin paper, weak bindings). Also, a lack of a means of delivery, a monitoring mechanism, and poor communication between the DECS offices and the schools contributed to the in-school shortage. 13. On the production side, 83.6 million textbooks were produced, an annual average of 13.9 million, very close to the planned annual average of 14.7 million. Considering the 9.9 million average enrollment during the project (1993), an average book-life of 3 years, and an average number of 6.6 subjects, the project has, on average, produced one textbook per subject (or one set) for every 1.57 students. This is far above the project objective of one textbook per subject for every two student. However, as noted above, availability of textbooks in schools remains a serious problem in all provinces, and particularly for those far from the capital. In the more remote schools, ratios of one book for every 5 pupils are commonly reported. Textbook availability in classes is not monitored by DECS nor tracked by its MIS. DECS staff are aware of this situation, and  6 they attribute it to unresolved storage and school-level distribution issues. The targeting formula for distribution proposed in the SAR for the SBP was superseded in 1994 by a new mechanism laid down by law which tended to favor the better-off communities. The same formula replaced the SAR targeting formula for the distribution of desks. 14. Equipment. A total of US$4.6 million was allocated to the procurement of instructional materials in the elementary schools (globes, maps, science and math kits). The DECS regional offices were responsible for allocating fixed equipment budgets and preparing the annual equipment procurement plans based on the guidelines and criteria issued by the DECS' central office. Information from the regional offices were not available at the time of the completion mission. 15. Component Two. In-service Training of Teachers, Principals, and Supervisors. In-service training is conducted entirely at the regional level. Training results compiled in Manila show that only 25 percent of the original participation-in-training target was attained between the project years of CY1990-1993. The reason for the low rate of achievement was the cut in the DECS budget coupled with delays in the receipt of funds. The current level of the DECS' training budget for the regions remains unchanged. 16. The Professional Board Examination for Teachers (PBE7) Validity Studies. Though its implementation was delayed, this subcomponent has had a significant impact on the future status of teacher training and teacher licensing by highlighting the issues and initiating a policy dialogue. In 1995, GoP issued Law No. 7836 to strengthen the regulation and supervision of the practice of teaching in the Philippines. The law prescribes a licensure examination. In addition, phase I of the PBET study for 1991-1993 moved the Commission of Higher Education (CHED) to formulate a set of criteria for the selection of the Centers of Excellence for Teacher Education from among existing teacher education institutions. Validated items of PBET which were identified by the study were used to form the core of the Professional Education section of the new Licensure Examination for Teachers (LET) under the Professional Regulatory Commission. A second phase of the study is currently being completed covering 1994-1996 with a view to identifying consistently poor performing and high performing schools. 17. Component Three. The Drop-out Intervention Program (DIP). This subcomponent has been successfully completed and the DIP activities are being expanded under the DECS budget to address drop-out, particularly within the schools in economically depressed communities. A pilot study on three models of drop-out prevention was conducted in 30 schools from five regions. The models include: (i) the use of materials developed under PRODED, (ii) a school-feeding program, and (iii) a parent- teacher partnership program. During the start-up period in 1990, the Bank's Human Development Department provided technical assistance for both DIP and the Household and School Matching Survey-HSMS II (a school-based survey to identify demographic and socio-economic background data for elementary schools). An annual average of P2.4 million was released over the original life of the project between 1990-1994 and the pilot program was expanded to a total of 50 schools. Government appropriations have  7 increased to P2.6 million a year to cover approximately 26,000 students including 45 new schools included in the Social Reform Agenda (SRA) for a National Breakfast Program targeting grade one students. DIP is further expanding through the financial support of the mayors for the school-feeding program and local funds for multi-grade materials. 18. Literacy. The activities of this sub-component consisted mainly of the expansion of the Magbasa Kita ('Let Us Read'), a phono-syllabic method of first-level literacy training. The subcomponent had some major successes during 1990-1993, and it was adopted as a national program in 1991. The subcomponent fully achieved its objectives between 1990-1993. During those project years, both the number of classes and the enrollment went up about fivefold, to average 6,000 classes annually and 130,000 students per year. An ADB-assisted nonformal education project (effective 1994) de facto took over the activities of this sub-component. 19. Component Four. Student Assessment System (SAS). The achievements and impacts of this subcomponent are yet to be seen. The Bank provided technical assistance toward the development of tests in five academic subjects for grades 2, 4, and 6 to collect descriptive data on student performance. Item writing commenced in 1991 but delays in budget releases, a reordering of priorities, and a difficulty in assembling a National Advisory Board delayed the completion of the subcomponent. To date, the National Advisory Board has been appointed and studies have been initiated; they are scheduled to be completed on or around March 31, 1997. 20. MIS. This sub-component has been adequately achieved. A computer-operated educational planning model was completed under SEEP. Although these were supposed to be used for student enrollment projections, teacher information, and budgeting, they have yet to be utilized by DECS. 21. Information Dissemination (Service Manuals). This sub-component was not successful. Although no budget was appropriated, the Office of Technical Service under the Office of the Secretary drafted a service manual defining personnel action, elementary education, secondary education, administrative discipline, property rules and regulations for school building and grounds, physical facilities and management. The work was not finalized due to a lack of funds. Currently there is no budget allocation and no plans to finish the work. C. Implementation Record and Major Factors Affecting the Project Implementation Experience 22. The SEEP loan was closed on June 30, 1996. The total project cost (Table 7) was estimated at appraisal to be US$410 million equivalent with the Government contributing US$210 million equivalent. The project was designed to disburse the Bank-financed US$200 million in three years (between 1990-1993). Two months before the closing date of December 31, 1993, the project had disbursed only US$50 million (67 percent of  8 estimated amount). The loan was extended until September 31, 1994 and an additional US$75 million was disbursed, in part because of tighter supervision. As a result of an OECF offer of parallel finance (in 1994) of US$145 million, the Bank agreed to extend the closing date for the second time to December 31, 1995; US$25 million was canceled at that time. Withdrawals had increased to US$129.9 million by November 28, 1995, and a third extension was granted through June 30, 1996. Disbursement stood at US $160 million at the loan closing in June, 1996. Disbursements against commitments were made until October 31, 1996. Total Bank disbursements came to US$175 million. The OECF loan was fully disbursed as initially agreed between GoP, OECF, and the Bank. 23. The responsibility for overall project implementation rested with DECS, an agency which took over Bank financed project management from EDPITAF. The project was characterized by continuous delays in resource allocation, budget releases, and disbursement lags because of delays in submitting withdrawal applications. These delays were only partly a result of the recession. The Project Implementation Coordination Unit (PICU)-agreed upon during negotiations for SEEP- was never actualized because the Department of Budget and Management (DBM) did not think that SEEP would need extra management resources beyond a regular annual budget. Had DECS been more experienced in Bank project management and if the project had not been attempting to disburse at a fast pace, DBM's assessment would have been sound. Implementation bogged down because of insufficient intra- and inter- agency coordination and communication as illustrated by the lack of coordination between DECS and the Department of Public Works and Highways (DPWH), or DECS' inability to collect statements of expenditure (SOEs) from its own Regional Offices and to supervise and monitor whether or not the project inputs were reaching the target communities and schools. In 1994, the Bank advised the Borrower to create an informal project monitoring group to help overcome these problems. Participants in the advisory group were the Coordinating Council for the Philippines Assistance (CCPAP), an implementation unit of the National Economic Development Authority (NEDA) and the Resident Mission. This group helped to improve disbursement in the subsequent years of the project. 24. The procurement required to meet the project's needs was carried out as planned and adequately in conformity with Bank guidelines. There were two instances where the Bank's Procurement Guidelines were not followed and withdrawals were withheld. The first instance occurred early in the project and, due to a misunderstanding, paper was procured by LCB rather than ICB. The second instance in 1995 was associated with DPWH procuring prefabricated school buildings by giving all bidders parts of the contract. The school building program was carried out initially by DECS and later by the DPWH. The printing and distribution of textbooks were procured centrally and the procurement of desks was carried out mostly by the DECS Regional Offices. Training and studies were conducted in-house and by consultants. 25. The expected positive impact of the project inputs on school achievement was not achieved. Despite the fact that physical targets were achieved, educational quality improvement must be said to be negligible. The persistent classroom shortage, combined  9 improvement must be said to be negligible. The persistent classroom shortage, combined with the deteriorated state of the existing facilities due to inadequate maintenance, was exacerbated by the persisting deficit of desks and the inadequate distribution of textbooks. During the project period, the completion rate (percentage of students that complete all six grades of elementary school) remained globally almost unchanged, and regional disparities were not overcome. Major Factors Affecting the Project 26. Soon after implementation commenced, the project risks identified in the SAR became realities. There were major delays in the release of counterpart funds, and fluctuations in the budget allocations that had been agreed upon. There were also two major changes in DECS management during the project. Two changes in Education Ministers led to periods of adjustment. Increases in personnel costs (teacher salaries were increased) resulted in a decrease of funds that could have been used for capital expenditures, SEEP's most important component. The DBM determined that the project management unit for SEEP (which was discussed during negotiations and mentioned in the SAR) would not be funded because the project was "only budget support" and therefore would have no activities that were significantly different from the normal work of DECS. Subsequently, the responsibility for carrying out the school building program was moved from the DPWH to DECS (in 1991), causing most of DECS staff and institutional resources to concentrate on the school building program. An additional complicating factor was that natural disasters devastated project sites. First, a major earthquake caused widespread destruction, and related landslides blocked road access and slowed construction. Months later the eruption of Mt. Pinatubo buried villages and fields under a heavy cover of ash. Lastly, a financially important market for Filipino labor dried up due to the out-break of the Gulf War. As a result of the above, economic conditions worsened nation-wide. D. Project Sustainability 27. In view of the clear national priority now given to improving the quality of elementary education, there is little doubt that activities conducted under SEEP will be continued into the foreseeable future. The nature of the project was primarily budget assistance and the activities supported by the loan were the construction of classrooms, purchase of desks, textbooks, and equipment. Since these are standard items/annual expenditures in the DECS budget, the sustainability of these subcomponents is not dependent on external financing. With the improvement of the economy, higher budget appropriations of these line items can be expected. Therefore there is a good reason to have confidence in the sustainability of the project. 28. The other three components totaling $15 million-financing studies in teacher and administrator performance, drop-out, student assessment and the development of MIS and information distribution-were funded by the Government. Interviews with respective officials of DECS indicate that each of the activities either already feeds into on-going  10 activities or has the potential to feed into relevant programs. An annual P2.6 million are maintained in the budget of the Director of Bureau of Elementary Education (BEE) to be spent on drop-out prevention. The studies under SEEP have already been expanded into 6 more provinces and drop-out measures continue to be funded. MIS is a $10 million component under the Third Elementary Education Project (TEEP) signed in December 1996. Provided that they are given adequate and sustained attention, the lessons from the SEEP experience should live in DECS' institutional memory, and motivate it to champion the pedagogical changes under TEEP. The same can be said about PBET studies which have led the way for the LET, a professional licensure testing program to be initiated in 1997, and the new Student Assessment Studies (SAS) tests that will be forthcoming from the SAS studies under SEEP. The budgetary implications of the changes brought about by SEEP appear to be affordable and they are likely to be sustained. Additionally, the Bank has received assurances that the GoP is committed to providing adequate funding to the sub-sector (as indicated in the sub-sectoral memorandum of policy prepared by the DECS and adopted by the GOP in September, 1996). E. Bank Performance 29. Overall Bank performance in preparation and supervision was satisfactory. Project identification and subsequent preparation correctly focused on improving teaching and learning conditions by provision of basic inputs, improving teacher and school administrator skills and DECS managerial capacities. More attention could have been given to the links between what the Bank agreed to fund and the project objectives. Supervision missions were regularly carried out, on average twice a year, and included a completion mission. Instead of a mid-term review, Bank staff concentrated on working out the details of the first loan extension with GoP and OECF. Staff continuity was acceptable; however, after restructuring the missions concentrated on physical works (building and printing). More consideration should have been given to the utility and practicality of the buildings, desks, textbooks, and equipment inputs in addition to focusing on the achievement of numerical targets. F. Borrower Performance 30. The Borrower's performance was marginally satisfactory. Implementation delays were caused by a shortage of funds-a result of the recession. Project implementation and coordination was placed under a committee of two persons (not funded by the project, and who had full-time responsibilities elsewhere). Even with the best of intentions, this group could not have performed the task of a permanent coordination unit. While many routine activities were creditably done, management and coordination were consistently weak. Presentation of SOEs was almost always late and these documents were usually brought to Manila as a result of special field missions sent by DECS at the request of the Bank supervision missions. Government complied with most loan covenants, albeit with delay in many instances. The ones not complied with are being addressed under the follow-up operation. The sustainability of the project's institutional development activities are doubtful, in part because of a lack of Borrower ownership.  11 G. Assessment of Outcome 31. The project outcome is rated as satisfactory. Important physical objectives were met. Positive aspects of the project are: (i) the Borrower is considerably better off with the classrooms built and rehabilitated by the project than without them; (ii) textbooks and teaching materials, which are essential to classroom functioning, were produced, and most were delivered; and (iii) there will be important impacts in the future from the Drop-out Intervention Program, the SAS, and the PBET. Little positive outcome is immediately evident with respect to the main objectives of increasing quality education through the provision of inputs, improving educational staff performance and DECS managerial capacities. Planning capacities remain weak, statistical processing is slow and cumbersome, and the results of educational policy analysis are sometimes of questionable reliability. A significant number of students still do not have textbooks, and a positive impact of in-service teacher training on the effectiveness of teachers is not apparent. However, without the project, the elementary system would have suffered a deterioration in educational quality due to the sharp decline in resource availability. The project succeeded in maintaining the system and in laying the foundations for a new Bank assisted project, TEEP, which should lead to quality improvements in education. H. Future Operation 32. DECS will continue the SBP (including new school construction, classroom rehabilitation, and renovations) as well as the development and procurement of teaching materials and school equipment. Thus the activities which represent the bulk of the SEEP loan are being sustained as part of the normal DECS budget for elementary education. The findings of the PBET studies have initiated a healthy reflection process in the CHED concerning pre-service training, and policy changes in the DECS concerning the poor quality of some of the existing teachers in relation to in-service training. The Bank's follow-on project, TEEP, will strengthen and revitalize in-service training in 26 resource- poor provinces. The national literacy program, Magbasa Kita (developed with Bank assistance), has continued to develop and expand in several directions, partly with its own funding. The initiation of the Literacy cum Livelihood Program is a new intervention which has been developed for Magbasa Kita graduates. A second related development is that the Asian Development Bank assisted Non-formal Education Project initiated in July, 1994, will continue to build on the initiatives of SEEP. The activities of the DIP, developed through Bank assistance and piloted under SEEP, have proven successful and are to be expanded under the DECS annual budget. With regard to strengthening the planning and management in DECS, the MIS will be further improved under TEEP, thus improving DECS' decision-making capacity for educational planning. I. Key Lessons Learned 33. Ensure that project components directly serve the project objectives. For all the emphasis given in the loan's objectives to the quality of elementary education, SEEP  12 project cost was allocated to the infrastructure component and the annual DECS budget for classrooms, desks, textbooks, and equipment during CY1991-1993. In contrast, 4 percent of project costs went to cover the three components that address issues of school efficiency, quality, and equity. Involved Bank staff noted that because the proceeds from the Bank loan were not put into the education quality improvement components (teacher training, national achievement tests and pilot drop-out interventions) supervision missions were not inclined to become involved with those components that had a more direct correspondence with the improvement of student learning and achievement. More attention to the distribution of the civil works and infrastructure would have led to a better educational impact. However, an infrastructure-heavy design was reasonable given the economic difficulties, the urgent need for efficacious disbursement, and the importance of providing adequate elementary education facilities to as many children as possible. 34. Sharing supervision responsibilities between Washington and the Resident Mission can be efficient and effective. During the project, staff from the Resident Mission and Headquarters participated in all missions. Several useful studies were produced because of good Washington and field collaboration and also because access to key information was shared. For example, the pilot tests for the DIP and PBET studies that helped identify the next steps for drop-out intervention and teacher licensing were developed in this manner. For the future, the development of a supervision management system within DECS would broaden the pool of shared information resources, lead to more collegial relationships between Bank and DECS staff and reinforce the Borrower's self-evaluation capacity. 35. Management information, coordination mechanisms and financial accounting systems must be operational at loan effectiveness. During the implementation of SEEP the lack of a fully functional MIS compromised DECS' ability to monitor ongoing activities, execute action plans, and plan supervision missions. TEEP, the follow-up project, has taken this lesson into account. It has developed a stand-alone project management unit and detailed implementation guidelines including ones for the accounting systems. 36. Ongoing monitoring and evaluation is especially important in education sector projects. Unfortunately, despite the Bank's emphasis (recorded in project documents and aide memoires) on monitoring and evaluation down to the school-level, budgets and mechanisms for these activities were not forthcoming throughout the life of the project. Large investments were made through SEEP on the procurement of materials and equipment. With no monitoring or evaluation of what was happening in the schools, it was hard to know what the developmental impact of project-funded activities has been at the school level. In some cases information does not exist to show that the inputs even reached the targeted schools, much less that they were able to improve the quality of teaching and learning.  13 PART HI: STATISTICAL ANNEXES Table 1: Summary of Assessments Substantial Partial Negligible Not Applicable A. Achievement of Objectives Macro Policies x Sector Policies x Financial Objectives x Institutional Development x Physical Objectives x Poverty Reduction x Gender Issues x Other Social Objectives x Environmental Objectives x Public Sector Management x Private Sector Development x Likely Unlikely Uncertain B. Project Sustainability x Highly Satisfactory Deficient Highly Satisfactory Unsatisfactory C. Bank Performance Identification x Preparation Assistance x Appraisal x Supervision x D. Borrower Performance Preparation x Implementation x Covenant Compliance x Operation x E. Assessment of Outcome Infrastructure and materials x Teacher/administrator x performance Expanding Basic Education x Planning and Management x  14 Table 2: Related Bank Loans Loan/Credit Titles Purpose Year of Status | _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ Approval _ Preceding Operations l Sector Program for To support GoP's Ten-year Program for a three year Decentralized Elementary time-slice between 1982-1985. Inputs included Education (PRODED) curriculum reform, textbooks and teaching materials, 1981 Closed (Loan 2030-PH) 26 warehouses for textbooks, basic furniture for schools, teacher training, 13 regional training centers for teacher teaching, 52 one-year school building programs in 13 regions, and institutional capacity building for the DECS. Vocational Training To strengthen the infrastructure of the national 1982 Closed Project (Loan 2200-PH) industrial training system. Subsequent Operations l Third Elementary To assist in building the institutional capacity of Waiting Education Project DECS to manage the change process associated with effectiveness TEEP and to improve learning achievements, completion rates, and access to quality elementary education in 26 of the poorer provinces, especially in their most disadvantaged communities. Early Childhood To assist in strengthening the strategic framework for Pre-appraisal Development Project addressing inequities, develop cost-effective delivery mechanisms, and mobilize resources for targeting interventions in health, nutrition and cognitive development for the young children from poor families, the most vulnerable and highest pay-off group.  15 Table 3: Project Timetable Steps in Project Cycle Date Planned Date Actual Identification (FEPS) 09-08-1989 Preparation 03-14-1989 Appraisal 10-11-1989 Negotiations 05-09-1990 Board Presentation 06-26-1990 07-03-1990 Signing 07-09-1990 Effectiveness 08-30-1990 Project completion 12-31-1993 06-30-1996 Loan Closing 12-31-1993 06-30-1996  16 Table 4: Loan Disbursements: Cumulative Estimated and Actual (US$ million) Fiscal year _____________________ 1991 1992 1993 1994 1995 1996 1997 Appraisal estimates 74.8 150.0 192.0 200.0 - - - Actual 17.2 46.1 68.9 93.7 113.0 160.5 175.0 Actual as % of estimates 23.1% 30.7% 35.8% 46.8% - - - Date of final disbursement 10-31-1996 Estimated and Actual Disbursements (US$ million) 200 0 0 18 175 1991 199 (Fisca Yeas) 140 120 _ loci ~ ~~~~~~112.97 100 ~~~963.74 80 74.8 K68.9 60 4.13 410 -4- Estimate 20 00 -Actual 1991 1992 1993 1994 1995 1996 1997 (Fiscal Years)  17 Table 5/6: Key Indicators for Project Implementation and Operation Project Objective: To increase equity, efficiency and quality in elementary education through budget assistance to the DECS Subsector Investment Program and Action Plan. Key Implementation Indicators Estimated Actual in SAR/President's Report l Component I Increasing the Provision of Educational Infrastructure and Material Classroom 26,500 Classroom Construction 49,600 Classroom Replacement 9,800 Replacement and Rehab. 32,500 School Building Program Classroom Rehabilitation 36,400 New Workshops 2,994 Construction new workshops 4,300 Rehabilitation of workshops 2,468 Rehabilitation of workshops 5,100 Toilets 4,288 Construction of toilets 2,800 new school desks 2.52 mill. Desks Produce new school desks 1.5 mill. (6 years) Instructional materials Develop, produce, and distribute: Textbooks 44 mill. Textbooks 83.6 mill. Teacher's Guides 146,000 (6 years) Instructional materials & charts 2.8 mill. Includes teachers' guides Raise student-textbook ratio from 2:1 in The official student-textbook ratio is 1990 to 1:1 in 1992. reported as 3:1 in 1996 Equipment Evidence of maps, wall charts, globes Procure equipment (no target in SAR) purchased by the project in the schools, but overall numbers are not available 2. Improving Teacher and Regional training materials produced Materials produced Administrator Performance FY 1991 124,000(modules) FY 1991 4,757 (modules) FY 1992 175,000 FY 1992 3,832 In-service Training FY 1993- 224,000 FY 1993 5,792 Total number of training sessions FY 1991:122; FY 1992: 106 FY 1993: 111 Teachers trained Teachers trained FY '91 100,000 FY '91: 8,309; FY '92: 23,855 FY '92 150,000 FY '93: 52,660 FY'93 200,000 Head-teachers trained Head teachers trained per year 19,000 FY '91: 5,342; FY '92: 7,694 FY '93: 7,028 Supervisors trained per year 5,000 Supervisors trained FY '91: 5,342; FY '2: 7,694 FY '93: 7,028 Monitor and Evaluate training M&E of training conducted but no data 3 studies completed: All 3 studies completed  18 3. Expanding Basic Education 24 pilot schools (FY'90) equipped with: FY'90 24 pilot schools Planned interventions: FY'95 50 pilot schools Introduction of Dropout Prevention I. multi-level materials, trained FY'96 45 new SRA schools Measure implementors and 14 staff weeks of local Actual interventions: expert assistance, I.multi-level materials, 2. school feeding program, and 2.school feeding program, 3. non-formal summer pre-school program. 3.parent teacher partnership programs. Evaluation of Educational Outcome A study on effects of school and non-school Study completed. factors on school retention completed Literacy Classes Initiated Expansion of Literacy Training New learning materials translated and FY'91 6,849 printed, FY'92 6650 FY'93 6320 Teachers trained for new materials, , ~~Number of graduates Literacy classes initiated, FY'91 54,154 FY'92 110,840 Classes monitored and evaluated, FY'93 129,977 Post-literacy activities initiated The Literacy cum Livelihood Program was developed as post-literacy activity 4. Strengthening Planning and Management A national assessment system established: National assessment system not ready. 1. New computer equipment and software 1. Three new terminals with software. Elementary Student Assessment 2. Local staff training (180 staff months) 2. Training conducted but no data 3. Local/foreign experts (198 staff months) 3. Training conducted but no data MIS improved by financing: FY'96 (personnel data sheet updates 1. New computer equipment and software started on the MIS) Management Information System 2. Central network and regional links 1. Computers installed installed and maintained 2. Links installed to selected regional 3. Local experts (170 staff months) areas 4. Local training (70 staff months) 3. Training (30 staff months) 3 studies completed on: Studies completed Planning and Budgeting Methods I. Standardized enrollment projection, Three computer models completed 2. Unit cost calculations, and Models are not yet in use 3. Budget inflation estimates. Service manuals in draft, Distribution system upgraded by financing: Expert services not funded from project Distribution System for Organizational 1. New policy book with service manuals due to no budget allocation or release Information 2. Local expert services (I5 months) 3. Workshops for dissemination  19 Table 7: Studies Included in the Project Component Study Status 1. Review of Pre-Service Study quality and relevance of selected pre- Completed Training and Certification service elementary teacher training (document with Asia File) programs; Validity of the Professional Board Completed Examination for Teachers; (document with Asia File) 2. Expanding Basic Education Evaluation of non-school factors affecting Completed student achievement and survival; (document with Asia File) Evaluation of the drop-out intervention pilot Completed programs; (document with Asia File) 3. Evaluation of Educational Study to determine the relative effects of Expected to be completed Outcomes school and non-school factors on the around March, 1997 interrelated educational outcomes of student attendance, achievement and retention.  20 Table 8a: Project Costs (US $million) Category Appraisal Estimates Actual/Latest Estimates 1990-1992 1990-1997 (US$ million) (US$ million) Local Foreign Total Local Foreign Total I.Civil works 203.8 50.9 254.7 - - 510.0 2.Desks 26.8 4.7 31.6 - - 23.8 3.Textbook 11.4 2.0 13.4 - - printing/distribution 4.Textbook paper 8.3 27.9 36.2 - - 5.Equipment 0.4 3.8 4.2 - - Subtotal 4. and 5. 8.7 31.7 40.4 - - 0.8 6.Local Training 6.5 1.1 7.6 - - 7.Miscellaneous 3.4 0.6 4.0 - - 8.Local experts 0.5 0.1 0.6 - - 9.Foreign experts 0.0 0.1 0.1 - - Total Base Costs 261.2 91.3 352.5 - - 10. Physical Contingencies 8.1 2.8 11.0 - - 11. Price Contingencies 38.4 8.1 46.5 Total Project Cost 307.7 102.3 410.3 - 534.6 (1\a,b) la\ Total actual is greater than estimated due in part to the OECF loan granted after appraisal of the World Bank loan. lb\ Government accounting was not able to provide actual expenditures by implementation category because of the decentralized expenditure procedures. Table 8b: Project Financing (US$ millions) Ap raisal Estimate Actual/Latest Expenditure Estimates Local Costs Foreign Total Local Costs Foreign Costs Total Costs IBRD 107.7 92.3 200.0 102.5 72.5 175.0 Government 200.0 10.0 210.0 NA NA 214.6 OECF 0.0 0.0 0.0 NA NA 145.0 Total 307.7 l 102.3 410.0 NA | NA 534.6  21 Table 9: Economic Costs and Benefits A cost benefit analysis was not undertaken at the time of appraisal and a net present value or an economic rate of return is not available for comparison.  22 Table 10: Status of Legal Covenants Agree Section Covenant Present Original Revised Description of Comment -ment Type status fulfillment fulfillment Covenant date date I I 4.401 (a) I CP Maintains records and accounts Action being which reflect project operation taken under l_________ resources and expenditures follow-up project 2 4.01(b-i) I C Have above records and accounts for each fiscal year audited by independent auditors acceptable to the Bank (b-ii) 1.9 C Sept. 30 Provide a certified copy of the audit each year to the Bank no later than nine months after the end of each fiscal year. (b-iii) I C Provide other information on records, accounts and audits as the l______ Bank may request. 3 4.01 (c) 3 For all expenditures from the Loan which are made by SOE, the Borrower shall: (c-i) 3 CP Maintain records with accounts Better organiza- tion and regular (c-ii) 3 CP Retain all records of expenditures update needed until at least one year after the FY audit has been received by the Bank. (c-iii) 3 C Enable the Bank's representatives to examine such records (c-iv) 3 C Ensure that records and accounts referred to in para (b) are included in the annual audit which must also contain an opinion of the auditors as to the reliability of these records. l 4 Schedule 10 C March, each Conduct an annual review meeting 5 para I year with Bank in time for the DECS annual planning and budget review. para.2 10 C Ensure that a minimum equivalent to 4% be set aside for book delivery to the schools. para. 3 10 NC Maintain the PICU l_____ para.4 10 C Carry out the Action Plan Key: C = Complied with; CP = Complied with partially; CD Complied with after delay; NC = Not complied with  23 Table 11: Compliance with Operational Manual Statement The Borrower complied with the operational and maual statements adequately Table 12: Bank Resources: Staff Inputs Planned Revised Actual Stage of Project Cycle Weeks US$(000) Weeks USS(000) Weeks USS(000) Through Appraisal 91.1 168.0 NA NA 90.2 225.4 (168.0) 13.1 13.1 31.6 NA NA 13.1 41.2 (31.6) Supervision 90.6 238.3 NA NA 72.5 .311.40 (250.1) Completion 8.1 21.9 NA NA 4.1 12.5 (9.3) Total 202.9 459.8 NA NA 179.9 590.5 Note:_ _ _ Actual________________ in_______ S r o w (459.0) Note: Actual in US$ are shown with travel cost and without travel cost in parenthesis.  24 Table 13: Bank Resources: Missions Stage of Month No. of Days in Specialized Staff Implementation Development Project Cycle and Person Field Skills Represented Status Objectives Types of Year s Problems Through Feb. 1989 7 19 Ec,Ar Appraisal June, 1989 3 16 Ec, Ar, Ed Appraisal Oct. 1989 10 17 Ec(TM), Ar, Dis, Ed, l Approval March, 1989 1.5 5 Op SA, E c. Approval ~~~~~~~~Ec, Ar. Board through Effectiveness Supervision Nov. 1990 6 Ar(TM), Ec,, Ed, *Delay of SA, RA. funds *Delay of activities March 1991 2 8 Ar, Ed. 1 I * Disbursement lag * Delay of July 1991 4 16 Ar, Ec, Ed. 2 2 funds *Management Feb. 1992 4 - Ar, Ec, Ed, SA. 2 1 *Managemcnt *Delay in audit report March 1993 4 8 Ar., Op, E c, Ed. I *Lack of data Nov. 1993 3 8 Ar, Ec, Ed. I I *Disbursement *Delay in audit Nov. 1994 2 6 Op(TM), Ar. S S *Quality impacts Mini- March 1995 2 OP, Ar. S S *Delay of supervision June 1995 funds Mini- *Disbursement supervision Sept. 1995 3 41 OP, Ar, M. S S May 1996 2 M, P. S S Delay of funds Disbursement Key: Ar-architect /implementation; Dis-disbursement; Ec-Economist;Ed-Educator; M-management Op-Operations; P-procurement; RA-research analyst; SA-student assessment; TM-task-manager  25 ApRendix A Page 1 of 6 PHILIPPINES SECOND ELEMENTARY EDUCATION (SEEP) Implementation Completion Mission and THIRD ELEMENTARY EDUCATION PROJECT (TEEP) Pre-Launch Mission AIDE-MEMOIRE November 18, 1996 1 Introduction. In accordance with terms of reference dated October 11, 1996, Mr. Serge Theunynck (Architect, Implementation Specialist) visited Manila from October 21-31 to assist DECS in preparing the Guidelines of TEEP. Mr. Theunynck was joined by Mrs. Mari Takahashi Parker (Education Specialist) to conduct a World Bank Implementation Completion Mission for SEEP during November 1-15 and assist DECS in the preparation of the Government ICR. The TEEP Mission conducted working sessions with members of the PISU to complete the operational guidelines on: (i) INSET, (ii) SIIF, (iii) funds, (iv) management, (v) procurement, (vi) MIS/ M&E, (vii) IEC, and (viii) school building program. Mr. Federico Gimenez (Procurement Advisor, EAIHR) and Ms. Jayshree Balachander (RMP) joined the Mission for discussions on the textbook component. 2. The SEEP Mission was met with reports of project activities. Discussions were held with respective officials of the DECS, CHED, DPWH, IMDC, DOF, CCPAP, and the CAR regional officials and divisional officials of Benguet. Field visits to 5 schools and a textbook warehouse were made in Manila and Benguet. The Mission was joined for several of the meetings by Ms. Flerida Chan (OECF, Project Officer) and Ms. Cecilia Vales (Resident Mission, Procurement Specialist). Both Missions are grateful for the cooperation provided by the Government; in particular, for the guidance and support provided by Undersecretary Erlinda Pefianco, the commitment of PISU members, and the tireless facilitation rendered by Ms. Ester Dijamco in the context of the numerous SEEP meetings and during field trips. The following summary highlights the findings of the two Missions. Many of the points were explored with DECS and other agencies at a wrap-up meeting on November 15, 1996. 3. The Status of SEEP. The US$200 million SEEP loan was closed on June 30, 1996 and fully disbursed as scheduled on October 31, 1996. Total disbursements came to US$175 million (US$25 million was canceled). Audit reports covenrng the loan period through December 1995 have been received. Audit reports for the period of January, 1996 - June, 1996 remain to be filed in accordance with the Loan Agreement. The Mission has confirmed that activities included under the various project components are nearing completion. The Government financed PBET Validity Study (undertaken during CY 1994-1996) and the Student Assessment Study are still ongoing and are to be completed on or around March 31, 1997. 4. Preparation for the ICR. In accordance with the Bank procedures, an ICR will be completed within approximately six months of the Closing Date. As a follow up to the ICR preparation initiated during the last Bank Mission of May 1996, a guideline for the preparation of the Government's ICR was reviewed in a meeting with the DECS.  26 Apfpendix A Page 2 of 6 5. Schedule to ICR Completion. It was agreed that the Government's ICR would reach the Bank by the end of November 1996. The Bank will send its draft ICR to the Government in January 1997 (or as soon as possible) for comment. Comments should be received in Washington no later than two weeks after the draft arrives in Manila. The final version of the ICR will incorporate the comments received. 6. The Net Impact of SEEP. SEEP was originally designed as a three year budget support loan to assist the Government in maintaining improvements in the quality of elementary education. In the face of the revenue shortfall caused by the 1989-1993 national economic recession, the original project was scheduled to last three years. Following three extensions, it disbursed over six years. The Mission compared planned and actual annual physical outputs for the School Building Program (SBP), desks, and textbooks; reviewed the institutional development impact of the project in the implementing agency and looked for instances and examples of policy improvement or capacity enhancement which were the result of studies and training. (i-a) The School Building Program (SBP). This component substantially achieved its objectives. The Bank and OECF loans have enabled DECS to finance approximately 47,500 additional classrooms over the six years of implementation. This is nearly double the number of classrooms planned for at appraisal. Annually, the target was 8,800 classrooms and the actual number built averaged 7,900, approximately 90% of target figures. However, because implementation took longer than anticipated, a greater number of classroom units could be constructed. 4,300 toilets were built in six years against an original three year target of 2,800. (i-b) The other SBP inputs led to the replacement of 2,750 classrooms, only 28% of the total planned and 14% of the average annual target. The rehabilitation of 32,000 classrooms corresponds to 88% of the subcomponent objectives and 44% of the planned annual average. These modest achievements in replacement and rehabilitation explain the ever growing inventory of schools with a sub-optimal physical environment. Part of the original plan of work on the 'back- log" has been funded and actualized by the Local Government Units (LGUs). Consequently, the facilities in less wealthy provinces with poorly funded LGUs deteriorated more than in better-off provinces. The construction and rehabilitation of about 3,000 multi-purpose buildings represent 70% and 60% of the respective objective or 35% - 30% of the annual average rate of construction targets. (ii) Desks. Activities undertaken within this subcomponent are also quite satisfactory. In comparison to the initial target of procuring and distributing 1.5 million desks in three years (0.5 million per year), the project obtained 2.5 million during the six years of implementation (0.4 million per year). However, the new models (both centrally and regionally procured under SEEP) are reported by the field offices to be less durable and require repair more often than the locally manufactured predecessors. Access to the regional offices has been reported to be the key factor holding back the effective distribution of the desks to the remote schools. (iii) Textbooks. On the production side, the target of this subcomponent has been achieved: 83 million textbooks have been printed and 79 million have been forwarded to the Divisions. This represents 180% of the planned quantities and an annual average of 13.8 million textbooks, corresponding to 94% of the annual SEEP average target; however, the initial objective of  27 Appendix A Page 3 of 6 increasing the student to textbook ratio from 2:1 to 1:1 by 1992 has not been achieved. The lack of a monitoring mechanism does not allow DECS to assess what the schools are receiving. Currently, the generally accepted ratio of student to textbooks is 3:1. The reasons commonly set out are related to the less durable physical quality of the textbooks; lack of a means of delivery; and poor communication between the DECS offices and the schools. The closer schools to the Division are being supplied better than the farther ones. (iv) Regarding the distribution of budget allocations, the formula to target distribution proposed in the SAR for the SBP, a formula based on needs and the level of regional poverty, was replaced in 1994 by a new formula laid down by law. The new law prescribes budget allocation proportionally to enrollment (50%) and needs (40%). As a result, the new formula tends to favor populous areas, and to place the less populated (often rural and poorer) areas at a disadvantage. Regarding the distribution of desks, the same new formula replaced the SAR formula. (v! Pre-Service and In-service Training. A study on pre-service teacher training was initiated by DECS under SEEP and completed by CHED in 1995. CHED plans to utilize the findings of this study to lay a new course for pre-service teacher training. In-service training is conducted entirely at the regional level. Training results compiled in Manila show that only 25% of the original training target was obtained between the project years of CY 1990-1993. The reason for the low achievement is the cut in the DECS budget appropriations coupled with slow budget releases. However, this is an underestimation of the actual in-service training conducted because it does not take into account the training activities financed from other sources such as local funds, the services of the National Educator's Academy of the Philippines, and funds from intemational donors. The current level of DECS budget to the regions remain unchanged. (vi) The Professional Board Examination for Teachers (PBET) Validity Studies. This subcomponent, though delayed, has provided significant impact to the future status of teacher training and teacher licensing by highlighting the issues and initiating a policy dialogue. In 1995, GOP issued Republic Act No. 7836, an act to strengthen the regulation and supervision of the practice of teaching in the Philippines and prescribing a licensure examination. In addition, phase I of the PBET study for 1991-1993 has guided the Commission of Higher Education (CHED) to formulate a set of criteria for the selection of the Centers of Excellence for Teacher Education from among existing teacher education institutions (TEI). Validated items of PBET which were identified by the study were used to form the core of the Professional Education section of the new Licensure Examination for Teachers (LET) under the Professional Regulating Commission. The Bank has provided technical assistance to assist in the structuring of the PBET study. The second phase of the study is being completed for 1994-1996 with a view to identify consistently poor performing and high performing schools. The findings of the studies have initiated a reflection process in CHED concerning the issue of ineffective TEIs and in DECS the status of teachers who continue to fail PBET but are automatically licensed after 10 years of teaching. (vii) Household and School Matching Survey (HSMS) II and Drop-out Intervention Program (DIP). These subcomponents have been successfully completed and the DIP activities are being expanded under the DECS budget. A pilot study on three models of drop-out prevention was conducted in 30 schools from 5 regions. The models include: (i)the use of multi-level materials developed under PRODED; (ii)school-feeding program; and (iii) parent-teacher partnership  28 Appendix A Page 4 of 6 program. During the start-up period, the Bank provided technical assistance for both DIP and HSMS II (a school-based survey to identify demographic and socio-economic background data for elementary schools conducted in 1990 under SEEP). An average of P2.4 million per year were released over the life of the project and between 1990-1994, the pilot program was expanded to a total of 50 schools. Government appropriations have increased to P2.6 million a year to cover approximately 26,000 students including 45 new SRA schools for a National Breakfast Program targeting grade 1 students. DIP is further expanding through the financial support of mayors for the school-feeding program and local funds for multi-grade materials. Monitoring is conducted by 33 education specialists. (viii) Literacy. The activities of this sub-component consisted mainly of the expansion of the Magbasa Kita 'Let Us Read" a phono-syllabic method of first-level literacy training. The subcomponent was well achieved during 1990-1993 and was adopted as a national program in 1991. The subcomponent successfully achieved its objectives between 1990-1993. During the project years, both the number of classes and the enrollment went up about five fold, to average 6,000 classes annually and 130,000 students per year. Magbasa Kita has continued to develop and expand in several directions based on the lessons learned. The first is the initiation of the Literacy cum Livelihood Program which provides a context based on reality through which Magbasa Kita graduates can continue literacy training. The second is the ADB assisted Non-formal Education Project initiated in July, 1994 which focuses on illiterate adults and youths in selected areas. (ix) Student Assessment System (SAS). The achievement and impact of this subcomponent is yet to be seen. The Bank provided technical assistance toward the development of tests in five academic subjects for grades 2, 4, and 6 to collect descriptive data on student performance. Item writing commenced in 1991 but delay in budget releases, a reordering of priorities, and a difficulty in assembling a National Advisory Board delayed the completion of the subcomponent. To date, the National Advisory Board has been appointed and studies have been initiated to be completed on or around March 31, 1997. (x) MIS. This sub-component has been adequately achieved. A computer-operated educational planning model was completed under SEEP to be used for student enrollment projections, teacher information, and budgeting. During the project, The National Statistics Office (NSO) assisted DECS in improving the capacity to project student enrollment all the way down to the school level. The Bank is providing US$4.4 million for MIS under the Third Elementary Education Project to further improve the decision-making capacity of DECS' MIS for educational planning. (xi) Service Manuals. This sub-component was not successful. Although no budget was appropriated Technical Service under the Office of the Secretary drafted a service manual defining personnel action, elementary education, secondary education, administrative discipline, property rules and regulations, school building and grounds, physical facilities and management. The work was not finalized due to complete lack of budget allocation. Currently there are no funds and no plans to finish the work. 7. Relevance of the Budget Support. As budget support, the project has partially achieved its objective. GOP allocated 72% of the project's base cost to the school building program alone, expecting rapid disbursement. The original plan was to allocate a total of P 6.78 billion by in creasing the allocation  29 Appendix A Page 5 of 6 incrementally from P 1.33 billion in 1990 to P3.25 billion by the end of the three year project in 1992. The actual DECS budget released for SBP remained at P 1.1 billion during the original SEEP years of 1990- 92. Combined with long delays in the collection of SOEs, this resulted in a 40% loan disbursement at the end of three years. Nevertheless, during the loan extension over the next 3 years, the SBP budget release increased up to P. 3.45 billion in 1994-95. After cancellation of US$25 million in 1995, the loan was fully disbursed in October 1996. 8. Management Arrangements of SEEP. SEEP was unable to disburse quickly in spite of the fact that one of its objectives was budget support. When discussing this matter with DOF and CCPAP, they attributed the problem to the absence of a Project Implementation Coordination Unit (PICU). During appraisal, a PICU was planned but never funded and actualized because SEEP was viewed as strictly a budget support project and should not need extra management resources and PICU operated on an adhoc basis. This situation caused expensive consequences such as: (i) weakening the project's capacity to manage, supervise, and monitor; (ii) inability to collect SOEs which slowed disbursement considerably; and (iii) increasing the cost of the loans. 9. Summary of Agreements for SEEP. (i) Audit Report. In accordance with the Loan Agreement Covenants, outstanding audit reports will be filed with the Bank as soon as possible. (ii) ICR. The Government's contribution to the ICR will arrive in Washington by the end of November 1996 and the Bank will forward a draft ICR in January 1997 for comment by the Government. These will arrive within two weeks of receipt of the draft. The Third Elementary Education Project (TEEP): Post-negotiation Mission 10. TEEP Board Conditions. The mission is pleased to note that the last requirements from the World Bank Board have been fully complied by DECS: The Project Management Advisory Committee (PIMAC) and the Project Implementation Support Unit (PISU) were created respectively by DECS Secretary's Orders 74.s.1996, dated 24 October 1996, and 78.s.1996, dated 25 October, 1996. The Resettlement Framework was approved in a letter dated October 31, 1996 from DECS Undersecretary to the Bank. In addition, an MOA was signed by DECS and DOF concerning the use of the Municipal Development Fund (MDF) as a conduit for funding the SBP. 11. The Status of PISU. Heads of components have been appointed with the exception of Civil- Works and Procurement. An office space is under rehabilitation to be assigned to the PISU. The Mission was concerned that the members have still not yet been fully released from their previous assignments. 12. Project Guidelines. Significant progress has been achieved on the following Guidelines: (i) INSET, (ii) SIIF, (iii) Budget and Financial Management, and (iv) Civil works. It was agreed that the draft Guidelines on INSET and SIIF will be shared with Drs. Jangira and Ward for their comments and then completed. The Guidelines for Budget and Financial Management as well as Civil works need to incorporate the recommendations of the Mission and be completed. The other Guidelines are: (i) IEC, (ii) DEDP, (iii) Project Management, and (iv) Procurement and have been discussed in detail during the Mission. It was agreed that these Guidelines would be submitted in draft form to the Bank no later than  30 Appendix A Page 6 of 6 November 30, 1996. These will be reviewed by the Bank and returned to the PISU for finalization. It was agreed that all Guidelines be submitted for final review by the Bank by December 31, 1996. 13. Textbooks. The Mission was joined by Mr. Federico Gimenez. Agreements were reached concerning the details of the procedures for bidding on paper and the reprints for textbooks to be retro- financed under TEEP. Bidding documents will be submitted for prior review soon. The invitation to bid will be placed in the agreed newspaper without further delay. 14. Recoimnendations for TEEP. (i) Since the two unappointed positions are crucial to the start-up of TEEP, the Mission recommends their appointments as soon as possible. (ii) The Mission recommends that the rehabilitation of the PISU office be started immediately and the necessary equipment (furniture, computers, fax, and a photocopier) be provided along with an arrangement for petty cash. (iii) The Mission recommends that MOAs between DECS and DBM for budget arrangements and between DECS and DPWH for the SBP be prepared in line with the Guidelines, and submitted to the Bank for review before the signing. (iv) The Mission recommends that the PISU share their draft Guidelines with each other to ensure the consistency of the total set of Guidelines.  31 Annex B Page 1 of 15 Evaluation Government of the Philippines PROJECT BACKGROUND 1.1 In 1988, the World Bank conducted a sector review to identify ways to improve quality, equity and efficiency in the educational system without unduly increasing the fiscal burden of the Government. The analytical work in the Sector Report revealed the following major issues in the education sector: (a) inadequacy of physical inputs for teaching and learning, (b) weaknesses in teachers' subject mastery and pedagogical skills, (c) lack of strong professional support from school administrators and supervisors, (d) high dropout rate at the elementary level, (e) increasing number of functional illiterates, and (f) absence of clear administrative arrangements for sector monitoring and evaluation. 1.2 The Bank also financed a six-year project for elementary education which was known as the Program for Decentralized Educational Development (PRODED). The project's basic objective was to introduce improvements in policy, management and other sectoral concerns in order to achieve greater efficiency and effectiveness in the operation and administration of the elementary education system. PRODED consisted of sub-projects on curriculum development, staff development, technical assistance, special studies and research, instructional materials development and facilities development. 1.3 The Bank's operational program in the education sector is the continuing support to the provision of basic education as the necessary foundation of human resource development. Using the findings of the Sector Study and the accomplishments of PRODED as basis of analytical work, the Bank identified the areas of persistent problems in the elementary education sector which would need assistance. Thus, a second project for elementary education was proposed for funding assistance. Project preparation started in 1988, which led to the detailed design in June 1989 and finally to the appraisal of the project in October 1989. PROJECT OBJECTIVES AND SCOPE 1.4 The objective of the project is to increase equity, efficiency and quality in elementary education through assistance to the DECS investnent program and action plan. Specifically, the project aims to: 1. meet the subsector's requirements for essential physical resources with emphasis on improving their distribution to educationally and economically disadvantaged areas. The physical inputs include classrooms, multi-purpose workshop and toilet facilities, school desks, textbooks and other instructional materials including teachers' guides and instructional devices and equipment. The project's physical targets are: a) construction of 26,500 new classrooms to meet enrolment increments and reduce the existing backlog b) replacement of 13,900 severely dilapidated classrooms c) rehabilitation of about 36,400 damaged classrooms d) construction of 4,300 new workshops  32 Annex B Page 2 of 15 e) rehabilitation of 5,100 damaged workshops f) construction of 2,800 toilets g) procurement of 1.5 million school desks h) production and distribution of 44 million textbooks, 146,000 teachers' guide and 2.8 million reference materials and charts i) school equipment and instructional aids such as globes, maps, science and math kits The allocation of schoolbuilding requirements considered such factors as enrolment, and classroom shortages while during the middle part of project implementation, the policy of access and equity was considered by putting up elementary schools in barangays without elementary schools and completing incomplete elementary schools. Desk allocation took into consideration the school's population, the number of serviceable classroom furniture and the number of existing buildings/classrooms where the furniture will be housed. For textbooks, enrolment projections and textbook inventory are the main factors for computing textbook needs, along with the normal life span of a book. The project intended to raise the previous textbook-pupil ratio of 1:2 to 1:1 by end of 1992. 2. improve the professional competence of teachers and school administrators through inservice taining programs and the conduct of three studies on the following: a) pre-service elementary teacher -raining programs b) the validity of the Professional Board Examination for Teachers c) institutional networking for teacher training 3. expand basic education through the following: a) introduction of three drop-out prevention measures on a pilot basis in schools selected from low income municipalities in six regions b) evaluation of the effects of school and non-school factors on attendance, achievement and retention c) expansion of the literacy training program undertaken by the Bureau of Nonformal Education of DECS and its field offices 4. further develop the DECS institutional capacities in planning and management through: a) introduction of an annual assessment program of elementary student performance to provide data on achievement b) development of an integrated system of data processing, storage and retrieval and initiate decentralization of information management to the divisions c) conduct of studies to review the methods used in enrolment projections, calculating unit costs and budget inflation estimates d) development of a system for the maintenance and distribution of organizational information  33 Annex B Page 3 of 15 1.5 The Bank financed the infrastructure, facilities and instructional materials components of the project with the Overseas Economic Cooperation Fund (OECF) of Japan providing co-financing arrangements in the amount of 20.0 billion Yen (about US $145 million). However, OECF financed only a portion of the Schoolbuilding Program (SBP). Because of this co-financing scheme, the potential amount to be disbursed from the Bank loan was considerably reduced. From 1991 to 1995, the annual average share of OECF financing for the SBP was 78% while the Bank's share was only 22%. 1.6 Per appraisal estimates, the budgetary requirements to meet project expenditures for 1990-1992 was about P7.74 billion for the infrastructure and materials component. However, the approved budgetary appropriation for the same period was P5.16 billion or a deficiency of P2.58 billion. This deficiency in budgetary appropriations has affected largely the attainment of program targets within the three-year period (1990-1992). Moreover, DECS failed to get necessary level of appropriations after the first year of the project because of the Gulf War in 1991 and the resultant economy measures set by the government. 1.7 The Bank did not finance any of the various education studies under the project. For the entire duration of the project, only three components (drop-out intervention, literacy training and MIS) had specific funding sources in the DECS appropriations. The budget for the rest of the components had to be sourced from realignment of funds from other items in the DECS budget. This action resulted in implementation delays and a re-designing of some aspects of the affected project components. EII PROJECT IMPLEMENTATION IMPLEMENTATION STRUCTURE 2.1 DECS Order No. 28, series 1990 provided for the organization of a Project Advisory Group (PAG) and a Project Implementation Coordinating Unit (PICU) to coordinate and manage the implementation of the various components of the project. The PAG is responsible for the formulation of policies relating to the overall implementation of the project while PICU is responsible for the coordination of the implementation of the project. The PAG is chaired by the Secretary of Education and co-chaired by the Undersecretary for Basic Education. The members of PAG are Undersecretary for Finance and Administration, Assistant Secretary for Planning, Assistant Secretary for Human Resource Development, Directors/Heads of implementing agencies, the Regional Director of DECSRO IV, Chief of Financial and Management Service, representative from the Department of Budget and Management (DBM), and Department of Public Works and Highways (DPWH). PICU which is responsible for overall project coordination was headed by the Assistant Secretary for Planning as Project Coordinator and staffed by an Assistant Project Coordinator and two members each from the Office of Planning Service (OPS), Financial and Management Service (FMS) and EDPITAF.  3L Annex B Page 4 of 15 2.2 For each of the project component, a project manager was designated to oversee project implementation. For the Schoolbuilding Program and desk project which were implemented by DPWH and DECS field offices, respectively, the implementation was done by the district engineers in the case of DPWH and the Division Superintendents for DECS. The Regional Offices rendered monitoring and supervision functions. It was only in 1992 when the Financial and Management Officers were assigned as Project Coordinator in the DECS Regional Offices. For DPWH, the Fiscal Controllers at the regional office were given the responsibility of monitoring the submission of expenditure documentation from its district engineering offices. The DECSRO Finance Officer and the DPWH Fiscal Controller were responsible in so far as the documentation of expenditures was concerned. 2.3 The implementation of the textbook component consisting of the printing and distribution of textbooks, teachers' manuals and teachers' guides was undertaken by the Instructional Materials Development Center (formerly Instructional Materials Corporation). 2.4 The DECS Order provided that the Assistant Project Coordinator and members from OPS, FMS and EDPITAF will be detailed on full time basis at the PICU which shall be based at the DECS Central Office, then located at Palacio del Gobernador in Intramuros, Manila. PICU did not become fully operational because of the following reasons: a) only two staff members from OPS were working on the project but this was not even on a full time basis since they had other assignments in their mother unit b) one staff from EDPITAF was detailed to the project for six months but was subsequently recalled by the Executive Director c) the Assistant Project Coordinator resigned from DECS after ten months of the project d) there was no available office space for PICU e) PICU did not have operating expenses for travel, communication, supplies, transportation, etc. Expenses were charged against OPS funds, and f) there is no full-time accountant assigned to the project. LINKAGES AND INTER-AGENCY COORDINATION 2.5 The project maintained continuing linkages with various external government agencies and organizations. This coordinative linkages was done by the PICU. The functions of the collaborating agencies were as follows: - The Department of Public Works and Highways was responsible for the civil works component specifically the construction of schoolbuildings. - The Commission on Audit (COA) was responsible for the preparation of the financial audit - The Department of Budget and Management was responsible for the review and release of budgetary appropriations annually - The Department of Finance (DOF) provided oversight support  35 Annex B Page 5 of 15 The National Economic and Development Authority (NEDA) monitored project implementation The Coordinating Council of the Philippine Assistance Program (CCPAP) also monitored project implementation and assisted in coordinating with other agencies in order to facilitate project activities The World Bank Resident Mission acted as liaison between DECS and the World Bank headquarters in Washington D.C. to follow up requests, communicate with task managers and facilitate the transmittal of project documents to headquarters. IMPLEMENTATION PER PROJECT COMPONENT 2.6 Provision of Infrastructure and Materials 2.6.1 Schoolbuilding Program DPWH implemented the Schoolbuilding Program (SBP) from 1990 to 1995 except in 1991 when DECS took over the implementation. The Bank and OECF financed the construction of 46,835 new classrooms which is almost double the number of classrooms planned for during the appraisal stage of the project. Other SBP outputs are the replacement of 2,722 classrooms which was only 20% of the planned target and the rehabilitation of 32,560 classrooms which achieved 89 % of the target (based on SAR estimates). In 1994 and 1995, no classroom replacement project was undertaken because priority was given to providing new classrooms in barangays without elementary schools and the completion of incomplete elementary schools. Most of these sites were given a two- classroom building. Other school facilities provided were 2,994 additional multi-purpose workshoDs, 2,468 rehabilitated workshops and 4,288 toilets. When DECS implemented the Schoolbuilding Program in 1991, substantial savings (amounting to P133 million) were realized as a result of prudent management of allocated budgets. The savings that DECS was able to generate went into the construction of additional classrooms, toilets, the installation of lighting and water systems in the classroom and minor repair work. The implementation of the program was monitored by local school officials who were called School Officials Project in Charge (SOPICs). Together with the regional directors and superintendents, the SOPICs supervised the construction of the schoolbuildings with technical assistance from an engineering consultancy firm hired by the DECS. In 1994, an innovation in the SBP was introduced through the manufacture of pre-fabricated (demountable) schoolbuildings which utilized environment-friendly materials predominantly made with steel/metal. Although the pre-fabricated schoolbuildings were envisioned to be completed within a shorter period than the conventional design, implementation of the Schoolbuilding Program as a whole took a longer period which extended to two years. Delays  36 Annex B Page 6 of 15 were attributed to accessibility, site problems, peace and order problems, requests for realignment to conventional structures and political interventions in realignments. New technologies are continually being tested and tried out in the utilization of materials for classrooms. Among the latest innovations being tried out are schoolhouses made of bricks and buildings using plastic roofing, and styrofoam sandwiched with concrete. 2.6.2 Desks An average of P230 million was allocated yearly for the procurement of elementary school desks. Compared to the initial target of 1.5 million desks, the project was able to provide 2.5 million desks or an average of 400,000 per year. Procurement was done at various administrative levels from central office down to the division level. In line with the current thrust of promoting environrnent friendly technology, new models for classroom furniture were tested and manufactured. The materials are made of all wood, all steel, all plastic, all fiberglass or a combination of materials. Wood-based desks are to be sourced from recycled wood and agro- waste as well as tree stumps and the plantation tree varieties. ? with the advent of new designs, preference of end-users is still for the traditional wooden desks because of its durability, longer life span, and availability of materials to replace broken parts. 2.6.3 Textbooks The project was able to print 83.6 million textbooks including teachers' manuals and teachers' guides. This represented an accomplishment of 178% of the targetted quantities and an average of 13.8 million textbooks printed annually. Lnspite of these quantities, the planned 1:1 textbook-pupil ratio has not been fully achieved especially in remote schools. A monitoring mechanism should be devised to ensure that books are received by the recipient schools on time. Toward this end, the schools should be informed about the quantities and delivery schedules of specific book tides that they have been programmed to receive. An initial step to address the distribution problem is the computerization of distribution and monitoring activities. This project has been delayed by the difficulty in getting accurate and up to date data on enrolment and textbook receipts from the field. In June 1995, President Ramos signed into law the Book Publishing Industry Development Act (RA 8047). The law provides for the privatization of the textbook program and the subsequent abolition of the Instructional Materials Development Center.  3 7 Annex B Page 7 of 15 2.6.4 Equipment Equipment procured for elementary schools consisted mostly of office equipment such as typewriters, numeographing machines and copiers. Instructional equipment was limited to sewing machines, cassette recorders, overhead projectors and tools for Livelihood Education. The bulk of procurement for equipment went to the division offices which are supervising the public schools. Computers, fax machines, copiers and typewriters were the most common purchases. 2.7 Improving Teacher and Administrator Performance 2.7.1 In-service Training- In-service training programs for teachers and principals are conducted mostly at the district and division levels while the training for supervisors is done at the regional and division levels. Training is generally done on the teaching of the various subject areas along with instructional management and materials development. Specific concerns that focus on the current policies and thrusts of the DECS and government as a whole are also included in the training programs. Aside from the field offices, the Bureau of Elementary Education also conducts special training programs for field personnel. The National Educators Academy of the Philippines (NEAP) also conducts training programs for school personnel on a regular basis. There is no specific line item in the budget that is allocated for inservice training. Funds are taken from the regional and division budget for Maintenance and other Operating Expenses. 2.7.2 Pre-service Teacher Training The Bureau of Higher Education which was then a part of DECS, together with the Philippine Association for Teacher Education (PAFTE) conducted a study on pre-service programs for teachers during the school year 1991-1992. The study covered 309 elementary teacher training institutions representing 80% of the actual number at survey time. The research project was designed to examine the quality of selected elementary teacher training programs by investigating the deliberate educational structures, contexts, content, instructional practices and resources designed to foster teaching- learning. The findings of the study showed that pre-service elementary teacher training (PETT) institutions are heavily concentrated in Luzon due to population density. Majority of the PETT schools comply with the DECS minimum requirements for teacher education programs. Faculty qualification requirements are not fully met because only 52% of the faculty surveyed possessed at least a Master's degree. Most PETT schools offer majors or fields of specialization which requires little or no equipment/facilities like  3 Annex B Page 8 of 15 Communication Arts, Mathematics and Social Studies. Sciences are the least offered majors because of the inadequacy in laboratory equipment in most PETT schools. In terms of instructional practices, the study revealed that teaching methods used do not develop analytical and critical thinking while student teaching content does not include the development of research skills. The average NCEE rating obtained by students entering the Bachelor of Education (BEEd.) course is higher than the cut-off score set for teacher education. However, the average NCEE rating obtained is not very high, which is an indication that high school graduates entering the prograam were not the 'cream of the crop." The study came up with a set of recommendations related to directions for upgrading the quality and relevance of elementary teacher training programs, standards for the establishment of a system for institutional evaluation and guidelines for the consolidation and/or elimination of poor quality programs. 2.7.3 Validity of the Professional Board Examination for Teachers (PBET) This study was conducted by the National Educational- T-eing and Research Center (NETRC) in cooperation with Dr. Milagros R. The of the University of the Philippines College of Education. The purpose of the study was to establish the curricular and concurrent validity of the PBET in order to prove that the examination is a valid measure of teacher quality. The first phase of the study has been completed. This involved a review of the PBET administered in 1990, 1991 and 1992. Data gathered from the study was used as one of the criteria in the final selection of the Centers of Excellence for Teacher Education by the Commission on Higher Education. Validated test items were used to form the core of the Professional Education portion of the Licensure Examination for Teachers (LET) which is now administered by the Professional Regulations Commission. A second phase of the study is on-going which will cover a continuing analysis of the 1994, 1995 and 1996 PBET in order to identify consistently poor performing and high performing teacher training institutions. 2.8 Expanding Basic Education 2.8.1 Dropout Intervention Program (DIP) The program was conducted by the Bureau of Elementary Education in thirty pilot elementary schools from Regions IV, V, VI, VIII and XII. The schools were selected on the basis of an agreed criteria, one of which was a high dropout rate. Four types of intervention programs were introduced which were: a) multi-level materials (MLM)-assisted insmjction, b) MLM-assisted instruction with parent-teacher partnership (PTP), c) school feeding (SF) and  3) Annex B Page 9 of 15 d) SF with PTP. The pilot study sought to determine the relative influence of the four intervention programs on the drop-out rate, absenteeism rate, school participation rate and achievement level of Grades I to VI pupils. The results of the study revealed that school feeding and school feeding with parent-teacher partnership have the most influence in reducing absenteeism rate and drop-out rate. As the child progresses to the higher grades, the use of multi-level materials with PTP are the most effective because promotion to the next grade level is based on academic achievement. There is no single intervention which can address the problems of absenteeism, drop-ut and improving achievement level all at the same time. However, should it become necessairy to make a choice from among the four intervention programs, considering the limited government resources to sustain feeding program, the most logical choice would be a strengthened PTP program combined with MLMs. Teachers and parents who participated in the program agreed that the support of the community and the barangay officials contributed to the success of DIP. 2.8.2 Evaluaton of Educaional Outcomes or Household and School Marching Survey 11 (HSMS 1I) Round II of HSMS was undertaken by the Bureau of Elementary Education from 1990 to 1992. The studv covered seven regions (I, IV, V, VI, VIII, XII and NCR) with 126 schools as samples. The selection was intended to reflect diversitv in schooling condition. The schools included as samples in the DIP were also covered in HSMS II. The main purpose of the study was to determine the relationships of home, school and communitv factors to achievement. An additional purpose was to further examine the causes of dropping out. The study confirmed the findings of earlier studies that the pupils' socio-economic characteristics play a significant influence on achievement. School factors that emerged as potent predictors of achievement include the amount of time spent by the administrator in supervision, the presence of other school services such as in-school health service, remedial instruction and pre-school education. Community factors include proximity of the school to a commercial center and the level of economic development of the school community. The second part of the study dwelt on the determinants of absenteeism and dropping-out. These are also grouped into school and non-school factors. The school variables could be effectively addressed by the educational system while the other variables can be addressed through non-educational policies and programs.  Annex B Page 10 of 15 2.8.3 Expansion of Literacy Training The activities under this component consisted mainly of the expansion of the Magbassa Kita (Let us Read) which was launched initially in 1978 as a pilot project for Muslim women in the provinces of Sulu and Tawi-Tawi. The program was gradually expanded to cover all regions of the country. The number of beneficiaries of this program reached 493,915 through 29,908 classes organized from 1990 to 1995. Currently, the Bureau of Non-formal Education is working its way towards the use of community and needs based literacy materials. The Bureau is also in the process of undertaking ethnographic studies of representative communities such as fishing, mining, urban slums, refugee centers, tribal groups, etc. These studies will become the basis for the development of prototype literacy materials addressing the needs of specific clientele. The literacy training program was expanded to include training on livelihood skills development. This scheme was utilized to attract more clientele to the program. A new project was launched in 1994 which caters to illiterate adults and school dropouts in disadvantaged areas. This is the Nonformal Education Project funded through a loan from the Asian Development Bank (ADB). The project is part of the Department's commitment to address the twin problems of poverty and illiteracy. 2.9 Strengthening Planning and Management 2.9.1 Student Assessment System (SAS) This component has been delayed in implementation because of late budget release, and the difficulty in convening the members of the National Advisory Board. The SAS project is intended to develop test instruments to measure pupil performance in selected subjects and grade levels (Science, Mathematics, English, Civics and Culture and Filipino for Grades II, IV and VI). To date, an item writing workshop has been completed for the tests in these five subject areas. The printing of the tryout tests is on-going for administration in 1997. The project has been overtaken by other more important activities of the NETRC such as the administration of a National Achievement Test for Grade VI pupils in 1992 and the annual National Elementary Achievement Test (NEAT) beginning SY 1993-1994 and the National Secondary Assessment Test (NSAT) beginning SY 1994-1995.  41 Annex B Page 1 of 15 Evaluation Government of the Philippines 2.9.2 Management Information System The objectives for this component have been adequately achieved. The accomplishments include the following: a) development of three databases on educational statistics, schoolbuilding information and personnel information; b) installation of 3 databases at the central office, regional offices and school division offices of the pilot region; c) training of personnel and executives; d) acquisition of additional computer units for distribution to regional and selected division offices; e) conduct of an annual search for outstanding Educational Management Information System (EMIS) from the school to national level; and f) development of a computer application program to process educational data gathered through the unified data gathering system. Further improvement of this component will be undertaken through the Third Elementary Education Project. 2.9.3 Planning and Budgeting Studies Two studies were completed which would be useful in improving the quality of data used for planning and budgeting purposes. The first study came up with a standard methodology on enrolment projection while the second is a computer simulation model to determine student flow, teacher demand, phvsical facilities requirement, education cost and budget. Training workshops were conducted for central and regional office personnel. 2.9.4 Information Distribution System This component was not completed because of lack of funds and turn-over of staff assigned to the project. A draft service manual has been prepared in the areas of personnel action, elementary education, secondary education, administrative discipline, property rules and regulations, schoolbuildings, grounds and physical facilities management and parents teachers associations. Currently, there are no plans to ftmish this project. BANK'S PARTICIPATION IN THE PROJECT 2.10 The Bank conducted supervision missions on an average of two per year from 1991 to 1993 and on an annual basis towards the end of the project. The activities of the mission were focused on the progress of project implementation particularly loan disbursements. During the missions, problems were identified together with the appropriate action recommendations to resolve such issues.  42 Annex B Page 12 of 15 2.11 The Bank provided technical assistance in several project components such as DIP, HSMS II, Pre-Service Teacher Training, PBET Studies, MIS and SAS. The Bank review mission was composed of educators, economists, education information specialist, student assessment specialist, architects and management specialist. Supervision of these components stopped in 1994 when the mission's visits were confined mostly to the financial performance of the Project. 2.12 Two disbursement missions came during the first two years of project implementation. It was observed that these missions did not visit the field offices where the actual disbursements of funds were made. Thus, they were not able to get first hand information on how funds were actually spent and how documentation of expenditures was done. 2.13 As early as the July 1991 Review Mission, findings were made showing the need to extend the loan to be able to absorb the loan amount of $200 million. The March 1992 Review Mission suggested the possibility of restructuring the project by extending the implementation period from 3 to 5 years. This restructuring would require a reallocation of funds among the categories specified in the Loan Agreement and cancellation of some amount which will not be utilized and subsequently, the extension of the loan closing date. 2.14 The Resident Mission based at the Bangko Sental ng Pilipinas Building in Manila extended its support to the project by providing facilitative and coordinative service between the implementing agency and the Bank's headquarters in Washington, D.C. III. PROJECT OUTCOMES The project's outputs helped in improving the elementary education subsector and DECS as a whole in the areas of policy and sector improvement. 3.1 Policy Improvement The studies on Drop-out Intervention, Pre-service Teacher Training and PBET Validity have resulted in policy recommendations along these areas. The DIP study laid the groundwork for expansion of the project to other provinces/regions of the country. The Pre-Service Teacher Training Study recommended the adoption of measures to prevent the further proliferation of teacher education programs in already heavily concentrated areas. The Commission on Higher Education (CHED) has imposed a moratorium on the opening of new Teacher Education programs except for courses offering specialization in Science, English and Mathematics. Phase I of the PBET study has guided CHED in the formulation of criteria for the selection of Centers of Excellence for Teacher Education. The results of the second phase of the study will be useful in judging the quality of teacher education institutions (TEIs) and eventually, one of the basis for the closure of programs in low performing schools.  43 Annex B Page 13 of 15 3.2 Sector Improvement The provision of essential educational facilities such as schoolbuildings and desks has contributed to the overall goal of achieving equity and quality in education. Barangays without elementary schools were provided with a two- classroom schoolbuilding. Incomplete elementary schools were made complete through the construction of additional classrooms to house other grade levels. Classroom furniture replaced the dilapidated wooden benches. Schools and colleges of arts and trades in some regions earned additional income through the manufacture of wooden desks or armchairs to supply elementary schools. Textbook production requirements exceeded planned targets. However, inspite of this achievement, the goal of increasing the textbook-pupil ratio from 1:2 to 1:1 by the end of 1992 has not been attained. This is attributed to the lack of monitoring mechanism which will ensure that the books are delivered to the end users on schedule. The project's outputs also contributed to improvements in performance indicators such as participation rate, cohort survival rate and achievement rate. The average participation rate for the elementary level from 1990 to 1995 was 87.42 % or an average annual increase of 2.64 % while the average cohort survival rate for the same period was 67.63 %. Achievement level based on the mean score in the National Elementary Achievement Test (NEAT) rose from 41.77 when it was initially administered in 1993 to 45.64 in 1995 or an increase of 3.87 for the three-year period. The expansion of the literacy training program paved the way for the development of a project which focuses on illiterate youth and adults in disadvantaged areas of selected provinces. IV. LESSONS LEARNED 4.1 Budget Support Nature of the Loan The World Bank and OECF loans were considered budget support loans to finance regular expenditures of the government. The project was not treated as a foreign-assisted project in the General Appropriations Act and it did not result in any significant incremental expenditures for DECS. The allocation for the various components of the project which are financed by the loans are part of the Maintenance and Other Operating Expenses (MOOE) budget for regional operations (in the case of desks, textbooks and equipment) and capital outlays (for schoolbuildings). By the very nature of these expenditures i.e, these are basic education requirements, the funds were released regardless of loan drawdown performance.  44 Annex B Page 14 of 15 4.2 Project Management Arrangements The Project Implementation Coordinating Unit (PICU) which was supposed to be the Project Monitoring Office did not become fully operational (see Para. 2.4). Hence, PICU operated on an adhoc basis. During the initial stage of project implementation, a request for funds to cover the operating expenses of the PICU was made to the Department of Budget and Management. However, the request was denied since the components of the project are part of the regular projects of the implementing agency. The absence of a full-time staff to work on the project caused delays in disbursement because of the inability to follow-up and collect expenditure documentation on a regular basis. 4.3 Over-estimation of Targets The project suffered from budgetary cut backs in 1991 because of the Gulf War and the corresponding economy measures set by the government. The reduction in budgetarv allocation affected the achievement of targets set during the appraisal of the project (Para. 1.6). 4.4 Preparation of the Audit Reports -nspite of a memorandum issued by the Commission on Audit in 1990, the submission of the annual audit reports to the Bank was delayed from six months to one year during the first three years of project implementation. This was attributed to the sheer volume of transactions at the field level (especially true for the schoolbuilding program) which requires a long period for auditing and preparation of audit reports. A follow-up memo was issued by COA in 1994 reiterating the provisions of the memorandum issued in 1990. The delay was reduced to three months or less during the succeeding years. Constant monitoring of the field offices was done to minimize delays in reporting. 4.5 Documenration of Expendirures Disbursements from the loan were made upon submission of a report called Statement of Expenditures (SOEs). This report was prepared by the office where disbursements were made (the DPWH district engineering offices in the case of schoolbuildings and the DECS field offices in the case of desks and equipment). In some cases, the regional offices also submitted SOEs when implementation was made at this level. The preparation of SOEs is a time consuming task because each individual transaction has to be recorded monthly. This is especially true for the schoolbuilding program which consists of thousands of small-scale projects. The processing of SOEs for inclusion in a withdrawal application is a tedious task on the part of the staff assigned to this job because all expenditure items have to be checked individually to determine if these are eligible for reimbursement. Computational errors, double reporting and cumulative reporting are the most common reasons for delays in processing.  45 Annex B Page 15 of 15 The fact that the project was not specifically identified as a foreign- assisted project since it merely financed regular expenditures and did not result in any significant incremental expenditures led to a lack of attention to the requirements for expenditure documentation. This expenditure documentation involved additional work to existing duties for all those involved from the field level to the central level. 4.6 Lack of Monitoring Mechanism DECS does not have its own mechanism in place to monitor the Schoolbuilding Program. It has to rely on the report of DPWH to determine how many of the facilities were actually built, replaced or rehabilitated within a given year. On the issue of textbook delivery, the responsibility of IMDC ends upon receipt of the textbooks in the division warehouses. DECS still lacks the necessary logistics to monitor delivery up to the school level and to ensure that the books are issued to the schoolchildren.   I    LfA'. Titt N LR' e F - i_ l t tK . -, 1; - - .L 'Y |~ ?0 -, i '' ,, 1- '-l 'L E