PROJECT INFORMATION DOCUMENT (PID)
APPRAISAL STAGE
Report No.: PIDA3688
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Project Name Myanmar Decentralizing Funding to Schools (P146332)
Region EAST ASIA AND PACIFIC
Country Myanmar
Sector(s) General education sector (60%), Other social services (40%)
Theme(s) Education for all (60%), Social safety nets (40%)
Lending Instrument Investment Project Financing
Project ID P146332
Borrower(s) Union of Myanmar
Implementing Agency Ministry of Education
Environmental Category B-Partial Assessment
Date PID Prepared/Updated 03-Apr-2014
Date PID Approved/Disclosed 03-Apr-2014
Estimated Date of Appraisal 02-Apr-2014
Completion
Estimated Date of Board 20-May-2014
Approval
Decision
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I. Project Context
Country Context
Myanmar is a culturally and ethnically diverse country, comprising more than 130 ethnic groups
across countries and regions. It is one of the poorest countries in the East Asia and Pacific Region,
with an estimated gross domestic product (GDP) per capita of between US$500-800. While
reliable poverty data are scarce in Myanmar, all indicators point to poverty being concentrated in
rural areas: two rounds of household surveys (in 2005 and 2009) supported by the United Nations
Development Program highlight significant differences in poverty across geographical areas, and
the bulk of the poor are reported to be concentrated in rural areas. Available figures also suggest
that social indicators are poor, for example 32 percent of children under five suffering from
malnutrition, the highest rate in the region. Agriculture is the mainstay of the national economy,
generating approximately 43 percent of gross domestic product, 54 percent of employment and
providing livelihoods to more that 70 percent of the population. However, the sector is
characterized by a number of constraints, including limited irrigation, little value-added agro-
processing capacity, poor policy settings, and widespread indebtedness in rural communities.
Decades of underinvestment have taken a toll on public institutions and the civil service, limiting
their ability to provide services in rural areas. Health and education services (among others) suffer
from having been underfunded for decades. As part of the move toward a “people-centered
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approach,” government has substantially increased spending on health and education, more than
tripling their nominal allocations between 2011/12 and 2013/14. In addition, the FY2012/13 budget
provided a significant raise to civil servants, whose salaries – in particular for those at the lower
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levels of the bureaucracy and in rural areas – had often been insufficient to cover living costs.
Partly as a legacy of these limitations, households have had relatively high out-of-pocket costs to
access public health and education services.
Sectoral and institutional Context
Education reform is one of the key priorities set out by the government. The 30 Year Education
Development Plan (2001/02-2030/31) lays out strategies to promote greater access and to improve
the quality of basic education, and some significant progress has been made. Enrollment in primary
and secondary schools has increased rapidly and public expenditure in education has tripled over
the last 3 years. But significant challenges remain. Myanmar remains far from full primary
enrollment; legislation and the policy framework for education remain outdated; and there is a
strong demand for the government to address curriculum and language of instruction to reflect
Myanmar’s diverse language and cultural context. Capacity to implement reform at all levels also
remains a concern, particularly as increasing roles and responsibilities of local authorities will be
required for decentralization to take place.
Education providers in Myanmar include the government, which is by far the largest, the Monastic
School System, the Ethnic Education Departments and other non-state providers. At present, the
government supported education sector includes about 35,500 primary and post-primary schools,
3,000 middle or lower secondary schools, and 2,300 high or upper secondary schools. About 5.2
million students are enrolled in primary school (grades 1-5), 2.3 million in middle school (grades
6-8) and 0.7 million in high school (grades 10-11). There are about 1,400 monastic schools
registered with the government (accounting for less than 1 percent of total enrollment), as well as a
much smaller number of non-registered affiliated and community schools and school run by cease
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fire groups in some States. Enrollment in private schools is virtually non-existent in primary and
middle school but accounts for approximately 5 percent of enrollment in high school. Primary net
enrollment rates (as measured by the Multiple Indicator Cluster Surveys (MICS) survey in 2009/10)
stood at 86.7 percent, dropping to 58 percent and 32 percent for middle and high school,
respectively. Net enrollment rates are lowest for the poor and among the bottom 40% of the
population. There are no clear gender differences in enrollment patterns at a national or state level
at a primary school level. At middle and high school level, net enrollment rates for girls are
somewhat higher than they are for boys. The higher enrollment of girls at these levels partly reflects
higher opportunity costs for boys in the labor market.
A renewed financial commitment to the sector provides evidence that education has become a high
priority on the government’s national agenda. Public education spending was estimated to have
been about US$354 million equivalent in the fiscal year 2010/2011, representing an estimated 0.7
percent of GDP. The budget for education in 2013/2014 has risen substantially to about US$1
billion equivalent, or about 14 percent of overall government spending. A large share of this new
education spending is accounted for by increasing teacher wages, which are low by regional
standards. But Myanmar is also focused on the need to increase non-salary recurrent spending, as
well as to increase both government and donor-financed investments. This rapid increase in the
public funding for education has begun to re-balance public funding with private spending on
education. The Bank’s recent rapid assessment of education spending estimates private
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contributions to education to be about two-thirds of overall education spending in Myanmar in
2009/10, which is high by global standards. The recent increase in public spending implies that a
more balanced share of the cost of education is born by the public sector. Public education spending
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is likely to continue to increase in the near term in absolute terms and as a share of overall (public
and private) education spending.
Decentralization of education will have particular importance in the conflict-affected ethnic
minority areas. These regions (affecting approximately 15-20% of townships) are among the most
underserved areas of the coun try, largely due to ongoing armed conflicts between ethnically-
associated non-state armed groups and the government. A clear and credible path towards
decentralized governance of the education sector could be a positive contribution to the ongoing
peace process, as it addresses some of the widely-held grievances regarding central control of
education. However, government-led efforts to improve schools in conflict-affected areas in the
short term may be opposed by influential ethnic leaders and armed groups, especially if it is seen to
undermine the ethnic education systems. The peace negotiations are likely to shape governance and
service delivery in the ethnic areas, so it will be essential for efforts to promote decentralized
education to avoid scenarios that could preempt outcomes of the negotiations, or undermine the
government’s credibility in the peace process.
Decentralizing funding for education
The Ministry of Finance (MoE) in Myanmar is currently decentralizing funding for education
through two national programs: (i) it transfers funding for various operating expenditures through
townships to schools based on the number of primary students in the school; and (ii) it transfers
funding through townships and schools to pay cash stipends to poor children and scholarships to
high achieving students. The school grants program has its origins in the need to provide schools
with operating funds following the government’s decision to make primary education (grades 1–5)
free beginning in school year 2009/10.
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The school grants program is national in coverage and grant levels have grown rapidly, albeit from
a very low base. In FY 2012/13, Myanmar transferred approximately US$250 on average to small
schools, US$400 to medium size schools and US$500 to larger schools in direct subsidies to
support spending on school’s operational costs. The program supported more than 40,000 schools,
and accounted for overall spending of about US$15 million equivalent in 2012/13. These amounts
have been more than doubled in the 2013/14 budget. School grants programs in neighboring
countries (Cambodia, Lao, Vietnam) provide individual primary schools in the range of US$2,000
to US$3,000 per school annually.
The stipends program is also national in coverage, but is small both in terms of financing and the
number of beneficiaries. Eligibility is currently limited to approximately 33 students in each of
Myanmar’s 330 townships, covering 2 students per grade in grades 1 through 11. The beneficiary
population is about 11,000 students nationally. In the 2013/14 school year, the government plans to
double the number of students receiving stipends in grades 1-5, raising the number of beneficiaries
to 16,000 students, and a similar further expansion is planned for secondary students in the 2014/15
school year. The stipend amounts are US$5 per month over 10 months for primary students, US$6
per month for lower secondary students and US$8 per month for upper secondary students. In total,
approximately US$700,000 equivalent is currently allocated annually for stipends. Although the
levels of stipends are comparable to the levels of stipends in other countries with stipends programs
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at a comparable level of development, the coverage of the program is substantially lower and the
dispersal across townships is much thinner.
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The implementation of the stipends program is uneven across and within townships. The uneven
implementation reflects the absence of clear and detailed operational guidelines for townships and
schools, and the omission of key implementation steps that can help to standardize processes. The
stipends program uses a combination of categorical targeting, focusing on orphans, and a broader
based poverty criteria for which there is no criteria. All schools are encouraged to nominate
students for the stipends program, and selection among the nominated students is made at the
township level. Practices for selecting students are not uniform across Myanmar. In some state/
regions, school officials consult with Parent-Teacher Associations (PTA) and/or Boards of Trustees
in making the stipend awards, but this consultation is not mandated. Townships are encouraged in
the existing guidelines to form committees to allocate stipends across schools. In practice, the use
of committees is not uniform across townships. There is no structure in place for program
monitoring and evaluation, resulting in limited knowledge of actual program implementation at the
Departments of Basic Education (DBE) and Department of Education Planning and Training
(DEPT) levels.
Learning outcomes. The Comprehensive Education Sector Reform (CESR) rapid assessment
identified the lack of reliable information on learning outcomes as a significant obstacle for
education reform. Information on learning outcomes is particularly important in a decentralized
system where local stakeholders have decision making authority and financial discretion. In this
environment, the role of central authorities becomes one of holding localities accountable. Data on
how well children are learning is crucial for assessing system performance. Standardized learning
assessments are, therefore, a necessary complement to support decentralized systems.
Gender status. The education sector is characterized by a high degree of gender equality. There are
virtually no differences in net enrollment rates between boys and girls. The small gender
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differences in net enrollment rates are however dwarfed by differences in enrollments due to socio-
economic circumstances: less than 10 percent of high-school age children in the poorest quintile are
enrolled in high-school, compared to over 60 percent in the richest quintile.
In terms of teachers and administrators, the MoE has the highest proportion of female workers
among all ministries. Amongst teachers, around 83 percent are women, with slightly higher rates in
primary than in high school. A new female Education Minister H.E. Prof Dr. Khim San Yee has
been recently appointed in a male dominated senior leadership team. Women are well-represented
in leadership positions below the top positions: 62 percent of primary school head masters are
women and 55 percent of high school head masters are women. Moreover, looking across the sector
– including amongst township education officers and the ministry staff – 70 percent of the positions
of deputy directors (and above) are held by women (on average, only 33 percent of women hold
deputy director posts (and above) across all ministries).
II. Proposed Development Objectives
The objective of the Project is to help improve and expand Myanmar’s School Grants Program and
Student Stipends Program.
III. Project Description
Component Name
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Expansion and Improvement of the School Grants Program
Comments (optional)
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Component Name
Expansion and Improvement of the Student Stipends Program
Comments (optional)
Component Name
Capacity Improvement Support to Strengthen Monitoring and Implementation of Programs
Comments (optional)
IV. Financing (in USD Million)
Total Project Cost: 80.00 Total Bank Financing: 60.00
Financing Gap: 0.00
For Loans/Credits/Others Amount
BORROWER/RECIPIENT 0.00
International Development Association (IDA) 60.00
AUSTRALIA, Government of 20.00
Total 80.00
V. Implementation
The program is expected to be implemented over a 4-year period between June 2014 and May 2018.
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Disbursements are likely to follow a schedule revolving around the school’s calendar (early June
through end-March each year). Because the IDA and Trust Fund funding contributes to the
ministry’s own funding for existing programs, the overall responsibility for implementation rests
with MoE departments and township officers. MoE will make funding available to townships and
schools in accordance with operational guidelines to be agreed with the Bank and Australia as part
of the DLI process.
MoE will establish a Project Steering Committee within the MoE which would be responsible for
opening and maintaining the IDA designated account for reporting to the Bank, including the
arrangements of external audits. The Project Steering Committee will be legally established by
MoE under terms of reference (TOR) satisfactory to IDA prior to the finalization of negotiations.
The Project Steering Committee will be coordinated by the DEPT, which will appoint a Secretary to
the committee who will be the Bank’s primary liaison for program supervision. The Project
Steering Committee will meet periodically to monitor program implementation.
The project follows a results-based approach with disbursements against an eligible expenditure
program linked to measurable results, referred to as Disbursement-linked Indicators (DLIs).
Reporting against achievement of DLIs is expected to be completed by March 31 of each year. This
deadline will be preceded by an annual program review meeting between the Bank, Australia and
MoE prior to January 31 of each year in which a detailed schedule for DLI evaluation and
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monitoring will be agreed. The verification of DLI reporting is expected to take place during the
March-May period each year. The reporting and verification process will aim to confirm DLI
achievement and authorize the annual IDA disbursement by July 30 of each year.
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In parallel with the DLI reporting and verification process, MoE will provide the Bank with
evidence of actual spending on eligible expenditures (covering the period April 1 through March 31)
by June 30 of each year beginning in 2015. The amount of each subsequent advance following the
initial advance in 2014 will be subject to documentation of the previous advance against eligible
expenditures and achievement of the relevant DLIs.
VI. Safeguard Policies (including public consultation)
Safeguard Policies Triggered by the Project Yes No
Environmental Assessment OP/BP 4.01 ✖
Natural Habitats OP/BP 4.04 ✖
Forests OP/BP 4.36 ✖
Pest Management OP 4.09 ✖
Physical Cultural Resources OP/BP 4.11 ✖
Indigenous Peoples OP/BP 4.10 ✖
Involuntary Resettlement OP/BP 4.12 ✖
Safety of Dams OP/BP 4.37 ✖
Projects on International Waterways OP/BP 7.50 ✖
Projects in Disputed Areas OP/BP 7.60 ✖
Comments (optional)
VII. Contact point
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World Bank
Contact: James A. Stevens
Title: Senior Operations Officer
Tel: 473-2848
Email: jstevens2@worldbank.org
Borrower/Client/Recipient
Name: Union of Myanmar
Contact: Maung Maung Win
Title: Director General, Budget Department, Ministry of Finance
Tel: 95-67-410-450
Email: maungmaungwin58@gmail.com
Implementing Agencies
Name: Ministry of Education
Contact:
Title:
Tel: (95-67) 407-534
Email: myo.theingyi@gmail.com
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VIII. For more information contact:
The InfoShop
The World Bank
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1818 H Street, NW
Washington, D.C. 20433
Telephone: (202) 458-4500
Fax: (202) 522-1500
Web: http://www.worldbank.org/infoshop
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