Document of The World Bank Report No: 73474-MV INTERNATIONAL DEVELOPMENT ASSOCIATION PROJECT APPRAISAL DOCUMENT ON A PROPOSED GRANT IN THE AMOUNT OF SDR 6.7 MILLION (US$ 10.0 MILLION EQUIVALENT) TO THE REPUBLIC OF MALDIVES FOR AN ENHANCING EDUCATION DEVELOPMENT PROJECT (EEDP) March 26, 2013 Education Unit Human Development Department South Asia Region This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. CURRENCY EQUIVALENTS (Exchange Rate Effective February 28, 2013) Currency Unit = Maldivian Rufiyaa (MVR) MVR 15.35 = US$ 1 US$ 1.51483 = SDR 1 FISCAL YEAR January 1 - December 31 ABBREVIATIONS AND ACRONYMS AAA Analytical and Advisory GCE General Certificate of Education Activities O/L Ordinary Level ARCS Audit Reports Compliance GDP Gross Domestic Product System GoM Government of Maldives ASFF Annual School Feedback Form HDI Human Development Index ATI Access to Information HEC Higher Education Council BP Bank Policy HEI Higher Education Institution CAS Country Assistance Strategy HIES Household Income and CDD Community Driven Expenditure Survey Development HR Human Resource CSU Coordination Support Unit IA Implementation Agency DHE Department of Higher Education IBRD International Bank for EEDP Enhancing Education Reconstruction and Development Project Development EMIS Education Management ICB International Competitive Information System Bidding ESA Environmental and Social ICT Information and Assessment Communications Technology ESAMF Environmental and Social IDA International Development Assessment and Management Association Framework IFR Interim Financial Report ESMF Environmental and Social IRR Internal Rate of Return Management Framework ISN Interim Strategy Note ESMP Environmental and Social IUFR Interim Unaudited Financial Management Plan Report ESQID Education Supervision and MDG Millennium Development Goal Quality Improvement Division MMA Maldivian Monetary Authority FM Financial Management MNU Maldives National University FY Fiscal Year MoA Memorandum of Agreement GCE General Certificate of Education MoE Ministry of Education A/L Advanced Level MoED Ministry of Economic QA Quality Assurance Development QAAC Quality Assurance and MoFT Ministry of Finance and Accreditation Council Treasury QATDA Quality Assurance and Teacher MQA Maldives Qualifications Development Awards Authority QCBS Quality- and Cost-Based MVR Maldivian Rufiyaa Selection NCB National Competitive Bidding SA School Administration NIE National Institute of Education SAP Strategic Action Plan NPV Net Present Value SBCQ Selection Based on Consultant's OM Operations Manual Qualifications OP Operational Policy SBD Standard Bidding Document OPP Office of Projects and Programs SBM School-Based Management ORAF Operational Risk Assessment SBPD School-based Professional Framework Development PAD Project Appraisal Document SIL Specific Investment Loan PAS Public Accounting System SMT Senior Management Team PDP Professional Development SSE School Self-Evaluations Policy TEB Tender Evaluation Board PPRS Policy Planning and Research ToR Terms of Reference Section TRC Teacher Resource Center Regional Vice President: Isabel M. Guerrero Country Director: Diarietou Gaye Sector Director: Jesko S. Hentschel Sector Manager: Amit Dar Task Team Leader: Harsha Aturupane  MALDIVES ENHANCING EDUCATION DEVELOPMENT PROJECT (EEDP) TABLE OF CONTENTS Page I. STRATEGIC CONTEXT .................................................................................................1 A. Country Context ......................................................... 1 B. Sectoral and Institutional Context. ....................................... 1 C. Higher Level Objectives to which the Project Contributes ................... 3 II. PROJECT DEVELOPMENT OBJECTIVES ...........................................................3 A. PDO........................................................ 3 B. Project Beneficiaries ..................................... ........ 3 C. PDO Level Results Indicators......................4.... ............4 III. PROJECT DESCRIPTION ......................................................................................... 4 A. Project Components ..................................... ........ 4 B. Project Financing ......................................... ..... 10 1. Lending Instrument ..................................... ........ 10 2. Project Cost and Financing ............................... ......... 10 C. Lessons Learned and Reflected in the Project Design..................... 11 IV. IM PLEM ENTATION ..................................................................................................... 11 A. Institutional and Implementation Arrangements ................ ............. 11 B. Results Monitoring and Evaluation .................................. 13 C. Sustainability......... ........ ............................... 14 V. KEY RISKS AND MITIGATION MEASURES......................................................15 A. Risk Ratings Summary .................................... ...... 15 B. Overall Risk Rating Explanation .................................... 15 VI. APPRAISAL SUMMARY .........................................................................................16 A. Economic and Financial Analyses .......................... ......... 16 B. Technical .................................................... 17 C. Financial Management...................... ................. 18 D. Procurement ............................................. 18 E. Social (including Safeguards) ...................................... 18 F. Environment (including Safeguards).................................19 Annex 1: Results Framework and Monitoring.................. ................20 Annex 2: Detailed Project Description........................................23 Annex 3: Implementation Arrangements......................................34 Annex 4: Operational Risk Assessment Framework (ORAF)........................55 Annex 5: Implementation Support Plan....................... ................58 Annex 6: Economic and Financial Analysis....................................60 Annex 7: Future Strategy and Program Development.............................71 Annex 8: Documents Used................................................ 76 Annex 9: Map........................................................ 77 PAD DATA SHEET Maldives Enhancing Education Development Project (P131331) PROJECT APPRAISAL DOCUMENT SOUTH ASIA SASED Report No.: 73474-MV Basic Information Project ID Lending Instrument EA Category Team Leader P131331 Specific Investment B - Partial Assessment Harsha Aturupane Loan Project Implementation Start Date Project Implementation End Date 17 June 2013 31 December 2017 Expected Effectiveness Date Expected Closing Date 03 June 2013 30 June 2018 Joint IFC No Sector Manager Sector Director Country Director Regional Vice President Amit Dar Jesko S. Hentschel Diarietou Gaye Isabel M. Guerrero Borrower: Republic of Maldives Responsible Agency: Ministry of Education Contact: Dr. Abdul Muhsin Mohamed Title: Permanent Secretary Telephone 960-334-1121 Email: amuhsin@moe.gov.mv Project Financing Data(US$M) ] Loan [X] Grant [ ] Other ] Credit [ ] Guarantee For Loans/Credits/Others Total Project Cost (US$M): 11.00 Total Bank Financing 10.00 (US$M): 1 Financing Source Amount(US$M) BORROWER/RECIPIENT 1.00 IDA Grant 10.00 Total 11.00 Expected Disbursements (in USD Million) Fiscal 2014 2015 2016 2017 2018 0000 0000 0000 0000 Year Annual 1.00 1.50 2.35 2.60 2.55 0.00 0.00 0.00 0.00 Cumulati 1.00 2.50 4.85 7.45 10.00 0.00 0.00 0.00 0.00 ve Project Development Objective(s) The project development objective is to enhance and strengthen strategic dimensions of education access and quality. Components Component Name Cost (USD Millions) National Level Education Development 8.55 School Level Education Development 1.15 Project Management, Monitoring and Evaluation, and 1.30 Program Development Compliance Policy Does the project depart from the CAS in content or in other significant Yes [ ] No [X] respects? Does the project require any waivers of Bank policies? Yes [ ] No [X] Have these been approved by Bank management? Yes [ ] No [ ] Is approval for any policy waiver sought from the Board? Yes [ ] No [X] Does the project meet the Regional criteria for readiness for implementation? Yes [X] No [ ] Safeguard Policies Triggered by the Project Yes No Environmental Assessment OP/BP 4.01 X Natural Habitats OP/BP 4.04 X Forests OP/BP 4.36 X 11 Pest Management OP 4.09 X Physical Cultural Resources OP/BP 4.11 X Indigenous Peoples OP/BP 4.10 X Involuntary Resettlement OP/BP 4.12 X Safety of Dams OP/BP 4.37 X Projects on International Waterways OP/BP 7.50 X Projects in Disputed Areas OP/BP 7.60 X Legal Covenants Name Recurrent Due Date Frequency Steering Committee X Description of Covenant The Recipient shall, no later than three months after the Effective Date, establish and thereafter maintain through the period of Project implementation, a Steering Committee, chaired by the Minister of Education, with functions, composition and resources satisfactory to the Association. Name Recurrent Due Date Frequency Management of Project X Description of Covenant The Recipient shall carry out the day-to-day management of Project activities through its Ministry of Education and, to this end, shall maintain at all times during the period of implementation of the Project, a Project coordination support unit within the MOE, with functions and resources satisfactory to the Association, and with staff in adequate numbers and with qualifications, experience and terms of reference satisfactory to the Association. Name Recurrent Due Date Frequency Operations Manual X Description of Covenant The Recipient shall ensure that the Project is carried out in accordance with the arrangements and procedures set out in the Operational Manual. Name Recurrent Due Date Frequency Annual Work Plan and Budget X Description of Covenant The Recipient shall prepare and furnish to the Association not later than November 1 of each year a consolidated annual work plan and budget, and shall ensure that the Project is implemented in accordance with the annual work plans and budgets as approved by the Association. iii Name Recurrent Due Date Frequency Safeguards X Description of Covenant The Recipient shall ensure that the Project is carried out in accordance with the provisions of the ESAMF, the ESAs and the ESMPs. Name Recurrent Due Date Frequency QATDA Awards X Description of Covenant For the purpose of carrying out activities to be financed by Awards Component 2.4 of the Project, the Recipient shall make Awards to the eligible schools in accordance with eligibility criteria, procedures and terms and conditions acceptable to the Association as specified in the Financing Agreement and elaborated in the Operational Manual. Name Recurrent Due Date Frequency Financial Management X Description of Covenant The Recipient shall, no later than six months of the following fiscal year, prepare and submit audited annual project financial statements to the Association. Name Recurrent Due Date Frequency Financial Management X Description of Covenant The Recipient shall, no later than 45 days following the end of the reporting quarter, prepare and submit Project Interim Unaudited Financial Reports (IUFRs) to the Association. Conditions Name Type Description of Condition None Team Composition Bank Staff Name Title Specialization Unit Qaiser M. Khan Sector Lead Economist Human Development AFTHD (Peer Reviewer) Laura M. Kiang Consultant Operations SASED 1v Julie-Anne M. Graitge Program Assistant Program Assistant SASHD Harsha Aturupane Lead Education Team Leader SASED Specialist Lianqin Wang Senior Education Education (Peer MNSHE Specialist Reviewer) Chau-Ching Shen Senior Finance Officer Finance CTRLN Haider Raza Senior Procurement Procurement SARPS Specialist Manush Hristov Senior Counsel Legal LEGEN Mohamed Ghani Razaak Senior Social Social Development SASDS Development Specialist Anita Lakshmi Fernando Team Assistant Team Assistant SASHD Darshani De Silva Environmental Environment SASDI Specialist Supul Chamikara Financial Management Financial Management SARFM Wijesinghe Specialist Mari Shojo E T Consultant Education SASED Saurav Dev Bhatta Senior Education Education SASED Specialist Aminath Inasha Shafeeq Operations Analyst Operations SACMV Non Bank Staff Name Title Office Phone City Locations Country First Location Planned Actual Comments Administrative Division Maldives Vaavu Atoll Vaavu Atoll X Maldives Thaa Atoll Thaa Atoll X Maldives Shaviyani Atoll Shaviyani Atoll X Maldives Seenu Atoll Seenu Atoll X Maldives Raa Atoll Raa Atoll X Maldives Noonu Atoll Noonu Atoll X V Maldives Gnyaviyani Atoll Gnaviyani Atoll X Maldives Meemu Atoll Meemu Atoll X Maldives Lhaviyani Atoll Lhaviyani Atoll X Maldives Laamu Atoll Laamu Atoll X Maldives Kaafu Atoll Kaafu Atoll X Maldives Haa Dhaalu Atoll Haa Dhaalu Atoll X Maldives Haa Alifu Atoll Haa Alifu Atoll X Maldives Gaafu Dhaalu Atoll Gaafu Dhaalu Atoll X Maldives Gaafu Alifu Atoll Gaafu Alifu Atoll X Maldives Faafu Atoll Faafu Atoll X Maldives Dhaalu Atoll Dhaalu Atoll X Maldives Baa Atoll Baa Atoll X Maldives Alif Dhaalu Atoll Alif Dhaalu Atoll X Maldives Alif Alif Atoll Alif Alif Atoll X Institutional Data Sector Board Education Sectors / Climate Change Sector (Maximum 5 and total % must equal 100) Major Sector Sector % Adaptation Mitigation Co- Co-benefits % benefits % Education Secondary education 50 Education Primary education 30 Education Tertiary education 15 Public Administration, Law, and Public administration- 5 Justice Education Total 100 Z I certify that there is no Adaptation and Mitigation Climate Change Co-benefits information applicable to this project. vi Themes Theme (Maximum 5 and total % must equal 100) Major theme Theme % Human development Education for all 50 Human development Education for the knowledge economy 50 Total 100 vii  I. STRATEGIC CONTEXT A. Country Context 1. The Republic of Maldives, a multi-island nation of spectacular natural beauty, is one of the more advanced economies in South Asia and classified as a middle income country. The Maldives consists of an archipelago of nearly 1,200 islands and a population of about 400,000 inhabitants: approximately 310,000 Maldivians and 90,000 expatriate workers. More than 25 percent of the population live in the capital city, Male', while the rest are distributed among just under 200 other inhabited islands. The country ranked 109th in the human development index (HDI) for 2011, which was the second highest HDI rank in South Asia after Sri Lanka. The Maldives is seeking to accelerate human development and promote economic prosperity. The expansion and development of human capital is of central importance for the achievement of this goal. 2. The Maldivian economy has experienced strong economic growth over the last two decades. The tourism sector has been the main engine of growth. The economy is critically dependent on a small number of sectors, with the following contribution to GDP in 2011, tourism (30%), government administration (13%), transport (9%), communication (9%), construction (7%), real estate (7%), wholesale and retail trade (4%), manufacturing (4%), education (4%), and several other relatively small sectors. Transport and communication, and other sectors including trade, construction, real estate, and business services are also linked to the tourism sector. 3. The dominance of tourism in the economy makes the Maldivian economy highly vulnerable to fluctuations and variations in global economic and social conditions through their effect on tourism, and the transmission of these effects to other related sectors. Periods of global recession, when tourist arrivals have fallen, have been particularly difficult for the Maldives. After averaging almost 7 percent for several years, growth is estimated to have declined in 2012, due to the effects of continued weak economic conditions in Europe, Maldives' largest market. The slowdown in the economy has reduced the resources available to the country to fund important investments, including in human development. In this context, the proposed project, which will provide a grant of US$ 10 million for investment in education, has the potential to make a strong contribution to the country's human development. B. Sectoral and Institutional Context 4. The Maldives has about 62,000 students and 6,000 teachers in approximately 220 public schools. In addition, there are a small number of private education institutions which enroll about 1,700 students. The Maldivian education system consists of the following stages: primary education (grades 1-7, ages 6-12), lower secondary education (grades 8-10, ages 13-15) higher secondary education (grades 11-12, ages 16-17), and higher education (ages 18 onwards). The overall net primary enrolment rate, 94 percent, is high. There is also gender parity, with the net primary enrollment for boys at 94 percent, and the net primary enrollment rate for girls also at 94 percent. The net lower secondary enrollment rate is 81 percent, with boys' net enrollment at 83 percent and girls' net enrollment at 79 percent. 1 5. Despite these achievements the education system faces a number of future challenges. There is a sharp drop in enrollment at the higher secondary education level. The higher secondary education net enrollment rate is a mere 19 percent, with boys' net enrollment at 20 percent and girls' net enrollment at 19 percent. Gross enrollment rates in higher secondary education are 28 percent for boys and 31 percent for girls. This is one of the most steep falls between lower secondary and higher secondary education in the world. The main reason for the sharp drop in participation at the higher secondary level has been the limited number of schools offering education in grades 11-12. Out of about 220 schools in the Maldives, until recently only 5 provided higher secondary education. Enrollment in tertiary education is also low, just 3 percent. The Maldives lags behind in higher secondary and tertiary education participation in relation to other small island nations. Policy action to expand higher secondary and tertiary education is now needed urgently. 6. The quality of education at all levels is another major policy challenge facing the Maldives. For instance, learning outcomes in both primary and secondary education are modest and there are substantial regional disparities. National assessments of learning outcomes at grade 4 and grade 7 show that learning levels are unsatisfactory. At grade 4 the average score of students in the English language is 32 percent and in mathematics 38 percent. In grade 8 the average score of students in the English language is 29 percent and in mathematics 30 percent. The performance of students at national examinations is also inadequate. At the General Certificate of Examinations (GCE O/L) in 2010 only 33 percent of boys and 37 percent of girls passed. 7. The Government of Maldives (GoM) is aware of the challenges in the education sector. The Ministry of Education (MoE) has prepared an education sector development program to address these challenges. The MoE program has now increased the number of schools offering higher secondary education in atolls, where there are sufficient student numbers to make this expansion viable, to 38 schools: 4 schools in Male' and 34 schools in the atolls. In addition, the MoE is promoting private-public partnerships to increase tertiary education opportunities. 8. The education development program is also addressing the low quality of education through several strategic initiatives. A strategic initiative is the development of a system of regular National Assessments of Learning Outcomes, which can inform policy formulation and program development. In particular, the national assessments can feed into curriculum design, teaching methods and teacher development, the production of teaching-leaming material, measures to promote regional equity of education opportunities, and decisions on the allocation of resources. The MoE has also developed a Quality Assurance (QA) system, containing both internal school-level QA reviews and action, and external reviews of quality. This QA system, especially the school-based QA protocols and processes, now needs to be refined and scaled up throughout the country. The MoE is also seeking to improve the quality of teachers through suitable pre-service teacher education and continuing teacher development programs, especially school-based professional development (SBPD) of teachers. In addition, the MoE is planning to strengthen the management and leadership skills among school heads, deputy heads and leading teachers, and the members of school boards. Further, the development of the education management skills of MoE staff, especially planning, administration, budgeting and monitoring, is of key importance in the MoE program. 2 C. Higher Level Objectives to which the Project Contributes 9. Education is extremely important for the Maldives, at the current stage of development of the country, to increase the number of well-educated and qualified Maldivians. At present the country depends heavily on expensive overseas labor for management, technical and administrative jobs, as there are insufficient Maldivians with higher secondary and tertiary level qualifications to take up these jobs. The project will assist the GoM to expand secondary education and higher education to meet the rising demand for sophisticated and high-level skills from employers. The increase in the number of educated Maldivians will, in the long-term, assist the sustained economic growth of the country by enabling a greater proportion of the human capital needs of the economy to be met from the domestic labor market, thus reducing the dependence on expensive expatriate labor. The promotion of education access and quality under the project also covers the entire country, including the outer atolls. By increasing education levels in the outer atolls, the project will help to broad-base economic opportunities for young people and promote equitable economic and social development in the country. 10. The Country Assistance Strategy for FYO8-FY12 (CAS) and its Progress Report (CASPR) underscore the significance of the development of Maldives' education system. As signaled in the CAS and CASPR, education access and quality and the linkages between the education system and local labor markets remain central to human development in the Maldives. The FYO8-12 CAS Program, therefore, identified the need for continued financial support for the education sector, building on the now-closed Integrated Human Development Project and underpinned by analytical work on education undertaken during the CAS period. This project responds to that identified need. II. PROJECT DEVELOPMENT OBJECTIVES A. PDO 11. The project development objective is to enhance and strengthen strategic dimensions of education access and quality. 12. The project addresses the key challenge of increasing access to secondary and higher secondary education by supporting the expansion of facilities in secondary and higher secondary schools. In addition, the project will support key policy initiatives to improve the quality of primary and secondary education, such as the development of a system of national assessments of learning outcomes to inform education policy, regular quality assurance reviews at school level which will feed into school improvement activities, and teacher development. The analytical work on which the project is based, the programmatic series of Maldives Education Sector Reports 2012, identified these education development initiatives as the priority initiatives for the Maldives at the present time. B. Project Beneficiaries 13. The direct beneficiaries of the project will be approximately 50,000 school students, about 5,000 school teachers, 220 principals and 500 education managers and administrators. The indirect project beneficiaries will be the school communities of about 220 schools; the households of the students; the contractors of school infrastructure and suppliers of education 3 equipment; and the academics and researchers who will receive support for research and evaluation activities. In the long-term, as the quantity and quality of school completers rises, employers and the higher education and training sectors will also benefit. C. PDO Level Results Indicators 14. The success of the project in terms of meeting its key objectives are to be measured by the following indicative outcomes: * Increased survival rate through higher secondary education (grades 1-12). * A system of National Assessments of Learning Outcomes for policy and program development established and operationalized. * Proportion of atolls in which a system of quality assurance reviews is established and findings incorporated in the implementation of school improvement plans. Number of beneficiaries. * At least 50,000 school students are expected to benefit from the project activities. * About 48 percent of these students will be girls. 15. The outcomes will be monitored by gender and atoll, where relevant. III. PROJECT DESCRIPTION A. Project Components 16. The Maldives Enhancing Education Development Project (EEDP) is organized under three components: (a) national level education development; (b) school level education development; and (c) project management, monitoring and evaluation, and program development. Component One: National Level Education Development (Total US$ 8.55 million: IDA US$ 7.95 million and GoM US$ 0.6 million) 17. The objective of this component is to promote strategic initiatives at the country level to strengthen and develop the education system. The national level education activities will be implemented by the Ministry of Education (MoE), National Institute of Education (NIE), and higher education institutions. The following key sub-components will be supported under this component. 1.1 National Assessments of Learning Outcomes for Policy and Program Development 18. National assessments of learning outcomes have become one of the main vehicles for assessing education systems and formulating education policies in OECD countries and middle- income countries. The EEDP will support the Maldives to develop the capacity of the country to design and implement national assessments of learning outcomes in grades 4 and 7 according to a regular cycle for key subjects such as English, mathematics and Dhivehi, and use the results and findings for education policy and program development. The EEDP will help build the 4 technical capacity within the MoE, especially the Education Supervision and Quality Improvement Division (ESQID) to undertake rigorous, state-of-the-art national assessments and to deliver short-courses, and in the National Institute of Education (NIE) to conduct advanced certificate or diploma level courses in national assessments of learning outcomes. The project will also build the capacity of selected policy makers and education specialists within the MoE, especially in the ESQID, the Policy Planning and Research Section (PPRS) and the NIE, to use the results and findings from national assessments for strategic policy and management decisions. The national assessments under the project will help monitor learning outcomes over time. The information and feedback from these national assessments can be used by policy makers and education specialists in key education areas such as curriculum development, pre- service teacher education, continuing teacher development, the production of educational material including textbooks, and the allocation of resources. 1.2 Management and Leadership Development of Staff in the Education Sector 19. The EEDP will assist the MoE to develop the human resources in the education sector, with a special focus on education managers and administrators, school principals, and leading teachers who are potential future principals. The project will support a set of principals and leading teachers who already have bachelor's degrees to obtain master's degrees in education administration/management (either full time or in block mode). In addition, principals and leading teachers who only have diplomas will be supported to obtain bachelor's degrees in a relevant field such as education management or administration. Priority would be given to the younger principals and leading teachers, to maximize the return on investment. The scholarships for Master's and Bachelor's degrees will cover expenses in the higher education institutions, such as tuition fees, and also other costs such as living expenses and transport. The scholarships for the programs would be administered by the Scholarships Section of the Department of Higher Education (DHE). This section has considerable experience of administering scholarships, since it handles government funded scholarships. The section also administered the scholarships under an earlier Bank funded education project, and has experience of Bank procedures. 20. MoE staff, including from the Atoll Education Units, will be provided with short-term courses and/or exposure programs tailor made to develop their administrative, managerial and technical skills for work in the MoE and Atolls. This would cover in the Maldives Quality Assurance Authority (MQA), too. The short-term training would be administered by the Human Resources Division of the MoE. 1.3 Learning Environment Enrichment of Secondary Schools 21. The Maldives has an atoll-wide network of schools that provide universal access to primary (grades 1-7) and secondary (grades 8-10) education. However, until recently access to higher secondary education (grades 11-12) was very limited, initially to one school in Male', and then to four more schools in the atolls. The government has now adopted a policy to expand access to higher secondary education through about 38 strategically selected schools, across the country, which will serve as hubs for higher secondary education in the atolls and in Male'. The higher secondary schools, and the secondary schools which feed students into them, need greater physical facilities and equipment, especially for IT and science. Strong IT skills are necessary for 5 all secondary school completers who either plan to seek employment opportunities in the labor market or proceed onwards to higher education. Science subjects are needed to enable secondary school students to offer a curriculum options with subjects such as biology, chemistry and physics. Such subjects are pre-requisites needed for professions such as medicine, allied health sciences, engineering, electronics, and science teaching. These are professions which are in short supply among Maldivians, resulting in expensive expatriate staff being recruited for these occupations. 22. The project will support a set of about 45 strategically selected schools, which include all 38 higher secondary schools and some of the large secondary feeder schools, to enrich their learning environments through the provision of IT and science equipment, and the expansion of classroom facilities in over-crowded large schools to help implement the government policy of single-session schools. This initiative is expected to help improve the transition rate from secondary to higher secondary education and increase the survival rate through the school system to grade 12. The additional facilities will also enable islands to conduct labor-market oriented skills training for youth, including after school hours as co-curricular activities. About 25,000 students, including all higher secondary students, attend these schools and will benefit from these facilities and equipment. The schools selected already have adequate numbers of teachers for these subjects, so that additional teachers will not be needed. However, the schools will receive support under the project's short-term training programs in education management and leadership, quality assurance and school-based teacher development. Hence, an integrated package of learning enrichment activities will be made available to these strategic higher secondary and secondary schools. Component Two: School Level Education Development (Total US$ 1.15 million: IDA US$ 1.0 million and GoM US$ 0.15 million) 23. The objective of this component is to promote strategic initiatives to improve the performance of schools. The school-level activities would be implemented on-site in the schools by school officials such as principals and teachers. The following key sub-components will be supported under this component. 2.1 School-Based Management 24. The country has adopted a professional control model of school-based management, where the main decision-making authority has been devolved to principals and teachers. School- based management is a new initiative in the Maldives, and members of Senior Management Teams of schools and Schools Boards need training and capacity building in the aims and objectives of school-based management, the roles and responsibilities of the various school level agencies, and the variety of actions that can be taken under school-based management to improve the effectiveness and performance of schools. The EEDP will assist the MoE to train and strengthen the capacity of Senior Management Teams of schools and Schools Boards to take the school-based management initiative forward efficiently. Attention will be given to the fact that there are differences in abilities of principals, leading teachers, school boards and stakeholders, across the various atolls and islands, in the training and capacity building work. 6 2.2 Modernizing Quality Assurance for School Improvement 25. Quality assurance (QA) is a key feature of education systems in many high income countries like Singapore, Scotland, the United Arab Emirates (UAE) and several middle-income countries including Malaysia and Sri Lanka. The MoE is keen to develop and establish a quality assurance system that encompasses internal self-assessments by schools themselves, consistent with international trends in Quality Assurance in OECD and middle-income countries. The EEDP will help the MoE to establish a regular, annual QA system for schools, with the main emphasis on internal self-evaluations. The school self-evaluations (SSEs) would, in turn, feed into the School Improvement Plans for the following year. 26. Larger schools would be trained and be able to conduct their own self-evaluations, and incorporate the findings and recommendations into improving quality in their schools. Smaller schools in remote atolls would receive training in self-evaluations too; however, they would also be supported to conduct self-evaluations and incorporate the findings and recommendations into their School Improvement Plans by atoll level education units, especially the Teacher Resource Centers. Private schools which receive government subsidies to enroll students would also be expected to be part of the QA program. The findings of the QA self-evaluations would also inform the school-based teacher professional development activities of schools. 2.3 Stren$thenin$ School-Based Professional Development (SBPD) for Teachers and Other School Staff 27. The successful achievement of a high quality of education depends on the availability of an adequate stock of professionally educated, competent and motivated teachers. School-based teacher professional development has been noted globally for its effectiveness. The MoE is aware of the importance of school-based professional development (SBPD) for teachers as a promising strategy for continuing teacher education and training. The MoE has published a Professional Development Policy (PDP), developed SBPD guidelines for schools, and encouraged schools to conduct SBPD activities. It is mandatory for all academic staff in schools to receive a minimum of 15 hours (3 days) of professional development in every year. The SBPD guidelines seek to ensure that there is a procedure and process involved in the implementation of SBPD programs. 28. The EEDP would assist the MoE, especially the NIE, to further develop the system for SBPD by improving the capacity of Professional Development (PD) coordinators and Teacher Resource Center (TRC) coordinators, helping schools undertake SBPD activities, and assisting the NIE to monitor the implementation of SBPD in schools. All schools in Male' and the outer atolls would implement SBPD programs according to an annual cycle. The SBPD program would be related to and informed by the Quality Assurance self-evaluations by schools. 2.4 School Quality Assurance and Teacher Development Awards (QATDA) 29. A system of School Quality Assurance and Teacher Development Awards (QATDA) would be supported under the project. The QATDA would assist school improvement activities through the implementation of School Improvement Plans and Annual School Feedback Forms 7 (ASFF), with a special focus on quality assurance self-evaluations and school-based teacher professional development. Under the project all schools would receive an annual award of between MVR 6,000-7,500 (about US$ 400-500), depending on school size, commencing in 2014, to implement the findings and recommendation of the QA self-evaluations to improve student learning and soft skills, and to implement SBPD programs to enhance teacher performance. The QATDA will provide an incentive for schools to implement QA and SBPD activities. 30. Under the QATDA, there would be an annual Memorandum of Agreement (MoA) between the MoE and schools to implement, monitor and report QATDA activities. The awards would be made available in the first year against approved proposals. A model proposal is included in the operations manual. In subsequent years, the awards would be made available on the basis of performance in the previous year on implementing QA activities and SBPD activities. The implementation of the QA and SBPD activities would be monitored through the Annual School Feedback Forms (ASFFs). Component Three: Project Coordination, Monitoring and Evaluation, and Program Development (Total US$ 1.30 million: IDA US$ 1.05 million and GoM US$0.25 million) 31. The objective of this component is to facilitate the coordination of project components, undertake monitoring and evaluation of results and outcomes, and support the Ministry of Education to undertake program development to develop the education program in key areas for the future of the education system. The following key sub-components will be supported under this component. 3.1 Education Strategy and Program Development 32. The EEDP will support the government to develop future strategies and programs in priority areas through program development and technical assistance. The GoM has identified the following priority areas for strategy and program development with support from the project: a) A Modelfor Multi-Grade Teaching in Small Schools 33. The Maldives education authorities are considering multi-grade teaching given the geography of the country with its large number of small islands. Some of the schools in these islands have few students in each grade (as little as 3 students in some cases). Providing a teacher for every grade is very expensive. Multi-grade teaching would help reduce the exorbitant cost of providing education in these small schools. In addition, combining grades in such schools would potentially help enhance the cognitive and non-cognitive skills of students by giving them more opportunities for peer interaction. The EEDP will assist GoM with technical expertise to develop a framework for multi-grade teaching. b) A Model for Expanding Multiple Curriculum Streams in Secondary Schools 34. The Maldivian education system contains three streams of study at the secondary level: arts, commerce and science. Due to resource constraints, most schools are unable to offer more 8 than one stream of study in practice. At present, multiple streams of study are available in only a small subset of the 185 schools providing secondary education. In particular, very few schools offer subjects from the arts stream. As a result, a substantial proportion of students are compelled to study subjects within the confines of one stream, usually commerce, offered by their schools. Recognizing the need for a broader and more balanced curriculum, the government has been encouraging more schools to offer multiple streams of study at the secondary level. However, government policy makers and planners recognize that expanding course choices can be expensive, especially in schools where the science stream needs to be introduced. The EEDP will assist GoM with technical expertise to develop a framework for the expansion of multiple curriculum streams in schools that have sufficient numbers of students to make the broadening of choice feasible. c) Continuing (In-Service) Training for Untrained Teachers and for Inclusive Education 35. The Maldives has about 3,600 teachers in primary education, of whom about 23 percent are untrained. The untrained teacher ratio is higher in the atolls than in Male'. One important reason for the relatively low learning outcomes and examination performances of Maldivian students is the poor quality of primary education, partly due to the substantial number of untrained primary teachers, in country. The MoE now recognizes that it is necessary to train the untrained teachers to bring them up to at least diploma level. The EEDP will support the MoE provide the necessary training programs for some of these untrained teachers so that they can reach at least the minimum of a diploma in education. 36. The MoE has adopted an Inclusive Education Policy to promote equity of education opportunities for children with special needs. The development of inclusive education will require training teachers in the pedagogical methods required for children with special learning needs. Some infrastructure, and careful planning of the delivery of inclusive education services is required. The EEDP will support the NIE to establish the delivery mechanism of inclusive education and provide a set of teachers with the training required for inclusive education. d) A Master Plan for Higher Education 37. The Higher Education Master Plan would provide the foundation for the future development of the higher education sector. The master plan would address issues such as the desired size and structure of the higher education sector, the governance of higher education, the roles of the public and private sectors, the quality of higher education, the economic and social relevance of higher education, and the costs and financing of the higher education sector. The project would support the development of the master plan through the technical assistance required, the consultation process, and the preparation and dissemination of the master plan. e) Strengthening the Maldives Qualifications Authority 38. The EEDP would also help to strengthen the Maldives Qualifications Authority (MQA), which has the mandate to undertake quality assurance and accreditation of private and public higher education institutions. The EEDP would assist the Department of Higher Education (DHE) of the MoE and the MQA to develop the benchmarks, standards and review procedures 9 for external quality reviews as well as guidelines for internal quality assurance units in higher education institutions. Also, the project would help the staff of the MQA involved in quality audits to obtain practical experience of undertaking reviews in another external QA agency. 3.2 Project Coordination, Monitoring and Evaluation 39. The EEDP will support the MoE to coordinate the project, as well as undertake monitoring and evaluation. The strengthening of project coordination would be through support for a team of experts in operations, monitoring, procurement and financial management, who would assist the MoE, including atoll level officials such as the Teacher Resource Center (TRC) Coordinators, to implement and monitor project activities efficiently. The monitoring activities will take place at three levels: national, atoll and school. The purpose of monitoring will be formative, and support implementation at each level by identifying problems and taking action to resolve issues and remove bottlenecks to implementation. An education management information system (EMIS) is being designed for the MoE and the project will assist the EMIS. The evaluation activities would help assess the results of the project, and would include obtaining beneficiary satisfaction information. The resources from the project would also support the communication and dissemination of monitoring and evaluation information to education stakeholders, including political authorities, policy makers, academics and researchers, principals and teachers, students, and the general public. B. Project Financing 1. Lending Instrument 40. The proposed lending instrument is a Specific Investment Loan (SIL) financed through an IDA Grant. A SIL was chosen for its simplicity. A SIL has the added advantage that the staff members of the MoE are familiar with its operational arrangements, especially the fiduciary and safeguards procedures. 2. Project Cost and Financing 41. The total Project Cost is US$ 10 million of International Development Association (IDA) grant financing and US$ 1 million of financing from GoM. Table 1 below summarizes the cost estimates by the three components. Table 1: Project Cost and Financing Su mmary (US$ million) Project Components Total IDA GoM 1. National Level Education Development 8.55 7.95 0.60 2. School Level Education Development 1.15 1.00 0.15 3. Project Management, Monitoring and Evaluation, and Program Development Total 11.00 10.00 1.00 10 C. Lessons Learned and Reflected in the Project Design 42. The Maldives has successfully implemented Bank funded education projects in the past. For instance, the country attained universal primary enrollment, as well as trained the human resources needed for positions in the government, with support from previous Bank projects. The Bank also has on-going operations in areas such as pensions and environment, whose experience is also useful. The project builds on lessons learned from previous and on-going operations, in education and other sectors. In addition, the project draws on international evidence of good practices in education from other small island countries, including in the Caribbean and the South Pacific. The main lessons are as follows. a) The project should prioritize development initiatives around which there is broad consensus and agreement among policy makers and stakeholders, as policy commitment and consistency is important for successful implementation. b) Direct school level interventions are especially important for education development activities to be sustained cost-effectively, given the geography of the country with a large number of small islands scattered over several hundred miles. c) Continuous capacity building of atoll and island level education officials will be important during project implementation to ensure maximum technical and management support for schools to implement education development activities. IV. IMPLEMENTATION A. Institutional and Implementation Arrangements National Level 43. The MoE will be in overall charge of the project. The MoE will implement the project through its institutions, such as the Policy Planning and Research Section (PPRS), the National Institute of Education (NIE), the Education Supervision and Quality Improvement Division (ESQID), the Human Resource (HR) and School Administration (SA) sections, the Department of Higher Education (DHE), the Physical Facilities Development Division, and the Procurement section [see Table 2]. These institutions will implement the activities of the project in line with their respective mandates and responsibilities. The project will have a steering committee chaired by the Minister of Education and comprising of the heads of the education agencies implementing project components. The PPRS will convene the steering committee. 44. The PPRS will coordinate the various agencies to forge synergy and establish consistency. The MoE will be assisted by the Atoll Education Offices and Teacher Resource Centers (TRCs) to provide operational support, and to implement and monitor the activities of the project, at island and school level. The PPRS will have the support of a Coordination Support Unit (CSU) to help coordinate, implement and monitor project activities. The CSU will include: (a) a Monitoring and Evaluation Specialist, (b) an Operations Officer, (c) a Procurement Specialist, and (d) a Financial Management Specialist. The PPRS has designated a staff member who will oversee and coordinate activities between the PPRS and the CSU. 11 Table 2: Key Activities and Responsible Agencies Key Activities | Responsible Agencies Component One: National Level Education Program Development 1.1 National Assessments of Learning Education Supervision and Quality Improvement Outcomes for Policy and Program Division (ESQID) Development 1.2 Management and Leadership Department of Higher Education (DHE) and Human Development of Staff in the Resource (HR) Education Sector 1.3 Learning Environment Enrichment Physical Facilities Development Unit (G Section) of Secondary Schools Component Two: School Level Education Development 2.1 School-Based Management School Administration (SA) and National Institute of Education (NIE) 2.2 Modernizing Quality Assurance for Education Supervision and Quality Improvement School Improvement Division (ESQID) 2.3 Strengthening School-Based National Institute of Education (NIE) Professional Development for Teachers and other School Staff 2.4 School Quality Assurance and Education Supervision and Quality Improvement Teacher Development Awards Division (ESQID) (QATDA) to Schools Component Three: Project Management, Monitoring and Evaluation, and Program Development 3.1 Education Strategy and Program Policy Planning and Research Section (PPRS), Development Department of Higher Education (DHE), National Institute of Education (NIE), Education Supervision and Quality Improvement Division (ESQID) and other MoE agencies 3.2 Project Coordination, Monitoring Policy Planning and Research section (PPRS) and and Evaluation MoE agencies School Level 45. The EEDP will follow the principal of subsidiarity, where power and responsibility are devolved to the maximum extent possible to the frontline service delivery agencies, in this case the schools. The key activities to improve school performance under the project, such as the quality assurance program and the professional teacher development of teachers, will be implemented mainly at the school level. Also, school-based management activities and the annual school feedback form (ASFF) program will be also implemented at the school level. The school heads and senior management teams will be responsible for the organization and management of these activities. The principals and senior management teams will lead the internal self-evaluations of the quality assurance process. They will also lead the needs assessments of teacher skills and competencies in relation to the school development plans, and organize the professional development programs required. The school heads and senior management teams will also be responsible for implementing the ASFF program. 12 Operations Manual 46. An Operations Manual (OM) has been prepared by the MoE to guide the implementation of the project by the various agencies of the MoE. The OM includes a brief description of education sector issues that the project is expected to address, a detailed description of project components, implementation strategies and cost estimates, and the time schedule of activities. Additionally, the OM includes the project design and management structure, outcome and intermediate indicators, procurement, financial management and environmental safeguards arrangements. B. Results Monitoring and Evaluation 47. The EEDP will devote special attention to the monitoring and evaluation of results and outcomes. The objectives of monitoring and evaluation are to: (a) track the implementation experience of the project, and strengthen the efficiency of implementation where needed; (b) assess the results achieved under each project component and sub-component; and (c) evaluate the overall outcomes of the project. Monitoring and evaluation activities will commence from the beginning of the EEDP and continue until project completion, and will assess project inputs, processes, intermediate outcomes and outcomes. A detailed Results Framework has been developed for the project and is presented in Annex One. This framework comprises a set of development outcomes and intermediate outcomes, with baseline information and annual targets, to provide a continuous picture of project performance. 48. The overall project monitoring activities will be undertaken by the PPRS of the MoE. The other central level MoE agencies will monitor the implementation of activities under their mandates and responsibilities at atoll and school level. For instance, the ESQID will monitor the implementation of the internal quality assurance activities at school level. The NIE will monitor the implementation of the SBPD programs. This monitoring would follow a cascade model where appropriate, with atoll education officials and the coordinators of teacher resource centers assisting the national MoE agencies to monitor the activities in the atolls and islands. The main current weakness associated with monitoring and evaluation in the education system is the shortage of staff trained with relevant skills, including statistics and quantitative analysis. The EEDP will help develop these skills among staff in the MoE. Research and evaluation activities will generally be contracted out to independent research agencies, such as the Maldives National University (MNU), private higher education institutions and consulting firms, or individual consultants. The evaluations under the project will include beneficiary feedback surveys, especially for school level development activities. 49. The performance of the EEDP will be reviewed regularly, including through bi-annual implementation support and supervision visits to the country, and covering Male' and the outer atolls. The implementation support strategy has been developed based on the structure and contents of the EEDP and the risk profile. The EEDP will provide continuous support to the MoE to implement the project effectively and flexibly. The implementation support will focus on the education and economic content of the operation, the fiduciary and safeguards requirements, and the mitigation of risks identified in the Operational Risk Assessment Framework (ORAF), especially policy level, governance, design and delivery quality risks. 13 50. The Bank will support the implementation of the project through careful supervision of the project, and through analytical and advisory activities (AAA) where relevant. The AAA support will include impact evaluations, policy research and studies, and technical assistance. The project will cover a range of activities, including works, goods, consultant services, technical assistance, training, workshops, conferences, seminars, monitoring, evaluation, research and studies. The Bank will provide implementation support and supervision, including fiduciary oversight. All overseas training, capacity building, study visits, and academic studies will require prior review and no objection by the Bank. C. Sustainability 51. Several elements of the EEDP support the sustainability of the project. 52. Strong technical foundations and national consensus on policy measures to improve education. The EEDP supports the overall education program of the MoE. The development initiatives supported by the project enjoy high priority within the education sector of the Maldives. The technical contents of the EEDP are supported by international evidence of good practices, and rigorous analytical work on the Maldivian education system. In addition, the EEDP has been prepared through an extensive process of nation-wide consultation, covering policy makers, technocrats, government officials, principals, teachers, students, parents, academics, employers, and local community members. Hence, country ownership and commitment for the activities of the EEDP are strong. 53. Implementation of the EEDP through the normal education institutions of the country. The project is designed to be implemented by the education institutions of the MoE, in line with their institutional mandates and responsibilities. The activities of the EEDP, therefore, are mainstreamed within the MoE structure. The project will support capacity building of school stakeholders and staff of the MoE. The capacity building initiatives will be introduced in a phased manner, giving time for adequate development of the capacity required, especially for schools in the outer atolls and islands. The MoE agencies will have the technical capacity and commitment to maintain and sustain the project's development initiatives after the life of the project. 54. Flexible project design with an incremental, evolutionary approach to achieving outcomes. The EEDP has a flexible project design based on a multi-year medium-term plan. The project takes an incremental approach to the promotion of complex development activities, phasing in strategic initiatives annually in selected atolls. This provides scope for fine-tuning of initiatives in the light of fresh information before they are rolled out to additional atolls. The project design also encourages atolls and islands to implement school level development activities to suit their individual needs and circumstances. 14 V. KEY RISKS AND MITIGATION MEASURES A. Risk Ratings Summary 55. The key risks to the EEDP and their proposed mitigation measures have been identified in the Operational Risk Assessment Framework (ORAF) in Annex 4. The most important risks and mitigation measures during implementation are summarized in Table 3. Table 3: Risk Rating Summary Risk Rating Stakeholder Risk Low Implementing Agency Risk - Capacity Substantial - Governance Moderate Project Risk - Design Moderate - Social and Environmental Moderate - Program and Donor Low - Delivery Monitoring and Sustainability Substantial Overall Implementation Risk Moderate B. Overall Risk Rating Explanation 56. Stakeholder risks: School-based management is a relatively new concept in the Maldives. There is hence a risk that there might be erosion in the current support for school-based initiatives in the bureaucracy or among politicians. It is expected that this risk will not be significant given that the project design is aligned with the government's ongoing initiatives to focus more on school level activities and school performance. Recent government initiatives to establish school boards and promote school-based management are consistent with the activities supported by the project. 57. Capacity risks: In some cases, school communities might have limited capacity to implement the new initiatives under the project. Similarly, implementation might also be hampered by the unfamiliarity of the MoE staff with Bank procurement and financial management policies. Hence, the project will support training and capacity building of school communities in the new initiatives, and these initiatives will be introduced in a phased manner. Furthermore, procurement and financial management training will be provided to relevant staff, and provisions will be made for procurement and financial management specialist support. 58. Governance risks: Potential lack of continuity in staffing, and capacity limitations in the MoE to monitor compliance of project-funded civil works with engineering and environmental standards are key governance risks in the project. These risks will be addressed by training a pool of relevant staff procurement and financial management. In addition, provisions for 15 procurement and financial management specialist support will also be made. The project will also support training and capacity building of school communities in the new initiatives, and these initiatives will be introduced in a phased manner. 59. Project design risks: A key feature of the project is the decentralized delivery of programs where relevant. Decentralized delivery could be hampered by capacity limitations and inadequate co-ordination and cooperation among education sector officials across atolls and islands. The MoE will identify atolls and islands which lag behind in implementation performance and strengthen initiatives to support them. In addition, the components of the project are built around strengthening decentralized service delivery. Decentralized program delivery will also be strengthened by introducing external atoll level sample based monitoring of schools. 60. Social and environmental risks: Civil works and other activities associated with expansion of secondary schools could have unforeseen environmental impacts. As a risk mitigation measure, the project has prepared an Environmental and Social Management Framework (ESMF) to guide project implementation. In order to ensure effective implementation of the project's ESMF, training will be provided to strengthen the MoE's capacity to monitor and report on impacts. Furthermore, the project also has provisions for environmental specialist support. 61. Program and donor risks: The World Bank is the only donor providing large scale support to the education sector. The few other donors in this sector are engaged primarily in providing focused technical assistance to the government. Hence, the risks in this area are low. 62. Risks related to delivery monitoring and sustainability: The geography of the country makes monitoring a challenging task. Monitoring activities in the scattered islands of the Maldives could stretch the capacity of the MoE. At the same time, results of monitoring and evaluation activities might not be adequately linked to improved management and teaching practices at the school level. In the area of staff development, there is also a danger that fellowship beneficiaries may not complete their programs or may return to jobs that do not utilize their skills. In order to ensure effective monitoring, the project's monitoring system will involve both atoll level education administrators and the MoE staff, and capacity building activities for these staff will be implemented. Senior management of schools will receive training in utilizing self-assessments for improved management and teaching practices. And mechanisms to bond fellowship beneficiaries to return to their designated positions will be set up. VI. APPRAISAL SUMMARY A. Economic and Financial Analyses 63. The EEDP is investing resources in the education cycles that yield high economic benefits. The private rate of return increases as level of education rises. The rates to higher education and to secondary education are 11.6 percent and 8.9 percent respectively, which are higher than that to primary education (5.4 percent). Earnings increase by 5.3 percent for an additional year of schooling. Education also produces a variety of social benefits such as externality effects of education on family health and child nutrition, and on responsible 16 citizenship. Social benefits accrue to the entire society spill over even to future generations, and represent a considerable return although they are difficult to quantify, and thus are significantly important in the context of a country's development. 64. The economic analysis presents assessment of benefits and costs associated with the EEDP. Economic costs include total project costs and private costs that comprise direct household outlays as well as opportunity costs for schooling. Similarly, the benefits are taken to be those changes in the quantity, quality and reduction in internal inefficiency of education produced over the period as a result of the EEDP. While this project consists of several parts, the largest part, enhancing quality and access of higher secondary and higher education, will be the focus of this analysis. The main sources of data used in the analysis come from Household Income and Expenditure Survey (HIES) 2009/2010 and MoE Education Statistics (various years). 65. The cost-benefit analysis suggests that the EEDP yields positive expected incremental net benefits under the base case as well as under the selected alternative cases examined in the sensitivity analysis. Under the base case, the present discounted value of benefits is estimated to be US$ 48 million while the present discounted value of costs is estimated 26 million. The net present value (NPV) of the EEDP benefits is US$ 22 million. The internal rate of return (IRR) associated with this NVP is 30 percent. More information is given in Annex 6 of this Project Appraisal Document. 66. The EEDP is expected to add MVR 150 million (US$10 million) over the project period (2013-2018). Under different scenarios, the share of EEDP in the total education budget ranges from 0.6 percent to 2.6 percent. The allocations of the EEDP will have a limited fiscal impact on the overall education sector budget, and it will not be a burden for the government to maintain expenditures when the operation closes. However, the EEDP's allocations represent about 5-19 percent of the total capital budget for the period 2013-2018. The EEDP's funds have a significant impact on the total capital expenditures. Hence, the EEDP makes a genuine and significant contribution to investment in education during the period of the project's life cycle. 67. The GoM is seeking cost-effective interventions, given the geography of the country with a large number of small islands scattered over several hundred miles. The EEDP has the potential to improve cost-effectiveness of the education system. The development of a model of multi- grade teaching will contribute to reducing the burden of the teacher salary bill. Similarly, promoting private-public partnerships in higher education will enable the country to meet the rising demand for higher education in a cost-effective manner. In addition, focusing on strengthening activities school level through school-based management, internal quality assurance and school improvement plans, will promote the cost-effective delivery of education services. B. Technical 68. The analytical foundations of the EEDP are the comprehensive analyses of education in the Maldives contained in two recent World Bank Education Sector Reports, General Education in the Maldives (2012) and Higher Education in the Maldives (2012). The design of the EEDP is based on lessons learned from education operations in small island economies and from other 17 countries which Maldivian authorities consider to be exemplar countries. The quality assurance self-evaluations system in the Maldives will follow the quality assurance system in Singapore. The use of national assessments of learning outcomes for policy formulation is based on models in Hong Kong SAR, China and Singapore. The school-based teacher development and school- based management initiatives draw on the experiences of middle-income island countries such as Trinidad and Tobago, and the Seychelles. The development of a higher education master plan will use lessons learned from island nations in the Caribbean and the South Pacific. The three components of the project, including at national level and school level, are inter-linked and mutually supportive, so that the overall impact of the EEDP is likely to be greater than the sum of its component parts. C. Financial Management 69. The financial management systems in the MoE relating to the Project have been reviewed and summarized in Annex 3. 70. The Financial Management (FM) team of the Bank conducted an assessment of the MoE to ensure that the proposed project's FM arrangements can provide the Bank with accurate and timely information regarding the activities that will be financed under the project, thereby providing reasonable assurance that the Bank's funds will be used for the purposes intended. The proposed overall FM procedures and practices for the project are satisfactory to meet the IDA's fiduciary requirements as per OP/BP 10.02. The project has a moderate FM risk rating. The CSU under the MoE is responsible for the project's FM activities, including compliance with the financial covenants of the legal agreement. D. Procurement 71. A procurement assessment was undertaken before appraisal. The results are summarized in Annex 3. 72. The Tender Evaluation Board (TEB) under the Ministry of Finance is administratively authorized to carry out procurements for the values above MVR 1.5 million. Procurements less than MVR 1.5 million (about US$ 100,000) will be undertaken mainly by the MoE. In the event of estimated values of the contracts exceeding MVR 1.5 million, the requirements and specifications from the MoE would be communicated to the TEB and the bidding documents would be prepared accordingly within the TEB. The EEDP will support the TEB during the bidding document and bidding stages. The TEB is short of qualified procurement staff and hence would require support from the EEDP. The Director General (Procurement) in the MoE is aware of Bank procurement procedures. In addition, the MoE will be strengthened with technical assistance and training in procurement under the project. The MoE will employ a Procurement Specialist under the CSU to assist the EEDP in carrying out the procurements under the Project. E. Social (including Safeguards) 73. The project is designed not to have any negative social impacts, as the project is focused on improved access to education and improvements to education quality across the country. Therefore the project has the potential to produce considerable positive social benefits. The 18 project will not trigger Bank social safeguard policies on involuntary resettlement and indigenous peoples. Maldives has a unique land ownership structure where all lands are under the Government ownership. Thus all Maldivians are entitled to shelter and as a result squatters are never found in public land or buildings. Within this context, the project will not require triggering of OP 4.12 - Involuntary Resettlement. There are also no indigenous peoples in Maldives and therefore the OP 4.10 - Indigenous Peoples will also not be triggered. F. Environment (including Safeguards) 74. The project will finance construction and rehabilitation of classrooms, libraries, laboratories, etc. in existing school premises in the Maldives. It is envisaged that environmental impacts may occur during construction and renovation of school buildings and associated facilities and subsequent management of school facilities. However, these impacts will not be irreversible or cumulative. The environmental impacts are expected to be limited to (i) the management of wastes at the rehabilitation /construction sites (waste water, solid waste, rejection and elimination of wastes such as oils and paints, demolished material), soil erosion, loss of vegetation, as well as dust and noise during the works; (ii) issues around the water supply, sanitation and solid waste management in the schools; (iii) high demand of material for construction, such as wood for furniture and windows, sand, etc.; (iv) structural integrity of the facilities; and (v) issues related to use and disposal of chemicals from laboratories. Based on this, the project has been categorized as a Category B project and the project will trigger Operational Policy (OP)/Bank Policy (BP) 4.01 - Environmental Assessment. 75. The MoE has prepared an Environmental and Social Assessment and Management Framework (ESAMF) as part of the safeguards requirement of the project, which consists of a environmental and social baseline assessment, likely impacts due to the project, mitigation measures and guidelines to be followed during project implementation. The ESAMF is consistent with the World Bank safeguards requirements and GoM's environmental regulations and associated requirements. The MoE has identified 8 schools requiring infrastructure development for the first eighteen months of project implementation. Based on this list MoE has conducted an Environmental and Social Assessment (ESA) to develop the baseline and prepared site-specific Environmental and Social Management Plans (ESMPs) for these 8 schools. In addition, an Environmental and Social Management Framework (ESMF) has been developed for the project to guide the safeguard process to be followed during project implementation to mitigate and manage potential impacts anticipated from activities to be undertaken under the project, particularly related to physical facilities. The ESMF provides an environmental and social screening form, environmental, health and safety guidelines to ensure that adverse environmental and social impacts from project activities are identified and captured in the planning stages, ESMPs developed, contractor clauses to be used as part of contractual documents and responsibilities of different implementation entities. The ESAMF has been disclosed before appraisal in-country to the public in English and Divehi on February 21, 2013. 19 Annex 1: Results Framework and Monitoring MALDIVES: Enhancing Education Development Project (EEDP) Cumulative Target Values Data Source/ Responsi PDO Level Results E Unit of End Methodology bility for r MBaseline Indicators C- Measure 21 20506 217 Target and Data C Basline 2014 2015 2016 2017 Tre Frequency Collection Increased survival F Percent 17 18 20 23 27 27 Project MoE rates through higher Monitoring PPRS secondary education Report (grades 1-12) Annual A system of National 2 Text National Staff National Initiativ A A Project MoE Assessments of assessme trained, Assessm es to National National Monitoring ESQID Learning Outcomes nt to and test ent address Assessm Assessm Report established and measure items conduct findings ent ent operationalized student and ed and from the repeated repeated progress question dissemin National for for Annual towards naires ated for Assessm Grades 4 Grades 4 system for Grades 4 ent and 7 and 7 learning analysis and 7 included for for goals of for in the Dhivehi, Dhivehi, agreed learning Dhivehi, educatio English, English, outcome English, n and and s piloted and develop Mathem Mathem and Mathem ment atics atics develop atics plan of ed the MoE 20 Cumulative Target Values Data Source/ Responsi PDO Level Results E Unit of End Methodology bility for r MBaseline Indicators 2014 2015 2016 2017 Target and Data Frequency Collection Proportion of atolls in E Percent 0 20 40 60 80 80 Project MoE which a system of Monitoring ESQID quality assurance self- Report evaluations are established and findings incorporated Annual in the implementation of school improvement plans Direct project F Number 0 10,000 22,000 36,000 50,000 50,000 Project MoE beneficiaries: Monitoring PPRS Number of students Report who will benefit from Annual access and quality enhancing activities Female beneficiaries: F Percent 0 46.5 47.0 47.5 48.0 48.0 Project MoE Percentage of female Monitoring PPRS students who will Report benefit from access Annual and quality enhancing activities 21 Intermediate Outcome Indicators Cumulative Target Values Data Source/ Responsi Intermediate Outcome E Unit of End Methodology bility for a Baseline Indicators 2014 2015 2016 2017 Target and Data Frequency Collection Number of targeted E Number 0 20 40 70 100 100 Project MoE education sector staff Monitoring DHE progressively Report completing short Annual HR courses, diplomas degrees, and postgraduate degrees Physical Learning Number 0 5 15 30 45 45 Project MoE Environment Monitoring PPRS Improved in Schools Report (number) Annual Proportion of atolls F Percent 0 20 40 60 80 80 Project MoE implementing School- Monitoring Professional ReportNIE Development Programs (SBPD) Annual informed by and related to QA reviews 22 Annex 2: Detailed Project Description MALDIVES: Enhancing Education Development Project (EEDP) Introduction 1. The Maldives Enhancing Education Development Project (EEDP) is organized under three components: (a) national level education development; (b) school level education development; and (c) project management, monitoring and evaluation, and program development. These components and the activities under them were prepared through a process of consultation and collaboration with the Ministry of Education (MoE); the Ministry of Finance and Treasury (MoFT); the atoll education agencies; public and private employers; public and private education institutions; academics; and school principals, teachers, parents and students. The components and activities are also based on the findings and recommendations of the Bank's programmatic Education Sector Reports: Human Capital for a Knowledge Society: Higher Education in the Maldives, an Evolving Seascape (2011); and Human Capital for a Modern Society: General Education in the Maldives, an Evolving Seascape (2012). Project Development Objective 2. The project development objective is to enhance and strengthen strategic dimensions of education access and quality. Project Description Component One: National Level Education Development (Total US$ 8.55 million: IDA US$ 7.95 million and GoM US$ 0.6 million) 3. The objective of this component is to promote strategic initiatives at the country level to strengthen and develop the education system. The national level education activities will be implemented by the Ministry of Education, National Institute of Education (NIE) or higher education institutions. The following key sub-components will be supported under this component. 1.1 National Assessments of Learning Outcomes for Policy and Program Development 4. National assessments of learning outcomes have become one of the main vehicles for assessing education systems and formulating education policies in OECD countries and middle- income countries. National assessments are useful to analyze: (a) the quality of learning in the education system; (b) the particular strengths and weaknesses in the knowledge and skills of students; (c) the education performance of different atolls and islands; (d) educational and socio- economic factors associated with student learning outcomes; and (e) the evolution of learning achievements over time. 5. The EEDP will support the Maldives to develop the capacity of the country to design and implement national assessments of learning outcomes in grades 4 and 7 according to a regular 23 cycle for key subjects such as English, mathematics and Dhivehi, and use the results and findings for education policy and program development. The EEDP will help build the technical capacity within the MoE, especially the Education Supervision and Quality Improvement Division (ESQID) to undertake rigorous, state-of-the-art national assessments and to deliver short-courses, and in the National Institute of Education (NIE) to conduct advanced certificate or diploma level courses in national assessments of learning outcomes. The project will also build the capacity of selected policy makers and education specialists within the MoE, especially the Education Supervision and Quality Improvement Division (ESQID) and the Policy Planning and Research Section (PPRS), to use the results and findings from national assessments for strategic policy and management decisions. The national assessments under the project will help monitor learning outcomes over time. In addition, the project will support the analysis of factors that contribute to learning outcomes, such as school-related factors, classroom-related factors, and child-related factors. The information and feedback from these national assessments can be used by policy makers and education specialists in key education areas such as curriculum development, pre- service teacher education, continuing teacher development, the production of educational material including textbooks, and the allocation of resources. 1.2 Management and Leadership Development of Staff in the Education Sector 6. The human resources in the education sector need to be developed urgently. The majority of education staff members in the MoE and the Atoll Education Offices have not had any management and leadership training. In addition, MoE has a policy that all principals of schools should have at least a bachelor's degree, and the principals of large secondary schools should have a master's degree. However, at present, out of 214 school heads just 20 have master's degrees and only 50 have bachelor's degrees. Hence, considerable investment is required to develop the human resources of the education sector. 7. The EEDP will assist the MoE to develop the human resources in the education sector, with a special focus on education managers and administrators, school principals, and leading teachers who are potential future principals. The project will support a set of education managers and administrators, principals and leading teachers who already have bachelor's degrees to obtain master's degrees in a relevant field, such as education, education administration/management, education policy, education planning, education leadership, assessment and evaluation, teacher education and curriculum development. The degree courses could be either full time or in block mode. In addition, a set of principals and leading teachers who only have diplomas will be supported to obtain bachelor's degrees in a relevant field such as education management or administration. Priority would be given to the younger principals and leading teachers, to maximize the return on investment. 8. The Masters and Bachelor's degree programs will be delivered in different sets of institutions: (a) private higher education institutions (HEls) in the Maldives; (b) public higher education institutions in the Maldives; and (c) higher education institutions in other countries. 9. The scholarships for Master's and Bachelor's degree programs would be administered by the Scholarships Section of the Department of Higher Education. 24 10. MoE staff, including from the Atoll Education Units, will be provided with short-term courses and/or exposure programs tailor made to develop their administrative, managerial and technical skills for work in the MoE and Atolls. This would cover in the Maldives Quality Assurance Authority (MQA), too. The short-term training would be administered by the Human Resources Division of the MoE. The types of courses in which short-term Human Resource Development activities would take place are summarized in Table 2.1. below. Table 2.1: Indicative List of Short-Term Training Programs Type of Short-Term Training Program Staff from MoE Agencies to Participate Education Planning and Program Development MoE, DHE Education Administration and Management MoE, DHE, NIE National Assessment of Learning Outcomes MoE, NIE, MNU Quality Assurance MoE, DHE, MQA, NIE School-based Professional Development of MoE, NIE Teachers Multi-Grade Teaching MoE, NIE Curriculum Development NIE Private-public partnerships in Higher Education MoE, DHE, MQA Statistics MoE, DHE, NIE Use of statistical software MoE, DHE, NIE Computer applications (e.g. Microsoft office, MoE, DHE, NIE accounts packages) English language MoE Accounts MoE Procurement MoE, DHE, NIE Environmental management MoE Project monitoring MoE, DHE, NIE 1.3 Learning Environment Enrichment of Secondary Schools 11. The Maldives has an atoll-wide network of schools that provide universal access to primary (grades 1-7) and secondary (grades 8-10) education. However, until recently access to higher secondary education (grades 11-12) was very limited, initially to one school in Male', and then to four more schools in the atolls. The government has now adopted a policy to expand access to higher secondary education through about 38 strategically selected schools, across the country, which will serve as hubs for higher secondary education in the atolls and in Male'. The higher secondary schools, and the secondary schools which feed students into them, need greater physical facilities and equipment, especially for IT and science, as well as classrooms blocks to reduce overcrowding and allow single-session instructional time. Strong IT skills are necessary for all secondary school completers who either plan to seek employment opportunities in the labor market or proceed onwards to higher education. Science subjects are needed to enable secondary school students to offer a curriculum options with subjects such as biology, chemistry and physics. Such subjects are pre-requisites needed for professions such as medicine, allied health sciences, engineering, electronics, and mathematics and science teaching. These are professions which are in short supply among Maldivians, resulting in expensive expatriate staff being recruited for these occupations. 25 12. The project will support a set of about 45 strategically selected schools, which include all higher secondary schools and some of the large secondary feeder schools, to enrich their learning environments through the provision of IT and science equipment, and the expansion of facilities in over-crowded large schools to help implement the government policy of single-session schools. This initiative is expected to help improve the transition rate from secondary to higher secondary education and increase the survival rate through the school system to grade 12. The additional facilities will also enable islands to conduct labor-market oriented skills training for youth, including after school hours as co-curricular activities. About 25,000 students, including all higher secondary students, attend these schools and will benefit from these facilities and equipment. The schools selected already have adequate numbers of teachers for these subjects, so that additional teachers will not be needed. However, the schools will receive support under the project's short-term training programs in education management and leadership, quality assurance and school-based teacher development. Hence, an integrated package of learning enrichment activities will be made available to these strategic higher secondary and secondary schools. Component Two: School Level Education Development (Total US$ 1.15 million: IDA US$ 1.0 million and GoM US$ 0.15 million) 13. The objective of this component is to promote strategic initiatives to improve the performance of schools. The school-level activities would be implemented on-site in the schools by school officials (teachers, principals etc.). The following key sub-components will be supported under this component. 2.1 School-Based Management 14. The objectives of the school-based management (SBM) reforms are to: (a) empower principals and teachers, strengthen their professional motivation and enhance their sense of ownership of the school; (b) enable schools to forge links with local atoll and island communities to give stakeholders, including parents and past pupils, greater voice in school affairs and help the school; and (c) improve the sense of ownership and relevance of school performance for local communities. It has been noted globally that school-based management has the potential to become a low-cost way of making education spending more efficient by increasing accountability. Given the country's geography as a small multi-island nation, school-based management is an important policy initiative for the Maldives. 15. The country has adopted a professional control model of school-based management, where the main decision-making authority has been devolved to principals and teachers. Each school has a Senior Management Team (SMT) consisting of the school head, deputy heads, and leading teachers. In addition, under school-based management each school has a School Board, consisting of representatives of parents, past pupils, and local communities. The MoE has clarified the roles and responsibilities of School Boards under school-based management, and the roles and responsibilities of the SMTs of schools, as well as the mechanisms by which these two sets of school authorities interact. School-based management is a new initiative in the Maldives. Further assistance is needed to develop the model of school-based management that will be appropriate for the country, given the diversity and heterogeneity of schools across the islands. The aims and objectives of SBM, the roles and responsibilities of the various school level 26 agencies, and the variety of actions that can be taken under SBM to improve the effectiveness and performance of schools, need to be clarified. The members of school SMTs and School Boards will then need training and capacity building in the SBM initiative. The EEDP will assist the MoE to develop an appropriate model of school-based management for the Maldives, and to train and strengthen the capacity of SMTs of schools and Schools Boards to take the school- based management initiative forward efficiently. Attention will be given to the differences in abilities of principals, leading teachers, school boards and stakeholders, across the various atolls and islands, in the training and capacity building work. 2.2 Modernizing Quality Assurance for School Improvement 16. Quality assurance (QA) is a key feature of education systems in many high income countries, such as Scotland, Singapore, the United Kingdom (U.K), and the United Arab Emirates (UAE), and several Asian middle-income countries, including Malaysia and Sri Lanka. Quality assurance provides a framework for the systematic review and monitoring of an education system to determine whether an acceptable standard of quality is being achieved over the medium-term, and enhanced over the long-term in line with global developments in education. 17. The MoE is keen to develop and establish a quality assurance system in line with international trends. At present, the Maldives has an external quality assurance program mainly conducted by a central agency, the Education Supervision and Quality Improvement Division (ESQID) of the MoE. The MoE now appreciates the importance of developing the QA system beyond the external reviews conducted by ESQID to encompass internal self-assessments by schools themselves, consistent with international trends in Quality Assurance in high and middle-income countries. 18. The EEDP will help the MoE to establish a regular, annual QA system for schools, with the main emphasis on internal self-evaluations. The school self-evaluations (SSEs) would, in turn, feed into the School Improvement Plans for the following year. ESQID has prepared QA standards to facilitate the assessment of education inputs, processes and outcomes by schools (self-assessment) and by regional and national level authorities (monitoring and supervision). The internal evaluation will help schools to identify their strengths, weaknesses and development needs. The findings from the internal quality assurance reviews would then feed into the annual improvement plans of schools. 19. Secondary schools and larger primary schools would be trained and be able to conduct their own self-evaluations, and incorporate the findings and recommendations into improving quality in their schools. Smaller primary schools in remote atolls would receive training in self- evaluations too; however, they would also need to be supported to conduct self-evaluations and incorporate the findings and recommendations into their School Improvement Plans by atoll level education units, especially the Teacher Resource Centers. Private schools which receive government subsidies to enroll students would also be expected to be part of the QA program. The findings of the QA self-evaluations would also inform the school-based teacher professional development activities of schools. 27 20. ESQID will train the Senior Management Teams and Schools Boards in schools for school self-evaluations and help schools implement internal quality assurance activities, according to a phased plan, over the life of the project. The training would commence, in the early years of project implementation, in selected atolls, and then be gradually spread to cover all atolls over time. In addition, ESQID will monitor whether QA self-evaluations are actually taking place in schools and are being used in School Improvement Plans. The plan for the phased introduction of training and implementation of school self-evaluations, and monitoring by ESQID, is given in Table 2.2 below. Table 2.2: Plan for Capacity Building and Implementation of School Self-Evaluations across Atolls 2013 2014 2015 2016 2017 Training of staff Male' (12) Baa (12) Meemu (8) Laamu (14) for SSE Lhaviyani Kaafu (10) Faafu (5) Seenu (11) (5) Alif Alif (8) Dhaalu (7) Shaviyani Vaavu (3) Alif Dhaal Thaa (13) (14) Haa Alif (13) (9) Gaafu Dhaal Noonu (13) Gaafu Alif Gnaviyani (10) Raa (16) (9) (5) Haa Dhaal (15) Implementation Male' (12) Baa (12) Meemu (8) Laamu (14) commenced in Lhaviyani Kaafu (10) Faafu (5) Seenu (11) schools (5) Alif Alif (8) Dhaalu (7) Shaviyani Vaavu (3) Alif Dhaal Thaa (13) (14) Haa Alif (13) (9) Gaafu Dhaal Noonu (13) Gaafu Alif Gnaviyani (10) Raa (16) (9) (5) Haa Dhaal (15) Monitoring visits Male' (12) Baa (12) Meemu (8) Laamu (14) by ESQID Lhaviyani Kaafu (10) Faafu (5) Seenu (11) (5) Alif Alif (8) Dhaalu (7) Shaviyani Vaavu (3) Alif Dhaal Thaa (13) (14) Haa Alif (13) (9) Gaafu Dhaal Noonu (13) Gaafu Alif Gnaviyani (10) Raa (16) (9) (5) Haa Dhaal (15) Note: Numbers in brackets are the number of schools in each Atoll. 2.3 Strengthening School-Based Professional Development (SBPD) for Teachers and Other School Staff 21. The successful achievement of a high quality of education depends on the availability of an adequate stock of professionally educated, competent and motivated teachers. School-based 28 teacher professional development has been noted globally for its effectiveness. The MoE is aware of the importance of school-based professional development (SBPD) for teachers as a promising strategy for continuing teacher education and training. The MoE has published a Professional Development Policy (PDP), developed SBPD guidelines for schools, and encouraged schools to conduct SBPD activities. It is mandatory for all academic staff in schools to receive a minimum of 15 hours (3 days) of professional development in every year. The SBPD guidelines seek to ensure that there is a procedure and process involved in the implementation of SBPD programs. At each school, a Professional Development (PD) coordinator is identified by the principal and works as a focal point. The PD coordinator is expected to be competent and have the potential to coordinate and conduct the necessary training for the school staff. Teacher Resource Center (TRC) coordinators are expected to provide guidance and support to PD coordinators. In order to apply the SBPD activities and develop schools to become learning organizations, there is a need for capacity building of the PD coordinators and TRC coordinators. 22. The EEDP would assist the MoE, especially the National Institute of Education (NIE), to further develop the system for SBPD by improving the capacity of PD coordinators and TRC coordinators, helping schools undertake SBPD activities, and assisting the NIE to monitor the implementation of SBPD in schools. All schools in Male' and the outer atolls would implement SBPD programs according to an annual cycle. Private schools which receive government subsidies to enroll students would also be expected to be part of the SBPD program. 23. The range of SBPD activities would include school-based mentoring, peer learning, peer coaching, individual consultations, and visits to classrooms in other schools and islands. Under SBPD: * teachers can receive useful lessons on teaching techniques and observe demonstrations; * teachers can practice and discuss new techniques and new materials with colleagues and senior teachers on a regular basis; * leading teachers can give classroom demonstrations using SBPD activities; * the activities can increase communication and sharing of ideas among teachers; * provide a positive focus for inspectors' school visits, classroom observation, and meetings with teachers; * leading teachers can assist teachers using SBPD activities frequently and regularly; and * can serve as a link between a centralized type of in-service training program and specific teacher needs. The SBPD program would be related to and informed by the Quality Assurance self-evaluations by schools. 2.4 School Quality Assurance and Teacher Development Awards (QATDA) 24. A system of School Quality Assurance and Teacher Development Awards (QATDA) would be supported under the project. The QATDA would assist school improvement activities through the implementation of School Improvement Plans and Annual School Feedback Forms (ASFF), with a special focus on quality assurance self-evaluations and school-based teacher professional development. Under the project all schools would receive an annual award of between MVR 6,000-7,500 (about US$ 400-500), depending on school size, commencing in 29 2014, to implement the findings and recommendation of the QA self-evaluations to improve student learning and soft skills, and to implement SBPD programs to enhance teacher performance (see Table 2.3). The QATDA will provide an incentive for schools to implement QA and SAPD activities. Table 2.3: Distribution of QATDA by School Size School Size Amount of Award Number of Schools Total (MVR) (Student Numbers) per Year (MVR) in 2011 1-300 6,000 154 924,000 301 upwards 7,500 65 487,500 25. Under the QATDA, there would be an annual Memorandum of Agreement (MoA) between the MoE and schools to implement, monitor and report QATDA activities. The awards would be made available in the first year as an advance. In subsequent years, the awards would be made available on the basis of performance in the previous year on implementing QA activities and SBPD activities. The implementation of QA and SBPD activities would be monitored through the Annual School Feedback Forms (ASFF). Component Three: Project Coordination, Monitoring and Evaluation, and Program Development (Total US$ 1.30 million: IDA US$ 1.05 million and GoM US$0.25 million) 26. Under this component the project would help the MoE undertake policy oriented research and development activities, as well as strengthen project coordination, monitoring and evaluation. 3.1 Education Strategy and Program Development 27. The EEDP will support the government to develop future strategies and programs in priority areas through program development and technical assistance. The GoM has identified the following priority areas for strategy and program development with support from the project: a) A Model for Multi-Grade Teaching in Small Schools 28. The Maldives education authorities are considering multi-grade teaching given the geography of the country with its large number of small islands. Some of the schools in these islands have few students in each grade (as little as 3 students in some cases). Providing a teacher for every grade is very expensive. Multi-grade teaching would help reduce the exorbitant cost of providing education in these small schools. In addition, combining grades in such schools would potentially help enhance the cognitive and non-cognitive skills of students by giving them more opportunities for peer interaction. 29. The EEDP will assist GoM with technical expertise to develop a framework for multi- grade teaching. It will also support the preparation of some teaching-learning materials. The framework will contain the following: * clear policy guidelines for multi-grade teaching; * a curriculum framework for multi-grade teaching; 30 * a communications strategy to educate parents and local island stakeholders on the benefits of multi-grade teaching for their children. * a plan for the training of a cadre of teachers for multi-grade teaching; * a plan for the preparation of appropriate teaching-learning material; and * the monitoring and feedback mechanism to be used for multi-grade teaching. 30. Further details of the framework for multi-grade teaching are contained in Annex 7of this Project Appraisal Document. b) A Modelfor Expanding Multiple Curriculum Streams in Secondary Schools 31. The Maldivian education system contains three streams of study at the secondary level: arts, commerce and science. Due to resource constraints, most schools are unable to offer more than one stream of study in practice. At present, there are only 32 schools, out of 185 schools providing secondary education, where combined curriculum streams are taught. As a result, a substantial proportion of students are compelled to study subjects within the confines of one stream, usually commerce, offered by their schools. The MoE, recognizing the need for a broader and more balanced curriculum, has recently developed a National Curriculum which encourages more secondary schools to offer combined curricula so that students can select subjects from more than one stream. However, government policy makers and planners recognize that expanding course choices can be expensive, especially in schools where the science stream needs to be introduced. 32. The EEDP will assist GoM with technical expertise to develop a framework for the introduction of combined curricula in larger schools where there are sufficient numbers of students to make the broadening of choice feasible. The framework will contain the following: * a review of current policies, and the status of the 32 schools currently offering, combined curricula; * the identification of best practices as well as issues and challenges faced by these 32 schools; * the identification of all secondary schools where the combined curricula model could potentially be implemented, and proposing alternative approaches to implementation; * the development of policy guidelines for introducing the model to a broader set of schools, including the promotion of private-public partnerships; and * the preparation of a costed, phased implementation plan for the policy. 33. Further information on the model for expanding combined curricula in schools is contained in Annex 7 of this Project Appraisal Document. c) Continuing (In-Service) Training for Untrained Teachers and for Inclusive Education 34. The Maldives has about 3,600 teachers in primary education, 3,100 teachers in lower secondary education and 400 teachers in higher secondary education, respectively. At the primary education level, about 23 percent of teachers are untrained. It is much higher compared to secondary education level (2 percent of lower secondary and 3 percent of higher education 31 secondary teachers). The untrained teacher ratio is also higher in the atolls than in Male'. One important reason for the relatively low learning outcomes and examination performances of Maldivian students is the poor quality of primary education, partly due to the substantial number of untrained primary teachers, in country. A recent decision by the MoE to employ only trained teachers with a minimum of a diploma in education to work in schools is a positive policy initiative. It is now necessary to train the untrained primary teachers to bring them up to at least diploma level. The EEDP will support the MoE provide the necessary training programs for the untrained primary teachers so that they can reach at least the minimum of a diploma in education. 35. The MoE has adopted an Inclusive Education Policy to promote equity of education opportunities for children with special needs. This is also mandated under the clause 20 of article 08/2010 of the country's constitution. The MoE started setting up classes for children with special needs in 2006, with a vision to develop a minimum of one school in each atoll that accommodates children with special needs by 2010. Currently 11 schools across the country (3 schools in Male' and 8 schools in atolls) accommodate approximately 184 children with specials needs. However, the provision of inclusive education in the Maldives is yet in its infancy. The development of inclusive education will require training teachers in the pedagogical methods required for inclusive education. Some infrastructure and careful planning and establishment of its delivery mechanism is required. The EEDP will support the NIE to establish the delivery mechanism of inclusive education and provide a set of teachers with the training required for inclusive education. d) A Master Plan for Higher Education 36. The Higher Education Master Plan would provide the foundation for the future development of the higher education sector. The master plan would address issues such as the desired size and structure of the higher education sector, the governance of higher education, the roles of the public and private sectors, the quality of higher education, the economic and social relevance of higher education, and the costs and financing of the higher education sector. 37. The development of the master plan would be based on an international model for processes of this kind. This would include: * A Steering Committee. In the Maldives the Higher Education Council (HEC) would act as the Steering Committee for the Master Plan, and be responsible for producing the Master Plan and recommending it to the Cabinet and Parliament. * An expert Task Force of professional experts. The Task Force will consult all relevant stakeholders, such as policy makers, public and private higher education providers, employers, academics and researchers, parents and students, and work to prepare the plan and produce drafts for the Steering Committee to consider. 38. The project would support the technical assistance required, the consultation process, and the preparation and dissemination of the master plan. 39. More information on the Higher Education Master Plan is given in Annex 7 of this Project Appraisal Document. 32 e) Strengthening the Maldives Qualifications Authority 40. The EEDP would also help to strengthen the Maldives Qualifications Authority (MQA), which has the mandate to undertake quality assurance and accreditation of private and public higher education institutions. The EEDP would assist the Department of Higher Education (DHE) of the MoE and the MQA to develop the benchmarks, standards and review procedures for external quality reviews as well as guidelines for internal quality assurance units in higher education institutions. Also, the project would help the staff of the MQA involved in quality audits to obtain practical experience of undertaking reviews in another external QA agency, such as a member of the Asia Pacific Quality Network (APQN). MQA staff could, for instance, participate in the training programs and institutional reviews run by the APQN member. More details on the project support to strengthen the Maldives Qualifications Authority are given in Annex 7 of this Project Appraisal Document. 41. Other topics for policy analysis and program development would be decided as the project is implemented, in line with the emerging needs of the education system and trends in education across the world. These would include policy analyses for future policy formulation and strategy development. 3.2 Project Coordination, Monitoring and Evaluation 42. The EEDP will support the MoE to coordinate the project, as well as undertake monitoring and evaluation. The strengthening of project coordination would be through support for a team of experts in operations, monitoring, procurement and financial management, who would assist the MoE, including atoll level officials such as the Teacher Resource Center (TRC) Coordinators, to implement and monitor project activities efficiently. The monitoring activities will take place at three levels: national, atoll and school. The purpose of monitoring will be formative, and support implementation at each level by identifying problems and taking action to resolve issues and remove bottlenecks to implementation. An education management information system (EMIS) is being designed for the MoE and the project will assist the EMIS. The evaluation activities would help assess the results of the project, and would include obtaining beneficiary satisfaction information. The resources from the project would also support the communication and dissemination of monitoring and evaluation information to education stakeholders, including political authorities, policy makers, academics and researchers, principals and teachers, students, and the general public. 43. Details of the project costs are shown in Table 2.4. Table 2.4: Project Costs and Financing Summary (US$ million) Project Components Total IDA GoM Component 1: National Level Education Development 8.55 7.95 0.60 Component 2: School Level Education Development 1.15 1.00 0.15 Component 3: Project Management, Monitoring and 1.30 1.05 0.25 Evaluation, and Program Development Total 11.00 10.00 1.00 33 Annex 3: Implementation Arrangements MALDIVES: Enhancing Education Development Project (EEDP) A. Project Institutional and Implementation Arrangements 1. The project will be implemented by the Ministry of Education (MoE). The MoE will be directly responsible for implementation of national level activities, which includes policy formulation, monitoring and evaluation, research and technical support. Schools, which are under the MoE, will directly implement school-level activities, such as internal quality assurance reviews and school-based professional development of teachers. The institutional arrangements are the government's own institutional framework for the delivery of education services. Institutions in the education system will be able to draw on expertise, both national and international, and from the government sector, the private sector or civil society, to strengthen the quality and efficiency of the project. Project Management, Implementation and Oversight Ministry of Education 2. The MoE will be in overall charge of the project. The MoE has a set of departments, branches, centers and units, with mandates for various education activities [see the MoE Organizational Chart in Figure 3.1]. The relevant departments, branches, centers and units of the MoE will be responsible for implementing the sub-components of the project that are within their mandates. The MoE will be assisted by the Atoll Education Offices and Teacher Resource Centers to provide managerial support and to implement and monitor project activities at atoll and island level. The responsible agencies of the MoE which will implement project sub- components are presented in Table 3.1. 3. The Project will have a Steering Committee to provide policy direction and oversight. The Steering Committee will be chaired by the Minister of Education. The other members of the Steering Committee would be the State Ministers of Education; the Deputy Ministers of Education; the Permanent Secretary; the Directors-General and Heads of Agencies of the MoE; and representatives of the Ministry of Finance and Treasury (MoFT). The Policy Planning and Research Section (PPRS) would be the convener of the Steering Committee. The Steering Committee will discuss and decide on important policy aspects, as well as review the overall performance of the project, paying special attention to the anticipated outcomes and results framework. The Steering Committee would help relax any constraints to implementation. 4. The PPRS of the MoE, with the assistance of the Coordination Support Unit (CSU), will prepare an annual work plan for the project. This work plan will indicate progress to date on project activities, and the proposed activities and allocations of resources to achieve the project's targets. The annual work plan will be discussed and agreed with the World Bank prior to its implementation. 34 Figure 3.1: Ministry of Education Organization Chart Minister Higher Education Council State Minister/s Thauleemee Fund Committee Deputy Minister Permanent Deputy curement Committ Secretary Minister Maldives Qualification SchoolPolicy Planning Authority Aministration and Plarch (MQA) and Research Department of Higher Education Highe EductionNational Institute of ESQID - Human Education (NIE) =Rsources Kuliyya Forin - Department of Public Cororrate Relations Examination (DPE) Polytechnc Section Dhivehi Bahuge Finance Procurement Academy Section TVETA Hunaru Program Thauleemeettd Scholarship Division 35 Table 3.1: Key Activities and Responsible Agencies Key Activities | Responsible Agencies Component One: National Level Education Program Development National Assessments of Learning Education Supervision and Quality Improvement Outcomes for Policy and Program Division (ESQID) Development Management and Leadership Department of Higher Education (DHE) and Human Development of Staff in the Education Resource (HR) Sector Learning Environment Enrichment of Physical Facilities Development Unit (G Section) Secondary Schools Component Two: School Level Education Development School-Based Management School Administration (SA) and National Institute of Education (NIE) Modernizing Quality Assurance for Education Supervision and Quality Improvement School Improvement Division (ESQID) Strengthening School-Based National Institute of Education (NIE) Professional Development for Teachers and other School Staff School Quality Assurance and Teacher Education Supervision and Quality Improvement Development Awards (QATDA) to Division (ESQID) Schools Component Three: Project Management, Monitoring and Evaluation, and Program Development Education Strategy and Program Policy Planning and Research Section (PPRS), Development Department of Higher Education (DHE), National Institute of Education (NIE), Education Supervision and Quality Improvement Division (ESQID) and other MoE agencies Project Coordination, Monitoring and Policy Planning and Research section (PPRS), and Evaluation MoE agencies 5. The PPRS of the MoE will coordinate project activities. The PPRS will be strengthened with a Coordination Support Unit (CSU) under the project to assist the MoE in the implementation of fiduciary and safeguards processes, and project operations, administration and monitoring. The CSU would include specialists/consultants in the following areas: a Monitoring and Evaluation Specialist, an Operations Officer, a Procurement Specialist and a Financial Management Specialist. The Monitoring and Evaluation Specialist would monitor overall project implementation. The Operations Officer would implement project operations, and facilitate the implementation of the project by the CSU and MoE agencies. A draft Organization Chart of the PPRS and CSU, and the reporting line of the unit to the PPRS, is presented in Figure 3.2 and 3.3. 36 Operations Manual 6. An Operations Manual (OM) has been prepared by the MoE to guide the implementation of the project by the various agencies of the MoE. The OM includes a brief description of education sector issues that the project is expected to address, a detailed description of project components, implementation strategies and cost estimates, and the time schedule of activities. Additionally, the OM includes the project design and management structure, outcome and intermediate indicators, procurement, financial management and environmental safeguards arrangements. Figure 3.2: Policy Planning and Research Section (PPRS) Organization Chart Policy Planning & Rseanch DG .g Sttistics & Resench Formulation D DDD Stalistics & Proect & Policy IuiWpt Planing Research Rogamtit Pilainig U>it Fcrnulation Uit Uec unit I(DD) Serior Reseairh Research Serior Serior Selo Aralyst Officer / - Educatiomal - R1uafiomal _ Accaurts Senior EDOPlm Planne IIr Offlicer Asst. Statstcal . llr Off ker Officer - Educatiomal A tt Statistical Hlr fie IU - Aa3 Officer (3)- Adnyin Officet 37 Figure 3.3: Project Coordination Support Unit (CSU) Organization Chart Head Policy Planning and Research Section (PPRS) (E-Section) PPRS-EEDP Coordinator Project Coordination Support Unit (CSU) Monitoring and Evaluation Specialist Operations Officer Procurement Specialist Financial Management Specialist 38 7. The scholarships for Masters and Bachelor's Degrees will be administered by the Scholarships Section of the Department of Higher Education of the MoE. This section regularly administers the scholarships funded from the Government budget. In addition, this section has administered scholarships under a former World Bank funded education project, and the staff are familiar with World Bank procedures. The officials of the various agencies of the Ministry of Education, including Atoll education officials and teacher resource center coordinators, and schools heads and teachers, will be eligible for the scholarships. The recipients of scholarships will be selected by the Department of Higher Education, with the concurrence of the World Bank. The selection criteria for scholarships are outlined in the Operations Manual. The scholarships will cover the costs of higher education studies, such as tuition fees and expenses to higher education institutions. The scholarships will also cover a living allowance and other expenses, such as transport costs, for officials on no-pay leave. 8. Program management, implementation, monitoring, evaluation and research will be assisted through a technical support system. The MoE will be supported by national level education institutions such as the National Institute of Education (NIE), the Maldives National University (MNU) and the private Higher Education Institutions to undertake monitoring, evaluation and research activities. In addition, the MoE has access to national and international consultants that can evaluate and provide independent feedback on the implementation and results of the project. Resources for regular monitoring, evaluation, research and studies have been built into the budget, and will be supported by the EEDP. 9. The Bank will support the implementation of the project through careful supervision of the project, and through analytical and advisory activities (AAA) where relevant. The AAA support will include impact evaluations, policy research and studies, and technical assistance. Multi-sector activities, including school health and nutrition, and links between education and the labor market, and education and vocational training and technical education, could be explored. The project will cover a range of activities, including works, goods, consultant services, technical assistance, training, workshops, conferences, seminars, monitoring, evaluation, research and studies. The Bank will provide implementation support and supervision, including fiduciary oversight. All overseas training, capacity building, study visits, and academic studies will require prior review and no objection by the Bank. Schools 10. The EEDP will follow the principle of subsidiarity, where power and responsibility are devolved to the maximum extent possible to the frontline service delivery agencies, in this case the schools. The key activities to improve school performance under the project, such as the quality assurance program and the professional teacher development of teachers, will be implemented mainly at the school level. Also, school-based management activities and the annual school feedback form (ASFF) program will be implemented at the school level. 11. The Senior Management Teams (SMTs) led by the school principals will be responsible for the organization and management of these activities. The SMTs will lead the internal self- evaluations of the quality assurance process. They will also lead the needs assessments of teacher skills and competencies in relation to the school development plans, and organize the 39 professional development programs required. The SMTs will also be responsible for implementing the Quality Assurance and Teacher Development Awards (QATDA) and the ASFFs 12. The QATDA are expected to implement the school-based quality assurance reviews and school-based teacher professional development programs, and to help schools implement activities to improve student learning outcomes and soft skills, based on the findings of the quality assurance reviews. The funds for the QATDA would be sent to schools. ESQID would assist schools to implement their quality internal assurance reviews through appropriate training of school heads, school management teams and school boards. The NIE would help schools conduct school-based teacher professional development (SBPD) programs by providing information on the range of activities that can be undertaken as part of SBPD, and by training the coordinators of Teacher Resource Centers to act as resource persons for the schools in their respective atolls. In the first year of project implementation the QATDA would be provided against approved proposals. A model proposal is included in the operations manual. From the second year onwards only schools which have satisfactorily implement activities under the QATDA would receive funds. The implementation of activities under the QATDA will be monitored by the PPRS, with the help of the CSU. The Annual School Feedback Forms administered by the PPRS will be the main monitoring tool. B. Financial Management, Disbursements and Procurement Financial Management and Disbursements Arrangements Summary of Financial Management Assessment 13. The project will be implemented by the MoE with the assistance of the CSU. The implementation arrangements are being designed, in a manner which will ensure transparency and efficient fiduciary arrangements and will be adequate to account and report for project resources and expenditures. Budgeting 14. Budget allocations for foreign funded projects are reported to the MoFT and will be in accordance with the Financial Regulations of the GoM. The Government procedures for reporting budget allocations for foreign funded projects covers: (a) preparation of draft budget estimates, (b) budget proposal with timelines, and (c) financial covenants of the Financing Agreement between GoM and IDA. The government system of coding of expenditure will be followed by direct transfer of funds to classified expenditure heads. Total project expenditure with the estimated expenditure for next year from government budget will be prepared and sent to Ministry budget section before end of July every year by the FM Officer. Expenditures and Fund Flows 15. A designated account for the MoE will be set up with the Maldivian Monetary Authority (MMA) and managed by the MoE, to receive the funds from the IDA. The IDA will advance an 40 amount to this Bank account, to meet estimated expenditures for the first six months of the project, as forecasted in the interim financial reports (IFRs). From this Bank account, payments will be made to suppliers, vendors and to consultants for the project. In respect of large international contracts (if any), the MoE will have the option of requesting the IDA to make direct payments to the supplier. It has been agreed that all funds will be paid for and spent at the level of the MoE which will help not only in simplifying the fund flow and FM arrangements of the Project but also establish proper internal and operational controls from a fiduciary perspective. Expenditures and Fund Flows for QATDA 16. Under the Quality Assurance and Teacher Development Award (QATDA) scheme, schools will receive an annual award between US$ 400 and US$ 500 from project funds depending on the school size. These funds can only be used to conduct QA self-evaluations and to implement the findings and recommendation of the QA self-evaluations to improve student learning and soft skills, and to implement SBPD programs to enhance teacher performance. The procedures for implementing the 'Awards scheme' are detailed out in the memorandum of agreement (MoA) between MoE and each school receiving the QATDA awards and the eligibility criteria of the 'Awards' are detailed out in the operations manual. 17. The QATDA scheme will commence from 2014 and the QATDA award will be disbursed through the Community Driven Development (CDD) approach. Based on this approach and for the IDA's disbursement purpose, when IDA funds reach the hands of the school, those funds are recognized as expenditures for replenishment or reimbursement. However, for purpose of financial management, the schools are still required to follow relevant accounting rules and procedures and record and account for the expenditures incurred using QATDA awards. For all other project expenditures, IDA disbursements will be on actual expenditures. 18. A framework for performance measurement will be established to monitor the QATDA. Based on this framework a Memorandum of Agreement (MoA) will be signed between each school receiving the award and the MoE. A format of the MoA will be attached to the negotiation minutes. The first year award will be provided to each self-assessed school followed by the second year award that will be provided upon receiving confirmation through the ASFFs regarding the progress made on QA and SBTPD programs. All of these QATDA awards will be accounted as disbursements once the funds are released from the MoE and reach the hands of the schools. 19. As a part of the annual financial audit, a performance audit of the schools receiving the awards will be conducted to ensure that fiduciary assurance is obtained on the usage of awards in accordance with the Memorandum of Agreement (MoA). The ToR of the annual external audit will be included as an attachment to the operations manual. The performance audit will serve as an independent third party verification of the utilization of the QATDA and provides assurance to all stakeholders the awards have been used only for the purposes specified in the Memorandum of Agreement (MoA). 41 20. A Funds Flow Chart is shown below in Figure 3.3 Figure 3.3: Funds Flow 4-- F=,dflm, ....** *AcconA t ownersip IDA Designated Drc CSU of the Drc CSUof he............ Account (Uis$) MOBat lMMA Payments QATDA Project Payment for Worcs. Goods, Consutants, Training, 21. The proceeds of the IDA grant will be disbursed against eligible expenditures in the following categories inclusive of taxes. Disbursement Category Amount (US$) Disbursement % Goods, works, non-consulting services and consultants' services, training and workshops, and incremental 9,600,000 100 operating expenses Quality Assurance and Teacher Development Awards 400,000 100 (QATDA) Total 10,000,000 100 Counterpart Funds and Operating Costs 22. It is estimated that the GoM will contribute about US$ 1.0 million to the project costs (about 10 percent of the total project cost) over the life of the project. The government counterpart funds will finance travel, lodging and subsistence, and recurrent expenditures associated with training, school-based management, education strategy and program development, and monitoring and evaluation activities, for civil service staff of the Ministry of Education, the National Institute of Education, and schools. 23. Incremental operating costs of the project including taxes will be fully financed by IDA. Incremental operating costs include the normal expenditures of the project such as reasonable 42 costs of goods and services required for the day-to-day implementation of the Project including maintenance of vehicles and equipment, fuel, office supplies, utilities, consumables, office rental and maintenance, bank charges, advertising expenses, travel of contract staff, per diems, accommodation, and salaries of selected contracted support staff, but excluding salaries of consultants and officials of the Recipient's civil service. Staffing 24. The CSU is intended to be lean with a core group of mid-career officials including a FM officer who will be hired within 3 months of the project being effective. Due to advanced procurement stage of this staff, no dated covenant is envisaged and the task team is confident that the position will be filled in due course. The ToR for the FM Officer was cleared by IDA during pre-appraisal and the CSU presently has a short list of applicants who have responded to the recruitment advertisement. The MoE finance staff will handle all project FM activities in the interim. The FM officer is expected to implement the FM arrangements of the project. The FM officer will hire FM support staff as and when required. The FM support staff will be identified from personnel within the MoE's Finance Department. In respect of financial management arrangements, the FM officer will be responsible for implementing the internal control arrangements in the CSU, facilitating the payment process, ensuring proper accounting and submitting the financial reports in an agreed format to IDA. Accounting Policies and Procedures 25. All funds for the project will be routed through the MoE and the CSU will be responsible for funding all project expenditures including the QATDA awards, accounting for them, and for reporting on the financial and physical progress of the project. The Finance Department of the MoE will set up the financial accounting and reporting system for the project within the existing Public Accounting System (PAS). All project expenditures will be recorded using SAP. Books of accounts will be maintained on a cash basis of accounting and all applicable international accounting standards and policies (detailed in the OM) will be applied. The number of transactions in the project is expected to be moderate, which will enable focused attention on each transaction. The PAS system will be used to generate various expenditure reports of the project including the Interim Financial Reports (IFRs) that will be prepared on a cash basis and include a forecast of funds required for the next 6 months. IFRs will be submitted to the IDA within 45 days from the quarter end. Financial Reporting 26. The IDA related reporting requirements and the formats are spelled out in the OM and include the financial progress reports, physical progress reports and procurement, contract progress information to enable progress monitoring on an integrated basis. The CSU will submit quarterly IFRs to IDA within 45 days of the end of the quarter, starting from the end of the first calendar quarter after effectiveness. The OM will provide details on the reporting mechanisms that should be adopted by the project. 43 Internal Controls 27. Internal controls include structures, activities, processes, and systems which help project management effectively mitigate the risks to the project's achievement of the project development objectives. The project is following the government financial regulations and circulars. These regulations were reviewed during project preparation and include internal controls necessary for authorizing, approving, executing, recording, and reporting expenditure. Hence, these regulations and circulars are considered to be adequate to ensure that reliable internal control systems are in place for the project. An OM that includes a detailed chapter on financial management arrangement has been prepared and includes additional financial and other internal controls required for ensuring seamless project implementation. The final version of the OM was reviewed during appraisal. Internal Audit 28. The internal audits for the project will be carried out by the internal audit unit of the MoE according to its annual audit plan. These audits will cover schools financed under the project. The travel and other incremental costs required to audit these schools will be provided from the GoM share of project funds to the MoE's internal audit department. Prior to conducting the first project specific internal audit, the MoE will share a terms of reference (ToR) for the project internal audit with IDA to ensure that the ToR is acceptable to IDA. This process will result in periodic: (i) performance audit with identification of recommendations for enhanced accountability and transparency, and (ii) timely corrective actions by management. External Audit 29. The financial statements of the project prepared by the MoE will be audited by the Auditor General of Maldives to maintain full transparency and provide adequate assurance to all the stakeholders on the use of funds. Reasonable level of physical verification will also be conducted under the project. As a part of the annual financial audit, a performance audit of the schools receiving the awards scheme will; be conducted to ensure that fiduciary assurance is obtained on the usage of awards in accordance with the MoA. The ToR of the annual external audit will be submitted to IDA for clearance prior to engaging the external auditor. The audited financial statements of the project will be submitted to the IDA within 6 months of the end of the fiscal year. The MoE will disclose an English version of the project audited financial statements made available on its website to the public in accordance with the IDA's Access to Information (ATI) policy. These audited financial statements will be used for obtaining reasonable fiduciary assurance that IDA funds have been used for activities specifically agreed to be financed by IDA. Presently, the MoE do not implement any IDA projects. Hence, there are no overdue audit reports or ineligible expenditure pertaining to the MoE. 30. The following audit report will be monitored in the Audit Reports Compliance System (ARCS). According to the Bank's ATI Policy, the audit reports received by the Bank for the project will be disclosed in the Bank's external website for public access. 44 Implementing Agency Audit Report Auditor Date MoE Project Annual Financial Statements Auditor General June 30 Financial Covenants 31. The Financial covenants are: (i) Audited annual project financial statements to be submitted to the IDA no later than six months of the following fiscal year; and (ii) Project Interim Unaudited Financial Reports (IUFRs) to be submitted to the IDA no later than 45 days following the end of the reporting quarter. Procurement Arrangements and Methods General 32. Procurement for the proposed Project would be carried out in accordance with the World Bank's "Guidelines: Procurement Under IBRD Loans and IDA Credits" dated January 2011; and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated January 2011, as well as the provisions stipulated in the Financing Agreement. For each contract to be financed under this Project, the different procurement methods or consultant selection methods, estimated costs, prior review requirements, and time frame will be agreed between the Borrower and the Bank Project team in the Procurement Plan. The Procurement Plan will be updated at least annually or as required to reflect the actual Project implementation needs and improvements in institutional capacity. 33. The project procurement implementation will be the responsibility of the MoE. The procurement arrangements under the project will be primarily the responsibility of the PPRS which is supported by a Coordination Support Unit (CSU). The various items under the different expenditure categories, prior review thresholds, and methods of procurement are described in general below. 34. Procurement of Works: Works to be procured under this project include (i) construction of additional facilities at the existing schools; and (ii) rehabilitation of existing school infrastructure. Most of these works will be of small magnitude thus not requiring International Competitive Bidding (ICB) contracts. Given the scattered locations of the schools and the nature of the works to be financed under the Grant, civil works will be procured following National Competitive Bidding (NCB) procedures acceptable to IDA for the works estimated to cost more than US$ 50,000 equivalent. Small contracts costing less than US$ 50,000 equivalent may be procured by following the shopping procedures in accordance with the procurement guidelines. . All bidding documents will be in English and prepared using the IDA smaller-works Standard Bidding Document (SBD) and model bidding documents agreed with the Bank as the template. Minor contracts costing less than US$ 20,000 equivalent may be procured by following the procedures described for the Community Participation in accordance with the procurement guidelines. 45 35. Procurement of Goods: Goods to be procured under the Project include (i) school furniture; (ii) laboratory materials; (iii) teaching aid and educational equipment; (iv) office and IT equipment; (v) library books and teaching material/aids; (vi) computers and accessories; (vii) and consumables. The procurement would be carried out using the Bank's SBDs and model bidding documents agreed with the Bank. Library books and teaching materials/aids will be procured directly from the publishers on the basis of pro-forma invoices. However, whenever there are two or more publishers or suppliers exist for the similar items, comparative bids will be sought from a minimum of two publishers or suppliers. Given the scattered locations of the schools, Goods procurement would be carried out in lots suitable to the prevailing needs, geographical locations and the nature of the Goods to be financed under the Credit. Goods estimated to cost more than US$ 100,000 equivalent will be procured following International Competitive Bidding (ICB) procedures acceptable to IDA. Goods estimated to cost less than US$ 100,000 equivalent may be procured by following the NCB procedures in accordance with the procurement guidelines. Goods estimated to cost less than US$ 50,000 equivalent may be procured through the Shopping procedures. Printing and production of education materials contracts will be awarded by following the respective procurement method as appropriate in accordance with the above indicated thresholds. 36. Procurement of Non-consulting Services: Non-consulting services required under the project will be procured under NCB or Shopping procedures, following the same thresholds as for Goods. 37. The following methods will be applicable for Goods and Works consistent with the relevant sections of the Bank's Procurement Guidelines: a) International Competitive Bidding (ICB) b) National Competitive Bidding (NCB) c) Shopping (S) d) Community Participation (CP) 38. The Bank's Standard Bidding Documents (SBDs) will be used for all Goods and Works procurements. The SBDs may be customized, as appropriate. 39. Selection and Employment of Consultants: TA consultancies for firms estimated to cost US$ 300,000 equivalent or more will be selected in accordance with Section II of the guidelines, Quality- and Cost-Based Selection (QCBS). All other TA consultancies for firms will be in accordance with Section III of the guidelines Other Methods of Selection. Individual consultants for TA may be selected in accordance with Section V of the guidelines, Selection of Individual Consultants. 40. The following methods will be applicable for selection of consultants, consistent with the relevant sections of the Bank's Consultant Guidelines: a) Quality- and Cost- Based Selection (QCBS) b) Quality-Based Selection (QBS) c) Least Cost Selection (LCS) d) Fixed Budget Selection (FBS) 46 e) Selection based on Consultants' Qualifications (CQS): for services estimated to cost less than US$ 300,000 equivalent per contract, in accordance with the provisions of paragraph 3.7 of the Consultant Guidelines f) Single-Source Selection (SSS) g) Procedures set forth in paragraphs 5.2 and 5.3 of the Consultant Guidelines for the Selection of Individual Consultants h) Sole Source Procedures for the Selection of Individual Consultants 41. The Bank's standard request for proposal (SRFP) document will be used for all consultant services. The SRFP may be customized, as appropriate. Assessment of the Agencies' Capacities to Implement Procurement 42. The Physical Facility Development Section, generally known as G-Section of the MoE is responsible for the planning and identification of infrastructure needs. The infrastructure means school buildings and furniture including computers etc. 43. There is no in-house capacity within the MoE to undertake the civil works procurements and hence these are carried out by the Office of Programs and Projects (OPP) of the Ministry of Housing and Infrastructure. The OPP is functioning under the Presidential Decree and have been mandated to undertake the implementation and monitoring responsibilities of the projects on behalf of the GoM. The OPP prepares the design and bidding documents on behalf of the line ministries. The actual procurement process is then carried out by the Tender Evaluation Board (TEB) of Ministry of Finance where the OPP represent during the pre-bid meetings for clarification purposes. There is a strong likelihood that the OPP might be transferred to the Ministry of Finance. 44. Director General (Procurement) is responsible for the procurements of goods under the MoE valuing up to MVR 1.5 million which is equivalent to US$ 100,000. The Director General (Procurement) is familiar with the World Bank procurement procedures. Some of the staff members who were adequately trained to deal with the procurements under the Ministry of Education during the recently concluded project are now transferred to OPP. Procurements above MVR 1.5 million would be procured by the TEB with the support of the CSU which will be strengthened by additional staff. 45. The key issues and risks concerning procurement for implementation of the project have been identified and include: * Limited experience and the lack of knowledge of the staff, other than the DG (Procurement), who handle procurement, * Limited experience in the selection of consultants. * Absence of systematic procurement performance and compliance monitoring. * Limited experience in dealing with complaints, and fraud and corruption issues. 46. The corrective measures which have been agreed are: 47 * Implement an effective capacity building program within the project coupling with capacity building of other areas such as FM, Environment and social. * Produce operation manual by the MoE within first six months of the project. * Produce SBDs for the NCB procurements specific to the Project use prior to the Project effectiveness. * Produce simplified document/manual for smaller value contracts which can be understood by the implementing agencies such as schools located remotely before disbursing funds to schools for the works executed on community participation basis. * Appoint dedicated procurement staff at the MoE in addition to the DG (Procurement) being overall in-charge of the procurements under the project. * Preparation of a realistic procurement plan and monitoring the progress at various levels. * The following key indicators will be used for assessing procurement performance and risk rating: o Percentage of procurement activities which have more than 25 percent delay in bid/proposal evaluation. o Percentage of contracts which have been extended and/or have more than 15 percent modifications by value. o Percentage of post reviewed contracts with notable irregularities. o Percentage of procurement activities which had complaints. 47. The Bank will carry out its own procurement post reviews annually, discuss the findings, and agree with MoE and project implementing staff on corrective actions to address deficiencies. 48. The overall project procurement risk is rated high. The high risk rating will be reviewed and revised accordingly once the remedial measures, as listed above, are in place. Procurement Plan 49. The Implementing Agency (IA) has developed a detailed procurement plan for project implementation for the first 18 months and has agreed with IDA on the basis for the procurement methods. This plan has been agreed between the IA and the Bank and the respective plans are available at the MoE. The Procurement Plan will be updated at least annually, or as required, to reflect the actual needs vis-d-vis project implementation and institutional capacity. School level procurement activities will be included in their annual development plans, if any. Frequency of Procurement Supervision 50. In addition to the prior review supervision to be carried out from Bank offices, the capacity assessment of the implementing agencies has recommended semi-annual supervision missions to visit the field to carry out reviews of procurement actions on a sample basis. 51. A dedicated staff member(s)/consultant(s) will be assigned for procurement monitoring and reporting, training and guidance. A procurement competent consultant or a staff member will be attached to the MoE for this purpose. These consultants/staff members attached to the MoE will report to the Secretary/Steering Committee though the head of the CSU. A bi-annual 48 procurement progress reports to be provided to the World Bank would include status updates, procurement monitoring reports and analysis of agreed intermediate outcome indicators. The MoE will develop an effective monitoring mechanism during the first six months of the Project. Details of the Procurement Arrangements 52. Goods, Works, and Non Consulting Services: Method and Prior review thresholds for prior review contracts are shown in the Table 3.2. Table 3.2: Thresholds for Procurement Methods and Prior Review rocurement PPrior Review categoryProcurement Method Method ThresholdTheol Category Threshold National Competitive Bidding Works estimated to First contract (NCB) in accordance with the cost more than US$ (regardless of Bank's Procurement Guidelines, 50,000 equivalent per the value) and subject to the provisions set contract. subject to prior forth below. review; SAll subsequent contracts subject to post review on sample basis. National Shopping in Works estimated to First contract accordance with the Bank's cost not to exceed subject to prior Procurement Guidelines, and US$ 50,000 review; subject to: equivalent per Allsubsequent * receiving not less than three contract. contracts subject sealed quotations from to post review on qualified/registered sample basis. contractors; * submission of quotations by a pre disclosed deadline and public opening; and * a written invitation for quotation shall be provided, including a detailed description of the works, and Direct Contracting to School Works estimated to First contract Development Society of the cost not to exceed subject to prior particular school for community US$ 20,000 review; and participation equivalent. All subsequent contracts subject to post review on sample basis. 49 rocurement PPrior Review CategoryProcurement Method Method ThresholdTheol Category Threshold ICB in accordance with the Packages of goods, First contract Bank's Procurement Guidelines: equipment and NCS (regardless of Bank's latest standard bidding estimated to cost the value) documents for goods shall be exceeding US$ subject to prior used. 100,000 equivalent review; and per contract. All contracts estimated to cost more than US$ 300,000 equivalent per conontract. NCB in accordance with the Packages of goods, First contract Bank's Procurement Guidelines, equipment and NCS subject to prior and subject to the use of SBD estimated to cost not review; and Goods, agreed with the Bank. to exceed US$ Allsubsequent Equipment 100,000 equivalent contracts subject and Non- per contract. to post review on cosltn suamplen baqotaionsb services National Shopping in Goods estimated to First contract (NCS) accordance with the Bank's cost not to exceed subject to prior Procurement Guidelines, subject US$ 50,000 review; and to: equivalent per All subsequent * receiving not less than three contract. contracts subject sealed quotations; to post review on " submission of quotations by sample basis. a pre disclosed deadline and public opening; and " a written invitation for quotation shall be provided, including quantity requirements, specifications, delivery schedule, terms of payment, and evaluation criteria. Quality and cost based (QCBS) Consultancies All contracts estimated to cost more estimated to cost Bank's latest standard request than US$ 300,000 exceeding US$ Consultant for proposal shall be used. equivalent value in 300,000 Services- accordance with equivalent; and Firms Section 11 of the All Terms of Bank's Guidelines for Reference. selection of ___________costnts.xce 50 rocurement PPrior Review CategoryProcurement Method Method ThresholdTheol Category Threshold * Quality based (QBS) Irrespective of the All contracts * Least cost (LCS) value in accordance estimated to cost * Fixed Budget (FBS) with paragraphs 3.2 to less than US$ 3.6 of the Bank's 300,000 Bank's latest standard request Guidelines for equivalent; and for proposal shall be used. selection of All Terms of consultants. Reference. Services costing less than US$ 300,000 equivalent per contract may comprise all nationals. Selection based on Consultant's Services costing less First contract Qualifications (CQS), in than US$ 100,000 subject to prior accordance with paragraph 3.7 equivalent per review. of the Bank's Consultant contract. All Terms of Guidelines. Reference Bank's latest standard request for rposal shall be useda. Single Source Selection (SSS) Irrespective of the All contracts Justification or SSS on the value in accordance subject to prior Bank's latest format shall be with paragraphs 3.9 to review; and used. 3.10 of the Bank's > All Terms of Guidelines for Reference. selection of consultants. Competitive selectioanIrrespective of the All contracts procedures value under the estimated to cost Inivdul Bank's standard contracts latest provisions in Section exceeding US$ Cnividalt version shall be used. V of the Bank's 20,000 are (Cnutat Consultant subject to prior (IC)Guidelines, review; and o All Terms of Reference. 51 rocurement PPrior Review CategoryProcurement Method Method ThresholdTheol Category Threshold Sole-Source selection Irrespective of the All contracts procedures value under the estimated to cost Bank's standard contracts latest provisions in exceeding US$ version shall be used. paragraph 5.4 of the 10,000 Bank's Consultant equivalent; and Guidelines. All contracts estimated to cost not to exceed US$ 10,000 equivalent are subject to prior agreement - Justification shall be provided in the procurement plan. > All Terms of Reference. National Shopping in Works estimated to First contract accordance with the Bank's cost less than US$ subject to prior Procurement Guidelines, and 20,000 equivalent review; and subject to: value involving Allsubsequent * receiving not less than three community in contracts subject Works sealed quotations from accordance with the to post review on Procurement qualified/registered Bank's Procurement sample basis. at School contractors; Guidelines. level / * submission of quotations by community a pre disclosed deadline and participation public opening; and * a written invitation for quotation shall be provided, including a detailed description of the works, and evaluation criteria. 53. Overseas Fellowships: Fellowships will be awarded under the Government's current administrative procedures, which are satisfactory to IDA. The Government, in the interest of increasing the number of fellowships available, will undertake to have as many fellowship recipients as possible placed in regional institutions. All fellowship beneficiaries will be selected and approved by MoE before being processed by the PPRS/CSU. The Bank will review the Training Plan of the PPRS/CSU prior to its implementation. 52 C. Environmental and Social (including safeguards) 54. The MoE will be responsible for the overall implementation of the Environmental and Social Assessment and Management Framework (ESAMF), conducting the overall monitoring of the Project's environmental and social safeguard activities, and ensuring the proposed activities are in compliance with the ESAMF and investments are sustainable. Within this context, the MoE has designated the head of the Physical Facilities Development Section (G section) to be responsible for safeguards compliance of the project, including liaising with the World Bank safeguards specialists as needed. The MoE will ensure that adequate capacity is available within the ministry or service is obtained from a suitable consultant to continue the safeguards screening of construction activities and preparation of Environmental and Social Management Plans (ESMPs) of proposed post-2014 construction activities. The MoE is also responsible to ensure adequate consultations are held as part of the screening process and such consultations are properly documented. The MoE will provide adequate technical support to school authorizes on operations and maintenance of physical facilities. 55. The assigned staff of the MoE Physical Facilities Development (G Section) and of Office of Projects and Programs (OPP) will ensure the construction designs take the recommendation of ESAMF and subsequent safeguards documents that will be prepared (findings of the screening reports and ESMPs) into consideration. Overall supervision and monitoring of the implementation of ESMPs will be also with the MoE G section, OPP, relevant island council and respective school authorities with the support of selected stakeholders from the participating islands. The school authorities will ensure the grievance redressal system defined in the ESAMF is put in place prior to mobilization of the contractors. Monitoring of implementation progress of each construction will be carried out periodically by the MoE and World Bank. The MoE will monitor the project and submit monitoring and progress reports to the World Bank bi-annually. The MoE will conduct necessary training to various groups involved in the implementation of safeguards requirements to ensure consistency in the application of environmental and social standards specified in the ESAMF. D. Monitoring & Evaluation 56. The EEDP will devote special attention to the monitoring and evaluation of results and outcomes. The objectives of monitoring and evaluation are to: (a) track the implementation experience of the project, and strengthen the efficiency of implementation where needed; (b) assess the results achieved under each project component and sub-component; and (c) evaluate the overall outcomes of the project. Monitoring and evaluation activities will commence from the beginning of the EEDP and continue until project completion, and will assess project inputs, processes, results, intermediate outcomes and outcomes. 57. A detailed Results Framework has been developed for the project and is presented in Annex One. This framework comprises a set of intermediate outcomes and outcomes, with annual targets, to provide a continuous picture of project performance. The results indicators focus on critical milestones and will be used to monitor the implementation performance of the different components of the EEDP. The outcomes constitute the key performance indicators that reflect the overall development objectives of the project. 53 58. The overall project monitoring activities will be undertaken by the PPRS with the assistance of the CSU. The CSU will have a full-time monitoring and evaluation specialist/ consultant to help the PPRS to monitor project activities closely. 59. The other central level MoE agencies will monitor the implementation of activities under their mandates and responsibilities at atoll and school level. For instance, ESQID will monitor the implementation of the internal quality assurance activities at school level. The NIE will monitor the implementation of the SBPD programs. This monitoring would follow a cascade model where appropriate, with atoll education officials and the coordinators of teacher resource centers assisting the national MoE agencies to monitor the activities in the atolls and islands. Research and evaluation activities will generally be contracted out to independent research agencies, such as the MNU, private higher education institutions and consulting firms, or individual consultants. 54 Annex 4: Operational Risk Assessment Framework (ORAF) MALDIVES: Enhancing Education Development Project (P131331) Stage: Negotiations / Board ISoe S takeholdersk Stakeholder Risk Rating Low Description: Risk Management: Erosion of support for the idea of school-based The project concept is aligned with the government's initiatives to focus more on school level activities and initiatives in the bureaucracy or among school performance. The key role of schools and local school communities in improving learning outcomes is politicians might slow down development also being increasingly understood by bureaucrats and politicians, as shown in the recent initiative to establish initiatives. school boards and promote school-based management. This initiative will be supported through the project. Resp: Both Stage: Imple Recurrent: Due Date: Frequency: Status: Not Yet mentat Due ion Capacity Rating Substantial Description: Risk Management: (i) The capacity of school communities, such as (i) The project design supports training and capacity building of school communities in the new initiatives. In teachers and principals and parents, to addition, these initiatives will be introduced in a phased manner, giving time for adequate capacity building, implement new initiatives such as quality especially for schools m the outer atolls and islands. assurance reviews and teacher professional Resp: Both Stage: Imple Recurrent: Due Frequency: Status: Not Yet development activities are limited. mentat 0 Date: Due ion Risk Management: (ii) Unfamiliarity of new staff with Bank's (ii) The Office of Projects and Programs in GoM has staff trained in procurement, who will support the MoE. procurement and financial management policies Provision will be made to increase the human resources for monitoring construction, and relevant training will be and procedures might delay disbursements, provided to the staff. Fiduciary training and on-site support will be provided to all agencies, and will continue during implementation. Arrangements have been made for procurement and financial management specialists to support the project. 55 Resp: Both Stage: Imple Recurrent: Due Frequency: Status: Not Yet mentat 0 Date: Due ion Governance Rating Moderate Description: Risk Management: (i) Lack of continuity in staffing might result (i) The project will be implemented mainly through the officials of the education system, such as MoE and Atoll slow implementation. education staff and the teachers and principals in schools. Resp: Client Stage: Imple Recurrent: Due Frequency: Year Status: Not Yet mentat 0 Date: ly Due ion Risk Management: (ii) Capacity of MoE to monitor and evaluate (ii) The Office of Projects and Programs in GoM has staff who will be able to monitor civil works and compliance of project-funded civil works with engineering activities in the schools. They will assist the MoE. engineering and environmental standards might Resp: Client Stage: Imple Recurrent: Due Frequency: Quar Status: Not Yet be weak. mentat 0 Date: terly Due ion Design Rating Moderate Description: Risk Management: Inadequate co-ordination and cooperation Strong process monitoring at the classroom level will be implemented to enhance the quality of classroom among education sector officials across atolls processes and translation of acquired teaching skills into the classroom to improve learning. The MoE will pay and islands could increase disparities in special attention to identifying atolls and islands which lag behind in implementation performance and strengthen education quality as decentralized delivery of policy initiatives to support these atolls and islands. External atoll level sample based monitoring of schools will the quality development programs takes place at be done to supplement this. school level. Resp: Client Stage: Imple Recurrent: Due Frequency: Status: Not Yet mentat 0 Date: Due ion Social and Environmental Rating Moderate Description: Risk Management: Civil works and other activities associated with Potential adverse environmental impacts are expected to be site-specific. To ensure effective implementation of expansion of secondary schools might have the project's ESMF, training will be provided to strengthen the capacity to monitor and report on impacts. unforeseen environmental impacts. Provision for environmental specialist technical assistance support has been made in the project. 56 Resp: Client Stage: Imple Recurrent: Due Frequency: Status: Not Yet mentat 0 Date: Due ion Program and Donor Rating Low Description: Risk Management: There are no other donors involved in this project. The World Bank is the only donor Resp: Stage: Recurrent: Due Frequency: Status: providing large scale support to the education O Date: sector. Delivery Monitoring and Sustainability Rating Substantial Description: Risk Management: (i) Monitoring the implementation of (i) The project has set up a monitoring system where atoll level education administrators will assist the project activities in the scattered islands of the MoE in monitoring. The project also supports capacity building of all relevant stakeholders, including MoE Maldives could stretch the monitoring capacity officials and atoll level officials, in monitoring and reporting. of the MoE. (ii) Fellowship beneficiaries may not (ii) Mechanisms will be built into the bonding system to ensure that fellowship beneficiaries return to their complete their programs or may return to jobs positions. that do not utilize their skills. (iii) The results of the monitoring and (iii) There will be continued participation of all stakeholders in the dialogue on the program and sector evaluation activities might not be adequately reforms. Senior management of schools will receive training in utilizing self-assessments for improved linked to improved management and teaching management and teaching practices. practices. Resp: Client Stage: Imple Recurrent: Due Frequency: Status: Not Yet mentat 0 Date: Due ion Implementation Risk Rating: Moderate Description: The implementation risk is assessed as moderate as most relevant risks, along with their mitigation measures, are assessed as either low or moderate. There is one high risk and two substantial risks identified for the preparation of the project. 57 Annex 5: Implementation Support Plan MALDIVES: Enhancing Education Development Project (EEDP) Strategy and Approach for Implementation Support 1. The implementation support strategy has been developed based on the structure and contents of the EEDP and the risk profile. IDA will provide continuous support to the MoE to implement the project effectively and flexibly. The implementation support will focus on the education and economic content of the operation, the fiduciary and safeguards requirements, and the mitigation of risks identified in the ORAF, especially policy level, governance, design and delivery quality risks. 2. The performance of the EEDP will be reviewed regularly, including through implementation support and supervision visits to the atolls. 3. Technical support: IDA will maintain continuous dialogue and provide technical advice and implementation support to the EEDP. Special attention will be paid to the quality assurance program, school-based teacher development, and expansion of higher secondary and tertiary education. The Task Team Leader (TTL), education specialists, senior operations officer, and operations analyst will provide regular inputs into these activities. 4. Overall project management: The TTL, based in the region, will coordinate the Bank team to ensure that the EEDP is implemented according to the Bank's requirements as specified in the Financing Agreement. He will engage in regular dialogue with the senior officials in government to monitor implementation and help resolve issues and relax constraints as and when they arise. He will be assisted by team members, including the education specialists and operations officer/analyst on the team. 5. Fiduciary requirements and inputs: The Bank financial management and procurement specialists based in the region will support project implementation through regular and timely training and capacity building of officials. Supervision of fiduciary processes and procedures will be conducted semi-annually. The operations officer/analyst on the team will work with the financial management and procurement specialists. 6. Safeguards: The environmental specialist based in the region will focus on the implementation of the environmental management plans for the project. The social specialist based in the region will focus on the implementation of the social safeguards of the ESMF. 7. Analytical support: IDA will assist the country by regularly undertaking education research and impact evaluations on themes and topics that are considered high priorities for future policy formulation and strategy development in the education sector. These studies and evaluations will be undertaken collaboratively with the government. The EEDP has provision to support research and program development by key public sector agencies such as the MoE, different implementation agencies in the MoE, Maldives National University (MNU) and private Higher Education Institutions, as well as through the contracting of private research and consulting agencies. 58 8. All terms of reference for studies and consultancies/technical assistance will need to be sent to the Bank for prior review and concurrence by the task team. 9. All activities for which individuals are expected to travel abroad would need to be sent to the Bank for prior review and concurrence by the task team. Implementation Support Plan 10. Bank staff will conduct supervision and implementation support missions twice and year. In addition, short missions could be conducted more frequently, especially by Bank staff based in the Colombo Office. A mid-term review will be held prior to June 30, 2016. 11. The staff skills mix required for implementation support is summarized below. Skills Needed Number of Staff Number of Trips Comments Weeks Task Team Leader 10 SWs annually Two each year and Based in the region field trips as required Senior Education 4 SWs annually Two each year and Based in the region Specialist field trips as required Education Specialist 10 SWs annually Two each year and Washington based field trips as required Senior Operations 4 SWs annually Field trips as required Washington based Officer (Consultant) Operations Officer / 4 SWs annually Two each year and Country office based Analyst field trips as required Financial Management 2 SWs annually Two each year and Based in the region Specialist field trips as required Senior Procurement 2 SWs annually Two each year and Based in the region Specialist field trips as required Environment Specialist 2 SWs annually Two each year and Based in the region field trips as required Senior Social 1 SWs annually One each year and Based in the region Development Specialist field trips as required 59 Annex 6: Economic and Financial Analysis MALDIVES: Enhancing Education Development Project (EEDP) Introduction 1. The Maldives Enhancing Education Development Project (EEDP) is organized under three components: (a) national level education development; (b) school level education development; and (c) project management, monitoring and evaluation, and program development. These components and the activities under them were prepared through a process of consultation and collaboration with the Ministry of Education; the Ministry of Finance and Treasury; the atoll education agencies; public and private employers; public and private education institutions; academics; and school principals, teachers, parents and students. The components and activities are also based on the findings and recommendations of the Bank's programmatic Education Sector Reports: Human Capital for a Knowledge Society: Higher Education in the Maldives, an Evolving Seascape (2011); and Human Capital for a Modern Society: General Education in the Maldives, an Evolving Seascape (2012). 2. The Maldives is strongly committed to promoting human development, economic growth and poverty reduction. In this context, the quality and quality of human capital is of vital importance. To address challenges in the education sector, the GoM requested technical and financial assistance from the World Bank. The Bank responded by preparing two education reports on general education and higher education. The proposed project, which builds on the recommendations of the reports, and the dialogue established with the stakeholders in the country, will assist the Government of Maldives (GoM) to strengthen and develop strategic dimensions of education access and quality. Rationale for Investing in Education Economic Benefits ofInvestment in Education 3. Human capital is the central determinant of economic well-being and social advancement in the modern global economy. The key characteristic that distinguishes between advanced, middle-income and low-income countries, is the knowledge content of their economic activities and production processes. Industry, agriculture and especially services have become increasingly knowledge and skill intensive in recent years. Further, the dominance of knowledge and skills is increasing at an accelerating rate. Among advanced economies, for instance, the education levels of their populations is the single most important factor determining their economic performance [Hanushek and Welch (2006), Hanushek and Woessmann (2008)]. Among middle-income and low-income countries, too, economies that have high education attainment enjoy considerable welfare gains [Fasih (2008), Patrinos and Psacharopoulos (2011)]. 4. Investment in human capital has a positive and rising impact on wealth, at all levels of education from primary schooling upwards, for both men and women in the Maldives [Aturupane and Harsha (2012)]. This is clearly seen in the econometric analysis presented in Table 6.1, where all the coefficients from primary education to higher education are positively signed and statistically significant. In addition, as the education levels of individuals increase 60 their wealth rises. These findings are consistent with the notion that investment in human capital is an important determinant of the economic well-being of individuals. Further, for secondary education and higher education, the education coefficients are larger than the coefficients of any other variables, for both men and women. This suggests that education has a stronger impact on wealth than any other factor, for men and women who have received secondary education or higher education. Between the sexes, the impact of education on wealth is stronger among women than among men. This can be attributed mainly to self-selection effects, as there is a greater likelihood of the more able women entering the labor market, while among men nearly all working aged individuals would participate in the labor market. The age variables, which are proxies for experience, display a familiar pattern, rising up to a maximum in late middle-age and then declining thereafter. This is consistent with the notion that experience has an economic value. The wealth functions also show that urban men and women earn significantly more than their counterparts in the rural sector. This is again a typical finding, as the urban sector has a larger range of well-paid jobs than the rural sector. Table 6.1: Education and Economic Well-Being (Wealth Index Factor) 2009, Generalized Least Squares Estimates Male Female Variables Male Coefficient T-Ratio Coefficient T-Ratio Constant -76,551*** -29.62 -83,320*** -32.07 Age Age 31-40 years 9,044*** 4.47 14,526*** 7.94 Age 41-50 years 20,318*** 8.01 26,700*** 11.27 Age 51-60 years 25,205*** 8.41 28,632*** 9.93 Age 61-70 years 14,568*** 4.60 21,375*** 6.59 Age 71 years above 6,418* 1.68 20,918*** 4.71 Education Primary 14,984*** 7.19 16,019*** 8.36 Secondary 36,930*** 16.21 40,223*** 17.89 Higher 57,741*** 14.52 64,960*** 16.48 Household size Family size 2,712*** 18.52 2,731*** 19.51 Marital status Married 13,394*** 7.99 13,605*** 8.98 Widowed 4,301 0.89 3,758 1.14 Divorced -1,477 -0.40 2,927 1.09 Location Urban 183,896*** 112.21 187,569*** 122.67 Observations 12,690 14,490 F(13, 12676) 1,381.86 1,536.24 Adjusted R-squared 0.59 0.58 Breusch-PaganCook- chi2(1) = 10.22 chi2(1) = 10.23 Weisberg test for heberosceasticiProb > chi2 = 0.0014 Prob > chi2 = 0.0014 heteroscedasticity Source: World Bank staff estimates, based on the Demographic and Health Survey, 2009. Note: All standard errors have been corrected for heteroscedasticity. *** means statistically significant at 99 percent, ** means statistically significant at 95 percent, and * means statistically significant at 90 percent. 61 5. The role of education in promoting female labor force participation is an extremely important element of gender empowerment and economic modernization. The relationship between education and female labor force participation is shown in Table 6.2. Education exerts a strongly positive effect on the labor force participation of women with secondary education or higher education in the Maldives. In addition, the likelihood of labor force participation rises with the level of education, for both married women and for all women. There are likely to be two sets of reasons for the higher labor force participation probabilities of women with secondary education and higher education. First, there are self-selection effects, as women who study up to these levels are likely to possess greater ability and motivation to work. Second, well educated women enjoy higher life-cycle earnings prospects. Hence, the opportunity cost of non- participation is greater for well-educated women. Table 6.2: The Impact of Education on Female Labor Force Participation, Marginal Effects Derived from a Probit Model, Maximum-Likelihood Estimates, 2009 Both never-married and Only ever-married ever-married female female Primary education -0.0020 -0.0067 (-0.11) (-0.30) Secondary education 0.1378 *** 0.1128 *** (5.90) (4.01) Highest education 0.3959 * 0.3669 * (10.15) (8.05) Partner's highest education, -0.0074 Primary (-0.37) Partner's highest education, 0.0195 Secondary (0.82) Partner's highest education, 0.0540 Higher (1.23) Observations 7,033 6,179 Prob > chi2 0.0000 0.0000 Pseud R2 0.0244 0.0223 Source: World Bank staff estimates, based on the Maldives Demographic and Health Survey 2009. Note: Z-values in parentheses. The probit model was controlled for other factors affecting female labor force participation, such as age, urban-rural residence, household characteristics, and marital status. *** means statistically significant at 99 percent, ** means statistically significant at 95 percent, and * means statistically significant at 90 percent. 6. The economic benefits for individuals include better employment prospects, higher earnings and higher savings levels. For all of society, on the other hand, expanding education can promote faster technological catch-up, increase national productivity and then improve a country's ability to maximize its economic output [Bloom et al (2006)]. Education, especially higher secondary and higher education, provides the skilled labor force which is needed for technology transfer and technology development, both in terms of specific skills and of general 62 learning ability. As economic production processes have become increasingly knowledge- intensive and technology-intensive in recent decades, the returns to education have been rising in many countries [Hanushek and Welch (2006)]. Private Rate ofReturn 7. Investment in education yields substantial rates of return to education. Table 6.3 presents the private rate of returns to investment according to various levels of education. The private rate of return increases as level of education rises. The rates to higher education and to secondary education are 11.6 percent and 8.9 percent respectively, which are higher than that to primary education (5.4 percent). Earnings increase by 5.3 percent for an additional year of schooling. The findings show that the EEDP is investing resources in the education cycles that yield high economic benefits. Table 6.3: Private Rates of Return to Education in the Maldives, 2009/2010 Education Level Private Rate of Return Primary Education 5.4 Secondary Education 8.9 Diploma/Certificate 2.7 Degree and Above 11.6 Total 5.3 Source: World Bank staff estimates, based on the Maldives Household Income and Expenditure Survey 2009/2010. Note: This is calculated using earnings equations method. Social Benefits ofInvestment in Education: Externality Effects 8. Education produces a variety of social benefits. For instance, the externality effects of maternal education on family health and child nutrition are among the key social benefits of investing in education. In developing countries the prevalence of life-threatening communicable diseases and under-nutrition has declined over time as girls and women have become better educated. This favorable relationship between female education and health and nutrition outcomes is seen in the Maldives, too. 9. Maternal education plays a strong and significant role in reducing the prevalence of child under-nutrition. The relationship between mother's education and child nutrition is presented in Table 6.4. In the Maldives, the prevalence of children either severely or moderately underweight decreases progressively and significantly as maternal education rises. Children of primary educated mothers are less likely to be under-nourished than children of uneducated mothers. Children of secondary educated mothers are less likely to be under-nourished than children of primary educated mothers. And children of tertiary educated mothers are less likely to be under- nourished than children of secondary educated mothers. The positive relationship between maternal education and child nutrition is the result of superior nutrition knowledge and greater ability to implement favorable nutrition practices among educated women. Educated mothers obtain and respond faster to new information on child nutrition, and utilize health care services for diseases that adversely affect nutrition more frequently. In addition, educated mothers have a higher propensity to use necessary nutrition supplementation in infancy and to adopt appropriate weaning practices. 63 Table 6.4: The Relationship between Mother's Education and Child Nutrition, 2009 Weight-for-age Mother's Below -3 SD Below -2 SD Above +2 SD Mean Z- Number of (%) (%) (%) score (SD) children No formal 5.2 27.1 2.7 (1.2) 321 education Primary 4.7 21.0 1.4 (1.0) 937 Secondary 1.9 12.3 2.4 (0.6) 1,092 Higher 0.0 11.9 3.7 (0.4) 110 Source: Maldives Demographic and Health Survey (DHS) 2009. 10. Maternal education plays a positive and significant role in reducing the incidence of child mortality. The relationship between mother's education and child mortality is presented in Table 6.5. The incidence of child mortality across all indicators, neo-natal mortality, post-neonatal mortality, infant mortality, and child mortality, decreases progressively and significantly as maternal education increases. Infants and children of primary educated mothers are less likely to die than children of uneducated mothers. And infants and children of secondary educated mothers are less likely to die than children of primary educated mothers. The positive relationship between maternal education and infant and child mortality can be attributed better health knowledge and greater ability to implement favorable health practices among educated women. Educated mothers adopt better pre-natal and neo-natal practices, obtain and respond faster to new information on infant and child health, and utilize health care services for life- threatening diseases, such as respiratory and water-borne diseases, more frequently and effectively. For instance, educated mothers are more likely to seek treatment from medical facilities and to use medicines over the prescribed cycle of treatment than uneducated mothers. Table 6.5: The Relationship between Mother's Education and Child Mortality, 2009 Child (under- Child (under- Mother's Neonatal Post-Neonatal Infant 1) Mort 5) Mort Education Mortality (%) Mortality (%) Mortality (%) M t y 5 ) No formal 32 9 41 6 47 Education Primary 17 6 23 5 28 Secondary 7 6 13 1 14 Source: Maldives Demographic and Health Survey (DHS) 2009. Note: Information on child mortality for higher educated women is not presented in the DHS report. 11. Education has other non-economic benefits. For individuals, education strengthens core values relating to responsible citizenship. Studies on the value of education outcomes identify a number of public non-economic benefits of education, including promoting democracy, increasing political stability, reduced crime, lower state welfare and prison costs, promoting social mobility [Hill et al (2005), McMahon (2009), OECD (2012)]. These benefits accrue to the entire society spill over even to future generations, and represent a considerable return although they are difficult to quantify, and thus are significantly important in the context of a country's development. 64 Poverty Alleviation and Equity 12. It is important that socio-economic status should not be an obstacle to achieving educational potential. Equity in education will have a tremendous value to the country. As shown in Figure 6.1 and Table 6.6, public investment is the most equitable at the secondary education level when measured in terms of participation rates across economic groups, with the Lorenz Curve falling almost completely onto the 45 degree line of perfect equality, and the Gini index of education just 0.003 where 0 is perfect equality and 1 is perfect inequality. This high level of equality at the secondary education level reflects the fact that enrollment across economic groups are most equal. Public spending on primary education is also highly equitable. The Lorenz curve for primary education is also close to the 45 degree line, and the education Gini index is just under 0.03. These results clearly support that children from households belonging to any economic quintile groups equally receive the benefits from investment in primary and secondary education. On the other hand, like most of other developing countries, public investment in higher education demonstrates lower degree of equity with the education Gini index of 0.55, compared to investment in primary and secondary education. The investment in education under the EEDP, by providing scholarships for degree and diploma programs, will help address inequality through targeted policy interventions. Figure 6.1: Benefit Incidence of Public Education Spending 100 . 90 - S 80 /7 - Primary Education 60- me Secondary '. 50 - Education 40 40 30 - Higher 20 - Education C 10 - 0 0 20 40 60 80 100 Poorest Poorer Middle Richer Richest Table 6.6: Education Gini Indexes of Public Expenditure by Level of Education Level of Education Gini Index Primary Education 0.09 Secondary Education 0.003 Higher Education 0.55 Note: In Gini Index, 0 is perfect equality and 1 is perfect inequality. 65 Cost-Benefit Analysis of the EEDP 13. Here we assess benefits and costs associated with the EEDP. It uses the approach of comparing net benefits in two scenarios, one with the project and one without (the counterfactual). Economic costs include total project costs and private costs that comprise direct household outlays as well as opportunity costs for schooling. Similarly, the benefits are taken to be those changes in the quantity, quality and reduction in internal inefficiency of education produced over the period as a result of the EEDP. As discussed earlier, there are different types of benefits from providing an individual with additional years of education. The cost-benefit analysis in this section focuses on economic benefits. While this project consists of several parts, the largest part, enhancing quality and access of higher secondary and higher education, will be the focus of this analysis. The main sources of data used in the analysis come from HIES 2009/2010 and MoE Education Statistics (various years). Benefits Stream 14. For the purpose of the economic analysis, benefits from the following sources are qualified: a) Increased number of higher secondary school completers and graduates. This will increase the quality of jobs and earnings of Maldivians. b) Improved quality of the education system. This will result in higher labor productivity and life-time earnings. Costs Stream 15. Total cost comprises direct project cost and indirect costs including private household education cost and opportunity cost of schooling. Data from the HIES 2009/2010 was used to estimate the private costs. Private household cost per students for higher secondary education and for higher education is estimated to be MVR 5,741 and MVR 8,145 respectively. In addition to the project cost, total project private household cost for secondary education and for higher education was projected over the project period and estimated to be US$ 1.7 million. Opportunity cost (foregone earnings) per year while attending school is estimated to be MVR 93,590 per higher secondary student and MVR 113,378 per higher education student. The total opportunity cost for project period is estimated US$ 25.4 million. Net Present Values ofBenefits and Costs, and Internal Rate ofReturn 16. Based on a discount rate of 12 percent for the benefits and costs streams discussed above, the present discounted value of benefits for the based-case scenario is estimated to be US$ 48 million while the present discounted value of costs is estimated 26 million. The net present value (NPV) of the EEDP benefits is US$ 22 million. The internal rate of return (IRR) associated with this NVP is 30 percent. 66 Sensitivity Analysis 17. A sensitivity analysis is also carried out under varying scenarios for progress in internal efficiency and external efficiency gains. Four criterions are used for this analysis: (a) survival rate from grade 1 to grade 12; (b) higher education gross enrollment rate (GER); (c) average annual wage growth rate; and (d) employment rate. As indicated in Table 6.7, the net present value (NPV) ranges from US$ 17 million in the low case scenario to US$ 35 million in the high case scenario. Similarly, the internal rate of return (IRR) varies between 26 percent and 36 percent (see Table 6.8). These results suggest that the EEDP is expected to yield significant economic returns and thus to be a very sound investment. There are conservative lower bound estimates, given that they do not account for other potential benefits including the social benefits of education. The total economic and social impact on the project is likely to substantially exceed the economic benefits, which are nonetheless very considerable. Table 6.7: Sensitivity Analysis of the NPV under Various Scenarios Internal Efficiency Survival rate through Survival rate through Survival rate through Scenarios grade 12 (23%) & grade 12 (27%) & grade 12 (3 1%) & Higher Education Higher Education Higher Education GER (4.5%) GFR (5.5%) GER (6%) Average annual wage growth rate (5.8%) & US$ 17 million US$ 20 million US$ 22 million Employment rate (45%) 8 Average annual wage growth rate (6.3%) & US$ 19 million US$ 22 million US$ 25 million Employment rate (55%) Average annual wage growth rate (7.8%) & US$ 25 million US$ 28 million US$ 35 million Employment rate (75%) Source: World Bank estimates. Table 6.8: Sensitivity Analysis of the IRR (%) under Various Scenarios Internal Efficiency Survival rate through Survival rate through Survival rate through Scenarios grade 12 (23%) & grade 12 (27%) & grade 12 (3 1%) & Higher Education Higher Education Higher Education GER (4.5%) GER (5.5%) GER (6%) Average annual wage growth rate (5.8%) & 30% 29% 26% Employment rate (45%) Average annual wage 3 growth rate (6.3%) & 32% 30% 28% m Employment rate (55%) Average annual wage growth rate (7.8%) & 36% 34% 32% Employment rate (75%) Source: World Bank estimates. 67 Fiscal Analysis 18. This analysis examines the current and projected budget for education sector. The results under three cases are presented here: (a) a base case scenario and (b) a low case scenario, and (c) a high case scenario. Tables 6.9, 6.10 and 6.11 present the stream of expenditures for the education budget for the period 2013-2017, and the contribution of the EEDP under different case scenarios. 19. The base case scenario uses conservative assumptions (see Table 6.9). GDP growth rate is assumed to be constant at 2 percent which is average pace in the recent past. Total government budget as a percentage of absolute GDP is projected to be 51 percent constantly. The proportion of education sector budget to total government budget is projected to remain 16 percent which is average pace observed over the last five years. It is assumed that recurrent and capital education budget remain constant at 89 percent and 11 percent respectively. The results of the base case show that total education budget could increase in real terms over the project period from MVR 1.7 billion to MVR 1.8 billion. 20. In the low case scenario shown in Table 6.10, it is assumed that GDP will increase at zero rate, given the fact that the country's fiscal situation has deteriorated continuously. Total government budget as a percentage of absolute GDP is projected to remain 51 percent. The percentage of education sector budget to total government budget is projected to decrease from 16 percent to 14 percent. We continue to assume that recurrent and capital expenditures remain constant at 89 percent and 11 percent respectively. Under the low case scenario, total education budget could decrease in real terms over the project period from MVR 1.7 billion to MVR 1.5 billion. 21. In the case of high-growth, GDP growth rate is assumed to continue to grow at 4 percent annually (see Table 6.11). Total government budget as a percentage of absolute GDP is projected to remain 51 percent. Total government budget to education is projected to increase from 16 percent to 18 percent. Again, we continue to assume that recurrent and capital expenditures remain constant at 89 percent and 11 percent respectively. The results of this scenario indicate that total education budget could increase in real terms over the project period from MVR 1.7 billion to MVR 2.2 billion. 22. The EEDP is expected to add MVR 150 million (US$10 million) over the project period (2013-2017) of the project. Tables 6.9, 6.10 and 6.11 present the contribution of the EEDP. The share of EEDP in the total education budget ranges from 0.6 percent to 2.6 percent. This shows that the allocations of the EEDP will have a limited fiscal impact on the overall education sector budget, and it will not be a burden for the government to maintain expenditures when the operation closes. However, the EEDP's allocations represent about 5-19 percent of the total capital budget for the period 2013-2018. The EEDP's funds have a significant impact on the total capital expenditures. Hence, the EEDP makes a genuine and significant contribution to investment in education during the period of the project's life cycle. 23. The GoM is seeking cost-effective interventions. Such interventions are important for education development activities to be sustained financially, given the geography of the country 68 with a large number of small islands scattered over several hundred miles. The proposed project has the potential to improve cost-effectiveness of the education system. The development of a model of multi-grade teaching will contribute to reducing the burden of the teacher salary bill. Similarly, promoting private-public partnerships in higher education will enable the country to meet the rising demand for higher education in a cost-effective manner. In addition, focusing on strengthening school level activities through school-based management, internal quality assurance and school improvement plans, will promote the cost-effective delivery of education services. Table 6.9: Base Case Forecasts for Education Budget 2013 2014 2015 2016 2017 Real GDP Growth Rate 2% 2% 2% 2% 2% GDP (base year 2003)(MVR, m.lin ' 20,546 20,957 21,376 21,804 22,240 million) Proportion of GDP to Government 51% 51% 51% 51% 51% Budget Total Government Budget (MVR, 10,478 10,688 10,902 11,120 11,342 million) Total Government Budget to 16% 16% 16% 16% 16% Education (%) Education Budget (MVR, million) 1,677 1,710 1,744 1,779 1,815 Recurrent Expenditure (MVR, 1,492 1,522 1,552 1,583 1,615 million) Capital Expenditure (MVR, 184 188 192 196 200 million) EEDP (MVR, million) 9.4 25.5 38.3 40.9 36.0 Share ofEEDPinthcapital 4.8% 11.9% 16.6% 17.3% 15.3% education budget (%) Share of EEDP in the total 0.6% 1.5% 2.1% 2.2% 1.9% education budget (%) 69 Table 6.10 Low Case Forecasts for Education Budget 2013 2014 2015 2016 2017 Real GDP Growth Rate 0% 0% 0% 0% 0% GDP (base year 2003)(MVR, milin ' 20,546 20,546 20,546 20,546 20,546 million) Proportion of GDP to Government 51% 51% 51% 51% 51% Budget Total Government Budget (MVR, 10,478 10,478 10,478 10,478 10,478 million) Total Government Budget to 16.0% 15.6% 15.2% 14.8% 14.4% Education (%) Education Budget (MVR, million) 1,677 1,635 1,593 1,551 1,509 Recurrent Expenditure (MVR, 1,492 1,455 1,418 1,380 1,343 million) Capital Expenditure (MVR, 184 180 175 171 166 million) EEDP (MVR, million) 9.4 25.5 38.3 40.9 36.0 Share of EEDP in the capital 4.8% 12.4% 17.9% 19.3% 17.8% education budget (%) Share of EEDP in the total 0.6% 1.5% 2.3% 2.6% 2.3% education budget (%) Table 6.11 High Case Forecasts for Education Budget 2013 2014 2015 2016 2017 Real GDP Growth Rate 4% 4% 4% 4% 4% GDP (base year 2003)(MVR, m.lin ' 20,546 21,368 22,223 23,111 24,036 million) Proportion of GDP to Government 51% 51% 51% 51% 51% Budget Total Government Budget (MVR, 10,478 10,898 11,334 11,787 12,258 million) Total Government Budget to 16.0% 16.4% 16.6% 17.2% 17.6% Education (%) Education Budget (MVR, million) 1,677 1,787 1,881 2,027 2,157 Recurrent Expenditure (MVR, 1,492 1,591 1,674 1,804 1,920 million) Capital Expenditure (MVR, 184 197 207 223 237 million) EEDP (MVR, million) 9.4 25.5 38.3 40.9 36.0 Share of EEDP in the capital 4.8% 11.5% 15.6% 15.5% 13.2% education budget (%) Share of EEDP in the total 0.6% 1.4% 2.0% 2.0% 1.6% education budget (%) 70 Annex 7: Future Strategy and Program Development MALDIVES: Enhancing Education Development Project (EEDP) Introduction 1. The EEDP will support a set of activities for strategy and program development in key areas for the future of the Maldives education sector. The assistance provided by the project will mainly be through intellectual inputs, especially policy research and analysis, and technical assistance. The main areas of support for strategy and program development are outlined below. a) A Model for Multi-Grade Teaching in Small Schools 2. Within the Maldivian context, multi-grade teaching refers to the teaching of students from different grade levels in the same classroom. Given the country's large number of small islands with correspondingly small populations, the Maldives education authorities view multi- grade teaching as a potentially effective approach to delivering primary level education in targeted locations. They have identified two key reasons for considering the use of multi-grade teaching: a) as some of the small schools in the islands have very few students in each grade (as few as 3 students in some cases), combining grades could help enhance both cognitive and non- cognitive skills of the students by giving them more opportunities for peer interaction, and b) combining grades could help reduce the high cost of education delivery in small schools with very few students' 3. There are a number of challenges that need to be addressed in moving forward with the implementation of multi-grade teaching in the Maldives. The first is the absence of clear policy guidelines regarding multi-grade teaching. In particular, it is not clear in what types of schools multi-grade teaching would be formally introduced as the preferred approach to education delivery, which grades would be targeted for multi-grade teaching, and whether multi-grade teaching should be viewed as a temporary measure to address the problem of small class size in targeted schools or whether it should be established as a desirable long term approach. Another challenge relates to the lack of a curriculum framework for multi-grade teaching and the unavailability of appropriate teaching-learning materials tailored to the Maldivian context. The third is the lack of a sound system of classroom process monitoring, feedback, and support. Even if the teachers are provided training in multi-grade teaching, a sound monitoring and feedback system would be essential for ensuring the quality of service delivery. Another issue of concern is the lack of awareness among stakeholders about the quality benefits of multi-grade teaching, and the perception among parents, teachers and community members that multi-grade teaching is an inferior alternative to traditional mono-grade teaching. 1 Such cost savings would most likely be achieved in multi-session schools that are being converted into single-session schools. There is currently a strong demand from parents and communities to convert existing multi-session schools into single session schools, and the government is trying to meet this demand. As such conversions typically require the construction of new classrooms, moving to single-session instruction can be quite costly. In schools where multi-grade teaching can be introduced, however, the conversion costs will be lower since the merger of multiple grades could make extra classrooms available. But in the country as a whole, significant cost reduction through multi-grade teaching will not be possible unless the issue of overstaffing in small schools can be addressed properly. 71 4. The EEDP will assist GoM with technical expertise to develop a framework for primary- level multi-grade teaching that will address the above challenges. It will also support the preparation of some teaching-learning materials. The framework will contain the following: * clear policy guidelines for multi-grade teaching; * a curriculum framework for multi-grade teaching; * a communication strategy to educate parents and local island stakeholders on the benefits of multi-grade teaching for their children; and * a costed, phased implementation plan that includes the training of a cadre of teachers for multi-grade teaching, preparation of appropriate teaching-learning materials, and the establishment of an appropriate monitoring and feedback mechanism. 5. The EEDP will provide support for a study to identify, based on clearly defined key characteristics, schools where multi-grade teaching could be potentially introduced as well as schools where it is already being practiced. It will also support the development of teaching- learning materials for primary-level multi-grade teaching. The NIE will be responsible for undertaking these activities supported by EEDP. b) A Model for Expanding the Provision of Multiple Curriculum Streams in Secondary Schools 6. The Maldivian education system allows for three streams of study at the secondary level, namely, commerce, science and arts. Because of resource constraints, most schools are unable to offer more than one stream of study in practice. As a result, the vast majority of the students are compelled to study subjects within the confines of the single stream, usually commerce, offered by their schools. In particular, very few schools offer subjects from the arts stream. Recognizing the need for a broader and more balanced curriculum, the government has been encouraging more schools to offer multiple streams of study at the secondary level. Currently, however, only some of the 185 secondary schools teach multiple streams. 7. MoE is interested in increasing the number of secondary schools offering multiple streams so that more students have access to a broader range of subjects from different disciplines. The broadening of subject choices for students is also expected to have a positive impact on net enrollment at the secondary level. However, government policy makers and planners recognize that there are cost implications associated with expanding course offerings, especially in small schools and in schools requiring the introduction of the science stream. Hence, there is a need to develop a clear policy for guiding the expansion of the combined curricula model to schools across the country. 8. The EEDP will assist GoM with technical expertise to develop a framework for expanding the provision of multiple streams in schools that have sufficient numbers of students to make the broadening of choice feasible. The framework will contain the following: * a review of current policies, and the status of the schools currently offering multiple streams; * the identification of best practices as well as issues and challenges faced by these schools; * the identification of all secondary schools where the multiple streams model could potentially be implemented, and proposing alternative approaches to implementation; 72 * the development of policy guidelines for introducing the model to a broader set of schools, including the promotion of private-public partnerships; * the development of a communication strategy for making parents, teachers and students aware of the benefits of multiple streams for higher studies as well for the job market; and * the preparation of a costed, phased implementation plan for the policy. c) Continuing (In-Service) Training for Untrained Teachers and for Inclusive Education 9. The Maldives has a high proportion of untrained school teachers. Since these untrained teachers are in primary schools, any learning deficiencies of students will have a cumulative effect further up into the secondary education system as well. The successful achievement of a high quality of education depends on the availability of professionally educated and competent teachers. A program to provide professional skills and competencies to the stock of untrained primary school teachers is needed especially urgently. The EEDP will provide a support to identify in-service teacher training needs, and to develop effective teacher professional development program. It will help produce professionally educated and competent teachers. 10. Inclusive Education Policy endorsed in 2012 clearly shows that it is the sole responsibility of the MoE to provide inclusive education along with the necessary teachers training and infrastructure establishment required to provide inclusive education to the students of the country. This is also mandated under the clause 20 of article 08/2010 of the country's constitution. The MoE started setting up classes for children with special needs in 2006, with a vision to develop a minimum of one school in each atoll that accommodates children with special needs by 2010. Currently 11 schools across the country (3 schools in Male' and 8 schools in atolls) accommodate approximately 184 children with specials needs. However, the provision of inclusive education in the Maldives is yet in its infancy. The development of a framework of inclusive education will require training teachers in the pedagogical methods required for inclusive education. Some infrastructure and careful planning and establishment of its delivery mechanism is required. The EEDP will support the NIE to establish the delivery mechanism of inclusive education and provide a set of teachers with the training required for inclusive education. d) A Master Plan for Higher Education 11. The World Bank Higher Education Sector Report Human Capital for a Knowledge Society: Higher Education in the Maldives - an Evolving Seascape (2011), recommended that the country should develop a master plan for the higher education sector. The EEDP will help GoM to develop such a master plan for higher education. 12. In preparing this master plan the following questions will need to be considered and answered, where possible: * What should be the targets for the Gross Enrolment Ratio in higher education in 2018 or 2020 ? * What share of the growth should be in the private sector ? * How should public sector growth be spread between MNU, the Polytechnic and the 73 College of Islamic Studies ? * How much of the expansion can be achieved by greater use of Open and Distance Learning ? * In what disciplines does the national Human Resource Development plan suggest that growth is required ? * What proportion of new academic programs should be for Science, Technology, Engineering and Medicine ? * How can the relevance of curricula and graduate employability be improved ? * How can the quality of teaching and pedagogy be brought to and maintained at international standards ? * How can the governance of the sector be strengthened ? * What needs to be done to strengthen the work of the Maldives Qualifications Authority ? * What is the policy for mature students (those over 24) wishing to enter higher education ? * What proportion of the delivery of higher education should be outside Male' ? * Given the suggested expansion, what is a reasonable target for the proportion of the government budget and the overall education budget going to higher education ? Who will pay for the expansion ? * Is there a greater role for ICT and the improvement of ICT infrastructure ? * What is the role of GoM in encouraging Higher Education Institutions (HEls) to undertake relevant research ? * How can GoM strengthen its management of the higher education sector and hold the HEls accountable ? * Can the funding mechanisms be improved so as to reward performance against national targets? 13. The discussion of these questions will require significant technical expertise, and the EEDP will provide for this. However it will be important for stakeholders in the community to be involved both in the development of options and ideas and in the consultation of the draft master plan. e) Strengthening the Maldives Qualifications Authority (MQA) 14. The Maldives Qualifications Authority has been established to implement the Maldives National Qualifications Framework (MNQF) and a quality assurance and accreditation system for private and public higher education. The current functions of the MQA include: * Registering HE and training institutions according to agreed criteria; * Maintaining a data base of registered organizations; * Accrediting and approving HE institutions and their programs; * Checking the colleges' documentation of each completed course before confirming each student's entitlement to an award; * Undertaking external quality reviews of HEls; * Supporting internal quality assurance activities within institutions; * Checking that students entering private HEls have appropriate qualifications; and * Recognising foreign institutions and their qualifications. 74 15. The MQA is at an early stage in its development. The EEDP will help build the capacity of the MQA in the following areas: (a) development of benchmarks, standards and review procedures for external quality reviews as well as guidelines for internal quality assurance units in higher education institutions; (b) providing the staff of the MQA involved in quality audits with practical experience of undertaking reviews in another external QA agency; and (c) facilitating collaboration between the staff of the MQA and overseas quality assurance agencies, such as the Quality Assurance and Accreditation Council (QAAC) in Sri Lanka. For instance, MQA staff could participate in the training programs and institutional reviews run by the QAAC. 16. The main focus in maintaining quality in higher education institutions lies in having a cell of suitably trained quality assurance staff who are charged with promoting a quality culture in their institution. MQA would create a professional network of these staff so that they could exchange good practice and be supported in their roles by the MQA. MQA could also include external (overseas) reviewers in their quality assurance and accreditation reviews in the Maldives. 75 Annex 8: Documents Used MALDIVES: Enhancing Education Development Project (EEDP) Aturupane, H. and M. Shojo. (2012a). "Enhancing the Quality of Education in the Maldives: Challenges and Prospects." Discussion Paper Series, 51. World Bank South Asia Human Development Unit, Washington DC. Aturupane, H. and M. Shojo. (2012b). "Expanding Access and Enhancing the Economic Benefits of Education in the Maldives: Challenges and Prospects." Discussion Paper Series, 54. World Bank South Asia Human Development Unit, Washington DC. Fasih, T. (2008). Linking Education Policy to Labor Market Outcomes. World Bank, Washington DC. Hanushek, E. and F. Welch. (2006). Handbook of the Economics of Education. Vol. 1. Elsevier Science and Technology Books. Hanushek, E. and L. Woessmann. (2008). "The Role of Cognitive Skills in Economic Development." Journal ofEconomic Literature, 46 (3): 607-668. Hill, K., D. Hoffman, and T. Rex. (2005). The Value of Higher Education: Individual and Societal Benefits. L. William Seidman Research Institute, W.P. Carey School of Business, Arizona State University. McMahon, W. (2009). The Private and Social Benefits of Higher Education: Higher Learning, Greater Good. Baltimore: The Johns Hopkins University Press. Ministry of Education, Maldives (MoE). School Statistics, various years. MoE, Male', Maldives. Ministry of Education, Maldives (MoE). (2007). Education for All: Mid-decade Assessment National Report. MoE, Male', Maldives. Ministry of Education, Maldives (MoE). (2010). Introduction: Quality Indicators Child Friendly Baraabaru Schools. MoE, Male', Maldives. Ministry of Health and Family, Maldives (MoHF). (2010). The 2009 Maldives Demographic and Health Survey (MDHS). MoHF, Male', Maldives. OECD (2012). Strong Performers and Successful Reformers in Education: Lessons from PISA for Japan. OECD, Paris. Patrinos, H. and G. Psacharapoulos. (2011). "Education: Past, Present and Future Global Challenges." Policy Research Working Paper, 5616. World Bank, Human Development Network, Washington DC. World Bank (2011). Human Capital for a Knowledge Society: Higher Education in the Maldives, An Evolving Seascape. World Bank, Washington DC. World Bank (2012). Human Capital for a Modern Society: Higher Education in the Maldives, An Evolving Seascape. World Bank, Washington DC. 76 IBRD 39879 71 72' 73' 74' 75' 76 HAA ALIFU. * Dhidhdhoo 7' HAA DHAALU - 8 Kulhudhuffushi ' " SHAVIYANI MALDIVES-I *4Funadhoo 6' . i* NOONU 6' Ugoofaaru * OManadhoo RA A .......................*...... LHAVIYANI -,,Nailfru Eydhaftjshi. 5' BAA KAAFU ALIFU Rasdhoo . ,OThulusdhoo ALIFU MALE A, A' MahibadWQo-) ALIFU INDIAN DHAALU F .. 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