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AFRICAN DEVELOPMENT FUND
KENYA
SUPPORT TO TECHNICAL VOCATIONAL EDUCATION AND TRAINING FOR RELEVANT SKILLS DEVELOPMENT-PHASE II
EARC/OSHD DEPARTMENTS
June 2015
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Table of contents
I. STRATEGIC THRUST & RATIONALE ...................................................................... 1 1.1. Project linkages with country strategy and objectives .................................................... 1 1.2. Rationale for Bank’s involvement .................................................................................. 2 1.3. Donors coordination........................................................................................................ 4
II. PROJECT DESCRIPTION ............................................................................................. 4
2.1. Project Components ........................................................................................................ 5 2.2. Technical solution retained and other alternatives explored ........................................... 9 2.3. Project type ..................................................................................................................... 9 2.4. Project cost and financing arrangements ........................................................................ 9 2.5. Project’s target area and beneficiaries .......................................................................... 10
2.6. Participatory Process for project identification, design and implementation ............... 11 2.7. Bank group experience and lessons reflected in project design ................................... 11 2.8. Key performance indicators .......................................................................................... 13
III. PROJECT FEASIBILITY ............................................................................................. 13
3.1. Economic and financial performance ........................................................................... 13 3.2. Environmental and social impact .................................................................................. 15
IV. IMPLEMENTATION .................................................................................................... 16
4.1. Implementation arrangements ....................................................................................... 16 4.2 Monitoring ..................................................................................................................... 17
4.3. Governance ................................................................................................................... 18 4.4. Sustainability................................................................................................................. 18
4.5. Risk Management ......................................................................................................... 18 4.6. Knowledge Building ..................................................................................................... 19
V. LEGAL FRAMEWORK .................................................................................................. 19
5.1. Legal instrument ........................................................................................................... 19
5.2. Conditions Associated with Bank’s Intervention ............................................................. 5.3. Compliance with Bank Policies .................................................................................... 20
VI. RECOMMENDATION .................................................................................................. 20
Appendix I: Country’s comparative socio-economic indicators
Appendix II: Table of ADB’s portfolio in the country Appendix III: Map of the Project Area
Appendix IV: Procurement Arrangements.
i
Currency Equivalents As of May 2015
1 UA = USD 1.53481
1 UA = KES 131.222
1 UA = EURO 1.18938
Fiscal Year
Kenya: 1 July – 30 June
Weights and Measures
1 metric tonne = 2204 pounds (lbs)
1 kilogram (kg) = 2.200 lbs
1 meter (m) = 3.28 feet (ft)
1 millimeter (mm) = 0.03937 inch (“)
1 kilometer (km) = 0.62 mile
1 hectare (ha) = 2.471 acres
ii
Acronyms and Abbreviations
ADF African Development Fund STI Science Technology and Innovation
AIDS Acquired Immune Deficiency Syndrome SPN Specific Procurement Notice
CSP Country Strategy Paper NPV Net Present Value
CBET Competency Based Education and Training ODeL Open Distance and E-learning
CDACC Curriculum Development, Assessment and
Certification Council PCR Project Completion Report
CSP Country Strategy Paper PSC Project Steering Committee
DFID Department for International Development PFM Public Financial Management
DFATD Department of Foreign Affairs, Trade and
Development PWD Persons with Disabilities
DPs Development Partners PPF Production Possibility Frontier
EIRR Economic Internal Rate of Return QCBS Quality and Cost Based Selection
EA Executing Agency RFP Request for Proposals
EMIS Education Information Management System TVETA
Technical Vocational Education and
Training Authority
EDCPG Education Development Partners Coordination
Group
TVET Technical Vocational Education and
Training
GPN General Procurement Notice TUs Technical Universities
GIZ German Technical Cooperation TTIs Technical Training Institutes
GoK Government of Kenya USAID
United States Agency for International
Development
GER Gross Enrolment Ratio UA Unit of Account
HCS Human Capital Strategy USD United States Dollar
HEST Higher Education, Science and Technology WITED Women in Technical Education and
Development
HIV Human Immunodeficiency Virus
ICB International Competitive Bidding
IGA Income Generating Activities
IT Institute of Technology
ICT Information, Communication and Technology
IMF International Monetary Fund
ILO International Labour Organization
JICA Japan International Cooperation Agency
KeNAO Kenya National Audit Office
KES Kenya Shilling
KEPSA, Kenya Private Sector Alliance
KAM Kenya Association of Manufacturers
KQF Kenya Qualifications Framework
LIWA Linkage of Industry with Academia
RISPs Regional Integration Strategies
LAPSET Lamu Port-Southern Sudan Ethiopia Transport
LCS Least Cost Selection
LMIS Labour Market Information System
MoEST Ministry of Education, Science and
Technology
MTP Medium Term Plan
NACC National AIDS Control Council
NEMA National Environment Management Authority
NESP National Education Sector Plan
SAGAs Semi-Autonomous Government Agency
STI Science Technology and Innovation
iii
Loan Information Client’s information
BORROWER: REPUBLIC OF KENYA EXECUTING AGENCY: MINISTRY OF EDUCATION SCIENCE AND TECHNOLOGY Financing plan
Source Amount (UA) million
Instrument
ADF 41.00 Loan
GOV. OF KENYA 7.6 Counterpart
TOTAL COST 48.6 ADB’s key financing information
Loan currency
Unit of Account (UA)
Interest type Not Applicable
Interest rate spread Not Applicable
Service Charge 0.75% on amount disbursed and outstanding
Commitment fee 0.50% on the un-disbursed loan amount
Tenor 40 years
Grace period 5 years
NPV (base case) 21.4%
EIRR (base case) 17.7%
Timeframe - Main Milestones (expected)
Concept Note approval
February, 2015
Project approval by ADF July, 2015
Loan Agreement Signing August, 2015
Effectiveness September, 2015
Closing Date June, 2021
Completion December, 2020
Last repayment December, 2055
iv
Project Summary 1. Project Overview: Similar to Phase 1, the overall development objective of the Phase
II project, in line with the Kenya Technical Vocational Education and Training
(TVET) Act, 2013is to improve access, quality and relevance of TVET. Building on
the Phase 1 targeted institutions, the Phase II project targets middle level engineering
and applied sciences faculties in thirty three (33) Technical Training Institutes (TTIs).
This is in line with the provisions of the Kenya CSP 2014 – 2018. The Phase II
Project has particularly brought on board four ‘specialized’ TTIs, which mainly enrol
youth with hearing and visual impairments as well as multiple disabilities.. The main
project interventions are to: provide the complete sets of equipment for engineering
and applied sciences work stations; upgrade skills for existing TVET tutors including
industry attachment; train poor and vulnerable youths in relevant TVET programs;
support operationalization of the newly created TVET authority for accreditation and
standards; and strengthen Governance and accountability at the TTIs level.
2. Project Outcomes: The project’s envisaged results are to contribute to enhanced
quality and relevance of TVET programs in line with the TVET Act of 2013
provisions; and to support increased access (enrolment) in engineering and applied
sciences TVET Programs to meet the immediate and emerging labour market
demands. Kenya’s unemployment is currently estimated at 40% of which 80% are
youth. At the same time, Kenya lacks critical middle level skills in the immediate and
emerging labour market to meet the demand side needs of the employment equation.
3. Needs Assessment: The TVET sector plays an important role in meeting the skills
demands for the labour market. Kenya is experiencing a skewed skill mix particularly
among university graduates, technicians and artisans. For example, the ratio of
technicians and associate professionals to craft and related trades workers for machine
operators and assemblers in the industry is 33:1:2 respectively. This ratio needs to be
in ‘reverse’. The emerging oil, gas and mining industry will support between 42,000
and 98,000 jobs over the next 10 years through its upstream needs. This skills gap
therefore requires urgent actions in equipping post primary and secondary youths as
well as out of school youth with middle level skills for the labour market.
4. Bank Added Value: The current TVET is highly ‘supply’ oriented. Bank’s support to
Phase I and II, contributes to realization of the TVET Act, 2013provisions
specifically in regard to enhancing TVET quality and relevance to respond to the
needs of the Labour market. The Government of Kenya (GoK) is undertaking major
reforms in the TVET sector. Notably the Kenya TVET Act, 2013 was enacted and its
implementation has begun, such as creation the new TVET authority to enforce
regulations and standards in the TVET sector. This support will also strengthen the
TVET systems and its institutions in line with the requirements of the TVET Act,
2013. The anticipated project’s outcomes will contribute to addressing the Youth
unemployment concern by equipping youth with relevant skills for the industry.
5. Knowledge Building: Access to credible and reliable TVET data for planning and
policy decisions is a challenge. The project will support creation of a sub-sector
TVET Education Information Management System (EMIS) at the MinistryThe
current EIMS is focused on ‘inputs’ and skewed towards primary and secondary
education data. Phase II of the project, will also facilitate the TVET Authority to
develop training manuals for accreditation and standards regulations; support tracer
studies for identified TVET trade areas; develop TVET gender guidelines; and
refresher trainings for TTIs management in GoK accounting and procurement
regulations as well as awareness of TVET Act, 2013 requirements.
v
RESULTS-BASED LOGICAL FRAMEWORK Country and project name: Kenya - Support to Technical Vocational Education and Training for Relevant Skills Development Phase II Purpose of the project: The purpose of the project is to equip vulnerable youth with relevant Technical Vocational Education and Training (TVET) skills and to improve access, quality and relevance
of TVET education and training. The log frame is mainly derive from the overall MoEST TVET Sub sector Log frame for 2014-2018 (Technical Annex Chapter 1 Page 6)
RESULTS CHAIN PERFORMANCE INDICATORS
MEANS OF VERIFICATION RISKS/MITIGATION MEASURES Indicator
(including CSI) Baseline
2013 Target 2019
IMPA
CT
Impact: Increased skilled and
employable human resource for
competitiveness and productivity.
Percentage of TVET graduates employed
or
Self-employed (disaggregated by sex).
15% 30%
-National Labour Statistics
-KEPSA Reports
-Tracer Studies
-Survey report
OU
TC
OM
ES
Outcome 1:Improved quality and
relevance of TVET programs
-Number of functional TTIs and Industry
Partnerships for TVET training.
-Percentage of Industry/ employers
satisfied with TVET graduates
(disaggregated by sex).
-Number of Tutors trained (at least 30%
females)
-Number of TTIs programs accredited by
TVETA
5(phase 1)
20%
126 (phase 1
7females )
0
0
50
60%
600
100
10(fields)
-MoEST statistical Data
-KEPSA data
-Tracer studies
-TTIs data
-Surveys
-TVETA Reports
Risk: Sustainability particularly as regards
maintenance of the procured equipment
Mitigation: At the moment, maintenance
and repair aspects are included in the TTI’s
annual performance contracts targets. TTIs
will be required to insure high value
equipment.
Outcome 2: Increased access
(enrolment) in engineering and
applied sciences TVET Programs
-Percentage of overall Students enrolled
in engineering and applied sciences
TVET programs
-Number of students completing TVET
courses in engineering and applied
Sciences disaggregated by gender
-Number of youths benefiting from
TVET scholarships
10%
10%
0 (phase 1)
40%
6000 per
year (50%
females).
“3000 (50%
females).
Risk: Potential conflict and political
interference in targeting of Youth to be
trained under Component 2.
Mitigation: The Directorate of Vocational
Training at MoEST has drafted a criteria
based on the one develop for youth training
under the Nairobi Outering Road Project.
The targeting mechanisms considers
categorical targeting for youth from slums
and other informal settlements as well as
Youth with disabilities and marginalized
regions
vi
OU
TPU
TS
1Engineering and applied sciences
infrastructure for TVET expanded.
2TVET Tutors Trained at diploma
and degree levels in engineering and
applied sciences
3 Tracer studies and surveys for
TVET graduates employability
carried out.
4TTIs and Industry partnerships
formed for TVET trainings in
engineering and applied sciences
5Guidelines for Gender
mainstreaming in TVET Developed
6Develop TVETA strategic plan
7Develop TVETA training manuals
and accreditation Standards
8Train and sensitize TVETA
monitors and evaluators in key
TVET policies and regulations
9Youth enrolled in TVET
engineering and applied sciences
10Train TTIs management in strategic
leadership and Government
regulations in Financial Management
and Procurement
11Develop TVET information system
1Number of target TTIs with complete
required workshops in engineering and
applied sciences.
1Number of TTIs with complete set of
required equipment in engineering and
applied sciences.
1Number of ‘Special’ TTIs with assistive
learning devices and dormitories
2Number of existing staff trained (at least
30 % female)
2Number of staff trained in ICT
integration in TVET (50% females)
3Number of tracer studies conducted
4Number of formalized partnerships
5Number of Gender Guidelines
6Number of TVETA strategic Plan
7Number of TVETA manuals
accreditation standards developed
8Number of TVETA evaluators trained
9Number of youth enrolled in TVET
through scholarships (50% females)
9Number of Youths
with disability, enrolled in TVET
programs(at least 30 % females)
10Number of TTIs management trained
11 Number of TVET EIMS developed
0
0
0
126(phase 1
7females )
0
0
0
0
0
0
0
0
0
0
0
33
33
4
600
200
10 Fields
50
1
1
10 Fields
50
3000
500
200
1
-MOEST data
-TTIs data
-KEPSA data
-Supervision mission reports
-TVETA Reports
Risk: Delays in timely provision of
counterpart funds. L The works designs are in place and the outstanding land ownership issues have been resolved under Phase 1. The MoEST projects team is in place and will also be responsible for Phase 2 implementation.
Mitigation: The project will assign
specific project activities for counterpart
funds instead of co-financing works and
equipment contracts which has led to
delays in execution of these contracts.
Risk: Trained TVET Tutors leaving for
Universities.
Mitigation: The project will apply the
Government bonding policy for staff
training sponsored by Government. The
policy bonds staff for a minimum of three
years at the duty station. In addition,
TVETA is reviewing TVET tutors scheme
of service.
KE
Y A
CT
IVIT
IES COMPONENTS
Component 1: Improve Access, Quality and Relevance of TVET. This component will mainly support
completion of works and supply of equipment for TTIs targeted under Phase 1; support training of TVET
tutors in engineering and applied programs as well as ICT; This component will support 3000 target youth
training in relevant TVET programs for the labour market, develop TVET gender mainstreaming guidelines
and manuals to reach out to girls; support consultancy for works supervision; carry out tracer studies and
surveys; develop a TVET sub-sector information system, and support operationalization of the new TVETA.
UA 40.4 million
Component 2: Equip Vulnerable Youth with Relevant TVET Skills and work experience. This component
will support training of at least 300 youth with disabilities; supply of special TVET learning devices for 4
‘special’ TTIs for the hearing and visual impaired youths; and support training of relevant TVET tutors in
special needs education.
UA 4.0 million
Component 3: MoEST institutional support and Project Management. This component will support project
implementation including M&E, audit;; and support capacity building of TTI’s management in strategic
leadership, and training in Government procurement and financial management regulations.
UA 4.2 million
vii
PROJECT TIMEFRAME TASKS 2015 2016 2017 2018 2019 2020
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
1 Project Approval
2 Entry into force
3 Publication of GPN
4 Development of an
implementation and ME plan
5 Submission of Audit Reports
6 Tenders and bid evaluations
for Equipment and Works
7 Supply of equipment and
Construction
8 Trainings for Youth and
TVET tutors
9 Project Launch
10 Project Supervisions
11 Project Mid-term review
12
Project Completion Report
1
REPORT AND RECOMMENDATION OF THE MANAGEMENT TO THE BOARD OF DIRECTOR ON A PROPOSED LOAN TO THE REPUBLIC OF KENYA FOR SUPPORT TO TECHNICAL VOCATIONAL EDUCATION AND TRAINING FOR RELEVANT SKILLS DEVELOPMENT
Management submits the following Report and Recommendation on a proposed ADF loan for UA 41
million to finance the ‘Support to Technical and Vocational Education and Training (TVET) for
Relevant Skills Development Phase II’ in Kenya.
I. STRATEGIC THRUST & RATIONALE
1.1 Project linkages with country strategy and objectives
1.1.1. The Government of Kenya (GoK) recognizes that its main resource is its people. GoK lays
emphasis on development of a reliable pool of human capital with the necessary skills and
competences to act as the key drivers of the goals of Vision 2030. In line with this, the Kenya Vision
2030 Second Medium Term Plan (MTP) 2013 to 2017 intends to equip the youth with necessary
skills, capital and opportunities to create wealth. Unless their needs are addressed, idle youth may
engage in crime, be recruited into terrorism activities, unrest and violence. Ensuring that youths are
meaningfully integrated into the society, economy and employment (with adequate skills) will open a
pathway to a demographic dividend for development that will improve Kenya’s competitiveness,
raise household incomes, and ultimately reduce poverty.
1.1.2. The TVET Act, 2013 which aims to strengthen the relevance and quality of TVET to respond to the needs of the labour market. To realize this, the GoK has created a TVET Authority
(TVETA) to mainly regulate and coordinate training; accreditation, registration and licensing of
TVET institutions and trainers; and promote quality, access and relevance of training programs. In
addition, the National Education Sector Plan (NESP) 2014 to 2018 notes that the TVET sector,
among others, requires implementation of a competency based curriculum and provision of modern
training equipment since most equipment in Technical Training Institutes (TTIs) is outdated and
inadequate. A number of TVET instructors have inadequate skills, experience and limited exposure
with industry and modern technology.
1.1.3 The Kenya Country Strategy Paper (CSP) 2014-18 second pillar is ‘Developing skills for
the emerging labour market of a transforming economy’. It recognizes the potential of relevant
skills development to significantly improve the employability of the Kenyan workforce, especially of
the youth and women. The CSP estimates that among the unemployed, 80% are youth aged between
15 and 34 years of age. One of the major challenges to youth employment in Kenya is skills
mismatch and inadequate training. The CSP emphasizes that “the maximum impact in terms of
employment generation can be achieved by developing the skills and experience of mid-level
technicians and artisans, and by strengthening the linkages between TVET and the private sector”.
The Bank’s 2014 East Africa Manufacturing Report identifies weak and lack of industrial technical
skills as an impediment to growth of the manufacturing sector in the region. Furthermore, the Bank’s
Ten Year Strategy for 2013 - 2022 and Human Capital Strategy (HCS) 2014–2018 prioritize relevant
skills development as key pillars to enhance inclusive economic growth in Africa. In addition, the
2011-2015 East Africa Regional Integration Strategies (RISPs) make reference to Education,
including HEST and acknowledge that the quality of education has not kept pace with regional
development needs or capacity to adapt new industrial technology.
2
Education and Training Analysis for the TVET Sub Sector 1
1.1.3 The GoK is undertaking various reforms in the TVET sector to enhance access, quality and relevance of TVET. A relevant and quality TVET sector is seen as a promising avenue to
provide the Youth with marketable skills. The reforms are guided by a number of policy documents
including: Vision 2030; Sessional paper No. 14, 2012 on Education and Training; NESP 2014-2018;
and the TVET Act of 2013. The Sessional Paper No.14, 2012 requires: attaining and sustaining a
Gross Enrolment Ratio (GER) of 20% in TVET; and providing adequate opportunities for accessible
competency based training. The GoK, within the MoEST’s Directorate of TVET, operates about 442
Public TVET institutions, a number that is set to sharply rise given the ongoing construction and
establishment of 60 new TTIs at Constituency level, with the targeted total number of 253 TTIs in
the current Medium Term Expenditure Framework (MTEF). Enrolment in 40 TTIs is currently at
79,000, up from 34,000 in 2003(41% are female). GoK is working towards increasing enrolment in
TVET to over 250,000 students by 2024.
1.1.4 Currently, Kenya has no common regulatory system for development, evaluation and issuance of qualifications. To address this, the new TVETA will oversee adoption of outcome-based
competences, development of a harmonized and standardized TVET; provide a benchmark for
teaching, training, learning, accreditation, assessment and certification. TVETA will provide clear
roles for its many actors including the Kenya Qualifications Framework (KQF) and the TVET
Curriculum Development, Assessment and Certification Council (CDACC). The KQF will provide
clear policy guidance on the requirements for registering national qualifications, their specification,
criteria for assessment, award and issuance of qualifications, and framing and structuring outcome
descriptors for all education and training levels. On the other hand, the CDACC will review and
provide accreditation for the competency based curriculum; and oversee TVET assessments and
certification.
1.1.5 The GoK introduced the free day secondary school to enhance transition from primary to secondary levels3. According to the NESP, primary to secondary education transition rate has
improved from 57.3% in 2005 to 73.3% in 2012. This implies that each year, an estimated 480,000
youths are completing secondary school. Of this, only about 30% qualify for University education.
This means 70% of the secondary school graduates need to be absorbed in the TVET system, yet
only 10% are currently enrolled in TVET. It is possible the rest are underemployed in the informal
sector as shown in Technical Annexes Chapter 3. An inadequate TVET system widens the labour
supply and demand gap for required skills including in the oil and gas sector projects. Discovery of
oil, gas and ores in Kenya provide opportunities for local employment and income generation. A
relevant and quality TVET sector is therefore critical to address the current skills gap in labour
market and respond to the Youth Unemployment and underemployment issue.
1.2. Rationale for Bank’s involvement
Labour Market Needs and Youth Unemployment4
1.2.1 The link between TVET and industry in Kenya is very weak resulting in a mismatch between the supply of skills and the labour market. The ‘Support to Human Resources
Development in Kenya’ 2014 report, notes that key among the TVET challenges is that the TVET
1 Technical Annex Chapter 1 contains an analysis of the overall Education and Training Sector and additional details on
Access to TVET and challenges facing the sector. 2 Technical Annex Chapter 1 contains a list of the main TTIs, enrolments and courses offered.
3 The Kenya Constitution (2010) makes provision for free and compulsory basic education (primary and secondary
levels) to all children. 4 Technical Annex Chapter 2 contains details on gaps in the Labour Market and project’s training areas focus
3
curriculum and structure is deep on supply orientation with little synch with industry needs. The
National Manpower Survey 2010/2011 shows that enrolments for TVET courses for priority sectors
are very low yet the greatest hiring need for the industry will be for technical and vocational
positions. This is mainly due to weak academia and industry linkage leading to skills mismatch for
the labour market. In addition, the Labour Market Information System (LMIS) is inadequate. The
International Labour Organization is supporting the Government towards a robust LMIS. The Survey
projected skill demand for 2014 onwards mainly for chemical engineers and technologists,
electronics and telecommunication engineering technicians, and mechanical engineering and related
technicians. The Kenya Sessional paper No. 14, 2012 notes that Kenya will need to achieve the
required developing country ratio of Engineer to Technologist to Technician to Operator of 1:3:12:60
by 2015. These ratios are far from being achieved; the current professional to craft and related trades
workers for machine operators and assemblers in the industry is a ratio of 33:1:2. It is projected that
eight of the top 15 occupations needed by the industry and over 60 per cent of new jobs will require
vocational training. These occupations include welders, pipefitters, drilling and servicing laborers,
truck drivers and heavy equipment operators.
1.2.2 The Labour market in Kenya is dual in nature, presenting formal sector alongside the informal sector. A survey conducted in 2014 among Kenya private firms and supported by USAID,
reported that some of the skills in short supply are: manpower for highly skilled information
technology companies; engineers to operate some machines for example, coffee and tea processing;
technicians who can repair and service equipment; and food technologists including cheese making;
skilled welders; and electrical technicians. The firms noted that these skills are sometimes sourced
from other countries especially India due to a perception that the skills are not available locally.
Furthermore, new infrastructure projects such as Lamu Port-Southern Sudan Ethiopia Transport
(LAPSET) project, the Standard Gauge Railway project, the airport and highways expansion
projects; and the Geothermal and Wind energy projects require relevant middle level skills in critical
masses.
1.2.3 The extractive industries are a promising source of employment in Kenya, for the emerging oil, gas and mining labour markets. It is projected that the oil, gas and mining industry
will create between 6,000 and 15,000 ‘direct’ new jobs over the next 10 years. A Luddin Foundation
2013 report, which focusses on the oil and gas sectors, noted the urgent need to develop industry-
tailored vocational and technical training curriculum, infrastructure and Equipment, Faculty,
Certified steam and pipefitters, welders and fabricators, process operators, truck drivers, mechanics,
drilling operators/labourers and heavy equipment operators. The report indicates that the extractive
industry will also support between 42,000 and 98,000 direct and indirect jobs over the next 10 years
through its upstream needs. Agriculture is also a major source of employment in Kenya. Reforming
TVET should also include making agriculture more attractive to the youth, for them to adopt agri-
business as an entrepreneurship venture and pathway to employment.
1.2.4 Expanding quality and relevant TVET programs will create opportunities for the youth who are 60% of the population. The skills gap noted above require urgent actions in equipping
Youths with relevant middle level skills for the immediate labour market. The proportion of the
youth category is expected to remain relatively high at 35.4 per cent of the population in 2015, 34.8
per cent in 2020, 34.6 per cent in 2025 and 35.2 per cent by 2030. This means that at least one in
every three Kenyans will continue to be the youth. Kenya’s youth5 are at least three times as likely as
adults to be hit by open unemployment mainly due to mismatch between training and the labour
market needs. The overall country’s employment problem is manifested in terms of 12.7 per cent
open unemployment rate, a 21 per cent under-employment rate and a working poor of 46 per cent of
5 Article 260 of the Kenyan Constitution (Republic of Kenya, 2010) defines youth as the collectively of all individuals in
the Republic who have attained the age of 18 years but have not attained the age of 35 years.
4
the employed. The youth in the 18-25 years age cohort are also likely to be having only primary level
education and mostly engaged in the informal sector (54.3%) or openly unemployed (14%).
1.3. Donors Coordination
1.3.1. GoK remains the main financier of TVET. Table 1 below shows TVET financing
requirements for 2014 to 2030. The financing requirements are towards realization of the provisions
of the TVET 2013 Act. The main Development Partners (DPs) in the Education sector continue to
focus mainly on basic education as shown in Figure 1 and 2 below.
Table 1: Overall financing requirements for TVET Sub-Sector (KES Billions) Year 2014 2018 2021 2024 2030
Students AMT KES
Students AMT KES
Students AMT KES
Students AMT KES
Students AMT KES
TVET 100,000 2.0 14,140 2.9 214,359 4.3 360,000 7 630,000 12
Source: NESP 2014 to 2018Final Draft Vol.3
Figure 1: DPs Support to Education Sub Sectors USD Figure 2: DPs Support to Higher Education USD
Source: EDCPG 2014 Analysis.
1.3.2. Donors coordinate in the framework of the Education Development Partners Coordination Group (EDCPG). The EDCPG meets on a monthly basis while its executive, known
as the EDCPG ‘Troika’, meets more often and as need arises. The Bank is a member of the EDCPG
and the outgoing chair of the Troika. The EDCPG provides a platform for policy and strategy
dialogue with GoK; information sharing; joint undertakings with MoEST such as Sector reviews; and
coordination of support to the Education Sector. The TVET Permanent Working Group was created
in 2014 and is convened quarterly by the Kenya Private Sector Alliance (KEPSA), Kenya
Association of Manufacturers (KAM), Linkage of Industry with Academia (LIWA) and the
Delegation of German Industry and Commerce in Kenya. The Bank is also participating in this
group.
1.3.3. Development Partners support to TVET can be grouped into two; confirmed support and support in the pipeline. Confirmed TVET support: DFATD and World Bank will support
studies on skills audit in the Oil and Gas sectors. Possible TVET support in the pipeline includes:
GIZ is considering support to the TVET sector in Lamu and Turkana Counties while also considering
support to the TVETA worth KES 3.5 million; JICA is supporting about 5 TVET tutors training at
master level in Japan. It is also considering support to the Kenya Toyota Academy for automobile
training; British Gas Kenya is assessing options for developing a pilot social investment partnership
in TVET with a focus on Mombasa, Kwale and Kilifi counties; DFATD is also considering support
to TVETA; and World Bank is preparing for an identification mission to establish gaps and priorities
for support to the TVET sub-sector. The GoK is also in discussions with the Peoples Republic of
5
China as well as the Government of Netherlands for TVET equipment support and integration of
Information, Communication and Technology (ICT) in TVET.
Currently, it’s challenging to show a matrix or a table of donor coordination in TVET investments
since the proposed projects are not at advanced stages and are not confirmed. The Bank through the
EDCPG and the TVET Permanent Working Group will continue to work closely with DPs preparing
TVET programs to facilitate optimal utilization of resources; coordinated support; and equity in
targeting of the TTIs.
II. PROJECT DESCRIPTION
2.1. Development Objectives and Project components
2.1.1 Development Objectives. The overall development objective of the project, in line with the
Kenya TVET Act, 2013 is to increase access and equity, improve quality and relevance of TVET
education and training. The specific objective of the project is to equip youth, at least 50% of them
women, with relevant TVET skills for the immediate and emerging labor market needs. The
expected project outcome is increased skilled and employable youths.
2.2 Project Components
2.2.1 The project’s components are summarized in Table 2, page 6. The activities build on and aim at
filling the gaps under Support to TVET Phase 1.
2.2.1. Component 1: Improve Access, Quality and Relevance of TVET. (UA 40.4 million) 2.2.1.1 Sub-Component 1.1: Strengthen TVET engineering and applied sciences training faculties. The TVET Act, 2013 and TVET Authority has established standards for accreditation of specific
TVET programs. In addition to provision of physical infrastructure, approved competency based
curriculum (CBET); a set of complete workstation equipment in the workshops; and qualified TVET
instructors in the target faculties are required. The TVET programs which meet these criteria are
accredited by TVETA and offered to students. 2.2.1.1.1 The project will therefore support completion of engineering and applied sciences
workshops/ laboratories in the eight TTIs6 under Phase 1; complete procurement of the remaining
sets of engineering and applied sciences equipment from some of the Phase 17 target TTIs.
Furthermore, this sub-component will also support provision of equipment and training at the
upcoming Mpeketoni TTI in Lamu. The Lowdar Youth Polytechnic in Turkana is currently being
upgraded by the County Government and the private sector, mainly Tullow Oil, as a Centre of
Excellence in Oil related trainings. These TTIs are located in areas where key projects such as the
LAPSET, railway, oil and wind projects are situated.
2.2.1.1.2 Sub-Component 1.1 will also include provision of engineering equipment for two
engineering faculties in Siaya IT, Mathenge TTI Nyeri, Nkabune TTI Meru, Mpeketoni TTI Lamu,
Mawego TTI Homabay, Oll’lessos TTI Nandi and Kaiboi TTIs Nandi. GoK has put new
engineering and applied sciences workshops in these TTIs but have no equipment. In addition, these
TTIs are mentoring some of the new TTIs created under Phase 1 as outlined in Technical Annex
6 Tseikuru in Kitui, Mukurweini in Nyeri, Wajir TTI, , Siala in Migori, Aldai in Nandi, Bureti in Kericho, Godoma in Kilifi and Butere
in Kakamega. 7 Mombasa TTI , North Eastern TTI Garrisa, Meru TTI, Kitale TTI Transzoia, Gusii IT Kisii, Kisumu Polytechnic, Eldoret
Polytechnic Uasin Gishu, Nairobi TTI, Sang’alo IT Bungoma, Coast IT Taita, Thika TTI Kiambu, Masai TTI Kajiado, Nyandarua IT
and Rwika TTI Embu.
6
Chapter 4. These TTIs will replace Phase 1 Machakos and Moi TTIs which are now upgraded to
constituent University colleges. The Sigalagala and Nyeri TTIs have also been ‘dropped’ from Phase
11 to give them time to make full and proper utilization of equipment provided under Phase 1.
Management and maintenance of equipment in the two TTIs is currently way below the required
minimum standards demonstrating a lack of ownership and need, yet MoEST (State Department of
Science and Technology) has a requirement for maintenance schedules.
Table 2: Summary presentation of project components and activities Component Activity description
Component I: Improve Access,
Quality and Relevance of TVET. Engineering and applied sciences infrastructure for TVET
expanded (Complete works in engineering and applied sciences
faculties and Procure additional sets of engineering and applied
sciences equipment for complete workstation in 33 target TTIs).
600 TVET Tutors trained at diploma and degree levels in
engineering and applied sciences.
Support development of the TVETA strategic plan; TVETA
training manuals and accreditation Standards; and Train and
sensitize TVETA monitors and evaluators in key TVET policies
and regulations.
Carry out tracer studies, with a gender perspective, by TTIs for
selected middle level trade areas in Engineering and applied
sciences to establish employability.
Component II: Equip Vulnerable
Youth with Relevant TVET Skills
and work experience.
Support development of CBET modules by TTIs and Industry
for relevant middle level trade areas
Enroll 3000 youth, including 300 youth with disabilities, in
relevant TVET programs for the labour market.
Procure learning assistive devices and other equipment for four
‘special’ TTIs for the hearing and visual impaired youths.
Support construction of workshops for the four ‘special’ TTIs.
Support construction of a 200 capacity dormitory and ablution
blocks in each of the four ‘special’ TTIs to enhance access
particularly for the visual and hearing impaired students.
Component III: MoEST
institutional support and Project
Management.
Procurement of a works supervising consultant
Develop TVET gender mainstreaming guidelines and support
WITED to facilitate girl’s access to engineering and applied
sciences TVET fields.
Support the network for TVET women tutors in engineering
TVET Areas to support girls(role model)
Develop a TVET specific information management system.
Support capacity building of TTI’s management in strategic
leadership and the TVET Act of 2013.
Support relevant oversight authorities to build capacities of TTIs
and TVET related Semi-Autonomous Government Agency
(SAGAs) to undertake requisite accounting, reporting, auditing
and satisfactory procurement.
Support project monitoring, reporting and audit.
The Kenya Technical Teachers College (KTTC) has also been ‘dropped’ from Phase 1 for equipment
provision since it has received additional equipment supplied under GoK/Netherlands TVET project.
KTTC, Nyeri TTI and Sigalagala TTI will however be supported in training of its tutors.
7
2.2.1.1 Sub-Component 1.2: Scale Up Human Capacity Building in TVET. The National Manpower
Survey 2012 established that there was an inadequate staff skill. The skilled staff stood at about
43.71% in technical training colleges. Investments in TVET workshops and equipment alone cannot
result into the desired reformed TVET system; a skilled TVET workforce plays an equally important
role in facilitating desired learning outcomes in the TVET sector. Based on the Phase 1 training
needs assessment, the project will support training of an additional 600 TVET tutors from certificate
to diploma level and from diploma to degree levels mainly in engineering and applied sciences.
Learning from Phase 1 omissions, the tutors training will include a mandatory three months
industrial attachment; a refresher course in pedagogical training for the relevant program; and a brief
course on integration of ICT in TVET. The training will be conducted at the three Technical
Universities namely; Technical University of Kenya, Technical University of Mombasa, and Dedan
Kimathi University of Technology.
2.2.1.2 Sub-Component 1.3: Support to Operationalizing the TVET Authority (TVETA). In line
with the TVET Act, 2013 the newly created TVETA focuses on the following key functions in order
to reform the TVET sector towards quality and relevance; (i) Improve quality and relevance of
TVET through standards and accreditation; (ii) Capacity building for TVET monitors and evaluators;
and (iii) improve communication and dissemination of TVET reforms. The Authority is developing
Training standards and accreditation requirements for some TVET Engineering and Applied
Sciences programs. The project will support TVETA to develop a five year Strategic Plan and its
implementation plan; a TVETA web portal; support training of at least 500 TVET monitors and
evaluators from the 47 counties; and support training workshops to sensitize TTIs and County
Governments on key TVET policies including the TVET Act 2013 and TVETA standards and
Regulations for TVET programs.
2.2.2 Component 2: Equip Vulnerable Youth with Relevant TVET Skills and work experience. (UA 4.0 million) 2.2.2.1 Sub-Component 2.1: Support Delivery of TVET Competency Based Education and Training
(CBET). This sub-component will support delivery of selected TVET CBET training programs in
Engineering and Applied Sciences in line with the Labour Market needs outlined under section 1.2 of
this report. The training will be conducted as a joint operation between TTIs and the private
sector/industry through a competitive process.
A MoEST August 2013 report8 on ‘Refining and Updating the National Skills Inventory and
Conducting Training Needs Analysis’ pointed out the need to address mismatch or skills gap through
active partnership and participation of industry or the workplace to ensure relevance of the
curriculum to meet job market demands. The formal acquisition of skills, knowledge and training
only at the TTI level, has been found not adequate in preparing students in meeting the requirements
of industry and the job market. The training proposals are therefore expected to take into account
partnerships with relevant industry to facilitate ‘on the job training’ through internships and
apprenticeships at artisan and technicians levels.
2.2.2.2 Sub-Component 2.2: Train Poor and Vulnerable Youth in relevant CBET TVET Programs.
Based on the above TTIs-Industry joint proposals, this sub-component will support, relevant skills
development for youth, including ‘unemployable9’ youth (50% of either gender), to acquire basic
skills in relevant fields in order to enhance their employability chances. This training will also
include ‘retooling’ of already trained youth to align their skills to the needs of the immediate and
emerging labour markets as described in Technical Annexes Chapter 2. The target 3000 youth will be
8 This report was supported under TVET Phase 1 project. Technical Annex Chapter 3 contains a summary of the report findings.
9 Unemployable youth are considered to be youth without meaningful skills for the job market and in most cases may not have attained
either post primary and or post-secondary education.
8
supported through scholarships in the framework of the TTI-Industry proposals for training areas
outlined above under Section 1.2 labour market. The training will include relevant apprenticeships
and, industrial attachments. The training will also include ‘soft skills’ such as communication skills,
work ethics and as well as sexual and reproductive health. Half of the new HIV infections in Kenya
are now among the youth.
2.2.2.2.1 This component will also support scholarships for 300 hearing and visually impaired
youths, and procurement of relevant teaching and learning assistive devices10 for the four ‘Special
Needs’ TVET TTIs11
. The TTIs enrol mainly hearing and visually impaired students as well as
students with multiple disabilities. The four TTIs also rehabilitate adults who have lost sight or
hearing. According to the NESP 2014-2018, enrolment of learners in ‘special’ institutions and units
currently stand at 102, 749 students at both primary and secondary schools. This will create an
overwhelming demand for enrolment in the four ‘special’ TTIs. Enrolment in the special TTIs is
currently limited mainly due to inadequate learning facilities, including learning assistive devices,
ablution blocks and dormitories. The project will therefore support construction of workshops and
dormitories at the four ‘special’ TTIs. TVET tutors in the four TTIs will be supported in ‘in-service’
trainings at the Kenya Institute for the Blind (KIB) and the Kenya Institute for Special Education
(KISE) to enhance their skills in special needs education. The students sit the regular TVET Kenya
National Examination Council in mainly carpentry and joinery, masonry, leather works, Garment
Making and Knitting, Weaving, and Hair and Beauty including body massage.
2.2.3 Component 3: MoEST institutional support and Project Management. (UA 4.2 million).
Public Finance and Governance
2.2.3.1 The Kenya 2014 – 2018 CSP reckons that the Bank has not intervened with specific
activities to address governance and accountability issues in the education sector in the past
including TVET Phase 1. However, the Bank periodically carries out financial management
assessments and trainings for project accountants. This has strengthened MOEST’s systems
specifically in regard to records management and proper reconciliations of Bank project funds.
Despite the effort made, governance and accountability issues still need to be addressed particularly
at the TTI level. Going forward, through this project, the Bank will support capacity building of TTIs
in financial management and procurement as part of project activities under this component. The
project will therefore support the oversight institutions including the Accountant Generals Office, the
Auditor Generals and the Public Procurement Oversight Authority to build capacities of TTIs and
related SAGAs to strengthen their overall Public Financial Management (PFM) and to enable the
oversight institutions to undertake their oversight roles effectively. The PFM training will also
include training of TTIs management in Governance at the Kenya School of Government. These
actions will be tailored on the recommendations of the Bank’s Fiduciary Risk Assessment for March
2015.
2.2.3.2 This component will also support TVET tracer studies in selected TVET engineering and
applied sciences programs. The study questionnaire will take into account gender perspective
including young TVET graduates female access to jobs. The tracer study’s findings will further
inform the needs of the labour market, priority TVET investment areas, and training choices among
the youth. A MoEST Gender Policy is in place. However, there is need to develop TVET specific
gender guidelines to promote girls enrollment to TVET programs particularly in engineering and
10
braille machines, white cane and embossers for the blind TTIs, hearing aids for the partially hearing impaired, audio visual
equipment including projectors for the deaf and blind TTIs, and specialised learning computers with the relevant audio visual special
software 11
Machakos TTI for the blind; Sikri TTI for the deaf Homabay; Nyangoma TTI for the deaf Siaya and Karen TTIs for the deaf
Nairobi.
9
applied sciences. The project will support this. TTIs management including the Board of Governors
will also be trained in strategic TVET management and leadership and sensitized in the TVET Act
2013 provisions. This component will also support development of a gender sensitive TVET
information management system, Project management as described under implementation
arrangements. The support will include, project M&E, one additional project vehicle reporting, and
audit.
2.2. Technical solution retained and other alternatives explored
2.2.1 This is a follow up project. The TVET Phase 1 project was designed to develop eight new
Technical Training Institutes (TTIs) in regions where TTIs did not exist; upgrade and rehabilitate
engineering faculties’ infrastructure in eleven existing institutions; develop eight Centers of
excellence in engineering/ applied sciences; enhance TVET human capacity; and build linkages
between the TVET institutions and the private sector. The Phase 1 projects’ intended outputs at
appraisal were significantly scaled down due to budget constraints and reforms in the TVET sector.
Table 3 on page 10 thus presents limited alternatives for a follow up project which aims to ‘fill in’
the Phase I project gaps.
2.2.2 The Government and the Bank proposed to proceed with a reduced scope as Phase 1, and
complete the project activities under ADF 13 to meet the project’s intended outcomes and also to
align some of the Phase 1 components such as curriculum reforms to the TVET Act 2013 which was
enacted midway of the Phase 1 project. TVET Project Phase 1 achieved a number of key project
outputs as shown under section 2.7 of this report.
Table 3: Project alternatives considered and reasons for rejection Alternative Brief description Reasons for rejection
Sector Budget Support
to MoEST for the
TVET Sub Sector
The TVET sub-sector budget
support would entail annual
funds tranches to MoEST and
agreed upon TVET indicators
to enhance TVET quality and
relevance.
This option was discussed at length and led to the
conclusion that it is highly unlikely that the initial
Phase 1 target TTIs would be the focus. This would
lead to incomplete sets of engineering and applied
sciences equipment in Phase 1 target TTIs and also
incomplete works in engineering workshops
particularly for the 8 new TTIs established in Phase
1. It would therefore be challenging for the target
TTIs to meet the TVETA requirements for
program’s accreditation.
2.3. Project type
The project type is a stand-alone operation within the framework of National Education Sector Plan
2014 to 2018 and the TVET Act of 2013. The project also supports Youth Employment priorities
outlined in the Second Medium Term Plan (MTP) 2013 to 2017. The ADF financing for this project
will build on Phase 1. The financing will support quality and relevance of engineering and applied
sciences TVET programs; inclusion of poor and vulnerable youth to equip them with relevant skills
for the labour market; and strengthen MoEST’s institutional capacities. The specific project loan for
‘stand-alone’ project loan is appropriate to ensure that the Phase 1 project objectives are met by
addressing ‘gaps’.
2.4. Project cost and financing arrangements
2.4.1 The total cost is estimated at UA 48.6 million excluding taxes and customs and duties of which
UA 16.25 million will be in foreign currency and UA 32.35 million in local currency. MoEST will
budget for the required taxes and customs each year as per the procurement plan packages. The total
project cost includes an ADF loan of UA 41 million and GoK counterpart of UA 7.6 million which
has been agreed upon by the Government.
10
2.4.2 The tables below present the project costs by components, financing source and category of
expenditure and expenditure schedule by component. Costs have been estimated on the basis of
information obtained from the MoEST, the Ministry of Public works, the project beneficiaries’
institutions and various stakeholders in the construction sector. The cost estimates have incorporated
6% for physical contingencies and 9.3% for price escalation on local and foreign currency. Technical
Annex Chapter 8 contains the detailed costing while expenditure schedule by component is in
Appendix III.
Table 2.4.2.1: Project Costs Estimates by Component [amounts in millions UA]
Components
Foreign currency cost
Local currency cost
Total Costs
% foreign
Component 1: Improve Access, Quality and Relevance of TVET. 12.92 21.30 34.22 38%
Component 2: Equip Poor and Vulnerable Youth with Relevant
TVET Skills and Work Experience.
0.85 2.54 3.39 25%
Component 3: MoEST Institutional Support and Project Management 0.00 3.56 3.56 0%
Total base Cost 13.76 27.40 41.17 33%
Price contingencies 1.51 3.01 4.52 33%
Physical contingencies 0.98 1.94 2.92 33%
Total project costs 16.25 32.35 48.60 33%
2.4.2 The project will be financed by counterpart funds and the ADF. Bank financing amounts to UA
41.00 million, or 84% of the project. The counterpart funds account for 16% of the project costs. Appendix IV provides details of categories, sources of financing and procurement arrangements.
Table 2.4.2.2: Sources of financing(amount in million UA equivalents)
Sources of financing
Foreign currency cost
Local currency cost
Total Costs % total
Government 0 7.6 7.6 16%
ADF 16.25 24.75 41 84%
Total project costs 16.25 32.35 48.6 100%
Table 2.4.2.3 Project cost by category of expenditure [amounts in millions UA]
Category of expenditure
Foreign currency cost
Local currency cost
Total Costs
% foreign
Works 0.00 8.77 8.77 0%
Goods 13.76 0.00 13.76 100%
Services 0.00 17.19 17.19 0%
operating Costs 0.00 1.44 1.44 0%
Total base cost 13.76 27.40 41.16 33% Price contingencies 1.51 3.01 4.52 33%
Physical contingencies 0.98 1.94 2.92 33%
Total project costs 16.25 32.35 48.60 33%
Table 2.4.2.4 Expenditure schedule by component [million UA]
Components Year 1 Year 2 Year 3 Year 4 Year 5 Total cost Component 1: Improve Access, Quality and Relevance of TVET. 6.06 8.09 10.10 14.14 2.01 40.40
Component 2: Equip Poor and Vulnerable Youth with Relevant
TVET Skills and Work Experience.
0.60 0.80 1.00 1.40 0.20 4.00
Component 3: MoEST Institutional Support and Project Management 0.63 0.84 1.05 1.47 0.21 4.20
Total project costs 7.29 9.73 12.15 17.01 2.42 48.60
11
2.5. Project’s target area and beneficiaries
2.5.1. Direct Beneficiaries. The project targets 3000 poor and vulnerable youths, including 300
youths living with disability from across the Country. Of the target youths, at least 50% will be
females. The 33 target TVET institutions will benefit from TVETA accreditation for engineering and
applied sciences programs thereby increasing their student’s enrolments in these faculties. Upgrading
of the four ‘special needs’ TTIs will also benefit Youth with disability to timely access TVET and be
empowered towards self-reliance’. The 600 TVET tutors (at least 30% female) will benefit from
skills upgrading. MoEST will benefit from an improved TVET information management system that
will enable it to make informed planning and policy decisions based on evidence from reliable data.
2.5.2. Indirect Beneficiaries. The industry/private sector will benefit from TVET graduates who
have relevant skills and also through the required industrial attachments. The Industry will have
access to subsidised labour for the specific period. The private sector will greatly benefit from the
equipment supply and installation. Overall, the GoK will benefit from a qualified and skilled TVET
workforce which will attract foreign investments and steer the country towards the Vision 2030
aspirations for human capital development.
2.6. Participatory Process for project identification, Design and implementation
2.6.1. The Stakeholder’s key inputs, relevant for this project, are summarized in Box 1 below.
Box 1: Main Outcomes of Project’s Stakeholders Consultations.
The stakeholder inputs in Box 1 above, been taken into account as described under the various
project’s sub components section 2.1 of this report. The project design and priority activities have
benefitted from input by strategic institutions including TVET institutions, TVETA, Development
Partners, MoEST management, the National Treasury and the Private Sector. The list of persons and
institutions consulted is included in Technical Annex Chapter 10.
2.7. Bank group experience and lessons reflected in project design
2.7.1. The 2015 Country Portfolio Performance Review (CPPR) is ongoing. However, the current
overall ratings for Implementation Progress and Development Outcomes stand at 2.65 and 2.9
respectively. This implies a satisfactory overall performance of Kenya’s portfolio. In addition, there
is no project at risk and no ageing project. Since 2009, the Bank has funded two higher education
(TVET and University) projects in Kenya. The TVET Phase 1 project was approved in 2009 (ADF
Loan UA 25 million) while the Support to Higher Education, Science and Technology (HEST)
project was approved in 2013 (ADF Loan UA 28 million). The overall aim of the two projects is to
improve access, quality and relevance of TVET and University education and training programs
mainly in Sciences and Technology. To meet this objective, the TVET Phase 1 project was designed
to develop eight new Technical Training Institutes (TTIs) in regions where TTIs did not exist;
upgrade and rehabilitate engineering faculties’ infrastructure in eleven existing institutions; develop
a) Private Sector /Industry must play a central role to enhance the ‘relevance’ aspect on TVET.
b) Support to TVETA is core since this authority will set and enforce standards in the TVET system. All other
support to TVET must ‘stem’ from TVETA requirements.
c) There is need to create a balance between ongoing TVET infrastructure investments and ensuring relevant
TVET graduates are immediately available to meet the labour market needs.
d) TVET should also priorities inclusion of Youth living with disabilities as many of them are enrolled in
‘special’ and integrated primary and secondary schools and require transition to tertiary education.
e) A competent and skills TVET human resource is required to deliver on the TVET Act 2013 reforms. In
addition to equipment and facilities, development partners must also focus on skills upgrade for the existing
TVET tutors.
f) Financing for the TVET sector is inadequate and therefore allocation should be prioritized based on labour
market needs.
g) Availability of TVET core data including enrollments by programs in each TTIs; number of staff; and overall
financing including from income generating activities is not readily available. There is a need for a robust
TVET information level at MoEST and TTIs levels.
12
eight Centers of excellence in engineering/ applied sciences; enhance TVET human capacity; and
build linkages between the TVET institutions and the private sector. Implementation of the Support
to HEST project is satisfactory.. The TVET Phase 1 and past basic Education sector projects in
Kenya have experienced implementation delays mainly due to inadequate project readiness at
appraisal and particularly relating to lack of prior preparation of works designs and equipment
specifications, as well as non-active Project Steering Committees to provide the much needed project
oversight.
2.7.2. TVET Project Phase 1 achieved a number of key project outputs. These include:
installation of engineering and applied sciences equipment in 25 TVET institutions; training of
existing 130 TVET tutors; carried out one study on National Skills Needs; and supported
construction of Engineering workshops and laboratories in 17 TTIs. The TVET Phase 2 project
therefore builds on the Phase 1 objectives and aims to consolidate project gains under Phase 1 and
‘fill’ in the gaps. The Phase 1 projects’ intended outputs at appraisal were significantly scaled down
as a result of budget constraints and emerging reforms in the TVET sector geared towards improving
quality and relevance of TVET. The Government and the Bank proposed to proceed with a reduced
scope as Phase 1, and complete the project activities under ADF 13 to meet the project’s intended
outcomes.
Lessons Learned and Reflected in Project Design for ‘Prompt Start Up’
2.7.3. In designing this project, the team has taken into account lessons from the ongoing Higher Education Projects, relevant TVET studies and reports; and final draft of the TVET Phase 1 Project Completion Report (PCR). The PCR documented challenges which have informed
design of this project. The main lessons learnt from Phase 1 are: (i) the need for ‘project readiness’
for implementation at appraisal particularly concerning preparation of works designs and listing of
equipment specification; (ii) formation of an inclusive Project Steering Committee where key
departments such as procurement and finance are involved; and (iii) Contract Management. A
dedicated PCU officer needs to monitor contracts milestones, validity of performance bonds and
each contract’s payments schedules. These lessons are taken into account as described below.
Technical Annex Chapter 4 has additional information on the PCR in process.
2.7.3.1 The under-costing and start up delays experienced under Phase 1 are not anticipated in this
project. The consultant firms under Phase 1 developed complete works designs and costings for
Phase 1 and II. The works and equipment contracts will be financed 100% from ADF while the
training activities will be co-financed with counterpart funds. This is based on delays experienced in
timely provisions of counterpart funds under Phase 1 which delayed execution of works. The
contract terms for the works supervising consultant, will be revised to reflected performance based,
as opposed to time based. In some instances, the supervising consultants delayed in supervising
works which contributed to construction delays.
2.7.3.2 A Project Steering Committee (PSC) will be constituted to include key departments involved
in the project processes. These departments are: Director of TVET, Director of Vocational Education
and Training, Chairman LIWA, Director General TVET Authority, Chief Executive Officer
Curriculum Development Assessment and Certification Council (CDACC), Head of supply Chain
Management Services, Head of Accounts, Head of Finance, Chief Economist. MoEST Legal Officer
and any persons will be co-opted to the PSC as need arises to enhance project performance. . These
departments were not adequately engaged during Phase 1 and these contributed to delays in
processing of the Project’s payments requests as well as procurements. Participation of the
department in the PSC is therefore critical for project oversight and accountability and timely
delivery of the project’s work plans. The proposed PCU includes three technical officers, to ensure
main project activities; including contract management is closely monitored. For the TVET Phase 1
project, only two officers were actively involved in the project and most time had heavy workloads.
13
2.7.3.3 The Bank in collaboration with USAID carried out an analysis on ‘Youth Employment Status
in Kenya’ in 2014 which also looked into the TVET sector. The key lesson learnt from this exercise,
is for this project to create a ‘balance’ between TVET infrastructure investments (quality aspects),
and investments to enhance ‘access’ and ‘relevance’ and ensure the TVET sector immediately
‘supplies’ relevant skills to the labor market12
. The Phase II activities will therefore support training
of youth to meet immediate labor market demands for technicians.
2.8. Key performance indicators
2.8.1. The following indicators, derived from the project’s log frame, are the key indicators. Impact
indicator: increased skilled and employable human resource. This will be measured mainly through
tracer studies. Outcome indicators: (i) Improved quality and relevance of TVET programs. This will
be measured through the number of TVETA accredited programs; (ii) Increased access (enrolment)
in TVET engineering and applied sciences Programs. Main output indicators: (i) Engineering and
applied sciences infrastructure for TVET expanded to enhance quality; (ii) Number of existing TVET
Tutors Trained at diploma and degree levels in engineering and applied sciences (at least 30%
females); (iii) Number of Youth enrolled in TVET engineering and applied sciences(50% females);
(iv) Number of TTIs and Industry partnerships formed to enhance relevance in engineering and
applied sciences; (v) A TVETA strategic plan developed; (vi) Number of TVETA monitors and
evaluators trained in ; and (vii) number of TTIs management and MoEST Semi-Autonomous
Government Agency trained in Government Financial and Procurement procedures.
III. PROJECT FEASIBILITY 3.1 Economic and financial performance
3.1.1 The project has positive economic benefits. The intended investment in TVET Phase II has
positive Net Present Value (NPV). The NPV at a 21.4 per cent discount rate is UA 21.4 million. The
internal rate of return of the project is 17.7 per cent. The financial simulation applied six key
assumptions. First, it treats TVET delivery and the productive sector as a system that depends on
each other with Technical Training Institutions (TTIs) on the supply side while the productive
sectors are demand side. Second, completion of TVET training improves life time earnings for those
who complete training. Third, the intervention increase graduation rate and thus reduces wastage
within the system. Fourth, all cost are projected based on actual budget provisions to the TVET
institutions with an escalation factor of 5% to account for inflation, being the target currently set by
the Central Bank of Kenya and in the Budget Strategy Paper for 2015. Fifth, the stream of benefits
and cost are discounted at 12% and projected for 20 years, although the Project has a tenor of 40
years and grace period of 5 years. Sixth, government and the parents bear the costs of TVET. Table 4
below summaries the key assumptions applied in the financial simulation model. Technical Annex
Chapter 5 has additional information on benefits of TVET.
Table 4: Key Assumptions of the Simulation
12
Technical Annex Chapter 2 contains additional information on the Labor Market Data in Kenya
No Assumption Rate or Number 1 Simulation Period 20 years
2 Grace Period 5 years
3 Price, wage escalation factor per year 5%
4 Employment rate of Diploma Graduates 90% per year
5 Wage compensation for Diploma Graduates USD 500 per month
6 Wage compensation for Certificate Graduates USD 300 per month
7 Average Student fees at Certificate USD 500 per year
8 Average Student fees at Diploma USD 700 per year
9 Discount rate 12%
10 Number of TTIs targeted 33
11 Direct trainees supported 3,300
12 Potential student beneficiaries in the medium term 100,000
13 Potential student beneficiaries in the medium term 250,000
14
Development Prospects Associated with the Project-enhancing competitiveness/ productivity
3.1.2 The project will contribute to increasing stock and quality of mid-level Science, Engineering and Technology Graduates (SET). Evidence including from the World Economic
Surveys published by the IMF in April 2015, shows that qualified human capital will serve to attract
investment in physical capital, notably through foreign direct investment. This will also enhance the
new policies and institutions relating to technology and innovation that are being modernized and
aligned to economic growth and human development goals enshrined in MTP II (2013-2017) and
Vision 2030. The TVET sector plays an important role in meeting the mid-level skills demands for
the labour market. As noted in the project summary, Kenya is experiencing a skewed skill mix
particularly among university graduates, technicians and artisans. The skills gap therefore requires
urgent actions in equipping post primary and secondary as well as out of school youth with middle
level skills for the labour market. This project will bridge the gap by training 3000 target youth and
300 youth with disabilities in relevant TVET programs for the labour market.
3.1.3 Improving competitiveness for exports led growth emphasized in the Kenyan Vision 2030 and Regional Integration Strategies require skills development. Although productivity has been
rising in recent years, and while Kenya is now a low middle income country, it is acknowledged that
the vision of raising its growth frontiers requires rapid enhancement of industry productivity to build
Kenya’s competitiveness. Effective competition requires skilled labour which is able to effect
product differentiation or compete based on quality of its products and thus moving up the value
chain. Although Kenya leads in terms of manpower development within the East African region,
skills enhancement within the engineering and applied sciences fields remains weak. This is even
more critical in the supply of mid-level skills to the emerging geothermal, oil and gas exploration
within the East African region. The proposed project will provide requisite skills and enhance the
flexibility and efficiency of the labour market to help Kenya move its exportable products up the
value chain thereby increasing export earnings. The investment will enhance business and
technological innovation by improving the capacity of workers to apply and adapt existing as well as
new technologies and processes.
3.1.4 Improving the quality of technical education is vital for economic development. Evidence
shows that the quality of education—rather than mere school enrollment—is a key determinant of
economic development. The TVET project, together with the proposed reforms in higher education
lay emphasis on quality and relevance. The new TVET legislation emphasizes science and
innovation as key to economic development. The intervention will thus continue to fund capacity
improvement including networking between the TTIs to ensure least cost training necessary for rapid
economic uptake. The government is currently in the process of constructing 60 TTIs besides the
existing 44 TTIs. In 2015/16 Budget, it is proposed that additional 70 TTIs be constructed. The well-
equipped Bank Group supported TTIs could lead in mentoring the new TTIs, thereby enhancing the
quality of all the potential trainees, which would rise to over 100,000 in the medium term and
250,000 in the long run.
3.1.5 The project contributes to competitiveness by enhancing complementarities between technology, skills and productivity. Technology improvement shifts the relative demand towards
higher skilled labour and thus also shifts the Production Possibility Frontier (PPF) to the right for
countries that embrace those changes. As evidenced by IMF World Economic and Financial Surveys
published in the Sub Saharan Africa Regional Economic Outlook, April 2015, in contrast, a lack of
skills enhancement can seriously constrain productivity and growth. Lack of this investment not
only reduces opportunity to reap from demographic dividend, it also delays opportunities to rise up
the Global Value Chains. It is noted that the link between the TVET and industry in Kenya has been
weak with the result that there is considerable mismatch between the supply of skills and the demand
from the marketplace. Training programmes and facilities have been found to be inadequate and
generally obsolete with Lecturers unable to deliver programmes of relevance to needs of modern and
15
more competitive labour markets. The TVET II project provides the learning institutions with
relevant equipment and learning facilities that will not only modernize but also make the learning
relevant to the emerging markets. It raises the quality of trainees, thereby enhancing their
productivity within an increasingly ICT driven production systems.
3.2. Environmental
3.2.1. The project has been classified as a category 2 operation. Construction will be carried out
in the existing TTIs and will mainly entail completion of works started under Phase 1. The
Environmental and Social Management Plan (ESMP) for the project was developed by a consultant
and approved by the National Environmental Management Authority (NEMA) during Phase 1. Phase
2 will mainly entail completion of construction works under Phase 1; and supply of remaining
engineering and applied sciences equipment. These activities will generate environmental conditions
that will require management measures to be prescribed through an Environmental and Social
Management Plan (ESMP). These will include, among others potential for solid waste generation
during construction and operation; dust, noise and vibration from site activities and equipment;
Occupational Health and Safety Risks including risks of slips and falls, working at heights, as well as
soil erosion during construction and wastewater discharges. The Phase 1 ESMPs have been reviewed
by a consultant and an updated consolidated ESMP submitted to the Bank by MoEST. A summary of
the updated ESMP and mitigation measures is contained in Technical Annex Chapter 7.
3.2.2. Resettlement. The project activities will take place within existing TTIs institutions therefore
no resettlement or social displacement is involved in this project.
3.2.3. Climate change. The project activities are unlikely to affect greenhouse gases in any way.
The ESMP prepared during Phase 1 concluded that the project’s implementation and its operations
within the academic institutions have minimal environmental impact and will be restricted to the
construction stage. All the same, the project includes rain water harvesting in target TTIs. Rain water
harvesting is now a standard requirement of public education constructions. Already, TTIs such as
Tsiekuru which is in the arid region, is utilising rain water harvested through the Phase 1 rain water
harvesting facilities. The project also includes skills development in Solar Photovoltaic Systems
(SPVs) which will be monitored alongside other TVET programs. The Kenyan government has taken
an active role to enable the development of alternative sources of energy. In September 2012, the
GoK gazetted ‘The Energy Regulations, 2012’. The new regulations stipulate that all technicians
involved in the installation of SPVs must acquire a license from the Energy Regulatory Commission
(ERC) after undertaking an industrial trade test to be administered by the National Industrial
Training Authority (NITA). Some of the project target TTIs including Nairobi TTI, Kitale TTI,
Kaiboi, Nyeri TTI and Meru TTI have the ERC approved curriculum and training equipment for
SPVs training. This training will be offer to some of the project target 3000 youths to equip them
with skills to install and maintain solar panels.
3.2.5. Gender. Females constituted 41.1 per cent of the enrolment in 2013 in all Higher Education
Institutions TVET and Universities. In 2012 there were 51,488 female enrolled in public TVET
institutions and 76,163 males. The Gender parity index in TVET is currently 0.55. The proposed
project interventions including scholarships for girls and construction of hostels will help to sustain
this parity. The TTIs have a gender related network ‘Women in Technical Education and
Development (WITED)’. WITED includes a team of women in TVET technical careers as role
models for girls. It advocates for greater enrolment of women in science and technical education in
TVET institutions. The project will facilitate WITED to bring on Board most women TVET Tutors
in engineering and applied sciences to participate in WITED initiatives, support development,
production and distribution of the career guides in TVET engineering and applied sciences to Girls
16
secondary school. The project will also support construction of dormitories and ablution blocks for
extremely remote TTIs such as Godoma, Wajir and Tseikuru TTIs to facilitate girls’ enrollment.
Dormitories will also be constructed for the four ‘special’ TTIs for the hearing and visual impaired
youths. These TTIs reported that lack of adequate accommodation facilities deters enrollment of girls
living with disabilities. One of the target TTI Nkabune, is mainly a girls only TTI (over 90%). The
MoEST overall Gender in Education policy (2007) will continue to guide gender mainstreaming in
TVET. Based on this policy, the project will support development of specific TVET Gender
guidelines to facilitate girls access to TVET and particularly in engineering and applied sciences
programs that are relevant for the labour market. The NESP 2014-2018 outlines the Gender policy
implementation strategies and logframe.
3.2.5.1 The project will also support about 1,500(50% of the target) young female’s enrollment to the
programs particularly under component 2. Young females are hard hit by unemployment rate of close
to 50 per cent as compared to about 30 per cent for young males. At a higher age, the female youth
are three times more likely to be unemployed than the male youth. Component 1, will also support at
least 180 TVET female tutors for skills upgrade in engineering and applied sciences programs. It is
estimated that less than 200 TVET female tutors are in engineering and applied sciences faculty.
3.2.6. Social. Poverty in Kenya has a ‘young face’. Young people (aged between 18 and 34 years
old) constitute more than a third of the Kenyan population. This demographic status represents
opportunities as well as challenges. Failure to meaningfully include the youth in Kenya’s social
economic development agenda will only worsen the current unemployment trends and contribute to
increased crime and violence. The high levels of youth unemployment may be explained by large
skill gaps. The project will train 3,000 youth in relevant skills and also deliberately target about 300
youths living with disability, particularly the visual and hearing impaired youth to enable ‘self –
reliant’ and promote empowerment of People Living with Disabilities. According to the ILO 2008,
low levels of education and skills training amongst majority of the youth greatly limit their chances
of being absorbed into and participating in the formal sector (ILO, 2008).
IV. IMPLEMENTATION
4.1 Implementation arrangements
4.1.1 Executing Agency (EA). The Ministry of Education, Science and Technology is the project’s
EA. The Principal Secretary (PS) for State Department for Science and Technology is the accounting
officer and will provide overall oversight to the project implementation. Similar to Phase 1, the
MoEST’s Directorate of TVET will be responsible for the day to day project implementation and
monitoring. This is in line with the Paris Declaration on aid effectiveness and within Bank rules and
regulations. Performance of MoEST for the Phase 1 project implementation is overall satisfactory.
Encountered project were mainly due to unanticipated processes in acquiring the legal TTIs land title
deeds and preparation of the works designs. This immensely delayed works commencement by two
and half years. The Directorate has technical officers including assigned procurement and accountant
officers responsible for the TVET projects. This team of regular MoEST officers will comprise the
Project’s Coordinating Unit (PCU). The PCU will be headed by a Project Manager and will include a
Procurement Officer; Finance and Accounts officer; a Monitoring and Evaluation officer; a Gender
specialist as a gender Focal Person; and three senior TVET Technical Officers. The PCU will report
to the PSC. The PCUs will execute project’s annual work plan and procurement plans, prepare
project quarterly report, and ensure the project is audited annually as required. Technical Annex
Chapter 4 outlines in details the envisaged project’s Governance Structures and the project’s
implementation plan.
4.1.2 A Project Steering Committees (PSC) will be formally constituted and will meet quartely
months to review project progress and provide guidance on matters arising. The PSC will be chaired
by the PS and will include membership as outlined under paragraph 2.7.3.2. The PSC will ensure that
17
terms, conditions, project objectives and reporting schedules are adhered to as per this report and the
loan agreements. The PSC will also review and clear the project’s annual work plans and budgets.
MoEST will submit to the Bank the PSC minutes as with the project quarterly progress reports.
Based on lessons learnt from Phase 1, it’s critical that the PSC includes critical department listed
above to ensure project matters such as payments processing and procurements are timely addressed.
4.1.3. Procurement Arrangements: All procurement of goods, works and acquisition of consulting
services financed by the Bank will be in accordance with the Bank’s Rules and Procedures: “Rules
and Procedures for Procurement of Goods and Works”, dated May 2008, revised July 2012; and
“Rules and Procedures for the Use of Consultants”, dated May 2008, revised July 2012, using the
relevant Bank Standard Bidding Documents, and the provisions stipulated in the Legal Agreement.
The various items under different expenditure category are described in Appendix III of this appraisal
report. Each contract to be financed by the Loan, the different procurement methods or consultant
selection methods, the need for prequalification, estimated costs, prior-review requirements, and time
frame are agreed between the Borrower and the Bank project team is provided in the Procurement
Plan (see Annex B.5 Technical Annex Chapter 6). A summary of procurement arrangements is
presented on Appendix III of this report.
4.1.4 Financial Management: In line with Paris Declaration on Aid Effectiveness and Accra
Agenda for Action, the Project will make use of the country’s financial management systems. The
day to day financial management of the Project will be done within the framework of a PCU and as
per the rules and procedures stipulated in the GOK’s Public Financial Management Act, 2012 and
other Government financial regulations. MOEST’s Directorate of Education through its Director and
the Chief Finance Officer of the Ministry will be responsible for the overall Financial Management
function of the Project. MOEST has experience in managing donor funded and ADB projects having
already implemented Support to TVET Phase I and Support to Enhancement of Quality and
Relevance in HEST projects. The Project will prepare and submit quarterly reports (financial and
physical) to the Bank within 45 days after the end of each quarter. MOEST’s internal audit
department will include the Project financial transactions in its annual work programme. Detailed
financial management arrangements and assessments as well as other matters are detailed out in the
Annex B.4 Technical Annex Chapter 9. The project’s annual financial statements will be audited
annually by the Office of the Auditor General (OAG). However, a private audit firm acceptable to
the Bank and appointed by the OAG may conduct the external audits in case the latter would need to
outsource the services. The audit report, complete with a Management Letter, will be submitted to
the Bank not later than six months after the end of the financial year. The cost of the audit will be
borne by the project. A detailed analysis of audit arrangements is in Annex B.6 of Technical Annex
Chapter 9.
4.1.5. Funds Flow and Disbursement Arrangement: The project shall use only the Direct Method
of disbursement as set out in the Disbursement Manual mainly due to the nature of its costs. A
detailed analysis of disbursement is provided in Annex B.4. of Technical Annex Chapter 9. 4.2 Monitoring
4.2.1. The PSC will be responsible for the overall project Monitoring and Evaluation (M&E). Project monitoring will make use of the existing MoEST M&E frameworks. Data collected for each
project activities will be disaggregated by sex. Similar to Phase 1, day-to-day M&E of project
activities will be carried out by the PCU at the Directorate of TVET and MoEST’s Central Project
Planning and Management Unit which carries out annual monitoring and evaluation exercises. The
East Africa Resource Centre (EARC) will supervise the project. The PSC will review performance of
the project annual work plan quarterly. The targets TTIs have own M&E systems and will therefore
provide the required project data particularly for the project’s outputs. The PCU will prepare and
submit to the PSC and the Bank project quarterly progress reports using Bank’s templates. The
training data in the quarterly reports will be disaggregated by sex. The reports will also include
18
status of the ESMP mitigation measures. The Bank will conduct at least two supervision missions
each year, prepare the required Implementation Progress Reports (IPR) and provide technical
assistance where needed. A mid-term review of the project will also be carried out. The project
timeframe for key milestones is presented on Page viii, ‘project timeframe’.
4.3. Governance
4.3.1 MOEST is implementing reforms to institutionalize good governance. Notably, the
Education Sector Governance and Accountability Action Plan 2007; Code of Conduct for teachers;
establishment of County Education Boards; reconstitution of TTIs Board of Directors in line with the
TVET Act 2013; and the Service charters of the Education sector. Despite these measures,
governance and accountability need to be strengthened. As described in detail under Component 3,
‘MoEST Institutional Support’ this project will support the Accountant Generals Office, the Auditor
Generals and the Public Procurement Oversight Authority to build capacities of TTIs and related
SAGAs to strengthen their overall Public Financial Management and accountability. These actions
will be tailored on the recommendations of the Bank’s Fiduciary Risk Assessment conducted in
March 2015. In collaboration with other DPs, the Bank will also explore options through Trust
Funds to support relevant trainings in education services planning and management for county, sub-
county and school level education management teams including communities to enhance efficiency
utilization of resources, value for money and facilitate voice and accountability in the education
sector.
4.4. Sustainability
4.4.1 The project activities are fully aligned to the GoK TVET reform therefore guaranteeing sustainability of the project’s outputs and intended outcomes. Technical Annex Chapter 1 shows MoEST’ TVET results framework for 2014 to 2018 from which the project’s log frame activities are
largely derived. Within the TVET Act 2013 framework, GoK is working towards TVET reform to
improve access, quality and relevance. In addition, GoK targets to train one million middle level
artisans by 2016. GoK, using its own resources, supports each TTI with about KES 107m annually
for operational and development grants. At least 3% of these funds are supposed to be used in
maintenance of facilities and equipment. For the fiscal 2015/2016 GoK has committed about KES3b
to TVET. Each TTI has a maintenance schedule which is a key deliverable for the annual
performance contracting. The maintenance and repair service providers are tendered for annually.
Some of the project target institutions such as Eldoret Polytechnic and Mathenge TTIs have insured
physical facilities and high value equipment. Siaya TTI is in the process of a valuation of its assets to
insure them. Going forward, all TTIs will be required to insure high value equipment. The GoK has
established the TVET Authority to institutionalise TVET reforms through enforcement of TVET
quality and relevance, standards and accreditation. The TVET Fund Board, established under the
TVET Act 2013, is still to be operationalised.
4.5. Risk Management
4.5.1 The main risks were identified and appropriate mitigation measures proposed as indicated on
Table 5 below.
19
Table 5: Project risks and mitigation measures Risk Rating Risk mitigation measures
Potential conflict and political
interference in targeting of the 3000
Youth to be trained under Component 2
M
The Directorate of Vocational Training at MoEST has drafted a
criteria based on the one develop for youth training under the
Nairobi Outering Road Project. The targeting mechanisms
considers categorical targeting for youth from slums and other
informal settlements as well as Youth with disabilities and
marginalized regions-see Technical Annex Chapter 4
Sustainability particularly as regards
maintenance of the procured equipment
M At the moment, maintenance and repair aspects are included in the
TTI’s annual performance contracts targets. TTIs will be required
to insure high value equipment.
Delays in timely provision of counterpart
funds.
H The project will assign specific project activities for counterpart
funds instead of co-financing works and equipment contracts
which has led to delays in execution of these contracts.
Trained TVET Tutors leaving for
Universities
M The project will apply the Government bonding policy for staff
training sponsored by Government. The policy bonds staff for a
minimum of three years at the duty station. In addition, TVETA is
reviewing TVET tutors scheme of service.
4.6. Knowledge Building
4.6.1 The project will support creation of a sub-sector TVET information database at the Ministry. The current Education Information Management System (EIMS) mainly focusses on basic
education data. The TVET database will entail development of critical data sets that respond to
TVET Act 2013 provisions. The project will support MoEST to identified critical TVET data that
needs to be collected, disaggregated by sex. The data collected must be core to inform policy,
planning, resource allocation and strategies. The project will also facilitate the TVET Authority to
develop training manuals for accreditation and standards regulations and support tracer studies for
identified TVET trade areas to further establish needs of the labour market. The project will also
facilitate development of TVET specific gender guidelines particularly to enhance girl’s enrolment in
TVET engineering and applied sciences programs. These guidelines are critical as GoK is in the
process of establishing a TVET Fund Board. TTIs management including their Board of Directors
will be trained in GoK financial management and required accounting and procurement regulations
and procedures. They will also be sensitised on the TVET Act, 2013 provisions. At least 50 TVET
Authority monitors and evaluators will be trained in TVET accreditation and standards.
V. LEGAL FRAMEWORK
5.1. Legal instrument
The financing instrument proposed is ADF loan in the amount of UA 41.00 million, to be extended
to the Republic of Kenya.
5.2. Conditions associated with Bank’s interventionConditions Precedent to Entry into Force of the
loan Agreement: The entry into force of the Loan Agreement shall be subject to fulfillment by the
Borrower of the provisions of section 12.01 of the General Conditions Applicable to the African
Development Fund Loan Agreements and Guarantee Agreements (Sovereign Entities).
Conditions Precedent to First Disbursement of the Loan: The obligations of the Fund to make the
first Disbursement of the loans shall be conditional upon the fulfillment by the relevant Borrower of
the following conditions:
(i) Designation of the TVET Phase II Project Coordination Unit (PCU) comprising of: a Project
Manager; a Procurement Officer; a Project Accountant; a Monitoring and Evaluation
officer; a Gender Focal Person; and three senior TVET Technical Officers (para 4.1.1) ; and
20
(ii) Preparation of a project annual work plan and eighteen months procurement plan and
approval by the Project Steering Committee (para 4.1.2).
Other Condition (i) Provision of adequate Counterpart Funds in the National Annual Budget starting not later than the
fiscal year 2015/2016. Such provision shall be made in the Borrower’s successive national budget in
every fiscal year.
5.3. Compliance with Bank Policies
With regard to support to TVET for development of middle level skills, the project is consistent with
the applicable Banks’ policies. These include: (i) The Bank’s 2013-2022 Strategy core operational
priorities include Skills and Technology; (ii) The Bank Human Capital Strategy 2014 -2018 focusses
on skills development and jobs; and (iii) The Kenya Country Strategy Paper (CSP) 2014-18 whose
second pillar is ‘Developing skills for the emerging labour market of a transforming economy’. This
project therefore complies with relevant Banks policies.
VI. RECOMMENDATION Management recommends that the Board of Directors approve the proposal for an ADF loan of UA
41 million to the Republic of Kenya for the purposes and subject to the conditions stipulated in this
report.
I
Appendix I: Country’s comparative socio-economic indicators Indicator Year Kenya Africa Developing
Countries Developed Countries
Chart
Basic Indicators
Area ('000 Km²) 580.4 30,046.4 80,976.0 54,658.4
Total Population (millions) 2013 44.4 1,109.0 5,628.5 1,068.7
Urban Population (% of Total) 2013 24.8 40.2 44.8 77.7
Population Density (per Km²) 2012 71.7 34.5 66.6 23.1
GNI per Capita (US $) 2012 860.0 1,691.5 2,780.3 39,688.1
Labor Force Participation - Total (%) 2013 36.8 37.4 0.0 0.0
Labor Force Participation - Female (%) 2013 46.3 42.5 39.8 43.3
Gender -Related Development Index Value 2007 0.5 0.5 .. 0.9
Human Develop. Index (Rank among 169 countries) 2012 145.0 .. .. ..
Propel. Living Below $ 1 a Day (% of Population) 2005 43.4 .. 25.0 ..
Demographic Indicators
Population Growth Rate - Total (%) 2013 2.7 2.5 1.4 0.7
Population Growth Rate - Urban (%) 2013 4.4 3.4 2.4 1.0
Population < 15 years (%) 2013 42.2 40.9 29.2 17.7
Population >= 65 years (%) 2013 2.7 3.5 6.0 15.3
Dependency Ratio (%) 2013 82.2 77.3 52.8 ..
Sex Ratio (per 100 female) 2013 99.6 100.0 934.9 948.3
Female Population 15-49 years (% of total population) 2013 24.3 24.0 53.3 47.2
Life Expectancy at Birth - Total (years) 2013 61.7 59.2 65.7 79.8
Life Expectancy at Birth - Female (years) 2013 63.6 60.3 68.9 82.7
Crude Birth Rate (per 1,000) 2013 34.9 35.3 21.5 12.0
Crude Death Rate (per 1,000) 2013 8.2 10.4 8.2 8.3
Infant Mortality Rate (per 1,000) 2013 51.0 61.9 53.1 5.8
Child Mortality Rate (per 1,000) 2013 76.0 97.4 51.4 6.3
Total Fertility Rate (per woman) 2013 4.4 4.6 2.7 1.8
Maternal Mortality Rate (per 100,000) 2010 360.0 415.3 440.0 10.0
Women Using Contraception (%) 2013 50.7 34.9 61.0 75.0
Health & Nutrition Indicators
Physicians (per 100,000 people) 2011 18.1 52.6 77.0 287.0
Nurses (per 100,000 people)* 2011 79.2 .. 98.0 782.0
Births attended by Trained Health Personnel (%) 2009 43.8 .. 39.0 99.3
Access to Safe Water (% of Population) 2012 61.7 68.8 84.0 99.6
Access to Health Services (% of Population) 2000 77.0 65.2 80.0 100.0
Access to Sanitation (% of Population) 2012 29.6 39.4 54.6 99.8
Percent. of Adults (aged 15-49) Living with HIV/AIDS 2009 6.3 3.9 161.9 14.1
Incidence of Tuberculosis (per 100,000) 2012 272.0 223.6 .. ..
Child Immunization Against Tuberculosis (%) 2012 84.0 83.1 89.0 99.0
Child Immunization Against Measles (%) 2012 93.0 74.6 76.0 92.6
Underweight Children (% of children under 5 years) 2009 16.4 .. 27.0 0.1
Daily Calorie Supply per Capita 2009 2,092.0 2,564.7 2,675.2 3,284.7
Public Expenditure on Health (as % of GDP) 2011 1.8 5.9 4.0 6.9
Education Indicators
Gross Enrolment Ratio (%) .. .. .. ..
Primary School - Total 2009 113.3 101.8 106.0 101.5
Primary School - Female 2009 112.0 97.8 104.6 101.2
Secondary School - Total 2009 60.2 45.4 62.3 100.3
Secondary School - Female 2009 57.1 41.9 60.7 100.0
Primary School Female Teaching Staff (% of Total) 2009 43.9 43.7 .. ..
Adult Literacy Rate - Total (%) 2007 72.2 .. 19.0 ..
Adult Literacy Rate - Male (%) 2007 66.9 .. .. ..
Adult Literacy Rate - Female (%) 2007 78.1 .. .. ..
Percentage of GDP Spent on Education 2010 6.7 5.3 .. 5.4
Environmental Indicators
Land Use (Arable Land as % of Total Land Area) 2011 9.7 8.4 9.9 11.6
Annual Rate of Deforestation (%) 2000 0.5 0.6 0.4 -0.2
Annual Rate of Reforestation (%) .. .. .. ..
Per Capita CO2 Emissions (metric tons) 2010 0.3 1.1 .. ..
Source: African Development Bank
0
20002
01
0
201
1
201
2
GNI per Capita (US $)
Kenya
2
2,5
3
201
0
201
1
201
2
201
3
Population Growth Rate -
Total (%)
Kenya
40
60
80
20
10
20
11
20
12
Access to Safe Water (% of Population)
Ke…
0
200
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
20
09
Secondary School - Total
Kenya
II
Appendix II: Table of ADB’s portfolio in the country
PROJECT NAME Main Sector Financing Source
Approval Date Closing
Date
Approved UA million
Disb. Ratio
% Loan(L) Grant(G) A. Public – National
1. Outer Ring Road improvement project Transport/
Roads ADF Loan 13.11.2013 31.12.2018 77.04 0.56 0
2. Timboroa - Eldorert " ADF Loan 24.11.2010 31.12.2016 35.00 0
3. Nairobi - Thika Highway Improvement " ADF Loan 21.11 2007 31.12.2012 117.85 3.15 L:91;
G;46
4. Thwake multipurpose water development Water & San. ADF Loan 30.10.2013 31.12.2019 61.68 1.21 0
5. Small and medium towns water supply " ADF Loan 03.11.2009 31.12.2015 70.00 44
6. Scaling up rainwater management " AWF 17.07.2014 31.12.2014 0.59 100
7. Kisumu UN-Sewered " AWF 17.07.2014 31.12.2017 1.03 0
8. Nairobi River Bain Rehabilitation " ADF Loan 06.12.2010 31.12.2015 35.00 54
9. Expanding branded toilet entrepreneurship " AWF 03.01.2014 17.09.2017 0.62 0
10. Mombasa - Nairobi Power transmission line Power ADF Loan 06.05.2009 31.12.2013 50.00 49
11.Power transmission improvement project " ADF Loan 06.12.2010 31.12.2013 46.70 26
12. ADF-PRG for Turkana power " ADF Loan 02.10.2013 03.03.2015 17.50 0
13. Menengai Geothermal development " ADF Loan 14.12.2011 31.12.2017 80.00 62
14. Menengai Geothermal development " Others 14.12.2011 31.12.2017 5.12 11.95 L:31;
G:27
15. Support to HEST Social ADF Loan 14.11.2012 30.06.2018 28.00 21
16. Support to TIVET " ADF Loan 16.12.2008 31.12.2015 25.00 81
17. Community empowerment project " ADF Loan 17.12.2007 30.06.2015 17.00 76
Sub Total National 665.89 19.11
B. Public – Multinational
18. Mombasa--Addis Ababa Road Corridor Ph. II Transport/Roads ADF Loan 01.07.2009 31.12.2015 125.00 57
19. Mombasa – Addis Ababa Road Corridor Ph
II " ADF Loan 30.11.2011 31.12.2018 120.00 35
20. Arusha - Athi River Road Dev. Project " ADF Loan 13.12.2006 31.12.2014 49.24 92
21. Arusha – Taveta – Voi Road project " ADF Loan 16.04.2013 31.12.2018 75.00 8
22. Nile Equatorial Lakes Electric Grid Power ADF Loan 16.06.2010 31.12.2016 39.77 17
23. Ethio-Kenya electricity Highway ADF Loan 19.09.2012 31.12.2018 75.00 1
24. East Africa Center of Excellence Social ADF Loan 03.10.2014 31.12.2019 25.00 0
25. Kenya Drought Resilience Agriculture ADF Loan 19.12.2012 31.12.2018 37.41 1
Sub Total Multinational (Kenya) 546.42
Total (Kenya) 1,212.31 19.11
Source: African Development Bank
III
Appendix III: Map of Kenya
Disclaimer: This map provided by the Group of African Development Bank, is exclusively
for the use of the readers of the report to which it is attached. The denominations used and the
borders which appear in it, do not imply on behalf of the Bank and its members States any
judgment as for the legal status of an unspecified territory nor the approval of the aforesaid
borders.
IV
Appendix III: Summary Procurement Arrangements
Project Categories
UA '000
Use of NPP or CPS
Use of Bank’s
procedures
Non- Bank-Funded Total
1. Civil Works
1.1 Buildings: Additional workshops and
laboratories in 8 new TTIs [N/A ] 12,300.00 3,700.00 12,300.00
1.2 Buildings: Additional workshops and
laboratories in 4 Special TTIs [N/A ] 2,350.00 2,350.00
2. Goods
2.1 Teaching & Learning Equipment for 8
new TTIs, 8 Centres of Excellence, 18
existing technical institutions
[N/A ] 15,250.00
15,250.00
2.1 Teaching & Learning Equipment for 4
specials technical institutions for people with
visual and hearing disabilities
[N/A ] 1,000.00 1,000.00
3. Consulting Services
3.1 Design Review and Supervision of Works [N/A ] 1,000.00 1,000.00
3.2 Tracer Studies & Surveys [N/A ]
300.00 300.00
3.3 Preparation of TVET Information
Management System [N/A ]
800 800.00
3.4 Institutional Support for Development of
Gender and Other Guidelines [N/A ] 500.00 500.00
4. Miscellaneous
4.1 Support to TVETA 1,000.00 1,000.00
4.2 Training of TTI Staff at Diploma and
Degree levels 3,000.00 3,000.00
4.3 Training of 3000 Vulnerable Youth 3,000.00 3,000.00
4.4 Support to Strengthening of MoEST and
related TTI PFM Systems 2,500.00
2,500.00
4.5 Training of Tutors at KISE
200.00 500.00
4.6 Project M&E
500.00 500.00
4.7 Project Management
1,100.00 1,100.00
4.8 Audit
100.00
100.00
TOTAL 9,500.00 31,500.00 7,600.00 48,600.00
+Figures in brackets are amounts financed by the Fund.