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OFFICIAL USE ONLY IDA/R2004-0134/1 May 28, 2004 Streamlined Procedure For meeting of Board: Thursday, June 17, 2004 FROM: The Acting Corporate Secretary Bangladesh: Reaching Out-of-School Children Project Project Appraisal Document Attached is the Project Appraisal Document regarding a proposed grant to the People's Republic of Bangladesh for a Reaching Out-of-School Children Project (IDA/R2004-0134). This project will be taken up at a meeting of the Executive Directors on Thursday, June 17, 2004 under the Streamlined Procedure. Distribution: Executive Directors and Alternates President Bank Group Senior Management Vice Presidents, Bank, IFC and MIGA Directors and Department Heads, Bank, IFC and MIGA This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank Group authorization. Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized

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OFFICIAL USE ONLYIDA/R2004-0134/1

May 28, 2004

Streamlined ProcedureFor meeting of

Board: Thursday, June 17, 2004

FROM: The Acting Corporate Secretary

Bangladesh: Reaching Out-of-School Children Project

Project Appraisal Document

Attached is the Project Appraisal Document regarding a proposed grant to the People's

Republic of Bangladesh for a Reaching Out-of-School Children Project (IDA/R2004-0134).

This project will be taken up at a meeting of the Executive Directors on Thursday, June 17,

2004 under the Streamlined Procedure.

Distribution:Executive Directors and AlternatesPresidentBank Group Senior ManagementVice Presidents, Bank, IFC and MIGADirectors and Department Heads, Bank, IFC and MIGA

This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contentsmay not otherwise be disclosed without World Bank Group authorization.

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Document o f The World Bank

FOR OFFICIAL USE ONLY

Report No: 29019-BD

PROJECT APPRAISAL DOCUMENT

ON A

PROPOSED GRANT

IN THE AMOUNT OF SDR 3 5.2 MILLION (USS5 1 MILLION EQUIVALENT)

TO THE

PEOPLE'S REPUBLIC OF BANGLADESH

FOR A

REACHING OUT-OF-SCHOOL CHILDREN PROJECT

May 19,2004

Human Development Sector Unit South Asia Region

This document has a restricted distribution and may be used by recipients only in the performance o f their official duties. I t s contents may not otherwise be disclosed without World Bank authorization.

CURRENCY EQUIVALENTS

(Exchange Rate Effective April 30,2004)

ADPEO AUEO CAMPE C&AG CBO CHT CMC C W D DflD DP DPE DPEO EA EFA EMIS EOP ERD ERP ESP ESTEEM EU FFE GER GIS GOB GPS HES HSC ICB I-PRSP L C LGED MDG M&E MoPME

CurrencyUnit = Taka Tk.61.00 = US$l.OO Tk.l.OO = US$0.016

US$l.OO = SDR0.689

FISCAL YEAR July 1 - June30

ABBREVIATIONS AND ACRONYMS

Assistant District Primary Education Officer Assistant Upazila Education Officer Campaign for Popular Education Comptroller and Auditor General Community-Based Organization Chittagong Hill Tracts Center Management Committee Children with Disabilities Department for International Development (UK) Development Partners Directorate of Primary Education District Primary Education Officer Education Allowance Education for All Education Management Information system End o f Project Economic Relations Division Education Resource Provider Education Service Provider Effective Schools Through Enhanced Education Management European Commission Food for Education Gross Enrolment Ratio Geographic Information System Government o f Bangladesh Government Primary Schools Household Expenditure Survey Higher Secondary Certificate International Competitive Bidding Interim Poverty Reduction Strategy Paper Learning Center Local Government Engineering Department Millennium Development Goals Monitoring and Evaluation Ministry o f Primary and Mass Education

FOR OFFICIAL USE ONLY

MTR NAPE NCTB NER NGO NORAD URC PEDPII PCP PPT P D PTA PT I ROSCC ROSCU SDC SIDA SKT ssc UEO UPE UNICEF

Mid-Term Review National Academy o f Primary Education National Curriculum and Textbook Board Ne t Enrolment Ratio Non-Government Organization Royal Norwegian Agency for Development Co-operation Upazila Resource Center Primary Education Development Program I1 Project Concept Paper Project Preparation Team Project Director Parent-Teacher Association Primary Training Insti tute Reaching Out-of-School Children Committee Reaching Out-of-School Children Unit Swiss Agency for Development Cooperation Swedish International Development Association Shishu Kallyan Trust Secondary School Certificate Upazila Education Officer Universal Primary Education United Nations Children’s Fund

V ice President: Praful C. Pate1

Sector Manager: Michel le R iboud Country Managermirector: Christine I. Wal l i ch

Task Team Leader: h i t Dar/Hena G. Mukher iee

This document has a restricted distribution and may be used by recipients only in the performance of their official duties. I t s contents may not be otherwise disclosed without W o r l d Bank authorization.

BANGLADESH Reaching Out-Of-School Children Project

CONTENTS

Page

A . STRATEGIC CONTEXT AND RATIONALE ................................................................. 1

1 . 2 . 3 .

Country and sector issues .................................................................................................... 1

Rationale for Bank involvement ......................................................................................... 3

Higher level objectives to which the project contributes .................................................... 3

B . PROJECT DESCRIPTION ................................................................................................. 3

1 . 2 . 3 . 4 . Project components 4 5 . Lessons learned and reflected in the project design ............................................................ 8

6 .

Lending instrument ............................................................................................................. 3 [If Applicable] Program objective and Phases .................................................................... 3 Project development objective and key indicators .............................................................. 4

.............................................................................................................

Alternatives considered and reasons for rejection .............................................................. 9

C . IMPLEMENTATION ........................................................................................................ 10 1 . 2 . 3 . Monitoring and evaluation o f outcomes/results., .............................................................. 11 4 . Sustainability ..................................................................................................................... 12

5 . Critical r isks and possible controversial aspects ............................................................... 12 6 . Loadcredit conditions and covenants ............................................................................... 14

Partnership arrangements (if applicable) .......................................................................... 10 Institutional and implementation arrangements ................................................................ 11

. . .

D . APPRAISAL SUMMARY ................................................................................................. 15 1 . 2 . Technical ........................................................................................................................... 15

Economic and financial analyses ...................................................................................... 15

3 . Fiduciary ........................................................................................................................... 16

4 . Social ................................................................................................................................. 17 5 . Environment ...................................................................................................................... 18

6 . Safeguard policies ............................................................................................................. 18 7 . Policy Exceptions and Readiness ...................................................................................... 19

Annex 1: Country and Sector or Program Background ......................................................... 20

Annex 2: Major Related Projects Financed by the Bank and/or other Agencies ................. 25

Annex 3: Results Framework and Monitoring ........................................................................ 27

Annex 4: Detailed Project Description ...................................................................................... 32

Annex 5: Project Costs ............................................................................................................... 43

Annex 6: Implementation Arrangements ................................................................................. 45

Annex 7: Financial Management and Disbursement Arrangements ..................................... 52

Annex 8: Procurement ................................................................................................................ 57

Annex 9: Economic and Financial Analysis ............................................................................. 63

Annex 10: Safeguard Policy Issues ............................................................................................ 71

Annex 11: Project Preparation and Supervision ..................................................................... 74

Annex 12: Documents in the Project Fi le ................................................................................. 76

Annex 13: Statement of Loans and Credits .............................................................................. 77

Annex 14: Country at a Glance ................................................................................................. 79

Map: IBRD 33292

.. 11

BANGLADESH

IDA GRANT FOR POOREST COUNTRY Swiss Agency for Development Cooperation Total:

REACHING OUT OF SCHOOL CHILDREN

47.53 3 -47 5 1 .OO

5.49 0.51 6.00

58.59 4.21 62.80

PROJECT APPRAISAL DOCUMENT

FY Annual Cumulative

SOUTH ASIA SASHD

2005 2006 2007 2008 2009 2010 1.61 5.15 9.56 12.26 15.52 6.90 1.61 6.76 16.31 28.58 44.10 51.00

Date: May 19, 2004 Country Director: Christine I. Wall ich Sector Manger/Director: Michel le Riboud Project ID: PO86791

Team Leader: Amit Dar/Hena G. Mukherjee Sectors: Primary education (1 00%) Themes: Education for a l l (P) Environmental screening category: B

Lending Instrument: Specific Investment Loan Safeguard screening category: S2 Project Financing Data

[ ] Loan [ ] Credit [XI Grant [ ] Guarantee [ ] Other:

For Loans/Credits/Others: Total Bank financing (US$m.): 5 1 .O Proposed terms:

Borrower: The Government o f the People's Republic o f Bangladesh Bangladesh

Responsible Agency: Ministry o f Primary and Mass Education (MoPME) Bangladesh

[ ]Yes [XINO Does the project depart from the CAS in content or other significant respects? Re$ PAD A.3

Does the project require any exceptions from Bank policies? Re$ PAD D. 7

I s approval for any pol icy exception sought from the Board?

[ ]Yes [XINO

[ ]Yes [XINO Have these been approved by Bank management? [ ]Yes [ IN0

[XIYes [ ] N o Does the project include any critical risks rated “substantial” or “high”? Re$ PAD C.5

~~ ~~

[XIYes [ ] N o Does the project meet the Regional criteria for readiness forimplementation? Re$ PAD D. 7 Project development objective Re$ PAD B.2, Technical Annex 3 The key objective o f the proposed Project i s to reduce the number o f out-of-school children through improved access, quality and efficiency in primary education, especially for the disadvantaged children, in support o f GOB’S national EFA goals.

Project description [one-sentence summary of each component] Re$ P A D B.3.a, Technical Annex 4 (a) Improving Access to Quality Education for Out-of-School Children to facilitate their

completion o f primary schooling through: (i) education allowances for eligible students; and (ii) grants to LCs where the students enroll.

(b) Communications and Social Awareness to raise awareness about the project, mobilize stakeholders to open new LCs or expand existing LCs, and disseminate information on qualification criteria, resource support, and other operational guidelines to stakeholders.

(c) Project Management and Institutional Strengthening to establish a sound structure for project management and implementation, and strengthen the capacity to deliver quality primary education to out-of-school children.

(d) Monitoring, Evaluation and Research to provide an effective monitoring and evaluation system to monitor the use of education allowances and grants support, and evaluate the two alternatives.

Which safeguard policies are triggered, if any? Re$ PAD 0.6, Technical Annex 10 Two safeguard policies that could be triggered under this project relate to environmental assessment (OPIBPIGP 4.01) and Indigenous People’s (OD 4.2014.10). Significant, non-standard conditions, if any, for: Re$ PAD C. 7 Board presentation: NIA

Loadcredit effectiveness: NIA

Covenants applicable to project implementation: NIA

A. STRATEGIC CONTEXT AND RATIONALE

1. Country and sector issues

While Bangladesh i s one o f the poorest countries in the world, i t s economic performance in the past decade has been relatively strong, and progress towards achieving the MDG goals, particularly in education has been favorable. Bangladesh has made significant progress both at the primary and secondary levels, especially in regard to increasing access and gender equity. With nearly 17.7 mill ion students enrolled in over 78,000 primary level schools in Bangladesh’s 480 Upazilas, primary gross enrollment rates rose from 76 percent in 1991 to 96 percent in 2002 while the corresponding net enrollment rates rose from 64 percent to 80 percent. Primary dropout rates fe l l from nearly 60 percent in 1991 to 30 percent in 2000. Gender parity in access to primary education has also been achieved. These achievements are particularly impressive when compared to countries in the South Asia region and other countries at similar levels o f per-capita income. For example, Bangladesh’s net enrollment rate ranked eighth among ten low-income countries (India, Pakistan, Sr i Lanka, Nepal, China, Indonesia, Kenya, Benin and the Republic o f Congo) in 1980. By 2000, i t s rank had improved to fourth. Furthermore, in South Asia, only S r i Lanka has matched Bangladesh’s feat o f achieving gender parity at the primary level. Additionally, the primary education system i s also targeted at enhancing equity in access-53 percent o f students in the primary education system come from poor households.

Significant challenges remain. The I-PRSP states that (i) the widening “quality divide” in education between the rich and the poor needs to be narrowed; and (ii) access to education for the poor needs to be increased to ensure an efficient and sustainable approach to equitable, quality education. Other fundamental systemic interlockmg issues may be summarized as follows:

The net enrollment rate (80 percent in 2001) suggests that well over three mil l ion children o f the primary school age (6-10 years) were out o f school. They include children who have never enrolled in school, those who had enrolled and dropped out from the formal primary education system, street children and children o f displaced families who have migrated from rural to urban areas; About one third o f children drop out before completing the five-year cycle; Children in remote rural areas have very limited access to education; and High levels o f student absenteeism.

IDA i s committed to helping Bangladesh realize its aspiration to reduce poverty substantially within a generation. To attain this objective, IDA’S Country Assistance Strategy (CAS, 21326-DB dated February 8,200 1) outlines a three-pronged strategy: (i) consolidating gains in human development and supporting initiatives to address the next generation o f development challenges in education, health and nutrition; (ii) implementing an integrated approach to rural development; and (iii) accelerating and broadening private sector-led growth. The CAS discussion on developmental priorities in the education sector resonates with the I-PRSP, stating that notwithstanding the past decade’s impressive gains recorded in education, improving quality and providing access to the disadvantaged remain a principal challenge, and would be key areas o f support for IDA.

Government Agenda: GOB i s fully cognizant o f these challenges and i s taking steps to address them. GOB has recently completed a National Plan o f Action for Education for All (EFA) 2002-20 15 which embraces all o f the goals o f EFA for making education compulsory, accessible and all-inclusive. The Ministry o f Primary and Mass Education (MoPME) has begun implementing (from July 2003) the second Primary Education Development Program (PEDPII), aimed at improving the quality o f education, enhancing access to schooling, and ameliorating overall management and oversight o f the state’s provision o f formal primary education. PEDPII, which i s being supported by 11 development partners

1

including IDA (with the Asian Development Bank as the lead development partner), represents a major step towards operationalizing the Government’s EFA and Poverty Reduction agenda.

However, non-formal schools providing primary education, also known as Leaming Centers (LCs), which enroll a significant proportion o f the school-age population l ie outside the ambit o f PEDPII. These institutions cater to about 8-10 percent o f students (about 1.7 million) at the primary level, and these children are mostly from the poorest segments o f society. This represents a substantial increase in enrollments since the beginning o f the 1990s, when LCs were catering to about two percent o f enrollment. Most o f these Centers provide three years o f primary education (some provide the full five- year cycle) after which many students transition to government-approved primary schools. Studies indicate that many o f these institutions have innovative teaching and learning methods and outcomes on student learning achievement, attendance and retention rates, etc. have been positive. Additionally, the Shishu Kallyan Trust (SKT) schools,’ which also cater to the disadvantaged, focus on providing primary education to workmg children in urban areas. These schools, operated by MoPME, are not covered by PEDPII. While enrollment in these schools i s small (about 20,000 students), GOB i s keen to expand this system to attract working children into school. However, significant resource constraints inhibit the ability o f LCs and SKT schools to grow, attract the most disadvantaged and provide good quality education. As these LCs were not formally recognized by GOB they have not been included in PEDPII. Thus there i s a gap that hinders GOB’S progress in reaching i t s EFA goals as stated in the National Plan o f Action.

Investments in the formal sector alone will not be enough for Bangladesh to move towards i ts EFA goals. Even if PEDPII, which focuses on supporting the formal primary sector, does achieve i t s targets, an estimated 1.8 mil l ion children would s t i l l not be in school by 2009. The net enrollment rates would then reach around 88 percent, instead o f 93 percent as targeted in the National Plan o f Action. To complement what i s being done under PEDPII, a transitional arrangement i s needed for the next 5-10 years as the Government continues to strengthen its system and enhance i ts capacity to provide quality primary education to all children in partnership with communities, NGOs, and other providers. To bridge this gap, GOB i s now committed to putting in place strategies to increase enrollments and improve the quality o f education in LCs, and MoPME has been identified as the implementing agency.

Attracting the most disadvantaged children into primary education will be challenging. Supply-side interventions focusing on building more classrooms and schools, and hiring more teachers may not be sufficient to attract these children to school. International experience, as well as the experience from Bangladesh, shows that it i s necessary to develop demand-side interventions to get these children to school by compensating the children and their families for the direct and indirect costs o f schooling, and to provide them with a teaching and learning environment sufficiently attractive to ensure that they stay in school. Developing such an environment will require community/parent participation and oversight o f center management, as well as providing flexibility to the LCs to manage and allocate resources.

Thus, this Project complements PEDPII by developing demand-side interventions to: (i) encourage out- of-school children to attend LCs; and (ii) improve the quality o f education in these Centers. Providing support for children to enroll in good quality LCs has the potential to reduce significantly the number o f out-of-school youth, and to ensure that they get quality education. Through testing and rigorously evaluating alternative approaches to enhancing access and improving quality, this strategy will allow the Government the opportunity to learn from alternative practices and methods in the delivery and management o f primary education.

’ SKT was established in 1989, with the aim o f providing primary and secondary education to working children aged 5-14. SKT i s managed by a Board consisting o f 10 members headed by the Minister, MoPME, and i s financed by an endowment. Currently SKT runs 45 schools in 37 districts - mainly in urban areas.

2

2. Rationale for Bank involvement

IDA has gained extensive experience in many countries-including Bangladesh--in developing demand- side and community-based interventions aimed at getting children into school and assisting countries in moving towards their EFA targets. Furthermore, IDA has a long history o f supporting primary education in Bangladesh. IDA has also maintained a dialogue with the Government, development partners, NGOs and civil society on options to support students who, having no access to the formal system, are le f t out o f PEDPII. The proposed ROSC Project i s consistent with the overall PEDPII framework. Aimed at getting children into LCs that provide primary level education, the Project will address the problem o f out-of-school children and test approaches to reaching out to them. This would provide GOB with the knowledge and experience about addressing the issue when planning for the next primary education sub- sector program that i s expected to follow PEDPII.

IDA’S resources for this Project will be made available on a ‘grant’ basis to GOB. This would permit direct monitoring o f the grant resources to show the impact o f grant funds in solving a specific problem. The results will provide the justification for the use o f more such resources in the future.

The value added elements o f IDA’S support will be to bring experiences from around the world and from Bangladesh: (a) in community management and mobilization; (b) the management and implementation of the education allowances and L C grants; and (c) comprehensive multi-level monitoring and evaluation.

3. Higher level objectives to which the project contributes

The Project contributes to Bangladesh’s long-term objective o f poverty reduction through the development o f human capital. This i s directly linked to the CAS objective(s) outlined in A.l above. The Project will also contribute to learning through testing new ways in which educational services could be delivered to the poorest and most disadvantaged children while ensuring adequate transparency and accountability.

B. PROJECT DESCRIPTION 1. Lending instrument

The proposed Bank instrument i s a Sector Investment Loan (SIL) financed through an IDA grant. GOB i s committed to extending coverage to all out-of-school children and to supporting non-formal LCs. The Project supported by the IDA grant will effectively test a package o f demand-side interventions aimed at widening access to primary education and improving the quality o f education in LCs and SKT schools. Lessons drawn from these will be critical as GOB moves towards assuming full fiscal responsibility for extending support to the non-formal system in order to achieve i t s EFA goals.

2. [If Applicable] Program objective and Phases

N/A

3

3. Project development objective and key indicators

The key objective o f the Project i s to reduce the number o f out-of-school children through improved access, quality and efficiency in primary education, especially for the disadvantaged children, in support o f GOB’S national EFA goals.

The key performance indicators (KPIs; for details see Annex 3) by End o f Project (EOP) include the following:

The number o f out-of-school children reduced by about 0.5 million. About 1.4 mil l ion student-years supported for new students. Percentage o f students reaching expected competency level based on teacher’s assessment in Bangla and mathematics not less than 65%. Average annual student attendance rate not less than 75%. Student grade completion rate not less than 80%. Average teacher attendance rate not less than 90%. Students in each grade to have on average, the same number o f textbooks as those in corresponding grades in the formal primary education system. Student transition rate to public and NGO schools to Grade 4 (from Grade 3) not less than 80%, or to Grade 6 (from Grade 5) not less than 70%.

(1) (2) ( 3 )

(4) (5) (6) (7)

(8)

At completion, the Project wil l be rated: 0

0

0

0

0

‘Highly Satisfactory’ if it achieves the core KPIs comprising indicators (1) through (5) above and at least one o f the remaining KPIs.

‘Satisfactory’ if it achieves the core KPIs. ‘Moderately Satisfactory’ if it achieves any five o f the KPI’s listed above but not all the core KPI’s.

‘Unsatisfactory’ if it achieves only four o f the K P I s listed above. ‘Highly Unsatisfactory’ if it achieves only one to three o f the K P I s listed above.

4. Project components

This i s a learning and evaluation Project that tests alternative approaches aimed at providing access to quality primary education. The Project will assist in the establishment o f Learning Centers (LCs) at the local community level by providing L C grants, and enroll students by providing education allowances. In order to achieve this, the Project will strengthen the capacity o f communities and local level institutions, and empower them to organize and manage the provision o f quality education. Project coverage will commence with targeting 60 Upazilas (out o f a total o f 484 Upazilas in Bangladesh) based on: (i) net enrollment rates; (ii) the gender gap in enrollment; (iii) the primary cycle completion rate; and (iv) poverty levels. The number o f Upazilas covered could be increased over the l i f e o f the Project. The Project will be implemented through the following components (see Annex 4 for a detailed description, and Appendix to Annex 4 for l i s t o f Upazilas).

Component I: Improving Access to Quality Education for Out-of-School Children (US$53.4 million)

The objective o f this component i s two-fold: to support schooling for out-of-school children and to facilitate their completion o f primary schooling through: (a) education allowances for eligible students; and (b) grants to LCs where the students enroll. In 60 percent o f the selected Upazilas, both education allowances to eligible children and grants to LCs will be provided. In the remaining Upazilas, only grants will be provided to LCs. The project implementation unit, in consultation with IDA, wil l finalize the choice o f upazilas where LCs will receive grants, and those where both education allowances and grants

4

will be provided. Regular evaluations will be conducted during the Project to examine the effectiveness o f these options, and decision will be made accordingly on modifying the percentages above, An Operations Resources Manual prepared by MoPMEiDPE will specify the procedures and guidelines for distributing education allowances and L C grants.

Subcomponent 1. I: Education Allowances to Out-of School Children

Financing under this subcomponent will include an education allowance scheme to attract out-of-school children to LCs. The annual education allowance will range from Tk.800 for class 1-3 and Tk.970 for class 4-5 students. Education allowances will be channeled to qualifying children through bank accounts, managed by their mothers or guardians, and will be disbursed twice a year.

Subcomponent I .2: Grants to Learning Centers/Schools

Each L C will be managed by a Center Management Committee (CMC).* Financing under this subcomponent will include grants based on specific criteria to eligible LCs which enroll new students to deliver quality education. These grants will range from Tk.25,000 for class 1-3 to about Tk.3 1,000 for class 4-5 per annum. Learning Center grants will be disbursed twice a year to qualifying LCs through bank accounts managed by the CMCs. A portion o f the grants will be earmarked for quality enhancements and improving school management and the remainder will be used at the discretion o f the CMC for teachers’ salaries, LC maintenance and renovations, improved sanitation and provision o f safe drinking water, extra-curricular activities, etc. In Upazilas where LCs receive only grants, the grant per L C will be approximately between Tk.55,000 - 65,000 per annum (by incorporating the average value o f the education allowance into the grant). Students in these LCs will not participate in the ROSC education allowance scheme.

Subcomponent 1.3: Shishu Kallyan Trust (SKT) Schools

The Project will finance grants to SKT schools and education allowances to working children enrolled in these schools. The education allowance will meet the direct and indirect costs o f schooling and compensate for a portion o f the opportunity costs for working children. The grant, to be provided on a per-capita basis, will also cover a part o f SKT program management expenditures. The annual educational allowances will be around Tk. 1400 for each student. Grants will be in the range o f Tk. 25,000-30,000 per annum.

Component 2: Communications and Social Awareness (US$2.7 million)

The objectives o f this component are to: (a) raise awareness about primary education in general and about the Project in particular, through appropriate media and communication campaigns; (b) mobilize stakeholders to open new LCs or expand existing LCs; (c) disseminate information on qualification criteria, resource support, and other operational guidelines to stakeholders; and (d) assess the effectiveness and ‘reach’ o f the communications and social awareness activities.

Subcomponent 2. I: Social Awareness

This subcomponent will finance: (a) the development and delivery o f effective communication about primary education in general and the Project in particular at the family, community, Upazila and national levels; (b) the development and distribution o f concise informational packages o f materials, which will be

The CMC would b e composed o f f ive parentslguardians, one female ward member, one UEO representative, and one Education service provider (see below), with the teacher as the member secretary to the CMC.

5

broadly distributed to potential Education Service Pro~iders(ESPs)~/Education Resource Providers (ERPs)~; and (c) logistical support for enhanced communication between the UEOs and the LCs.

Subcomponent 2.2: Community Mobilization

This subcomponent will finance: (a) the development o f community mobilization training modules for the training o f trainers (TOT) and other related materials; (b) the initial training o f CMC members; and (d) the preparation o f community mobilization reports for each Upazila.

Component 3: Project Management and Institutional Strengthening (US$2.4 million)

The objectives o f this component are to: (a) establish a sound structure for managing and implementing the Project; and (b) develop and strengthen the capacity to deliver quality primary education to out-of- school children.

Subcomponent 3.1: Project Management

The organization o f Project management i s illustrated in the Chart in Annex 6. Following i s a brief description o f the functions and responsibilities o f the key units in the management structure.

A t the national level, MoPME will be responsible for oversight o f the Project. DPE will be the implementing agency o f MoPME for the Project. GOB will establish a ‘Reaching Out-of-School Children’ (ROSC) Committee which will oversee overall project implementation, carry out joint annual reviews, and resolve implementation issues. The ROSC Unit, established by MoPME and headed by a Project Director, will be directly responsible for the day-to-day implementation o f the Project. Supporting the Project Director will be five Assistant Directors (ADS), each heading a section, who will be responsible for implementing various Project activities. At the Upazila level, the UEO will process applications for establishing LCs, facilitate disbursements o f education allowances and grants, and coordinate the monitoring o f LCs.

At the local community level, the CMCs will be responsible for managing the LCs with support from ESPs o f their choice. To support quality improvement o f the LCs, the CMCs will seek assistance from ERPs chosen by them.

Subcomponent 3.2: Institutional Capacity Building

For effective project implementation, the capacity at the central, Upazila and local community levels will be strengthened through regular in-country training, including management, educational development and financial management training. For key personnel in critical areas there may be some overseas training. Institutional capacity building efforts will be extended to ESPs and ERPs based on a needs assessment through appropriate in-country and international training.

To develop and enhance local community capacity, the ROSC Unit will prepare a standardized training and dissemination package, incorporating elements o f fiduciary responsibilities (resource management, supervision, procurement, etc.) and more broadly, project implementation responsibilities. The training

Education Service Providers (ESPs) are those agencies selected by CMC’s, in accordance with agreed terms, conditions and criteria, to assist in identify out-of-school and hard-to-reach children, to ensure their enrollment and attendance, and to support the CMC’s in running the LCs.

Education Resource Providers (ERPs) are NGOs, educational institutions, or agencies, wi th a multi- districthational presence and extensive experience in primary education, teacher training and curriculum development, selected by CMC’s to carry out educational technical services in accordance with agreed terms, conditions and criteria.

6

package wil l be designed on the basis o f a pre-implementation study to identify current practices in community organization and management. The package will include guidelines on procurement o f services, resource management, and accounting.

Subcomponent 3.3: Networking to Improve Quality

The ROSC Unit will facilitate the establishment o f a network o f participating ERPs, supported by a network coordinating body. The purpose o f this network will be to provide technical advisory services and equipment to ERPs, and to ensure the quality o f educational services provided.

Component 4: Monitoring, Evaluation and Research (US$4.3 million)

The objective o f this component i s to provide an effective monitoring and evaluation system to: (a) monitor the use o f grants support; (b) monitor the use o f education allowances; and (c) evaluate the two programs through action research, thematic studies, and impact assessments. In order to establish a baseline, qualitative and quantitative surveys at the level o f the household, community and LCs will be undertaken within the f i rs t six months o f project implementation.

Subcomponent 4.1: Monitoring the use of Grant Support by Learning Centers

This subcomponent will comprise monitoring activities relating to L C operations; student information; teacher information; utilization o f grants; and annual grant audits. T h i s task will be carried out by a contracted independent agency which will report to the ROSC Monitoring Section. The Upazila Education Office will be the administrative center for the monitoring process.

Subcomponent 4.2: Monitoring and Assessing the use of Education Allowances

Activities under this subcomponent will comprise monitoring and assessing education allowances to children attending LCs and SKT schools. The task wil l be carried out by the independent agency mentioned under Subcomponent 4.1 above, with the assistance o f CMCs and the UEO.

Subcomponent 4.3: Evaluating the Impact of Grants and Education Allowances

Activities under this subcomponent will be carried out by a contracted independent agency with relevant experience in the evaluation o f education programs, including the design and fielding o f nationally representative surveys, and the statistical analysis o f data derived from such surveys. Evaluation activities will include baseline surveys, assessment o f the operation o f recipient LCs, trachng expenditures including the disbursements o f grants and education allowances, and the overall management o f the Project. The evaluation will help provide information to GOB for any future efforts to institute standardized education criteria for the primary education system at large.

Subcomponent 4.4: Analytical Studies of Non-Formal Education

GOB has constituted a Task Force which i s developing a national non-formal education framework. Reviews and studies to be carried out under this component will be linked up with issues identified by the Task Force. A sector analysis o f primary schools that fall under state purview, will be undertaken to complement the work undertaken by the task force. GOB will also be supported in institutionalizing the non-formal education framework and implementing task force recommendations relevant to the primary education sub-sector.

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5. Lessons learned and reflected in the project design

Based on the experience o f previous Projects in Bangladesh as well as other intemational experience, some key lessons include:

Reliance on just one mode ofprovision ofprimary education may not be sufficient, Focusing on investments in the formal primary system, as PEDPII i s doing, i s extremely important. However, this would not be sufficient for Bangladesh to move towards achieving i t s EFA goals. By the end o f PEDPII, i t i s estimated that 1.8 mill ion children (most o f them coming from the most disadvantaged backgrounds) would s t i l l be out o f school. Recognizing that the NGO sector in Bangladesh, through their LCs, have the capacity to deliver good quality primary education, this Project focuses on getting primary-aged out-of- school children into these schools and providing them with good quality education. About 0.5 mill ion children are expected to benefit from the Project.

Institutional autonomy and accountability. An important reason why educational institutions do not provide good quality education i s that they have l i t t le autonomy to make decisions. The Project aims to alter this aspect. First, with regard to autonomy, LCs will be provided grants and will be responsible for making decisions as to how to use them for quality improvements, management, environmental improvements, etc. In terms o f accountability, the resources that LCs receive are tied to the number o f students enrolled. If LCs provide poor quality education, parents have the option to remove their children from the Centers. Given that financing i s tied with performance in this manner, LCs have the incentive to be accountable to parentdchildren.

Enhancing community involvement. Community involvement i s essential for improving the quality and coverage o f services in remote areas, as well as for Project sustainability. International experience suggests that communities become actively engaged when they have meaningful responsibilities, control over resources, and are accountable. These, along with good quality education for their children, are the incentives for community participation. The Project reflects these lessons in seeking to set up CMCs to be responsible for establishing and managing LCs.

Enhancing access through demand-side interventions. The Government’s strategy to promote education for the poor and girls through demand side interventions has enhanced access. Two programs provided subsidies to selected students and their families. The Food for Education (FFE) program provided grain rations to disadvantaged families if they send their children to primary school (it has been recently replaced by a targeted direct cash-subsidy stipend program and over five mil l ion students are expected to receive the stipend annually). The Female Secondary Stipends (FSS) program provides stipends and tuition waivers to female students residing in rural areas attending grades 6- 10 (with close to four mill ion girls receiving stipends annually). These programs have been successful in enhancing access, even though there are leakages associated with them, which the Government i s trying to minimize. The FFE succeeded in sending poor children to school: i t i s estimated that participation in the FFE increased the probability o f attending school by 20 percent. An additional year o f the FSS i s estimated to increase female secondary enrollment by as much as eight percent. The Project aims to enhance the access for the most disadvantaged by providing educational allowances to students.

Ensuring rigorous project evaluation. The Project i s testing the effectiveness o f alternative approaches in enhancing access and ensuring quality education for out-of-school children. Given that one o f the aims o f the Project i s to leam about the effectiveness o f these approaches, a comprehensive evaluation system, including establishing an agreed baseline, i s critical to the Project. This will allow for testing o f whether the Project i s meeting i t s systemic goals and also provide informatioddata for real-time corrective action. Extensive emphasis i s being placed on these aspects and resources have been provided to enable research, surveys and rigorous impact evaluations to be undertaken.

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6. Alternatives considered and reasons for rejection

The Project complements PEDPII. Given the nature (diversity, non-standardized, multiple providers etc.) o f non-formal provision in primary education, the design i s aimed at being flexible and testing different approaches. Several alternative approaches and design elements were considered:

Focus on supply-side interventions. While building schools and classrooms was an option, i t was rejected because such interventions are unlikely to attract children into schools, particularly the most disadvantaged. Providing incentives (education allowances) to families to enroll their children into LCs, providing institutions greater autonomy to manage their resources, and making them more accountable to parents were considered to be more effective in enhancing access and improving quality. Hence the approach used in the Project focuses on the demand-side - i.e. providing education allowances to children and grants to LCs.

Supporting formal sector institutions. This alternative was rejected as IDA, along with 10 other development partners, and GOB have recently committed to fully financing formal primary education for the next six years. However, LCs, which are not covered under PEDP 11, perform an indispensable educational and social function o f reaching out to the poorest and most disadvantaged strata o f society. The Project focuses on providing direct assistance to these Centers and to students to encourage enrollment in them.

Provision of Education Allowances and grants in all targeted Upazilas. I t was originally envisaged that education allowances and grants will be provided in all targeted Upazilas. This option was rejected on the basis o f feedback received during extensive stakeholder consultations during the Project preparation process. Wh i le some stakeholders fel t that i t was necessary to provide incentives (education allowances) to families to attract them to send their children to school, others fel t that the presence o f a high quality teaching/learning environment, which will be enabled through grants, will be enough to attract children to LCs. Hence, the Project i s designed so that education allowances and grants are provided in 60 percent o f eligible Upazilas, and only grants in the remaining 40 percent o f eligible Upazilas. The effectiveness o f these alternatives will be tested through rigorous impact evaluation carried out during project implementation.

Targeting education allowance payments. Most o f the out-of-school children are from poor families-- gross enrollment rates among the poor are 85 percent and are over 100 percent among the non-poor. In addition, most o f those who do attend LCs run by NGOs come from the poorest households: 77 percent o f these children come from households with a per capita expenditure o f less than $0.50 per day, as opposed to 40 percent o f such households that send their children to formal primary schools. Given that over 90 percent o f all out-of-school children belong to poor households, many o f them ultra-poor. Finally, Upazilas where the Project wil l be initiated are among the poorest in the country. Considering this reality, as a first step, the Project will provide education allowances to al l new enrollees in Upazilas where education allowances are being provided.

Using alternative institutions (to MoPME) for project implementation, Whi le i t i s possible to use other agencies to implement the Project (e.g., the private sector, social fund type institutions), this alternative was rejected for two main reasons. First, MoPME has accepted the concept o f supporting LCs r u n s by NGOs, and the Project i s an ideal way to engender this approach. Second, a long-term objective for primary education in Bangladesh i s for GOB (through MoPME) to support education for all primary school aged going children. The Project will provide MoPME with the opportunity to implement and test approaches to reach disadvantaged out-of-school children. Through the Project implementation, MoPME

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will enhance its knowledge and experience to address this issue when planning for the next primary education sub-sector program as a follow-up to PEDPII.

Contracting directly with NGOs to deliver education. In this Project communities will enter into an agreement with NGOs (or other such service providers) to deliver primary education. This approach has certain advantages over direct contracting o f NGOs. First, empowering the communities to choose their education providers (and then in the operation o f schools) will lead to greater accountability o f the L C to the community/parents. Second, selection o f the NGOs by a Government implementing agency has often been subject to political interference in the past. Wh i le this can s t i l l happen if communities are entering into agreement with service providers, the likelihood i s significantly reduced in the case o f the current Project, as the Government implementing agency does not have direct control over the choice o f the service provider. Finally, while GOB i s currently developing transparent criteria and mechanisms to contract NGOs (the NGO Foundation currently being designed by the Ministry o f Finance), i t i s likely that it will be another 18-24 months before the foundation becomes functional.

C. IMPLEMENTATION 1. Partnership arrangements (if applicable)

Bangladesh became eligible for IDA grants for fiscal year 2004, presenting an opportunity to utilize grant funds for the poorest primary school-aged children who were not covered under PEDPII. During the preparation o f PEDPII, the inclusion o f children outside the formal primary system was discussed with GOB and among Development Partners (DPs). It was agreed then that PEDPII will focus on formal primary education, and a follow-up operation to cover children out o f school/ in non-formal institutions could be prepared subsequently.

MoPME has shown strong ownership o f ROSC, and has invited DPs and NGOs to participate in the design and preparation o f the Project. While several DPs would prefer a more comprehensive sub- sectoral approach to primary education in Bangladesh, extensive consultations with DPs revealed that i t will take more time to reach consensus on the parameters o f such an operation. T h i s i s an attractive proposal, however, the additional preparation time required would have made it difficult for GOB to ensure commitment o f IDA Grant funds by June 30,2004. In addition, the option o f establishing an NGO funding mechanism was also discussed during Project preparation, but as explained in the section above, this was not feasible at this stage. While continuing the dialogue between GOB, DPs and NGOs with the aim o f developing a programmatic approach to primary education, GOB decided to proceed with ROSC which has the potential to significantly reduce the number o f children who would otherwise not have access to primary education. This would allow Bangladesh to reach i t s own EFA goals by 2015.

From a systemic perspective, additional financing would be required to assist GOB to help all out-of- school children to receive good quality primary education. In this context, DPs would have a crucial role to play. The proposed Project tests some approaches to enhance access to primary education for out-of- school children. Given that the Project will be operational in only about 60 out o f Bangladesh’s 484 Upazilas, collaborative efforts with GOB, NGOs, communities and other Development Partners would help to scale up these and other potential approaches. The approaches proposed in the Project are also flexible enough to allow for adjustments in design during implementation.

In order to set the stage for scaling up efforts, a sector analysis i s built into Component 4 - Monitoring, Evaluation and Research (see component 4.4). The study will examine the non-formal education sub- sector, identify financing options for DPs, and provide recommendations towards a wider and holistic approach to the primary education sub-sector. This analysis will also provide a forum for initiating and continuing dialogue involving the Government, DPs, and other stakeholders with the aim o f developing a fully programmatic approach to primary education in the near future.

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The Swiss Agency for Development Cooperation (SDC) has followed up i t s interest to participate in ROSC, and will cofinance US$6 million. This funding commitment awaits approval from SDC headquarters in Bern. Discussions and detailed information-sharing with the EC for possible participation are ongoing.

2. Institutional and implementation arrangements

At the national level, MoPME will be responsible for oversight o f the Project. DPE, under MoPME, will be the implementing agency for the Project. GOB will establish a ‘Reaching Out-of-School Children’ (ROSC) Committee which will oversee overall Project implementation, carry out joint annual reviews, and resolve implementation issues.

A Reaching Out-of-School Children Unit (ROSC Unit), established in DPE by MoPME, and headed by a Project Director (PD), will be directly responsible for day-to-day implementation. Supporting the PD wi l l be five Assistant Directors (ADS), each heading a section, who will be responsible for implementing various Project activities relating to: (a) provision o f education allowances and L C grants; (b) training and education development; (c) monitoring, evaluation, and research; (d) communications and social awareness; and (e) finance and administration. The PD and the five ADS, operating as a unified team, wil l be appropriately supported by a procurement officer, Project officers, computer operators and other required support personnel with relevant sk i l ls and experience. The ROSC Unit, in implementing the Project, will follow the policy directives o f the ROSC Committee.

At the Upazila level, the Upazila Education Office (UEO) will process applications for establishing LCs, facilitate disbursements o f education allowances and grants, and coordinate monitoring teacher and student attendance at LCs. The UEO will report directly to the ROSC Unit PD on Project related matters, and will share Project related information with the District Primary Education Officer and DPE.

At the local community level, the Center Management Committee (CMC) wil l be responsible for managing the LCs with support from ESPs. The ESPs appointed by the CMCs will lead community mobilization efforts to identify the target population, encourage it to start a school, and help organize the appropriate LCs. To support quality improvement o f the LCs, the CMCs wil l seek assistance from Education Resource Providers (ERPs).

3. Monitoring and evaluation of outcomes/results

The M&E component, as an integral part o f the Project, w i l l put in place a system to monitor the implementation o f the two main interventions: (a) provision o f grant funds to LCs; and (b) education allowances to students. Integral to the M&E system wil l be measures to evaluate these interventions and their outcomes/results. Monitoring and evaluation will be separate and distinct processes. Details for Project M&E are provided in Annex 3 (Results Framework and Monitoring) and Annex 4 (Detailed Project Description).

Monitoring o f the operation of the LCs, especially student and teacher attendance, will be carried out by the CMCs and UEOs who will be responsible for collecting data and information on the LCs. Data on SKT schools w i l l be collected by the SKT Director. All Project data and information will be transmitted to a contracted independent agency, which will be working closely with UEOs, for processing and preparation o f statistical and other reports to be submitted every six months to the ROSCU. Oversight responsibility for all the above will rest with the ROSCU.

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Evaluation o f the interventions and achievement o f Project objectives will be carried out by a contracted independent nationalhternational agency which will prepare an evaluation report every six months to be submitted directly to the ROSCC. The evaluation report will be based on special evaluative thematic studies and action research as well as the statistical and other reports prepared by the independent monitoring agency.

Risks To project development objective Gove”ent “itment diminishes with regard to utilizing the IDA grant

As the monitoring and the evaluation reports will assess the efficacy o f the Project interventions, particularly the LCs’ compliance with the conditions for Project support, they wil l provide the basis for the disbursement o f grant and education allowance funds. Hence, the agencies responsible for the respective reports will need to be timely in meeting the production deadlines.

Risk Risk Mitigation Measures Rating

GOB’S recent commitment for MoPME, the education l ine Ministry, to M

Annual and Mid-Term Review. Annual reviews will be undertaken jointly by the ROSC Unit and IDA. A mid-term review (MTR) will be held around July 2007. Two months prior to the MTR, a comprehensive report on Project progress and achievements will be prepared by the extemal evaluation agency, under Terms o f Reference acceptable to IDA, and submitted to the ROSC Unit. The reports would provide the basis for review o f the Project by the ROSC Committee which would provide feedback to the ROSC Unit and disseminate the reports to all concerned agencies.

4. Sustainability

The sustainability o f this Project will ultimately depend on GOB’S commitment to supporting the financing o f primary education for all. This implies that GOB needs to commit to finance primary education provided in Government schools and in learning centers (or by other potential providers) provided they meet some quality standards. Through PEDP I1 and the current Project, GOB i s clearly moving in this direction. The Project complements the development objectives o f the Second Primary Education Development Program (PEDPII, 2003-2009), supports MoPME’s strategy to achieve the EFA and Millennium goals, and augments GOB investments to increase access to quality primary education. Learning Centers supported under this Project are essentially transitional institutions which will provide basic education to hard-to-reach children from hard-core poverty groups until MoPME has developed the capacity, in terms o f physical facilities, professionally qualified teachers, and administrative support services which would be enhanced under PEDPII to ensure education for all by 20 15. From a financial perspective, if learning centers are going to be supported through the GOB budget following the end o f the Project, the recurrent cost implications are not very significant - an increase o f 3-4 percent. Given that the total costs under PEDP I1 (recurrent+development) fall well within the education budget projections for 2009/10, absorbing the additional recurrent costs due to financing o f learning centers i s likely to be sustainable for GOB.

Community mobilization -a key aspect o f the Project - will also be critical towards ensuring sustainability. The Project aims to mobilize communities to manage learning centers and financial resources for these centers. In other countries, empowerment o f communities along these lines has been shown to lead to enhanced community contributions (in cash or in-kind) towards the operation o f schools, thereby augmenting sustainability.

5. Critical risks and possible controversial aspects

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Risks

Dissemination of information and

timely manner. Component 3 - Project Management

inadequate attention from DPEj due to capacity constraints.

Component 4 - Monitoring, There could be leakages in the disbursements of educational allowances and grants.

Overall Risk Rating

does not Occur in a

Implementation suffers because of

resources to support the provision of education to out-of-school children, in l ine with i t s EFA goals and i ts PRSP objectives.

A Communications and Social Awareness plan will be prepared, and M substantial pertinent activities will be frontloaded.

and Institutional Development

delivery of allowances and grants will start at the beginning of 2005, this wi l l provide adequate lead time.

ROSCU will be the focal point for implementation. Additionally, since M

Evaluation and Research Rigorous monitoring mechanisms, and independent program evaluation S have been designed to ensure that irregularities are minimized. Annual impact studies and action research will reinforce these mechanisms.

M

CMCs and communities do not participate actively in Center/school management activities.

Access to quality primary education to out-of-school children i s not improved to such an extent that this would lead to increased productivity, and therefore increased income, and ultimately to a reduction in poverty.

Risk Mitigation Measures implement the Project, and its agreement to contribute towards Project financing are indicators of ownership and commitment. Strategies for Project delivery will be adjusted annually based on overall implementation progress. Project risks will be assessed as well, and if necessary, Project design will be altered to reflect prevailing conditions. Component 4 of the Project provides for (i) raising awareness at community, upazila and national levels on the multi-dimensional benefits of primary education and Project approach; (ii) mobilizing families, communities, and local education service providers to open new LCs or expand existing Centers; and (iii) disseminating information on qualification criteria, resource support, and other operational guidelines to all stakeholders. CMCs will be supported by UEOs and ESP’s in school management, and will undergo relevant training. Provision of well-targeted education allowances to poor out-of-school children to ensure retention and increase demand for primary education among poor children/families. Increased awareness campaign will reinforce the importance of quality primary education.

Risk Rating

M

M

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6. Loadcredit conditions and covenants

By Grant effectiveness GOB would have fulfilled the following conditions:

(a) Approved the Project Proforma; (b) Appointed appropriate persons for the key positions agreed for the ROSC unit, with Terms o f

(c) Finalized the Terms o f Reference satisfactory to IDA, for the external evaluation agency. Reference satisfactory to IDA; and

Grant Covenants

AccountdAudit. The Borrower shall: (a) maintain separate accounts for the Project in a format acceptable to IDA; (b) furnish to IDA audit reports conducted by independent auditors, acceptable to IDA, within six months from the end o f each fiscal year; and (c) furnish quarterly Financial Monitoring Reports (within 45 days from the end o f each quarter) commencing from Grant Effectiveness until Project closure. MoPME will maintain throughout the Project’s implementation period a computerized financial management system acceptable to IDA. MoPME will appoint private audit f i r m s to audit annually the disbursement o f education allowances and grants under the Project.

Project Management. The Borrower shall: (a) cause the Directorate o f Primary Education (DPE) to carry out project implementation activities in accordance with the annual operational plans and the Operations Resource Manual, as revised and agreed with IDA; (b) cause the Reaching Out-of-School Children Committee (ROSC Committee) to carry out joint annual reviews and provide advice and guidance to DPE; (c) ensure that the established Reaching Out-of-School Children Unit (ROSC Unit) i s competently and fully staffed for the entire Project period; and (d) provide adequate annual budget allocations to the ROSC Project including GOB counterpart funding.

Monitoring, Evaluation, Research, and Reporting. The Borrower shall establish a monitoring and evaluation scheme to monitor Project progress and achievement o f Project objectives, including tracking o f expenditures. DPE will maintain a Management Information System (MIS) under terms and conditions satisfactory to IDA. The Borrower shall ensure that the contracted external monitoring agency and the external evaluation agency are in place no later than November 2004.

Implementation. DPE shall: (a) cause every Learning Center under the Project to establish and maintain until completion o f the Project, a Center Management Committee, with Terms o f Reference acceptable to IDA; (b) enter into an annually renewable Cooperation Agreement with each Learning Center, satisfactory to IDA; the Cooperation Agreement will be signed by each Learning Center by December 3 1 for that Learning Center to be eligible for the subsequent Academic Year; and (c) enter into a renewable Participation Agreement with Nationalized Commercial Banks which include accountability measures to ensure that they provide quality and timely services as per the disbursement schedule for education allowances and Learning Center grants.

Environment and Social Covenants. The Borrower shall apply the agreed guidelines relating to Environment and Tribal Children.

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D. APPRAISAL SUMMARY 1. Economic and financial analyses

Disadvantaged children face significant demand-side constraints to go to school. Given the relatively high opportunity costs o f schooling, the lack o f demand-side incentives implies that parents find it relatively difficult to send children to LCs. These also lack resources to adequately invest in teaching/learning materials. The Project will encompass investments in the form o f education allowances to children and grants to LCs to help address the issues outlined above.

I t i s estimated that at least 500,000 students will benefit from the access and quality improvement measures. A cost-benefit analysis was carried out to identify the number o f beneficiaries, and the costs o f targeting out-of-school children. The Project yields an Economic Internal Rate o f Return (ERR) o f 15 percent. The real rate o f return i s likely to be somewhat higher reflecting positive externalities and longer-term intergenerational social benefits that come with increased levels o f education, including lower fert i l i ty rates and improved health outcomes to which i t i s difficult to assign monetary values. The investment will promote improvements in access to LCs for out-of-school children, beneficiaries o f which will be the incremental students entering the education system.

A poverty and benefit incidence analysis was also carried out to assess the extent to which the Project will target the poorest out-of-school children. As o f 2000, the number o f out-of-school children constituted approximately 2.5 mil l ion o f total primary school cohort - with almost all belonging to poor households. I t i s estimated that following PEDPII completion, approximately 1.8 mil l ion will st i l l be out-of-school. Through the Project about 30 percent o f these children belonging to poor households will be targeted.

The recurrent cost implications o f PEDPII are about $450 mil l ion in 2009/10. The additional annual recurrent cost implications o f supporting students attending learning centers will range from about $40-44 million. If learning centers are going to be even partially (50 percent) supported through the GOB budget following the end o f the Project, the recurrent cost implications in 2009/10 will not exceed $475 mil l ion (an increase o f less than 6 percent). Given that total costs under PEDPII fal l well within the primary education budget Projections for 2009/10, absorbing the additional recurrent costs envisaged here through partial support for the learning centers should be sustainable for GOB.

2. Technical

Implementation Capacity. PEDPII i s an undertaking which will challenge the capacity o f MoPME and DPE. To ensure that implementing the ROSC Project does not hrther tax the implementation capacity o f DPE, the ROSC Unit will be maintained as a relatively small entity. At the Upazila level, while the Upazila Education Office will be involved in program monitoring, a significant part o f this responsibility will also be contracted out to ease the burden on the upazila staff. The community, through the Center Management Committee, will play a crucial role in the establishment and management o f LCs.

Teacher Development. Well-performing teachers will be the fulcrum o f quality education in LCs and schools. Many teachers in non-formal teaching positions do not have the pre-requisites in academichowledge content nor pedagogical training. The Project will provide grants, a portion o f which w i l l be earmarked for quality-related activities, which will be used, for example, for initial teacher preparation and continuous teacher support aimed at enhancing pedagogical skil ls, that LCs will contract from ERPs. A network o f participating ERPs will be established whose functions will include upgrading teachers’ knowledge content; supervising teachers’ classroom performance; and development o f classroom-based, formative assessment activities.

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Disbursement of Grants and Educational Allowances. Disbursements will be based on the lessons o f experience in Bangladesh. Following the practices adopted in other IDA projects in Bangladesh, a Participation Agreement will be signed with the concerned Nationalized Commercial Banks to disburse funds to the eligible students and LCs. Such banks will receive a service charge o f 2.5 percent o f disbursed amounts.

Monitoring and Evaluation. To facilitate effective use o f data for policy formulation, planning and decision-making, a comprehensive M&E scheme will be established to ensure proper program monitoring and accountability at all levels. The M&E Section in the ROSC Unit will be responsible for the internal monitoring o f the Project. External monitoring will be required to ensure the validity o f data gathered and this activity wil l be carried out by a contracted independent agency. In addition to regular monitoring and evaluation, a Quantitative Service Delivery Survey (QSDS) will also be undertaken as a diagnostic tool for analyzing data on education and education finance from a governance perspective.

3. Fiduciary

Procurement

Procurement Environment and Reform Actions: Under the Public Procurement Reform Project (PPRP) currently being implemented, the Government has: (a) established a Central Procurement Technical Unit (CPTU) with adequate staffing funded from i t s own resources; (b) issued Public Procurement Regulations 2003 in October 2003 and Implementation Procedures in March 2004; and (c) prepared standard bidding documents (at approval stage). Concurrently, a capacity building plan to train 1,600 GOB staff i s underway. These actions contribute positively to an enhanced procurement environment.

Implementation of Procurement and Cauacitv Assessment: DPE will be responsible for managing the Project. The Project will largely involve education allowances to students, and very small annual grants to eligible learning centers (maximum about US$l,OOO) supported by Education Service Providers (ESPs). The grants will cover distinct firids for establishment, quality, management, training, and discretionary spending. Each learning center will be managed by a Center Management Committee (CMC). CMC may obtain certain specialized services from Education Resource Providers (ERPs). Since each grant will be o f very small amount and there are not many ERPs in the relevant field o f the locality, in most cases, CMCs will directly obtain services from the qualified ERPs. A l i s t o f potential ERPs and a financing agreement will be agreed with DPE depending on the eligibility criteria. In addition, the Project will involve small procurement o f goods, and some consultants services. DPE will disburse funds to the community managed learning centers’ bank accounts directly in two tranches (semi-annually). Considering the inadequate experience o f CMCs, a knowledge dissemination scheme by DPE will be undertaken to ensure appropriate use o f funds. Given the nature o f the Project, based on the procurement capacity assessment and the need for improvement, the procurement associated risk is rated average. One Procurement Officer will assist DPE in handling procurement matters including use o f grants and i t s financing arrangements between the learning centers and ESPs/ERPs. Details are provided in Annex 8.

Rules and Guidelines: All local procurement for IDA-financed goods, and services for which the shortlist entirely comprised o f national consultants, wil l follow the Government’s Public Procurement Regulations 2003, acceptable to the Bank (goods: < US$300,000 per contract, consultants’ services- f i rms: < US$200,000 per contract, individuals: < US$50,000 per contract). Consulting services and training obtained through international advertisement will follow the Bank’s Consultants Guidelines.

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Procurement Plan: The draft Procurement Plan has been prepared by DPE. The Plan includes the initial 18 months procurement, which then will be updated annually always covering the next 18 months requirement. All procurement activities shall be undertaken in accordance with this Plan.

Use of Standard Documents: DPE will follow IDA’S Standard Bidding Documents/Request for Proposals for international consultants, with Government’s issued documents under the new procurement regulations for all local procurement.

Prior Review Thresholds: IDA will carry out prior review o f the following contracts: (i) for goods - contracts estimated to cost US$300,000 equivalent or more and the first one contract regardless o f the value and method; and (ii) for consultant’s services- contracts estimated to cost US$lOO,OOO equivalent or more for f i r m s and US$50,000 equivalent or more for individuals.

Post Review/ Independent Procurement Audit: Procurement review o f small valued contracts below the threshold including grants contracts with ERPsESPs will be carried out annually on a sample basis (20 percent) by an independent consulting firm (Chartered Accountants’ firm with international affiliation).

Financial Management (FM)

The FM arrangements under the proposed Project will mostly follow existing Government policy and procedures. There are clear guidelines for authorization and approval o f financial transactions at the Ministry (MoPME) and Project levels (ROSCU). The existing systems are considered adequate for the Project. In addition, contractual agreements between Banks, Learning Centers and the ROSCU and education allowance criteria to student will indicate expenditure eligibility under Project components and will form the basis for accounting in appropriate heads. Under the direct supervision o f the ROSCU Project Director, an Assistant Director will be responsible for financial management activities.

IDA funds will be channeled through a special account in a Nationalized Commercial Bank. Participation Agreements between ROSCU and the banks will indicate periodic tranches to be disbursed from the special account to the nationalized commercial bank and the obligation o f both parties under the contract. Cooperation Agreements between ROSCU and the learning center wil l indicate the terms and conditions o f fund transfer fi-om the Bank to the learning centers and other statutory obligation o f both parties.

The Bank will disburse education allowance and grants to eligible guardian and learning centers respectively through its branches on the basis o f approved l i s t received from project management. GOB will provide requisite counterpart hnding following the treasury systems and procedures. IDA will disburse funds along with SDC under a joint co-financing agreement. Up to $100,000 in retroactive financing will also be available for eligible expenditures incurred between May 1, 2004 and Grant effectiveness for activities related to procurement o f goods, consultant services and training.

The Project financial statements will be audited annually by the Comptroller and Auditor General o f Bangladesh. The audit report will be submitted to IDA within six months o f the end o f each fiscal year.

4. Social

Poverty i s one o f the foremost barriers hindering Bangladesh from attaining i ts EFA goals. Children, especially girls from particularly disadvantaged groups such as the ultra poor, tribal populations, children with disabilities (CWD), children living in disaster prone areas, and urban slums are unable to attend school. The majority o f these children are compelled to work for wages. Moreover, a lack o f physical facilities and difficult terrain in remote areas create serious barriers for children in accessing education.

17

Many o f these children from vulnerable groups stand to benefit from LCs or schools outside o f the purview o f the formal system which contribute a great to deal to increasing the access to primary schooling. The success o f these LCs depends in large part on community participation which needs to be strengthened. One way o f addressing the issue i s to establish Center Management Committees which will function as community bodies that ensure accountability between Project stakeholders/partners, and to ensure that quality primary education i s being provided in LCs.

Building up on the environment and social assessment for primary education recently carried out under PEDPII, a rapid environment and social assessment has been undertaken with the objective o f identifying social and environmental health issues, especially relating to community participation and ownership o f LCs and access to safe water and hygienic sanitation facilities. The assessment indicated that the majority (over 80 percent) students and their guardians are highly satisfied with the teaching in the learning centers. Each learning center has a center management committee (CMC) consisting o f 7 members, which includes teacher, local promoter and mothers o f the students. CMC, together with the community provides security to the center and they v i s i t the center every week for cleaning the premises. T h i s Project will strengthen the CMC, especially for ensuring social mobilization for EFA, improving the environment o f learning centers and enhancing quality o f education. Social development outcomes will include: (a) increasing enrolment and completion in learning centers o f CWD, tribal, street children, child labor and poor children; (b) retaining children from the vulnerable groups in learning centers; and (c) strengthening o f social capital as measured by participation o f parents o f vulnerable groups in CMC's. MoPME will include key indicators on vulnerable groups in the EMIS.

5. Environment

The principal environmental concems o f the program relate to the need to ensure (i) the safety o f school water supplies, particularly from arsenic contamination, and (ii) the provision and maintenance o f adequate sanitation. An environmental assessment has been undertaken for developing a Guideline to address these issues, which has been discussed with GOB and other stakeholders, and made publicly available prior to appraisal. The Guideline details a process through which teachers and CMCs wi l l consult communities to establish a mechanism for providing safe water and sanitation to children.

6. Safeguard policies ~

Safeguard Policies Triggered by the Project Yes N o Environmental Assessment (OP/BP/GP 4.01) [X I [I Natural Habitats (OP/BP 4.04) [I [XI

Pest Management (OP 4.09) [I [XI Cultural Property (OPN 11.03, being revised as OP 4.11) [X I Involuntary Resettlement (OP/BP 4.12) 11 [X I Indigenous Peoples (OD 4.20, being revised as OP 4.10) [I Forests (OP/BP 4.36) [I [XI Safety o f Dams (OP/BP 4.37) [I [XI Projects in Disputed Areas (OP/BP/GP 7.60)* [I [XI Projects on International Waterways (OP/BP/GP 7.50) [I [XI

[I

[XI

* By supporting theproposedproject, the Bank does not intend to prejudice thefinal determination of the parties' claims on the disputed areas

18

Two safeguards have been triggered and MoPME has developed plans for addressing these issues. MoPME has developed an EMP for providing arsenic safe water and sanitation to children and teachers o f learning centers. A Macro plan for the overall development o f primary education for tribal children has been developed by MoPME in consultation with key stakeholders to address the needs o f tribal children within PEDP-11. This plan will be used for ROSC as well, and implemented in the Project Upazilas with tribal populations.

7. Policy Exceptions and Readiness

No policy exceptions are sought.

19

Annex 1: Country and Sector or Program Background BANGLADESH: Reaching Out-Of-School Children Project

Country Context

While Bangladesh i s one o f the poorest countries in the world, i t s economic performance in the past decade has been relatively strong. Annual GDP growth averaged 5 percent during the 1990s, with relatively high rates o f investment (about 22 percent o f GDP), increased public spending o n social sectors and the emergence o f progressive entrepreneurs. While the economy continues to perform below i t s true potential o f 6-7 percent annual growth needed to achieve the country’s 20 15 poverty reduction goal o f halving the incidence o f poverty f rom current levels, progress towards achieving the MDG’s has been favorable.

The main objective o f IDA’S assistance i s to help Bangladesh realize i t s aspiration to reduce poverty substantially within a generation. To attain this objective, IDA’S C A S outlines a three-prong strategy: (i) consolidating gains in human development and supporting initiatives to address the next generation o f development challenges in education, health and nutrition; (ii) implementing an integrated approach to rural development; and (iii) accelerating and broadening private sector-led growth. The CAS discussion on developmental priorities in the education sector notes that, notwithstanding the past decade’s impressive gains recorded in education, improving quality and providing access to the disadvantaged remain a principal challenge. These themes echo the findings in IDA’S most recent analytical work on the Bangladesh education sector (World Bank, Bangladesh Education Sector Review, 2000).

The Primary Education Sector

Bangladesh has made significant progress in education in the last two decades, especially in regard to increasing access and gender equity. There are nearly 17.7 m i l l i on students enrolled in over 78,000 primary level schools in 484 Upazilas (these Upazilas are equivalent t o sub-districts -there are 64 districts in Bangladesh), gross primary enrollment rates rose f rom 76 percent in 1991 to 97.5 percent in 2002 while corresponding net enrollment rates rose f rom 64 percent to 80 percent. Primary dropout rates fell by a third--from nearly 60 percent in 199 1 to 30 percent in 2000. Gender parity in access to primary education has also been achieved. These achievements are particularly impressive when compared to other countries in South Asia and elsewhere at similar levels o f per-capita income. For example, in 1980 Bangladesh’s net enrollment rate ranked eighth among ten low-income countries (India, Pakistan, Sri Lanka, Nepal, China, Indonesia, Kenya, Benin and the Republic o f Congo). I ts rank has n o w improved to fourth. Furthermore, in South Asia, only Sr i Lanka has matched Bangladesh’s feat o f achieving gender parity at the primary level. Despite this progress, critical problems persist as identif ied by both the I- PRSP and the National Plan o f Act ion for Education for All (2002-2015). Over three mi l l ion children s t i l l have n o access to primary schooling, and the quality o f education-especially in public institutions-- remains a major concern.

20

In 2003, the Government has embarked on a major Primary Education Development Program (PEDPII) aimed at increasing access and improving quality in formal primary schools. However, even if fully successful-by the end o f PEDPII, Bangladesh will fall short o f attaining access and quality goals as specified in the I-PRSP and the National Plan o f Action.

Type of School

Government Private Madrasa L c s

However, there i s another sector, not officially recognized by the Government, which i s delivering good quality education at the primary level, and, if supported, can help Bangladesh move closer towards attaining the above mentioned goals. Over the past 10-15 years NGOs have shown that they are able to successfully deliver quality education programs at the primary level--often to children coming from the most disadvantaged groups. However, these institutions are not included under PEDPII.

Percent o f children Percent of children satisfying basic education satisfying literacy

criteria criteria 21.5 35.4 23.5 39.3 33.0 42.0 38.3 45.2

The Growth of Primary Education in NGO LCs

Since the late 1980s, a variety o f NGO’s have been using a range o f delivery mechanisms to cater to basic education needs, especially for disadvantaged households. These institutions have played a complementary role alongside the formal primary education schools supported by the Government. Many such institutions provide three years o f primary education but some provide a full five-year cycle o f primary education. Most non-formal Centers follow the curriculum recommended by the National Curriculum and Textbook Board (NCTB) and receive free textbooks from the Government.

There has been a significant growth in the number o f non-formal institutions (known as LCs) over the past decade. While exact numbers are not available, at present about eight percent o f primary schools enrollment (close to 1.7 million) i s provided through these institutions-this i s a four-fold increase over the past decade. Whi le the growth o f enrollments in these institutions has slowed down somewhat due to various constraints discussed later-enrollments are s t i l l growing at approximately five percent annually. Currently, 68 percent o f children are in Centers run by BRAC, and 11 percent in schools run by Proshika with other NGOs enrolling the remaining students. Additionally, some NGOs also provide support to working children to enable them to go to school. One o f the largest NGOs o f this type i s the GOB supported Shishu Kallyan Trust, which operates 45 institutions in 37 districts - mainly catering to urban working children.

Student Achievement

A test to assess the basic competencies o f children (Assessment o f Basic Competencies-ABC), shows better outcomes for students in LCs as compared to those in formal schools (Table 2). These students do better in terms o f being more literate. I t should, however, be pointed out that a score o f 38 percent on the achievement scale i s too low for an effective education system.

To better understand why LCs are doing better, we examine the characteristics o f these schools below.

21

Establishment of Institutions

Type of School Average Number Percent of Percent o f Teachers schools with >2 Female

teachers Teachers

One o f the most important reasons underlying the success o f LCs i s that they are responding to demand expressed by the community. There i s no uniform method through which these Centers are established. What often happens i s that communities approach local NGOs to set up a learning Center in their community, and identify a group o f primary aged children (often 30-40 in number) who have either never been to school or are dropouts fkom formal primary schools. Alternatively, NGOs conduct rapid surveys/assessments o f primary education needs in a community, and with the assistance o f the community, identify a group o f children whom they can enroll in primary level institutions.

Student: Teacher Ratio

In either instance, the NGO agrees with the community to set up a learning Center-often using rented premises within the community-and using in-kind support from community members for minor repairs and upkeep. Children attending the Centers are provided access to safe drinking water and sanitation facilities within the communities.

Government Non-government Madrasa LCS

As shown below, while proportionately fewer LCs have school management committees (which include parents/community members), the proportion o f school with active community participation i s far higher than in other types o f primary schools.

4.4 91.5 44.0 73 3.9 76.0 37.3 55 N/A 80.4 4.7 32 1.1 1.2 89.0 31

Characteristics of Schools

LCs are significantly smaller than formal sector schools. They are predominantly single teacher institutions-with teachers being mostly female--and enroll about 30 students on average. The student teacher ratio i s significantly lower in the non-formal sector as compared to Government and non- Government primary schools (Table 3). Only 13 percent o f Government and 3 1 percent o f non- government primary schools have a studentteacher ratio below 40, while the corresponding f igure for non-formal Centers i s 95 percent.

Teachers in LCs are as well qualified as teachers in Government schools (measured by years o f formal education). ‘Basic training’ varies across school types with Government-run schools having a one-year course at primary teacher training institutes, and non-formal school teachers undergoing much shorter duration o f training. An overwhelming majority o f teachers in Government schools and non-formal institutions have undertaken basic training. This contrasts with the small proportion o f teachers with basic training in both non-government schools and madrasas. A similar picture emerges when refresher training courses are considered (Table 4).

Teacher absenteeism i s far less prevalent in LCs as compared to other schools. W h i l e rates o f teacher absenteeism in LCs i s about five percent, absenteeism rates are far higher in madrasas (12 percent), Government schools (13 percent), and non-government schools (21 percent).

22

Type o f School M e a n Education Percent Teachers Level with Basic

Percent Teachers with Refresher

An interesting feature o f LCs as compared to the other types o f schools i s the active involvement o f parents/guardians-especially mothers--in school management committees (SMCs). In contrast to other types o f schools where less than one-fifth o f members o f school management committees are women- over 50 percent o f SMCs members in non-formal institutions are women. Even though not all non-formal Centers have SMCs, guardians take a much more active role in participation in SMC meetings and decision making as shown in Table 5.

Government Non-government Madrasa LCS

Training Training 11.9 95.8 91.8 11.6 32.5 73.4 14.1 17.5 8.8 10.4 84.3 93.8

Internal EfJciency

Type o f School percent schools percent females in

Government 99.2 13.2

Madrasa 98.0 0.2 LCS 78.5 56.7

with SMCs SMCs

Non-government 98.6 13.8

By and large, efficiency indicators in LCs are better than those in formal schools. Table 6 provides information on some indicators on all o f which non-formal schools are performing better. Attendance and promotion rates are high; dropout and repetition rates are low. The coefficient o f efficiency (the ratio o f the expected pupil years to complete the cycle and total pupil years actually spent to produce those graduates) i s also high because o f the relatively few years taken to graduate.

Percent schools where guardians participate actively

28.9 21.0 25 .O 64.7

Better outcomes in LCs should not come as a surprise given some o f the above-mentioned characteristics-low student teacher ratios, high degree o f involvement o f parentdguardians in SMCs, and low rates o f teacher absenteeism.

Furthermore, non-formal LCs manage to attain these outcomes in a more cost-effective manner-with per pupil expenditures significantly less than in other schools (Figure 1). Variations in expenditures between rural and urban areas are also relatively small.

23

The main reason underlying these low unit costs are teacher salaries-teachers in LCs are paid significantly less than in other types o f schools. This also results in these institutions spending a significant proportion o f their recurrent expenditures on teaching and learning materials, while most o f the expenditures in public schools i s on teacher salaries (Table 7). Data also indicate that the unit

Type of School Government Non-government Madrasa Non-formal

expenditure/pupil in the non-formal sector i s lower than expenditures for the other three types o f schools.

Salaries Mater ia ls R e n t Others 94.6 1.6 0.6 3.2 87.4 4.6 0.4 7.6 93.9 2.1 0.6 3.4 51.1 31.8 15.8 1.3

Constraints to Growth

Due to resource constraints, LCs face significant challenges to providing quality education and attracting disadvantaged students. Some key ones include:

Demand-side. They are unable to provide adequate financial incentives to attract and retain children &om the most disadvantaged households. Given the relatively high opportunity costs o f

Oa.mmnt 1 NmQw.mmnt , Hdruh. 1 N o n l d 1 T W d Bshool

/DRud]

schooling, the lack o f demand-side incentives implies that parents find it relatively difficult to send children to these institutions; Infrastructure. State o f their physical facilities i s poor-often institutions lack such basics as blackboards, decent classrooms and useable toilets;

0

0

0

Teacher training. While significant efforts are made to improve teacher quality through teacher training, providing effective training remains a significant challenge; Teacher compensation. Teachers in the sector are committed to providing education to students. However, institutions are finding it increasingly difficult to hire and retain good quality individuals.

24

Annex 2: Major Related Projects Financed by the Bank and/or other Agencies BANGLADESH: Reaching Out-Of-School Children Project

Sector Issue

IDA-financed Increase equitable access to primary and secondary schooling; improve quality of education; strengthen management capacity; and prepare future policies and programs for higher secondary and post- secondary education reforms

strengthen capacity to deliver programs through NGOs and district administration

Improve and expand non-formal education;

Improve access to secondary education and improve opportunities for rural girls

Latest Supervision

(Bank-financed projects only) Implementation Development

Progress (IP) Objective (DO)

Project (PSR) Ratings

Bangladesh - General Education S S (Credit 21 18-BD) - (Closed April 20, 1997) (OED evaluation: Satisfactory)

Bangladesh - Non-Formal S S Education (Credit 2822-BD) (Closed June 30,2001) (OED evaluation: Satisfactory) with ADB/SDC

School Assistance Project (Credit Bangladesh - Female Secondary S S

25

Sector Issue

Provide quality basic education to urban working children in six cities and safe and supportive environment to facilitate their movement out of hazardous work. Poverty reduction through access to non-formal primary education for those traditionally outside formal schooling.

To provide a mix of formal and non-formal education and skills training followed by job placement services for the urban poor working children, resulting in gainful employment or self- employment Implementing Agency: UCEP Expand Non-Formal Education in Bangladesh through post-literacy and continuing education IPDO Ratings: H S (Highly Satisfactory), S (Satisfactory),

26

Latest Supervision

(Bank-financed projects only) Implementation Development

Progress (IP) Objective (DO)

Project (PSR) Ratings

(PEDPQI) (Royal Norwegian Embassy) Non-Formal Education Project (NFE-3, Basic Education for Hard to Reach Urban Children Project) (UNICEF, SIDA and DfID) BRAC Non-Formal Primary Education (NFPE 111) (EC, DfID, DGIS (Netherlands), UNICEF, AKFKIDA) Underprivileged Children’s Education Program (UCEP) Phase I V (DflD, Royal Norwegian Embassy, DANIDA and Swiss Development Corporation)

Non-Formal Education I1 Project (ADBDfID) U (Unsatisfactory), HU (Highly Unsatisfactory)

Annex 3: Results Framework and Monitoring BANGLADESH: Reaching Out-of-School Children Project

Results Framework PDO

The key objective o f the proposed Project i s to reduce the number o f out-of-school children through improved access, quality and efficiency in primary education, especially for the disadvantaged children, in support o f GOB’S national EFA goals.

Intermediate Results One per Component

Component One: Improving access to qualiiy education for out-of-school children. All project classes w i l l have enrolled a minimum o f 25 and a maximum o f 35 students who have never before enrolled in any school.

Component Two: Communications and social awareness Effective information, dissemination and IEC campaign relating to qualification criteria, resource support, and other operational guidelines to parents,

Outcome Indicators The number o f out-of-school children reduced by about 0.5 million. About 1.4 mil l ion student years supported for new students. Percentage o f students reaching expected competency level based on teacher’s assessment in Bangla and mathematics not less than 65%. Average student attendance rate not less than 75%. Student grade completion rate not less than 80%. Average teacher attendance rate not less than 90%. Students in each grade to have on average, the same number o f textbooks as those in corresponding grades in the formal primary education system. Student transition rate to public and NGO schools to Grade 4 (from Grade 3) not less than 80%, or to Grade 6 (from Grade 5) not less than 70% Results Indicators for Each

ComDonent Component One:

Each school w i l l have the basic facilities to provide a conducive learning environment. Student-teacher ratio at 25-35:l. Number o f teachers who received training sessions in modern instructional methods and classroom management. Teacher-based assessments o f student achievement in Bangla and mathematics are available monthly. Student enrollment in LCs. Bi-annual disbursement o f education allowances and grants. Number o f LCs assisted.

Component Two: Innovative grassroots marketing strategies employed for mobilization and awareness campaigns.

implemented annually: (i) minimum o f two workshops; (ii) minimum o f two dissemination campaigns; (iii)

Community outreach efforts

Use o f Outcome Information Data on outcomes, used in conjunction wi th the half-yearly implementation progress monitoring reports and evaluation reports, wil l be the basis for assessing the efficacy o f the grants and education allowance programs and the recipient students’ and schools’ compliance with eligibility criteria so that any necessary adjustments could be made to the programs. Information on outcomes w i l l also be used to adjust logistical and supervisory support (in-service teacher training, provision o f teachingilearning materials, etc.) to schools as needed.

U s e o f Results Monitoring

Component One: Results monitoring reports containing quantitative school data (e.g., student and teacher attendance) and qualitative information (e.g., assessments o f school facilities, overall environment, availability o f textbooks and learning materials, student achievements, etc.) w i l l indicate whether Project progress i s on track. If targets o f Project activities under specific interventions are lagging, the situation w i l l signal the need for appropriate follow-up action to address emerging issues.

Component Two: Effective dissemination information w i l l enable monitoring o f education service providers’ compliance with guidelines established for the Project. Marketing information w i l l provide the basis for assessing the effectiveness o f mobilization and awareness campaigns.

27

schools/LCs, communities, SchooYCenter Management Committees, Education Resource Service Providers, Education Service Providers, and Upazila Education Offices. Component Three: Project management and institutional strengthening. A Project Management Un i t (ROSCU) headed by a Project Director (PD) i s operating effectively wi th five supporting constituent sections, each headed by an Assistant Director (AD) for: (a) Grants and Education Allowance (GEA) programs; (b) Training and Education Development (TED); (c) Monitoring, Evaluation and Research (MER); (d) Information, Education and Communications (IEC); and (e) Finance and Administration (FA), al l under the oversight responsibility o f the ROSC Committee (ROSCC).

Component Four: Monitoring, evaluation and research. An independent local monitoring agency and an independent locallinternational private sector evaluation agency are operating effectively.

minimum o f two stakeholder training sessions.

Component Three: ROSCU fully operational within 3 months o f Project effectiveness. ROSCC with MoPME Secretary as Chair. Submission by LCs/ schools o f adequate budget statementdinvoices to ROSCU showing appropriate utilization o f grant funds. Timely submission o f evaluation and annual progress reports by independent evaluation agency directly to ROSCC.

Component Four: Baseline survey conducted within 3 months o f project effectiveness. Follow-up surveys and evaluations undertaken annually. Research based on follow-up surveys and evaluations undertaken annually. Non-formal education sectoral analysis completed.

Regular assessments o f the mobilization and social awareness campaigns w i l l support the above activities o f monitoring guidelines compliance and marketing effectiveness.

Component Three: At the operational level, ROSCU and its supporting sections w i l l be fully apprised by the periodic reports o f implementation progress, compliance with grants and education allowance criteria and guidelines, and actual or emerging implementation issues so that appropriate action could be taken. At the pol icy level, ROSCC w i l l have an overview o f progress towards Project objectives and be able to provide effective guidance to ROSCU, including possible policy adjustments in response to implementation issues. A t the national level, MoPME will be fully informed o f implementation achievements as well as shortfalls so that ROSCC w i l l receive appropriate and timely support in guiding the ROSCU. Al l the above will help ensure a flexible yet dynamic implementation process focused on problem-solving to achieve the Project objectives. Component Four: The reports by the independent local monitoring agency w i l l enable the ROSCU to verify the efficacy o f the Project interventions and whether the performance indicators are on track for disbursements o f grant and education allowances. The reports by the independent localhntemational evaluation agency w i l l facilitate the ROSCC’s work in overseeing the overall Project progress towards achievement o f its objectives. Non-formal sector analysis feeds into dialogue between GOB, DP’s, and other stakeholders on developing a wholistic approach to primary education in the near future.

28

x - $ 2 n 8

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I I I I

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$ 2 Z

c 13 0 .-

I 3 m

Annex 4: Detailed Project Description BANGLADESH: Reaching Out-Of-School Children Project

A. Background

Bangladesh has made significant progress in education in the last two decades, especially with regard to increasing access. Net enrollment rates at the primary level have r isen from 64 percent to 80 percent between 1991-2002. Gender parity has also been achieved. However, preliminary estimates show that the number o f out-of-school children aged 6-10 years in 2002 was over 3.5 million. T h i s number includes children who have never enrolled in school, those who had enrolled and dropped out from the formal primary education system, street children and children o f displaced families who have migrated from rural to urban areas.

The Government has recently completed a National Plan o f Action for Education for All (EFA) 2001- 20 15 which embraces all o f the goals o f EFA for achieving compulsory primary education. The Ministry o f Primary and Mass Education (MoPME), supported by development partners, has begun implementing the second Primary Education Development Program (PEDPII), aimed at improving the quality o f and enhancing access to primary schooling in Government supported schools. PEDPII, which i s being supported by 1 1 development partners, including IDA, represents a major step towards operationalizing the Government’s EFA and Poverty Reduction agenda. While PEDPII targets are ambitious, they will s t i l l leave over 1.8 mil l ion children aged 6-10 not having access to schooling by 2009. This will leave the Government well short o f achieving i t s EFA goals by 20 15.

Primary education i s also provided in LCs operated by NGOs. This i s an active sector which caters to about eight percent o f the primary students, mostly from the poorest segments o f society. However, these Centers l ie outside the ambit of PEDPII. Providing support to this sector has the potential to reduce the number o f out o f school children and help Bangladesh in moving towards attaining i t s EFA goals.

B. Project Objective

The key objective o f the proposed Project i s to reduce the number o f out-of-school children through improved access, quality and efficiency in primary education, especially for the disadvantaged children, in support o f GoB’s national EFA goals.

C. Project Description

To achieve the objective, the Project will assist in the establishment o f LCs (LCs), which will be managed by Center Management Committees (CMCs), at the local community level by providing L C grants, and enroll students by providing education allowances. In order to achieve this, the Project will strengthen the capacity o f communities and local level institutions, and empower them to organize and manage the provision o f quality education.

This i s a learning and evaluation Project that tests alternative approaches aimed at providing access to quality primary education. Project coverage will commence with targeting 60 Upazilas (see Appendix to this annex) selected on the basis o f (a) net enrollment rates; (b) the gender gap in enrollment; (c) the primary cycle completion rate; and (d) poverty levels. The number o f Upazilas covered could be increased over the l i fe o f the Project. The Project will be implemented through the following components:

32

Component 1 : Improving Access to Quality Education for Out-of-School children ($53.4 million)

The objective o f this component i s two-fold: to support schooling for out-of-school children and to facilitate their completion o f primary schooling through: (a) education allowances for eligible students; and (b) grants to LCs (LCs) where the students enroll. The allowances will partly offset the opportunity cost o f schooling for poor children, thereby attracting them to and keeping them in school. The Learning Center grants will provide support for meeting the operating costs o f the LCs and contribute to improving the quality o f teaching/learning activities and for building management capacity o f the LCs. In 60 percent o f the selected Upazilas, both education allowances to eligible children and grants to LCs will be provided. In the remaining Upazilas, only grants are proposed to be provided to LCs (these grants will be larger as they will include the value o f the education allowance). The rationale i s to test which o f the alternative approaches leads to better outcomes in terms o f access and quality. An Operations Resources Manual prepared by MoPMELDPE will specify the procedures and guidelines for the distribution o f education allowances and L C grants.

Sub-component 1.1: Education Allowances to Out-of-School Children

This subcomponent will comprise an education allowance scheme to attract out-of-school children to LCs. The education allowance will consist of: (a) a monthly payment o f Tk.50 for class 1-3 students and Tk.60 for class 4-5 students; (b) an annual payment o f Tk.200 to class 1-3 students and Tk.250 to class 4- 5 students to partially cover dress/uniforms costs; and (c) Tk.200 for candidates o f the Class V primary scholarship examination. The total annual education allowance per student will amount to Tk.800 for class 1-3 and Tk.970 for class 4-5.

Education allowances will be channeled to qualifying children through bank accounts managed by their mothers. If a child i s motherless then the bank account will be in the name o f the child’s guardian, preferably and if applicable, a female. All students enrolled in the eligible LCs/schools will receive the education allowance. Female students will account for preferably 60 percent o f children supported under the Project. The education allowances will be disbursed twice a year in March/April for the January-June semester and in September/October for the July-December semester.

Eligible children attending qualifying LCs will receive education allowances. Eligibility criteria for participation o f children in the program wil l include the following:

(a) I n newly established LCs: 0

0

0

Enrollment in the Project affiliated LCs; Appropriate age (entry age 7-10 years for class 1); and The child should never have been enrolled in formal schools, or LCs, or had dropped out from school or from LCs for at least one academic year.

(b) I n existing Centers: 0

0

Enrollment in the Project affiliated LCs; and Appropriate age (entry age 7-10 years for class 1);

Children enrolled in LCs will continue receiving education allowances if they: 0

0

Maintain an average o f at least 75 percent annual attendance in the LCs; and Show evidence o f satisfactory achievement level deemed adequate by the classroom teacher.

33

Sub-component 1.2: Grants to Learning Centers/Schools

This subcomponent will provide grants to eligible LCs (which enroll children receiving the education allowance) to: (a) establish new LCs; and (b) deliver quality education in new and existing LCs. The Project will strengthen the capacity o f CMCs to manage LCs, with support from Education Service Providers (ESPs).’ Three types o f schools/Centers will be eligible to participate in the program: (a) one- teacher one-class cohort type Centers (new or existing) that enroll all students in class 1 and move them through the higher grades to allow them to complete the primary cycle; (b) multi-grade teaching Centers/schools that also enroll dropout children in class 1 and 3, and (c) existing schools/LCs run by NGOs that will enroll new children targeted under the Project.

The L C grants ranging from Tk.25,700 for class 1-3 to about Tk.30,950 for class 4-5 per annum will consist o f

0 Establishment Fund--a one time initial payment in setting up new LCs (Tk.2000); Quality Fund--including (a) an annual payment (Tk.120 per student for class 1-3 and Tk.250 for class 4-5) to procure education materials and supplies; and (b) an annual lump-sum training grant (Tk. 1200 per annum for initial and continued teacher support). The quality fund could be used for purposes such as: (a) teacher preparation-programs o f short initial preparation for classroom teaching (10 to 30 days approximately). The training will focus on knowledge o f the curriculum to be taught, lesson structuring, classroom management, teaching and assessment strategies focused on producing understanding. The training will also provide specific instructions on how to prepare reports on leaming achievement o f each child in the class; (b) continuous teacher training-these will also be periodic short courses aimed at enhancing pedagogical sk i l ls o f teachers; (c) formative or academic supervision--teachers will continue to be trained through regular supervision (at least twice a month) in the location o f their LCs; (d) purchasing leaming materials-LCs will enter directly into contractual arrangements with Education Resource Providers (ERPs)~ to provide some o f the services mentioned under the quality fund. Management Fund-an annual payment o f Tk. 100 per student for schools/LCs management suppordtraining; This Fund could be used for building the capacity o f the CMCs including teachedhead-teacher to better manage institution. Discretionaiy Fund -an annual grant (Tk.480 per student for class 1-3 level and Tk.600 for class 4-5 level) which could be used for teacher salaries, center maintenance and renovations, co-curricular activities, sanitation and safe drinking water. T h i s discretionary fund will be paid semi-annually based on the number o f students in the schools (Tk.40 per month per student for class 1-3 level and Tk.50 for class 4-5 level) and will be utilized based on priorities identified by the CMCs.

0

0

In Upazilas where only grants will be provided to LCs, and students do not receive education allowances, the value o f the grants will be approximately between Tk. 55,000-Tk. 65,000 per annum (the grants are larger, as the average value o f education allowances i s added on).

The eligibility criteria for the participation o f LCs in the program wil l include:

’ Education Service Providers (ESPs) are those agencies selected by CMC’s, in accordance with agreed terms, conditions and criteria, to assist in identify out-of-school and hard-to-reach children, to ensure their enrollment and attendance, and to support the CMC’s in running the LCs.

districdnational presence and extensive experience in primary education, teacher training and curriculum development, selected by CMC’s to carry out educational technical services in accordance with agreed terms, conditions and criteria.

Education Resource Providers (ERPs) are NGOs, educational institutions, or agencies, wi th a multi-

34

For newly established Centers: 0

0

0

Establishment o f a Center Management Committee (CMC);7 Formal request by the CMC to the UEO for participation in the program; and Student enrollment: minimum o f 25 children, maximum o f 35 children per class o f which 60 percent preferably girls.

For existing Centers (and for Centers to continue receiving grants): Existence o f a functioning CMC; Formal request by the CMC to UEOs for participation in the program or for renewal; Student enrollment: minimum o f 25 children, maximum o f 35 children per class o f which 60 percent preferably girls; and Existence o f appropriate teaching and learning environment (e.g. use o f books with supplementary materials, appropriate utilization o f grants etc.).

Grants to LCs that meet these criteria will be renewed annually. Grants will be withheld for LCs that do not meet the criteria outlined above.

Sub-component 1.3: Shishu Kallyan Trust (SKT) Schools

Government’s SKT schools cater to educating working children in urban areas. T h i s subcomponent will provide support to the SKT program to provide education allowances to working children and grants to SKT schools. The education allowance will not only meet the direct and indirect costs o f schooling but also compensate for a portion o f the opportunity costs. The grant will be provided on a per-capita basis and will also cover a small part o f program management expenditures. The grant disbursements will be based on a detailed plan o f action.

In the first year, the existing 45 SKT Schools will be eligible for the education allowances and grants. After further evaluation o f the program, new SKT schools will be included in the Project.

Component 2: Communications and Social Awareness ($2.7 million)

The objectives o f this component are to: (a) raise awareness about primary education in general and the Project in particular at the family, community, Upazila and national levels through appropriate media and communication campaigns; (b) mobilize families, communities, and local Education Service Providers (ESPs) to open new LCs or expand existing Centers; and (c) disseminate information on qualification criteria, resource support, and other operational guidelines to parents, LCs, CMCs, ERPs, ESPs and UEOs; and (d) assess the effectiveness and “reach” o f the communications and social awareness activities, and mobilization campaigns, and modify them as needed.

Communications and awareness campaigns will target particularly disadvantaged groups, and will employ innovative grassroots mobilization strategies such as Participatory Rapid Assessment (PRA), Micro planning, and Reflect. The target groups o f this activity at the community level are: (a) more disadvantaged groups/communities (the landless, widow’s families, day-laborers, including fishermen, artisans, blacksmiths, cobblers etc), socially disadvantagedstigmatized groups (beda, sweeper, tea gardens’ laborers), aboriginals, families not living permanently for a year in a particular place; (b) backward areas (mainly areas having no mainstream school within two km, no formal communication by feeder roads within one km, having a teacher-student ratio o f more than 1:56, geographically inaccessible

’ The CMC will be composed o f five parentdguardians, one female ward member, one UEO representative, one ESP, with the teacher as the member secretary to the CMC.

35

areas), and (c) Urban slum areas (parents who have no permanent income, parents whose income i s below minimum salary level declared by the Government, parents who live on f l o a t i n m a s landslums or families who spend maximum Tk.800 for house rent, and working children).

Subcomponent 2.1: Social Awareness

This subcomponent will finance: (a) the development and delivery o f effective communication about the Project at the community, Upazila and national levels, (b) the development and distribution o f concise informational packages o f materials, which will be broadly distributed to potential ESPdERPs, and (c) logistical support for enhanced communication between the UEOs and the LCs.

Specific messages and materials will be designed for each o f the target groups and will be delivered through media channels used by each o f the target groups. Thus, communications at the national level will involve the use o f television and radio technologies, while communications targeted at the community level will rely on drama troupes, small mobile broadcasting units, etc. The initiating process at the community level wil l be through personal contact with local key persons, guardians, teachers, religious leaders, public meeting; distribution o f leaflets, posters etc. Information materialdmessages will be planned, designeddeveloped by relevant non-government agencies having sufficient prior experience. Knowledge o f the availability o f the informational packages will also be expanded through postal and radio messages and through provision o f a telephone “hot-line’’ which will provide immediate responses to queries.

In order to enhance communication between the UEOs and the LCs, logistic support will provided for: (a) engaging AUEOs in the design and delivery o f community level communications and social awareness efforts from the outset; (b) delivering the information packages o f materials developed for potential ESPs/ERPs to all relevant AUEOs; (c) providing AUEOs with the resources and support necessary for them to visit communities, encourage communities to identify and work with ESPs to open new LCs or expand student places in existing LCs; and (d) providing AUEOs with participatory training on the special need to reach educationally underserved groups such as working children, girls, disabled children, and children from ethnic/linguistic minority groups.

Subcomponent 2.2: Community Mobilization

This subcomponent will finance: (a) the development o f community mobilization training modules for the training o f trainers (TOT) and other materials; (c) the initial training o f CMC members; and (c) the preparation o f community mobilization reports for each Upazila. Mobilization activities will be carried out to organize communities to increase enrollment o f children and ensure access to quality schooling for disadvantaged out-of-school children. The mobilization activities will be initiated prior to the implementation o f education allowances and grants.

In the case o f new centers, the expected outcomes o f the community mobilization activities will include: (a) identification o f target areas/pockets/community; (b) information o f the C M C by parents to establish and operate a learning center and training o f the CMC; (c) identification o f potential students; (d) identification o f teachers; (e) identification o f academic supervisors; and ( f ) arrangements for the L C facilities including classrooms.

The ESP involved in community mobilization will provide continuous support to CMCs in L C management o f various activities including: (a) selection o f location, andor physical facilities to set up new LCs andor increase capacity o f existing LCs; (b) identification, selection and appointment o f teachers, (c) the proper identification and selection o f ERPs for overall quality education; (d) ensuring the

36

training o f teachers, and the availability o f quality educational materials for teachers; and (e) monitoring student and teacher attendance and assuming responsibility for grant utilization.

Component 3: Project Management and Institutional Development ($2.4 million)

The objectives o f this component are to: (a) establish a sound structure for managing and implementing the Project; and (b) develop and strengthen the capacity to deliver quality primary education to out-of- school children.

Sub-component 3.1: Project Management

The organization o f Project management i s illustrated in Chart 1 in Annex 6. Following i s a description o f the functions and responsibilities o f the key units in the management structure.

At the national level, MoPME will have oversight responsibility for the Project. The Project implementing agency will be DPE. GOB will establish a ‘Reaching Out-of-School Children’ (ROSC) Committee which will be composed o f a diverse group o f stakeholders, including representatives from MoF (Finance Division), Planning Commission, ERD, IMED, Ministry o f Social Welfare, Ministry o f Women and Children Affairs, two NGOs, DPE, and contributing Development Partners. The ROSC Committee will be chaired by the Secretary, MoPME. The ROSC Committee will: (a) oversee overall project implementation; (b) carry out joint annual reviews; (c) resolve implementation issues; and (d) hold formal semi-annual meetings to review policies governing project implementation and assess Project progress. Annually, one o f these Committee meetings will specifically review policy and Project progress with a view to identifying issues and proposing solutions. Review o f project implementation will be based on progress and planning reports prepared for this purpose, one set to be done by an independent evaluation agency and the other by the ROSC Unit.

The ROSC Unit, established by MoPME and headed by a Project Director (PD), wil l be directly responsible for the day-to-day implementation o f the Project. Supporting the P D will be five Assistant Directors (ADS), each heading a section, who will be responsible for implementing various Project activities relating to: (a) provision o f education allowances and LC grants; (b) training and education development; (c) monitoring, evaluation, and research; (d) communications and social awareness; and (e) finance and administration. The PD and the five ADS, operating as a unified team, wil l be appropriately supported by a procurement officer, Project officers, computer operators and other required support personnel. The ROSC Unit will follow the policy directives o f the ROSC Committee.

At the Upazila level, the Upazila Education Office (UEO) will process applications for establishing LCs, facilitate disbursements o f education allowances and grants, and coordinate monitoring teacher and student attendance at LCs. The UEO will report directly to the ROSC Unit PD on Project related matters, and will share Project related information with the Distr ict Primary Education Officer.

At the local community level, a Center Management Committee (CMC) wil l be responsible for managing the LCs with support from ESPs. The ESPs appointed by the CMCs will lead community mobilization efforts to identify the target population, encourage it to start a school, and help organize the appropriate LCs. CMC’s will select ESP’s which meet the following criteria: (a) a registered NGO or other organization with preferably five years experience in working with the respective community; and (b) at least three years experience in the area o f education service provision.

To support quality improvement o f the LCs, the CMCs wil l seek assistance from the Education Resource Providers (ERPs). These providers (who will often be NGO institutions) will have to meet the following criteria: (a) about ten years’ successful experience in the provision o f primary education; (b) have

37

demonstrated links with the formal system o f education through basing the curriculum and leaming activities on the national competency structure; (c) a system o f teacher education (initial, refresher, and continuous training) that i s organized to provide content knowledge and understanding as well as pedagogical vision and sk i l ls for classroom teaching and management, and induction and/or regular supervisory support in the classroom; (d) a quality assurance structure that articulates in a comprehensive manner activities relating to the preparation o f trainers, the content and form o f the initial teacher preparation and teacher support; (e) a proven well-structured teaching delivery system that allows teachers to use all the available time scheduled for lessons in schools; and (0 good quality resource materials as well as teacher guides.

The process o f establishing and operating new LCs will involve four steps: (a) community mobilization, supported by communications and social awareness activities, will prepare the way for establishing the CMC, which will include the training o f its members; (b) CMCs, through the UEOs, will submit an application to the ROSC Unit for participation in the Project (including l i s t o f potential students, teacher(s), location o f L C etc.); (c) once established, the CMC will be responsible for setting up new LCs, recruiting teachers, identifying ERPs with the help o f ESPs for teacher training and acquisition o f other educational services; and (d) CMCs will then open an account with the local Nationalized Commercial Bank and all Project financial transactions will be channeled to LCs (grants) and to parentdguardians (education allowances) through the bank.

The SKT system will also receive support from the ROSC Project to strengthen i t s management capacity. The existing SKT Director will be supported by an Assistant Director located in the SKT Directorate. The Project will provide support for the Assistant Director position on a declining basis over the l i f e o f the Project on the agreement that the position be incorporated into the revenue budget as per Government procedures. Although located in the SKT Director’s office, the Assistant Director will work and liaise closely with the ROSC Unit team o f Assistant Directors on issues pertaining to education allowances and grants, training and educational development, monitoring, evaluation, and research, communications and social awareness, procurement, and finance and administration.

Sub-component 3.2: Institutional Capacity Building

For effective project implementation, the capacity at the central, Upazila and local community levels will be strengthened through regular in-country training, including management, educational development and financial management training. For key personnel in critical areas there may be some overseas training. Institutional capacity building efforts will be extended to ESPs and ERPs based on a needs assessment through appropriate in-country and international training.

Institutional capacity building efforts will be extended to NGOs as Education Service and Resource Providers respectively, in order to ensure management efficiency and accountability. Training in various aspects o f managing LCs, including standards for financial management, audit, monitoring and evaluation, and reporting will comprise an integral part o f the institutional capacity building efforts.

To develop and enhance local community capacity, the ROSC Unit will prepare a standardized training and dissemination package, incorporating elements o f fiduciary responsibilities (resource management, supervision, procurement, etc.) and more broadly, project implementation responsibilities. The training package will be designed on the basis o f a pre-implementation study to identify current practices in community organization and management (how they manage resources, deal with community level complaints, what types o f arbitration options they use, what types o f sanctions they impose for misuse o f community property, etc.). The training package will be designed on the basis o f a pre-implementation study to identify current practices in community organization and management. The package will include guidelines on procurement o f services, resource management, and accounting--about how CMCs could

38

buy the services most suited to them, how they could manage resources, acquire training in accounting, carry out contracting o f services, supervise contractual work, etc. The training package will include a simple cash management system, and incorporate simple rules and procedures. Finally, capacity will also be enhanced at the community level to manage the process o f training, learning by doing, more intensive supervision, guidance and advisory services, etc.

Sub-component 3.3: Networking to Improve Quality

The Assistant Director for Training and Education Development in the ROSC Unit will initiate the establishment o f a network o f participating ERPs, who will be supported by a coordinating body. The purpose o f this network will be to provide technical advisory services and equipment to Ems, and to ensure the provision o f quality educational services. The functions o f the network will include: (a) ensuring that the teacher training and curriculum content are in line with the NCTB curriculum; (b) developing instruments for initial diagnosis and yearly assessment o f student learning achievement; and (c) identifying the l i s t o f instructional materials that will be used in teacher training and in the classroom. The network will meet at regular intervals to carry out these and other related tasks.

Component 4: Monitoring, Evaluation and Research ($4.3 million)

The objectives o f this component are to provide an effective monitoring and evaluation system to: (a) monitor the use o f grants support; (b) monitor the use o f education allowances; and (c) evaluate the two programs through action research, thematic studies, and impact assessments. In order to establish a baseline, qualitative and quantitative surveys at the level o f the household, community and LCs will be undertaken within the f i rst six months o f project implementation. Data will also be collected from Upazilas where the Project i s not currently being implemented.

Subcomponent 4.1: Monitoring the use of Grant Support by LCs

Monitoring activities under this subcomponent will be carried by a contracted independent agency with facilities for, and experience in, school mapping/construction, monitoring and educational data collection and processing in support o f the monitoring o f education programs. The ROSC Monitoring Section will be responsible for developing the appropriate TORS for this activity and for tendering. The TORS will specify the functions and responsibilities o f the independent agency, including the monitoring activities relating to: (a) LCs (management o f resources encompassing organization and implementation o f teaching/leaming programs, provision o f learning materials, and maintenance o f physical facilities and the leaming environment, etc.); (b) students (including enrollment, attendance, i dou t transfers, grade and cycle completion rates, learning achievement, etc., disaggregated by gender); (c) teachers (including age, gender, academic and professional qualification, teaching experience, etc.); and (d) Grant funds (including usage and breakdown by categories, and unit cost per student, etc.). The TORS will also specify the contracted agency’s scope o f work and reporting responsibilities, including the timing and coverage o f the reports. The UEO will be the administrative center for the monitoring process.

Subcomponent 4.2: Monitoring and Assessing the use of Education Allowances

Monitoring and assessment o f the education allowances scheme to children attending the LCs and SKT schools will be undertaken by the independent agency contracted to monitor the use o f grant support by the LCs as mentioned in subcomponent 4.1 above, with the assistance o f CMCs and UEOs. Technical assistance will be provided to the contracted agency to develop i t s capacity to monitor the delivery o f education allowances to targeted beneficiaries in the LCs. The technical assistance will include staff training and specialist consultant support for the assessment o f targeted programs, in gathering, validating and reporting data from the LCs, in strengthening and updating the MIS, and in developing and

39

disseminating informational reports. Appropriate support will also be provided in the form o f IT, filing systems, furnishings and other equipment as well as relevant staffing o f a monitoring cell in the contracted agency that will work specifically on monitoring the education allowances scheme.

Subcomponent 4.3: Evaluating the Impact of Grants and Education Allowances

Activities under this subcomponent will be carried out by a contracted independent local/international private sector agency with relevant experience in the evaluation o f education programs, including the design and fielding o f nationally representative surveys, and the statistical analysis o f data derived from such surveys. Evaluation activities will include baseline surveys, assessment o f the operation o f recipient LCs, tracking expenditures including the disbursements o f grants and education allowances, and the overall management o f the Project. The evaluation will help to provide information to GOB for any future efforts to institute standardized education criteria for the primary education system at large.

The TORs for this activity will specify the functions and responsibilities o f the independent agency, including the activities relating to: (a) Project management (including the organization and operation o f (i) the ROSC Uni t and its executive sections; and (ii) the MIS center; (b) LCs (including organization and implementation o f teachinghearning programs, and maintenance o f physical facilitiedlearning environment); (c) students (including enrollment, attendance, transfers, and grade and cycle completion rates, differentiated by gender as appropriate; (d) teachers (including age, gender, academic and professional qualification, and teaching experience; (e) grant funds (including usage and breakdown by categories, and unit cost per student); and (f) ERPs and ESPs (including their organization and effectiveness in service delivery). The TORs will also specify the contracted agency’s scope o f work and reporting responsibilities, including the frequency, timing, and coverage o f the periodic reports.

I t i s evident that national expertise i s available in several institutions such as IMED, BIDS, and IER to undertake the external evaluation o f the ROSC Project. The national capacity could be augmented by an experienced international evaluation agency which will work in collaboration with the national agencies. Given these favorable conditions, i t will be useful to explore the formation o f a consortium, composed o f national agencies, supported by an international agency to undertake the external evaluation. Such a consortium provides the rationale for the procurement o f locally-based expertise with an international skill mix at the shortest possible time so that the evaluation work could commence at about the same time as the start o f project implementation. The local consortium will also facilitate the institutionalization o f local expertise in the evaluation o f education projects/programs.

Subcomponent 4.4: Analytical Studies of Non-Formal Education

GOB has constituted a Task Force to work on developing a national non-formal education framework and support will be provided towards the implementation o f the non-formal education strategy. GOB will also be supported in institutionalizing the non-formal education framework and implementing task force recommendations relevant to the primary education sub-sector. Reviews and studies will be carried out under this component will be linked up with issues identified by the Task Force. For example, a comprehensive sectoral analysis could be carried out o f the non-formal education system in Bangladesh to: (a) explore modalities for scaling up support to the non-formal education sector; (b) determine the roles o f various providers and financiers; (c) explore financing mechanisms that will facilitate the coordination o f funding; (d) consider ways and means o f operationalizing the most appropriate financing mechanism; (e) explore the development o f a wholistic primary education sub-sector program in the future; and (f) address other issues as appropriate. Terms o f reference will be prepared in consultation with development partners, GOB, NGOs, and other stakeholders. In addition, thematic reviewdstudies, linked to the sectoral analysis, will also be carried out during the course o f the Project, e.g. experience on community-managed schools, and expenditure review for non-formal education.

40

Appendix: Selection o f Upazilas in which Project will Commence

Initially, the Project i s going to be operational in 60 Upazilas that have been chosen based o n the following variables--net enrollment rates, cycle completion rates, gender disparity, and poverty levels. 54 Upazilas which meet the specified criteria have been identified and are listed below (in addition six Upazilas which do not meet a l l these criteria have been chosen because o f their vulnerability to natural disasters and because they are home to specific socially disadvantaged groups). These criteria will be reviewed over the life o f the Project and the Project will to be expanded to more Upazilas based on these.

The criteria being used are as follows. The key criteria i s that Upazilas that have a net enrollment rate o f less than 85 percent. If an upazila meets that criteria, then it should meet at least two o f the following three criteria: (a) the gender gap in net enrollment should be at least two percentage points (i.e. boys enrollment exceeds girls enrollment by at least two percent); and (b) the cycle completion rate at the primary level should be below 50 percent; and (c) the Upazila headcount poverty level should be at least 30%. The l i s t o f 60 identified Upazilas i s given in Table 1.

41

Note: Upazilas poverty line (%) is taken from WFP Poverty line map of February 2004.

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Annex 6: Implementation Arrangements BANGLADESH: Reaching Out-Of-School Children Project

Chart 1 outlines the proposed organizational structure for management o f the Project. The Ministry o f Primary and Mass Education (MoPME) will have oversight responsibility for the Project. The Directorate o f Primary Education (DPE), i t s capacity suitably strengthened, will be the executing arm o f MoPME. The ROSC Unit (ROSCU), headed by a Project Director (PD), will be directly responsible for the day-to-day implementation o f the Project.

The ROSCU will follow the policy directives o f the ROSC Committee (ROSCC) composed o f representative stakeholders: MoPME, MoF, Planning, ERD, IMED, DPE, three NGOs, private sector entities, and contributing Development Partners (DPs). The ROSCC will hold formal meetings every six months to review policies on project implementation and assess Project progress. At one o f these meetings the ROSCC will conduct an annual review o f policy and Project progress, including identifying bottlenecks and proposing solutions. The annual review will be based on a progress report prepared by an independent evaluation entity, and an implementation plan for the following year prepared by the ROSCU. The ROSCC will be chaired by the Secretary, MoPME. In his absence, an official designated by the Secretary wil l have authority to call and lead ROSCC meetings.

The Project will finance the operational cost, including staff salaries, o f the ROSCU. The ROSCU PD will be supported by five Assistant Directors (ADS) who will be responsible for project implementation relating to (i) provision o f education allowances and L C grants; (ii) training and education development; (iii) monitoring, evaluation, and research; (iv) communications and social awareness; and (v) finance and administration. The PD and the five ADS, operating as a unified team, will be appropriately supported by various general and specialist staff, including a procurement officer, an accounts officer, project officers, computer operators, and other required support personnel (see Table 1 for responsibilities o f staff).

Management Strengthening in the LCs (LCs): The presence o f a functioning Center Management Committee (CMC) will be a pre-requisite for LCs’ qualifying for grant support. Support for strengthening the LCs’ management capacities will come fkom Government and NGO sectors. The LCs will operate with oversight support from their CMCs which will be strengthened by the inclusion o f parents, especially mothers, and local education NGO representatives. The LCs will receive support from the NGOs represented on their CMCs through earmarked resources in the L C grants, for their day-to-day functioning, including dealing with issues related to financial planning and management, and general site management. Government support will be provided through Assistant Upazila Education Officers (AUEOs). The AUEOs, with Project financial support, will be responsible for (i) visiting LCs to review their record-keeping functions, especially student and teacher attendance; (ii) collection o f Project data and information on the receipt and utilization o f grant funds and education allowances; and (iii) hosting periodic refresher courses for L C site managers and CMCs on site management issues.

Management Strengthening in the Shishu Kallyan Trust (SKT) Schools: The ROSC Project will also strengthen the management capacity o f the public SKT school system through support, on a declining basis over the Project life, for the position o f an Assistant Director (AD) who will be located in the SKT Directorate. The SKT AD will work closely with the ROSCU ADS on issues relating to education allowances and grants; training and educational development; monitoring, evaluation and research; communications and social awareness; procurement; and finance and administration.

Qualification for, and retention of, ROSC Project support will be contingent upon SKT schools having fully operational CMCs with representation from parents, especially mothers, and teachers. Incentives will be provided for SKT schools to enhance site management, specifically educational planning, general

45

site management, and operation of, and liaison with, the CMCs. The incentives are earmarked in the school grants which can be drawn only to address management and capacity-building issues through technical assistance which the SKT schools could contract from NGO, private or public entities. The SKT schools will also receive support for management and capacity building from MoPME through the AUEOs. The AUEOs, who wil l receive Project financial support, will periodically (i) v i s i t SKT schools to review their record-keeping functions, especially student and teacher attendance; (ii) collect Project data and information on the receipt and utilization o f grant funds and education allowances; and (iii) host refresher courses for SKT site managers and CMCs on site management issues.

Monitoring and Evaluation

The Monitoring and Evaluation component, as an integral part o f the Project, will put in place an M&E system to monitor the implementation o f the two main interventions-provision o f education allowances to students and grant funds to LCs (LCs)-and evaluate the interventions and their outcomes/results. Monitoring and evaluation will be separate and distinct processes.

Monitoring o f the operation o f the LCs, especially student and teacher attendance, will be carried out by the CMCs and AUEOs who will be responsible for collecting data and information on the LCs. Data for SKT schools will be collected by the SKT Project Director. All Project data and information will be transmitted to an independent contracted agency, which will be working closely with AUEOs, for processing and preparation o f statistical and other reports to be submitted every six months to the ROSCU. Oversight responsibility for al l the above will rest with the ROSCU (Chart 2).

Evaluation o f the interventions and achievement o f Project objectives will be carried out by an independent nationalhtemational agency which will prepare an evaluation report every six months to be submitted directly to the ROSCC. The evaluation report w i l l be based on special evaluative thematic studies and action research as well as the statistical and other reports prepared by the independent monitoring agency.

I t i s evident that national expertise i s available in several institutions such as IMED, BIDS, and IER to undertake the extemal evaluation o f the ROSC Project. The national capacity could be augmented by an experienced international evaluation agency which will work in collaboration with the national agencies. Given these favorable conditions, the formation o f a consortium, composed o f national agencies, supported by an intemational agency to undertake the extemal evaluation i s being explored. Such a consortium provides the rationale for the procurement o f locally-based expertise with an intemational skill mix at the shortest possible time so that the evaluation work could commence at about the same time as the start o f project implementation. The additional advantage i s that the local consortium will facilitate the institutionalization o f local expertise in the evaluation o f education projects/programs.

As the monitoring and the evaluation reports will assess the efficacy o f the Project interventions, particularly the LCs’ compliance with the conditions for Project support, they will provide the basis for the disbursement o f grant and education allowance funds. Hence, the agencies responsible for the respective reports will need to be timely in meeting the production deadlines.

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Table 1: I 1 Unit

Central Level

MoPME

ROSC Committee (ROSCC). Comprised o f h g h level representatives from MoPME, DPE, Finance Division, Planning Commission, ERD, IMED, Ministry o f Women and Children Affairs, Ministry o f Social Welfare, NGOs (two representatives), and participating DPs. The chair w i l l be MoPME’s Secretary. Directorate o f Primary Education

ROSC Uni t (ROSCU). Operational structure responsible for day-to-day Project functioning, including education allowances/grants operations, training and education activities communication and awareness campaigns, and M&E, procurement, and finance.

Key Roles and Responsibilities at Central and Local Levels

Key Roles and Responsibilities

Provides overarching policy and operational guidance for the Project Developing a regulatory framework specifying the objectives, composition and core

0 During project implementation: issuing guidelines to DPEOs and UPEOs re. collection of functions o f the ROSC Committee

data and quality indicators, supervision functions, etc. in NGO LCs, and ensuring compliance with these guidelines Oversee management and implementation o f SKT-specific Project activities

0 Sign Memorandum o f Understanding with relevant Government agencies Carry out joint annual review on the basis o f an annual independent evaluation report and

0 Provides advice and guidance on: (a) resolving implementation bottlenecks at inter-

Oversee overall Project implementation progress

ROSCU’s annual report, and following fiscal year’s plan

ministerial level; and (b) Project financial management

Facilitate ROSCU in i t s planning and implementation responsibilities Financial oversight on project implementation

0 Liaise with MoPME on project implementation activities Making support available from appropriate DPE line divisions

0 Setting up guidelines and regulations, and developing operations resource manuals for

Plan, implement and manage Project activities, and prepare budget estimates/reports Deliver education allowances/grants to LCs Overseelexecute contracts for goods and services

0 Plan and carry out procurement activities Oversee and manage awarenesslcommunications campaigns undertaken by contracted

Prepare annual progress report for ROSC Committee Sign Participation Agreements with Nationalized Commercial Banks

project implementation

entities

49

Unit

(i) Education allowance and Grants Unit

(ii) Training and Educational Development

(iii) Monitoring, Evaluation and Research

(iv) Information, Education and Communications Research

(v) Administration and Finance

Key Roles and Responsibilities

Prepare semi-annual estimates for education allowances and grants Establish and run system to ensure compliance with eligibility criteria by education

Organize calls for applications for grantsleducation allowances from LCs 0 Establish formal agreements wi th Learning Center grant recipients

Prepare the recipient l i s t o f awardees for education allowance and grants Track and maintain records o f al l transactions on education allowance and grant

Maintain contact wi th Nationalized Commercial Banks regarding management o f

0 Identify problems and seek solutions to issues arising f rom grantsleducation allowances

0 Establish the requirements for support institutions (NGOs) to be responsible for training

0 Facilitate contacts between LCs and NGO support institutions Facilitate networking among managers o f LCs through meetings at the local level

0 Carry out periodic field visits to learn about functioning o f LCs and their teaching

allowancelgrant recipients

allocations (linking with M&E and Programmer)

grandeducation allowance resources

programs management

and support o f teachers in LCs and preparing lists o f eligible institutions

processes, noting particular problems that should be brought to ROSCU’s attention Prepare regular reports on teaching and learning aspects in consultation with managing NGOs Prepare TORS for a mid-term evaluation o f Learning Center functioning and achievements Monitoring: Maintain contact with contracted monitoring agency’s central data unit Maintain contact wi th Upazila Education Offices (UEOs) for collecting data on grant and education allowance recipients, and on other key education indicators (key education indicators, quality, access, etc.) Liaise wi th project implementing entities1CMCs Evaluation: Ensure quality, consistency o f data collected Produce/oversee production o f semi-annual statistical data reports Produceloversee production o f semi-annual analysis o f Project progress

0 Oversee production o f impact studies o f Project effectiveness Research: Conducting special ad hoc studies to assess specific issues under the Project as needed (e.g. changes in quality, changes in girls’ enrollment rates) Feed datalinformation into annual monitoring and progress reports Prepare annual plans for IEC for dissemination o f research findings Prepare annual plans for IEF for SKT, education allowances, and M&E functions in

Feed datalinformation into annual monitoring and progress reports Maintain day-to-day administration o f staffing, logistics, personnel management. Maintain close contact wi th MOF and organize audits and liaise wi th accounts department Prepare the budget necessary for release o f funds

0 Make proposals for fund release semi-annually Channel funds to recipient entities Prepare annual financial reports

0 Ensure that LCs adhere to guidelineslcriteria regarding utilization o f grant resources in

Keep financial accounts, reports on financial progress, ensure internal control and auditing Maintain a computerized financial management system Contribute to preparation o f progress reports, semi- and annual plans Liaise with relevant uni ts within MoPME, and other Government agencies

collaboration with respective ADS

coordination with M&E

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Unit

Nationalized Commercial Banks

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Upazila Education Office

Center Management Committee (CMC)

Education Service Provider (ESP)

Education Resource Provider (ERP)

Key Roles and Responsibilities

Ensure timely transfer o f funds, including grants and education allowances, upon

Provide timely disbursement statements and other relevant documents ROSCU’s request

Act as focal point for processing applications to establish LCs, facilitating disbursements

Signs cooperation agreements with Center Education Committee Responsible for managing the Learning Center wi th support from Education Service Providers selected by the Center Management Committee Education Service Providers (ESPs) are those agencies selected by CMC’s, in accordance with agreed terms, conditions and criteria, to assist in identify out-of-school and hard-to- reach children, to ensure their enrollment and attendance, and to support the CMC’s in running the LCs. Education Resource Providers (ERPs) are NGOs, educational institutions, or agencies, wi th a multi-districthational presence and extensive experience in primary education, teacher training and curriculum development, selected by CMC’s to carry out educational technical services in accordance with agreed terms, conditions and criteria

o f grants and education allowances, and monitoring teacher and student attendance at LCs

51

Annex 7: Financial Management and Disbursement Arrangements

BANGLADESH: Reaching Out-Of-School Children Project

Risk Risk Rating System Risk The significant risk flag for the Project i s the weak financial monitoring system at the Ministry as well DPE level, which i s vital for Project o f this nature having key financial operations at the grass root level through multiple interventions.

M

Overall Risk rating M

Financial Management Assessment The objective o f the Financial Management assessment was to determine whether the Directorate o f Primary Education (DPE) which i s responsible for overall implementation, management and monitoring o f the Project has adequate financial management capacity to manage the Project. Wh i le carrying out the assessment, weaknesses indicated in the recently approved PEDPII including a financial management improvement plan have been taken into account. The FM arrangements for the proposed Project wi l l mostly follow existing Govemment policy and procedures, and will benefit from the FM improvement plan in terms institutional and technical support that was implemented under PEDP 11. The additional FM requirement will be to provide for any incremental support that might be necessary for the Project. As a detailed assessment o f DPE (the Implementing Agency) has recently been completed under PEDPII, the following i s a brief summary o f the ROSC FM arrangements.

Mitigation Measures

Agreement to h i re independent private fm under an agreed TOR and timeframe to review financial and operational progress o f the Project. The findings o f the review w i l l be key elements o f the semi-annual Project supervision mission.

Strengths and Weaknesses Strengths: The ROSC Project will have the following strengths in the area o f financial management: (a) The same computerized package (MACs) which will undergo further development under PEDPII will be used for the ROSC; current status of the MACs including any additional customization for the proposed Project will be further reviewed during appraisal; and (b) DPE experience in projects financed by donors and their FM requirements and other institutional arrangements will also contribute to the Project.

The weaknesses are highlighted in Table 2 below.

Table 2: Weaknesses Weaknesses

The Project w i l l have additional finance staff who may not have necessary sk i l l s and there could be delay their recruitment. Inadequate monitoring o f financial reports and delay in timely reconciliation o f field and unit data leading to delays in realistic cash forecast, yearly budget estimates and performance indicators review.

Resolution (i) Two staff wi th requisite qualification from Project start up under specific job description and reporting functions are in the process o f finalization. (ii) In-house training o f project staff by DPE staff or others having sufficient exposure to financial management and donors’ practice (i) Draft Financial reports w i l l be discussed and cleared bv the ROSCU and other Project units before finalizing and submission to IDA andGoB. (ii) ROSCU w i l l ensure no discrepancies in financial figures in the reports. (iii) Detailed service standards indicating processing time for fund releases from ROSCU to commercial banks and to eligible LC’s and parents have been prepared. Measures relating to commercial banks w i l l be part o f the Participation Agreement.

Implementing Entities : M o P M E & DPE 0 During implementation, MoPME will have overall responsibility for project implementation and

oversight. A ROSC Project Implementation Uni t (ROSCU) in DPE will be responsible for project

52

implementation. The ROSCU Project Director with the help o f two qualified project staff w i l l carry out all FM activities for the Project. A substantial amount o f the grant will be to support education allowances to eligible out-of-school children, provide grants to school attended by eligible education allowance students and support to Shishu Kallyan Trust schools (SKT) and monitoring o f the use o f education allowances and grants.

Funds Flow Arrangements IDA funds wil l be channeled through a special account into a Nationalized Commercial Bank. The Project director o f ROSCU will be the authorized person for issuing checks to third parties. In respect o f education allowances and grants to Learning Centers, ROSCU will transfer funds on a semester basis, based on the l i s t o f eligible students and Learning Centers, to Nationalized Commercial Banks. The Banks will disburse education allowances to motherdguardians and grants to Learning Center CMCs according to specified criteria. ROSCU will disburse funds twice a year (January and June) to a Nationalized Commercial Bank(s) under a Participation Agreement between ROSCU and the Bank(s). The Bank(s) will utilize the fund to disburse education allowance to legal guardian through i t s branches on the basis o f approved l i s t o f eligible students received fkom ROSCU. The same Bank(s) will also be responsible to disburse grants to eligible leaming centers based on the terms and conditions o f the Cooperation Agreement between ROSCU and eligible learning centers represented by their CMC’s. For all approved learning centers, ROSCU will disburse funds to the Commercial Bank(s) for their onward transfer to the eligible LCs. Subsequent fund transfer to LCs will be contingent upon submission o f fund utilization statement to ROSCU. The Participation Agreement clearly indicates the obligation o f the banks under the contract and remedies in case o f non-compliance with the agreed terms and conditions. The Cooperation Agreement indicates LCs statutory obligation under the contract including maintenance o f proper books o f accounts and conditions for receiving grants and their utilization.

GOB Funding Education allowance and grants will be funded 100 percent by IDNSDC. The rest o f the Project activities will involve counterpart funding. The counterpart funding will be provided following i t s treasury system for fund disbursement.

Donor Funding: Joint Co-Financing SDC will support the Project through joint co-financing with IDA through a grant agreement under the SDC-IDA co-financing framework agreement. The modalities and details are being finalized.

Accounting and Financial Controls The Accounts Code, the Treasury Rules and General Financial Rules o f the Government, existing chart o f accounts will form the basis for accounting and financial control in ROSCU. Books o f accounts will be maintained on a cash basis and using double-entry bookkeeping principles. In ROSCU, separate books o f accounts and registers will be maintained so that grant expenditures can be tracked and reported accordingly. The existing systems are considered adequate for the Project. In addition, contractual agreements between the Nationalized Commercial Bank(s), ROSCU and Learning Centers and criteria for education allowance and grants indicate expenditure eligibility under Project components and will form the basis for accounting under appropriate heads. If the existing charts o f accounts o f the Government are inadequate, additional chart or heads will be maintained to track Project expenditures. The Learning Centers will keep separate books o f accounts for grants and will provide a statement o f fund utilization before subsequent installments are requested. The LCs commitment under the contract will be closely monitored through the internal audit.

53

0 The Project accounts will be initially maintained manually. They will be linked to the existing MACs software within three months o f Project effectiveness. All financial reports wil l be generated from the MACs software. There are clear guidelines for authorization and approval o f financial transactions at the Ministry (MoPME) and DPE (ROSCU) levels. The Government’s existing financial power, authority and payment responsibility outlined in the Project Accounting Manual and General Financial rules will be followed. ROSCU will execute transactions with procurement process being done by independent staff while finance staff will be responsible for payment, recording and reporting.

0

Auditors

Staffing Under the direct supervision o f ROSCU Project director, an assistant Director (Finance and Administration) and an accountant will be responsible for financial management activities o f the Project. The terms o f reference o f the FM staff will be finalized by April 30,2004. Staff will be in place by July 3 1, 2004.

Completion date

Internal Audit and Monitoring Internal audit functions in the Project will be carried out through the monitoring and evaluation component o f the Project. I t has been agreed that the firm which will be responsible for periodic monitoring and evaluation will also be responsible for reviewing other financial issues, the use o f grants to LCs, delivery o f cash allowance to targeted beneficiaries, and evaluating the grant and education allowance program. The TOR o f the firm have been drafted, and include the internal audit function.

Government auditor (C& AG)

External Audit 0 As no separate financial statement i s prepared at the DPE level, the Project financial statements will

be audited annually by the Comptroller and Auditor General o f Bangladesh. The audit report will be submitted to IDA within six months o f the end o f each fiscal year. Unless any special or additional audit i s required, no other audit to will be carried out. Additional audits will be subject to Comptroller and Auditor General concurrence and agreed TOR. All previous audit reports o f IDA assisted PEDP I have been received on time. The pending observations under the same ministry and sector mainly relate to non-compliance with GOB rules and policies - e.g. non-deduction o f t a f l a t , violation o f Project Proforma provisions, and non- acceptance o f single-source selection methods. These are in the process o f being resolved through an Action Plan agreed during the preparation o f PEDP 11. A status report i s being prepared and has been submitted. IDA’S Audit Report Compliance System (ARCS) will keep track o f the following audit for ROSC (Table 3):

0

0

December 3 1 in each fiscal year

Table 3: Implementing I Audit Type and FY Agency DPEMoPME I Project Financial

Statements for each fiscal year ended on June 30

Financial Reporting and Monitoring 0 DPE already has systems in place to capture Project information and specific formats for reporting.

ROSCU, with the help o f the financial staff, will be responsible for consolidating financial information from all cost centers after scrutiny o f financial information, monitoring actual expenditures, and coordinating with Banks, other agencies and the Financial Management Unit o f MoPME for financial data reconciliation and reporting.

54

0 A set o f Ouarterlv Financial Statements (FMRs) will be prepared by ROSCU and will be submitted to the Bank along with the quarterly progress reports. These will include quarterly Sources and Uses o f Funds along with Uses o f funds by Project component/activities, Dollar Special Accounts Statements, Output Monitorinn Reuorts indicating quarterly financial or physical progress o f predetermined indicators o f key Project activities, and Procurement Monitoring Reuorts.

Actions/ Activities Two staff in the position o f Assistant Director and an Accountant wi th agreed job description.

A TOR satisfactory to IDA to carry out periodic review o f the use o f grant support to learning centers, delivery o f cash allowance to targeted beneficiaries and evaluate the grant and education allowance program. Plan to resolve outstanding observations under the Primary Education Development Project

Financial Management Action Plan Table 4 summarizes the financial management action plan.

Responsibilities Completion MoPMEiDPE TOR have been

prepared and staff w i l l be appointed by July 3 1,2004

MoPMEiDPE Draft TORS have been prepared

MoPMEDPE Done

Disbursement Arrangements Disbursements under the Project will be made as indicated in Table 5 below, which indicates the percentage o f financing for different categories o f expenditures o f the Project. I t i s expected that IDA funds will be disbursed over a period o f five and a half years, with a closing date o f June 30, 20 10. The traditional disbursement method (SOE-based) will be followed, with an option to switch to the report- based disbursement method at GOB’S request for IDA’S consideration.

Table 5: Allocation of Grant Proceeds’

Services (excluding

Retroactive Financing GOB will also have access to up to US$lOO,OOO in retroactive financing for eligible expenditures incurred between May 1,2004 and Grant effectiveness, for procurement o f goods, consultant services, and for training purposes. The documentation requirements for retroactive financing will be the same as those needed for disbursement against payments made under the grant.

* IDA Grant only; SDC i s financing US$6 mi l l ion o f the total project cost o f US$62.8 million.

55

Use of Statement of Expenditures (SOEs) IDA wi l l require full documentation for all prior review contracts that exceed the equivalent of: (a) US$300,000 for goods (b) US$lOO,OOO for service contracts with f irms; and (c) US$50,000 for individuals. Expenditures below the above thresholds and all expenditures under Operating Costs will be claimed on SOEs. SOEs will be reviewed by the initial supervision mission to ensure that funds are utilized for intended purposes.

Special Account For utilization o f IDA share o f Project expenditures, ROSCU will open and maintain a Convertible Taka Special Account (CONTASA) under terms and conditions acceptable to IDA. The authorized allocation o f the special account will be BDT 150 million.

56

Annex 8: Procurement BANGLADESH: Reaching Out-Of-School Children Project

General:

The total cost o f the Project i s estimated at US$62.8 million, o f which the IDA grant will finance U S 5 1 mill ion equivalent. The Project will largely involve education allowances to out-of-school children (US$27.3 million) and grants to learning centers (US24.5 million) through Center Management Committees, supported by Education Service Providers (ESP). I t will also involve small valued procurement o f goods, and some consultancy services.

Rules and Guidelines: All IDA financed procurement o f goods using international competitive bidding (ICB) will follow procedures outlined in the Bank’s “Guidelines for Procurement under IBRD Loans and IDA Credits ” (current edition). Consulting services and training obtained through international advertisement (dgMarketfUNDB online) will follow the Bank’s “Guidelines: Selection and Employment of Consultants by World Bank Borrowers” (current edition). All local procurement for goods, and services for which the shortlist entirely comprised o f national consultants, will follow the Government’s new procurement regulations (The Public Procurement Regulations 2003), acceptable to the Bank (goods- < US$300,000 per contract, consultants’ services- f i rms: < US$200,000 per contract, individuals: < US$50,000 per contract).

Procurement Responsibility. The Ministry o f Primary and Mass Education (MoPME) will have oversight responsibility o f the Project. The Directorate o f Primary Education (DPE), the executing arm o f MoPME, will manage the Project through i ts ROSC Unit, ROSCU, headed by a Project Director, that will be directly responsible for the day-to-day implementation o f the Project. The ROSCU will follow the general guidance o f a ROSC Committee with representatives from ministries, NGOs, and private sectors. Grants will be provided to learning centers o f 60 Upazilas (sub-districts) across the country in phases, each center each managed by a Center Management Committee (CMC). Over the entire Project period about 15,000 eligible learning centers will receive the grants, each not exceeding US$l,OOO per year.

Goods (US$0.5 million):

Most goods are small valued packages and are unlikely to attract foreign bidders, and as such procurement will not involve international competitive bidding

(i) contract may be procured using NCB. This includes office equipment, furniture, vehicles, printing materials, etc. (ii) items may be procured, through prudent shopping procedures, in packages with an estimated value less than US$20,000 equivalent per contract. This includes photocopiers, computers, air conditioners, audio- visual equipment, books, etc. (iii) costs less than US$2,000 equivalent may be procured following DC.

NCB: Goods and equipment contracts estimated to cost less than US%300,000 equivalent per

National Shopping- NS: Goods o f very small contracts or individual purchases o f off-the-shelf

Direct Contracting- DC: Computer software, journals, magazines, etc. with individual contract

Grants (US$24.5 million):

This grant will be used in small amounts per annum (not exceeding US$ 1,000) to establish new learning centers, and deliver quality education in new and existing learning centers. The Project will support local level institutions for community mobilization to establish the new learning centers andor strengthen the

57

capacity o f local communities to manage learning centers in collaboration Education Service Providers (ESPs). The grant o f will be provided to each learning center and will consist of: establishmentfund-a one time initial payment in setting up new Learning Centers; qualityfund- to procure education materials and supplies including teacher preparation; training grant; management fund--an annual payment for schools/ learning centers management supportltraining including capacity building o f CMCs; discretionalyfund - for teacher salaries, center maintenance and renovations, extra curricular activities, sanitation and safe drinking water etc. In the interest o f certain specific social objectives o f the Project, i t i s desirable to call for the participation o f local communities and ESPs. I t i s expected that approximately 15,000 learning centers will be financed under the Project in 60 upazilas (sub-district) in six districts. CMCs will consist o f majority o f parents including mothers, female ward chair-person, an Assistant Upazila Education Officer (AUEO), and one local ESP representative with the head teacher as member- secretary. Each learning center has to meet some specific eligibility criteria (Annex 4).

The CMC will take primary responsibility for hiring teachers and procuring materials. In certain situations, hiring o f local contractors may be necessary for sanitation and safe drinking water supply. Since each grant will be o f very small amount and there are not many Education Service Providers (ESP) in the relevant field o f the locality, in most cases, CMC’s will directly obtain services from the qualified ESPs. In some cases, Education Resource Providers (ERP) wil l be contracted to provide technical assistance to ESPs. L i s t s o f potential ERPs and a financing agreement will be agreed with DPE depending on the eligibility criteria. DPE will disburse funds to the community managed learning centers in two tranches (semi-annually). A Draft sample financing agreement between DPE and the learning center, specifying the mode and triggers for payment, i s included in the operational plan prepared by DPE.

Consultants’ Services and Training (US$7 million):

IDA will finance consultants’ services valued about US$2.6 mil l ion and training for about US$ 1.1 million. Assignments include: management consultant, external monitoring and evaluation consultant, research and development consultant, etc.

(i) Quality- and Cost- Based Selection (QCBS): Consulting services through f i r m s estimated to cost US$300,000 equivalent or more per contract will be procured following QCBS. Major assignments are ROSC management consultant, and external evaluation consultant. (ii) Quality- and Cost- Based Selection (QCBS)/ Fixed Budget Selection (FBS): Services through f i r m s estimated to cost less than US$300,000 equivalent per contract may be procured following either QCBS or FBS. Contracts may include external monitoring and evaluation consultant. (iii) Fixed-Budget selection (FBS)/ Least-Cost Selection (LCS): Services through f i r m s estimated to cost less than US$lOO,OOO equivalent per contract may be procured following FBS/LCS. (iv) Single-Source Selection (SSS): Specific consultants’ services through f i rms, satisfying Consultants’ Guidelines (paragraph 3.8 to 3.1 1) may be procured following SSS. The contract for monitoring and data processing i s likely to be outsourced on a single-source basis to the Local Government Engineering Department (LGED). LGED i s uniquely qualified to provide the monitoring and data processing service at the community levels because o f i t s extensive MIS/ GIS capacity at the upazila level and i t s long standing collaboration with MoPMEIDPE. Besides, Shisu Kallyan Trust (SKT) operated schools will also be contracted (v) Individual Consultants (IC): Services for assignments for which teams o f personnel are not required and the experience and qualifications o f the individual are the paramount requirement will be procured through individuals in accordance with Section V o f the Consultants Guidelines when the estimated cost i s US$50,000 or more per contract and in accordance with the national ru les when the estimated cost i s < US$50,000 per contract. Individuals will be selected on the basis o f their qualifications for the assignment.

58

Provision for training i s included. Most training o f individuals and staff members concerning capacity strengthening will be implemented through direct contracting.

Operating Costs &JS$3.5 million):

Incremental operating costs will be financed by IDA on a declining basis. T h i s includes: incremental salaries, operation and maintenance o f vehicles, office utilities, supplies & stationeries, and National Commercial Bank charges etc.

Procurement and Selection Planning

The draft Procurement Plan for goods, and Selection Plan for services has been prepared by DPE. The Plan will covers the initial 18 months o f the Project with the provision o f adjustments during this period, and thereafter will be updated annually covering always the next 18 months o f project implementation. The use o f the methods defined in the Plan i s mandatory. Prior to issuance o f any invitation for bids for procurement o f goods and selection o f services, the proposed Plan shall be furnished to IDA for i t s review and approval, in accordance with the provisions o f paragraph 1 o f Appendix 1 to the respective Guidelines. Procurement o f goods and selection o f all consultants will be undertaken in accordance with Plans approved by IDA.

Use o f Standard Documents:

For ICB procurement o f goods, the use o f IDA’S Standard Bidding Documents (SBD) i s mandatory. For NCB procurement, DPE or other implementing agencies will use the Government’s Standard Bidding Documents acceptable to IDA. For selection o f international consulting f irms, the Bank’s Standard Request for Proposals (RFP), including standard contract form will be used; for local consultants Government’s procedure laid out in the national regulations wil l apply including i t s documentation. Depending on the type o f procurement, the Bank’s or Government’s Standard B id Proposal Evaluation Form will be followed for submission o f evaluation reports.

Prior Review Thresholds:

Goods: During the initial 18 months o f the Project, IDA will carry out prior review o f the following contracts: all contracts estimated to cost US$300,000 equivalent or more and the f i rs t one contract regardless o f the value and method. After 18 months, the above thresholds will be reviewed defined / redefined in the revised procurement plan, if necessary.

Consultants Services: IDA’S prior review will be required for consultants’ services contracts estimated to cost US$lOO,OOO equivalent or more for f i r m s and US$50,000 equivalent or more for individuals. All single-source contracts wil l be subject to prior agreement by IDA.

Post Review/ Procurement Audit:

For compliance with the Bank’s procurement procedures, IDA will carry out sample post review o f contracts that are below i t s prior review threshold including contracts for grants provided to the learning centers. The Project also includes funds for carrying out procurement audit by an independent auditor. Such review (ex-post and procurement audit) o f contracts below the threshold will constitute a sample o f about 20 percent o f the contracts.

59

Review of Procurement Performance:

IDA will monitor the compliance with the requirements o f Bank’s different procurement methods and performance standards on a continuous basis. As part o f the project’s planned annual review/ mid-term review, a comprehensive assessment o f procurement performance will also be carried out. Based on the review, in consultation with the Government, IDA may revise the prior review threshold including the procurement and selection methods.

Reporting:

The Project will prepare quarterly Procurement Monitoring Report (PROCMOR) as per specific formats agreed with GOB.

Procurement Management Capacity:

Procurement Environment: The Country Procurement Assessment Report (CPAR), broadly accepted by the Government in February 200 1, identified inadequate public procurement practices as major impediment affecting Project implementation in Bangladesh. Procurement deficiencies include: absence o f a sound legal framework, protracted bureaucratic procedures allowing multi-point rent seeking, lack o f critical mass o f professionals to manage public procurement, inordinate delays in completing the procurement process and ineffective contract administration and absence o f mechanisms for ensuring transparency and accountability in public procurement.

Procurement Reform Actions: Following the CPAR recommendations, the Government with IDA’S support i s implementing the Public Procurement Reform Project (PPRP). As part o f the reform under PPRP, the Government has established a Central Procurement Technical Unit (CPTU) with adequate staffing funded from own resources, issued Public Procurement Regulations 2003 in October 2003 and implementation procedures in March 2004, and prepared standard bidding documents/ procurement approval procedures and delegation o f financial powers, all are at the approval stage. The new regulations, among others, take into account the multilateral development bank’s principles o f harmonization o f requirements for local procurement in borrowing counties.

Concurrently, in order to build procurement management capacity under the overall umbrella o f CPTU, ILO, Turin in co-ordination with Bangladesh Insti tute o f Administration and Management (BIAM) has developed a critical mass o f 16 local procurement trainers and started training in October 2003 o f about 1,600 publidprivate sector staff, to be conducted in phases over the next two years. All these actions are contributing positively in changing/ improving the procurement environment.

Capacity Assessment & Strengthening Actions: DPE will be responsible for managing the Project under the guidance o f a ROSC Council with representatives from ministries, NGOs, and private sectors. The Project will largely involve small amounts o f annual grants (- $1,000) to learning centers. Each learning center will be managed by a Center Management Committee (CMC) included in it representatives o f ESPs. For certain technical areas, CMCs/ESPs will obtain services o f Education Resource Providers (ERPs). Since each grant will be of very small value and there are not many ERPs in the relevant field o f the locality, in most cases, CMC’s will directly obtain services from the qualified ERPs; a list o f potential ERPs based on the eligibility criteria and a financing agreement will be agreed with DPE. In addition it will involve small procurement o f goods, and some consultants services. Given the inadequate experience o f CMCs, a knowledge dissemination scheme by DPE will be undertaken to ensure appropriate use o f funds. Given the nature o f the Project, based on the procurement capacity assessment and the need for improvement, the procurement-associated risk is average. One Procurement

60

Officer will assist DPE in handling procurement matters including use o f small grants and i t s arrangements between the learning centers and the ERPs.

1. Goods

Given the time constraint and the requirement for fast track processing o f this grant; to mitigate procurement associated risks, strengthen procurement management capacity/accountability, as Project preparation moves on, the following arrangements have been made/agreed:

ICB NCB Other' N.B.F. 0.31 0.21 0.52

(a) MoPME/DPE prepared a draft procurement plans; (b) MoPME/DPE will make available one procurement officer within one month o f grant effectiveness

for handling procurement planning, advance procurement actions, and all subsequent procurement matters under the Project;

(c) DPE, by July 3 1,2004 wil l send at least one concerned staff to undertake procurement training being organized by CPTU/IMED.

2. Consultants' Services

(excluding those covered in (b) below)

(a) Consultants

Table A: Project Costs by Procurement Arrangements (US$ mill ion equivalent)

(0.10) (0.13) (0.23)

2.39 0.60 2.99 (2.39) (2.39)

Expenditure Category

(b) MIS/Monitoring

3. Training

1 Procurement Method 1 Total Cost

2.50 2.50

1.54 1.54 (0.22) (0.22)

5. Grants (24.84) (24.84) 21.51 2.95 24.46

6. Operating Cost

4. Education Allowances I I I 24.84 I 2.46 I 27.30 I

(21.51) (21.51) 3.49 3.49

(0.75) (0.75)

(0.10) (50.93) (51.04)

11

21

Figures in parenthesis are the amounts to be financed by the IDA Credit. All costs include contingencies. Includes (i) goods to be procured through national shopping, direct contracting; (ii) consulting services to be procured following: quality- and cost-based selection, selection under fixed-budget, selection based on consultants' qualification, single-source selection, and individual consultants' methods, and training cost; and (iv) incremental operating costs.

31 NBF: Non-Bank financed - Swiss Development Cooperation (SDC).

61

Category I Method Review

Goods

Services

>=US$300,000 ICB All contracts <US$300,000 NCB First one contract irrespective o f

>=300,000 QCBS All contracts. <US$300,000. QCBS/ FBS All contracts o f US$lOO,OOO or

<us$100,000 FBS/LCS Post review >=US$50,000 IC- Qualifications, All contracts

<US$50,000 IC- Qualifications, Post review

value

more

references

Selective contracts (LGED, SKT,

Overall Procurement Risk Assessment:

references sss Prior agreement

Overall procurement risk i s average, and mitigation measures are described above.

etc.) - Grants < us$l,ooo Post review

Frequency o f procurement supervision missions proposed: Once in every six months. Besides, as part o f the fiduciary control, Bank’s staff and independent consultant, as deemed appropriate, will carry out post review/procurement audit o f contracts.

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Annex 9: Economic and Financial Analysis BANGLADESH: Reaching Out-Of-School Children Project

I. Background

Bangladesh has a strong national commitment to education and has one o f the largest primary education systems in the world. Gains in access have been impressive with total enrollment increasing substantially during the last decade and gross primary enrollment rates rising from 76 percent in 1991 to 97 percent in 2002. Dropout rates decreased by nearly half, from nearly 60 percent in 1991 to 30 percent in 2000. Completion rates increased significantly from 40.7 percent in 1991 to 67 percent in 2001. Gender parity in access to primary education has also been achieved.

Funded

MoPME MoPME

MoPME MoPME MoPME

by

MoPME

MoPME NGOs and othei Source: ‘

In 2002, nearly 17.6 mill ion students were enrolled in over 78,000 primary level institutions. Of the total number o f students, about 15.7 mil l ion (49.9 percent girls) were enrolled in Government funded, formal primary education schools (Table 1). Government primary schools and experimental schools attached to PTIs are fully funded by the Ministry o f Primary and Mass Education (MoPME). MoPME funds 70-90 percent o f registered nongovernment primary schools, and provides Tk.500 per teacher for community and satellite schools. GOB funds through MoPME, the construction o f some NOG-run full primary schools. The other types o f schools are recognized but not funded by the Government.

Table 1: Primary Education by type of school, number of schools, teachers, Gross Enr

School TvDe Government Primary School (GPS) Experimental School Attached to P T I

Registered Non-Government Primary School (RNGPS)

Community School (COM) Satellite School (SAT) H igh School attached Primary Section Non-Registered Non-Government Primary School (NGPS) Kindergarten Ebtedayee Madrasah High Madrasah attached Ebtedayee Madrasah NGO-run Full Primav School *

TOTAL

*imarv Education Statistics in Banglades

Ilment, !

Schools 37,671

53

19,428 3,225 4,823 1,576

1,792 2,477 3,443

3,574

301

78.363

-2002.” 1

udent-te

Teacher 157,236

25 1

76,758 9,759 9,649 10,490

6,380 15,150 13,479

14,806

1,097

315.055

253,653

61,402 rectorate o

cher ratio Pupils

Total 0,669,8 19 10,711

4,137,090 560,673 340,250 40 1,925

202,778 27 1,426 458,751

465,977

42,427

17.561.828

15,718,543

koss Enra

Girls 5,340,275

4,726

2,054,259 281,680 172,624 207,319

98,800 116,283 219,513

203,192

21,510

8,720.180

7,853,564

866.616

ments)

Boys 5,329,544

5,985

2,082,831 278,993 167,626 194,606

103,978 155,143 239,238

262,785

20,917

8,841,648

7,864,979

Pupill Teacher

Ratio

1,843,285 976.669

67.86 42.67

53.89 57.45 35.26 38.31

31.78 17.92 34.03

3 1.47

38.68

Division, Government o f the Peopl2s Republic o f Bangladesh. M a y 2002. Notes: * These N G O schools are constructed with GOB h n d s from MoPME.

Despite the considerable progress made over the past decade, the best estimates o f net enrolment rate (NER) suggest that at any one time there are close to 3.5 mil l ion children o f primary school cohort (6-10 years) who are out-of-school. The high gross enrolment rate (estimated at 97 percent) hides the fact that many young children are not in school and many others enroll at an older age than stipulated by the

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compulsory education legislation. While there i s a high level o f gender parity in terms o f total enrolments (50.3 percent boys and 49.9 percent girls in 2002), there i s far less parity in terms o f access to education for children in remote rural areas.

The Second Primary Education Development Program (PEDPII) i s the flagship program which operationalizes Government o f Bangladesh’s (GOB) strategy to achieve Education for All. The focus o f PEDPII i s on the formal primary education system. Whi le PEDPII will have significant impact on reducing the number o f out-of-school children, by the end o f PEDP I1 about 1.8 mill ion out-of-school children wil l s t i l l not have access to primary education. The Reaching Out-of-School Children Project complements PEDPII in that it will target the out-of-school children, support increase in non-formal school enrollment, increase completion rates and transition rates for students enrolled in non-government schools to govemment-supported secondary schools, improve the classroom environment, and ensure that unit costs are no higher than in the formal, Government supported primary institutions. To achieve the objective, access to non-formal primary education for out-of-school children will be facilitated through investments which support demand and supply-side interventions by: (i) providing targeted student allowances to eligible children (including education allowances to children in Shishu Kallyan Trust (SKT); (ii) providing grants to schools attended by eligible education allowance students; and (iii) supporting program management and institutional development to build local capacity for the management o f services by institutions catering for pupils who are not enrolled in regular primary education and establishing a sound structure for project management and implementation. The characteristics o f the non-formal LCs i s provided in detail in Annex 1.

I(a) Project Coherently set in ESW

Bangladesh’s Interim Poverty Reduction Strategy Paper (IPRSP) emphasizes the necessity o f providing quality primary education and states that the unsatisfactory performance o f the primary education system contributes to a colossal loss in systemic efficiency for the education sector as a whole. The Project “Reaching Out-of-School Children” incorporates two essential considerations necessary for achieving EFA: (i) addressing the equitable distribution o f educational opportunities in-country; and (ii) ensuring that meeting access goals does not come at the cost o f enhancing education quality. The Project will complement PEDPII in reflecting the IPRSP’s strategy o f improving access to education for all and improving the quality o f the non-formal primary education system.

The Project i s also designed within the context o f the recent World Bank ESW, Bangladesh Education Sector Review (2000). The analysis revealed that substantial progress has been made in increasing enrolments at the primary level in Bangladesh over the last two decades-from around eight mill ion in the beginning o f the 1980s to over 17.5 mil l ion by 2002, including over two mill ion students enrolled in a vibrant and active non-govemmental sector. However, the system faces several challenges: 0

0

0

0

About 10 percent o f the children do not enter primary school at all. These children are mainly from the hard-to-reach poor families for whom the opportunity cost o f attending school i s very high; 40 percent o f those who do enter primary education do not complete five grades; Repetition and dropout rates are high-students take six years to reach the fourth grade; and Those who do complete five grades perform on average at about a third grade achievement level and lack essential problem solving ski l ls.

The ESW analysis further states that the poor quality o f education arises out o f constraints which can be classified into three types: 0 Demand-side factors that prevent children from going to school or from benefiting from the

educational services provided by the school. For example, poverty, direct costs o f schooling, opportunity costs, the special needs o f some children, cultural constraints and prejudices.

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Supply-side factors that limit their capacity to provide adequate quality education opportunities for children living in the area. For example, schools not being accessible, short contact hours, inadequate facilities, untrained and poorly trained teachers often with inadequate knowledge, lack o f teaching and learning resources, teacher inertia and absenteeism. A related supply-side issue i s the fact that teachers lack adequate incentives to perform well in school and may in fact be getting a proportion o f their household income from providing private tuition, from which the poor cannot benefit. Institutional policies and administrative arrangements that can keep children from attending school or performing at an acceptable level or limit the school and classroom’s capacity to provide an effective education. For example, the “shift” system, weak organizational capacity, an organizational culture that does not properly value primary education, the high level o f centralized management, staffing policies that create inefficiency, inadequate funding arrangements, inability to make the most effective use o f available funds, and lack o f easy linkages between the formal and non-formal sectors.

The review goes on to say that solutions to these problems require priority attention to improvements in quality aimed at reducing wastage in the system, and leading to increased completion rates. Furthermore, that hard-to-reach children should be targeted through compensatory programs.

The Project aims to bring out-of-school and hard-to-reach children into school Le., increasing access to primary education, through various measures aimed at (a) providing incentives for poor families to send children to school, and for schools to attract out-of-school children; and (b) improving the quality o f student learning and performance outcomes with the objective o f mainstreaming children into the formal primary education system at the secondary level.

I@) Project Coherently set in the CAS

The problems o f access and low quality o f primary education are recognized in the latest CAS 21326-DB dated February 8,2001, which states that despite impressive gains recorded in education in the past decade, improving quality remains a major challenge. The CAS states that IDA and other donors will continue advocacy and support for improving access to and the quality and efficiency o f primary education. The Project which aims to enhance access to education for the disadvantaged directly responds to the CAS recommendation.

11. Rationale for Intervention

Primary-level education i s universally regarded as a public good with significant externalities. Primary education i s strongly correlated with economic development and with increased productivity, and i s one o f the key solutions to breaking the vicious cycle o f poverty. Support to non-formal education will help to bring out-of-school children into LCs. Non-formal LCs serve an important social function in that they help to lay the foundation through good-quality basic education for out-of-school children to help them to become literate, help them to increase their productivity and on the road towards better employment and income-earning possibilities. The enhanced level o f education and literacy achieved will be a significant factor in breaking the cycle o f poverty in the rural areas in Bangladesh. The main economic arguments for a proactive role for non-formal LCs and the Bank to complement government-supported formal primary education are as follows:

Returns to Primary Education. There are high private and social returns to investing in primary education-cost-benefit analysis studies o f primary school education show high rates o f return (Tiles, 1987; Acharya 1995 for private returns to education and Azariadus and Drazen, 1990 and Psacharopolous, 1994 for social returns to education).

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Primary education and income-generation. Benefits o f a good quality primary education system are strongly correlated with economic development and with increased productivity. In the absence o f a good quality primary education system the majority o f the labor force will continue to lack basic sk i l ls that are crucial to increasing efficiency and productivity in the labor market. The Project aims to enhance access to primary education, and to provide a better quality primary education to the disadvantaged children o f Bangladesh to enhance their employability and income-earning possibilities.

Equity. Primary education spending in Bangladesh i s pro-poor [refer PEDPII Economic and Financial Analysis for more detailed assessment and evidence]. Wh i le the Government has an important role to play in continuing to ensure that access to education-especially education o f good quality-is equitable, i t s resources are scarce and does not benefit al l children. Through the Project, targeted education allowances will be provided to the poorest regions with the greatest number o f out- of-school children, and grants will be provided to schools for institutional strengthening or quality enhancements in education as an incentive to attract more out-of-school children and to keep them in school. The Government supports primary education for street children through an initiative financed by the Shishu Kallyan Trust (SKT). The Project will support GOB’S efforts to target street children.

Information. Non-governmental organizations have a crucial role to play in the collection, analysis and dissemination o f information on the quality and effectiveness o f education provided through non- formal LCs. Organizations such as the Campaign for Popular Education (CAMPE) in Bangladesh perform o f this function quite systematically. Non-formal primary education LCs are closely monitored and evaluated by the non-governmental organizations that provide and finance them. However, these LCs have a ceiling on the number o f children they enroll. There are still far too many out-of-school children (over 3.5 million) who are unaware o f opportunities to schooling, or who just do not have proper access to education. Moreover, there are street children in urban areas who are unaccounted for and who have little opportunity for schooling. I t i s difficult to assess the magnitude o f the number o f out-of-school children. Furthermore, the Government has a crucial role play in the collection, analysis and dissemination o f information on the quality and effectiveness o f education provided in different institutions, and on analyzing how efficiently public and private funds flow through the administrative and budgetary system and ultimately reach communities, teachers and schools; and determining how these resources are combined with other inputs at the school level to generate education outcomes. By putting in place effective monitoring and evaluation mechanisms, the Project will complement the system being put in place under PEDPII, and wil l aim to ensure that such information i s readily available and can feed back into policy formulation both for non-formal as well as formal primary education.

111. Cost Benefit Analysis

Project cost-benefit analysis has produced an approximate internal rate o f return (IRR) o f 14.9 percent for the Project investment at a net present value o f US$0.52 mil l ion using a discount rate o f 12 percent. Increase in earnings for children who have received at least primary education has been used as a proxy for estimating Project benefits.

Benefits Stream: The investment will promote improvements in access to LCs for out-of-school children, beneficiaries o f which will be the incremental students entering the education system. An annual education allowance o f Tk.800 per student for Classes I-111 and Tk.970 per student for Classes SV- V will be provided to encourage students to attend primary education classes in the LCs. In addition, LCs will receive between Tk.25,000 and Tk.30,000 for establishment, quality, management and discretionary grants (for details refer Annex 4). I t i s estimated that around 500,000 students will benefit from the education allowance and Learning Center grants. The earnings differential for children with a quality

66

primary education i s double the earnings for children without primary education. Without the Project, out- of-school children’s eamings o f students as o f 2003 i s estimated to be Tk.12,000 p.a. Following the Project, it i s estimated that children with a primary education will earn Tk. 11,945 more than those without primary education.

Economic benefits are estimated in accordance with the following assumptions:

Population growth rate i s based on projections reported in the Bangladesh Bureau o f Statistics “Report on National Child Labor Survey 2002-2003”: 1.5 percent (2003-201 1). Improved access to primary education overall (in both formal schools and non-formal LCs) i s achieved for educationally disadvantaged children, especially children o f minority groups, through the Government’s primary education stipend program (PESP) under PEDPII as well as the education allowances through the “Reaching Out-of-School Children” Project, enhanced school facilities and resources, and improved classroom resources and teaching. Number o f out-of-school children o f age 6-14 years as o f 2002-2003 i s 3.5 million. The percentage o f out-of-school children who will receive education allowance and benefit indirectly from Learning Center grants will be approximately 21 percent. The Project will support the increasing numbers o f cohorts through the five years o f primary education, thereby enabling demonstration effect o f targeted support to improve access to schooling. The net enrollments as o f 2002-2003 in NFPE LCs i s estimated to be 1.22 million. Attendance and promotion rates are high in NFPE Centers at 96.4 percent. Dropout rate as o f 2002-2003 i s estimated at 3.0 percent. This level i s maintained throughout the l i f e o f the Project-until 2008/9. Repetition rate i s low at 0.4 percent as o f 2002-2003. This level i s maintained throughout the l i f e o f the Project--until2008/9. N o increase i s assumed for additional years o f schooling if the full five years o f primary schooling are not completed. At present time to graduate i s estimated to be 5.7 years. The benefits are estimated for completion o f the primary cycle only. N o allowance i s made for the fact that the improvements in primary education will allow more children to attend secondary school and thereby have access to even greater earning power. Incremental eamings benefits are calculated on the basis o f increased earning with each additional year o f primary schooling. Quality improvements include improvements in teaching due to increased teacher training, increase in the number of textbooks and supplementary materials, better physical facilities, and increase in number o f student-teacher contact hours for teaching and learning activities. I t i s assumed that a better quality education leads to higher returns to primary education.

Cost Stream: The estimated direct costs o f the Project comprise the Project investment, the public and private cost o f each additional pupil year, and the opportunity cost o f retaining each student in schools for an additional year. Costs for LCs are estimated to be equal to US$lOO for a 12 month period (the school year). This assumption i s based on the fact that NFPE LCs typically have a lower unit cost per student than public primary schools. Private costs are those incurred by the families o f each pupil on possibly school supplies and books. This i s estimated to be around US$5 per child per month for a 12 month period (the school year). The opportunity cost o f retaining each student in school for an additional year i s estimated to be equal to the wage o f that the child will get if (s)he works in the labor market. Finally, average student-teacher ratio i s maintained at 35: 1 until end-of-Project.

Using these assumptions, the Project yields an hternal Economic Rate o f Return (EIRR) o f 14.9 percent (Table 2). Net present value has been calculated based on a discount rate o f 12 percent. It i s assumed that the economic and financial rates o f return to be the same.

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Table 2: Economic Internal Rate of Return

Benefit stream US$3.02 bi l l ion Cost stream US$2.50 bi l l ion N e t benefit stream US$0.52 bi l l ion

The real rate o f return i s likely to be somewhat higher reflecting positive externalities and longer-term intergenerational social benefits that come with increased levels o f education, including lower fertility rates and improved health outcomes to which i t i s difficult to assign monetary values.

I I I(a) Sensitivity Analysis

Rates o f return are calculated on the basis o f alternative assumptions regarding the internal and external efficiency o f the system. For the purpose o f this analysis, (a) dropout and repetition rates are utilized as proxies and changes in internal efficiency are assumed to be captured by changes in dropout and repetition rates (and hence completion rates); and (b) potential wage growth rate i s utilized as proxy for changes in external efficiency. W h i l e these distinctions are somewhat artificial, they nonetheless provide us with some interesting information about the changes in rates o f return based on different assumptions regarding system efficiency.

The rates o f returns under different assumptions are summarized in Table 3. The “low” case for the internal efficiency i s based on dropouts and repetitions rising by 15 percent as compared to the base case, while the “high” case i s based on dropouts and repetitions falling by 15 percent as compared to the base case. With respect to external efficiency the “low” case i s based on a decrease in wage rate by 15 percent compared to the base case, while the “high” case i s based on a wage growth o f 15 percent more as compared to the base case.

Table 3: Sensitivit Anal sis External Efficienc

Internal Efficiency Medium 14.85 24.84

Medium 5.50 14.91 24.88 Hi h 5.58 14.97 24.92

The analysis demonstrates that the rates o f return are highly sensitive to changes in assumptions regarding external efficiency o f the system. For example, controlling for changes in internal efficiency, a 15 percent increase in external efficiency roughly corresponds to a 67 percent change in the rates o f return for the ‘high’ scenario. On the other hand, controlling for changes in external efficiency, a 15 percent change in the internal efficiency corresponds to just a 0.16 percent change in the rate o f return for the ‘high’ scenario.

IV. Poverty Analysis

Poverty i s cited as a significant constraint to children enrolling in school, for l ow attendance, low attainment, and poor performance among children o f primary school age population. Ranked as one o f the poorest countries in the world, Bangladesh has a GDP per capita o f US$350 p.a. About 50 percent o f the total population (1 34 million) are poor, and 37 percent are defined to be “hard-core” poor living in dire circumstances (Bangladesh Human Development Report 2000, BIDS). Approximately 55 percent o f primary education pupils come from poor households. Many households are unable to bear the indirect

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cost o f sending children to school, are most likely to need children’s labor for income-producing or cost- saving activities, and therefore, have high opportunity cost o f sending children to school. Frequent absenteeism and/or early withdrawal from school. Other reasons for include poor health and nutritional status among young and school-aged children resulting in i l lness andor physical and cognitive impairment or delays, leading to late enrollment, dropping out o f school, absenteeism and low learning outcomes.

In 1990, GOB enacted the Primary Education (Compulsory) Act to ensure that no child i s deprived o f a primary education due to inadequate school places, instructional quality, and discrimination arising from gender, income, ethnicity and residence. This Act has led to the elimination o f official school fees, the provision o f textbooks for free, and incentives to encourage the participation o f vulnerable children. Analytical estimates for the Second Primary Education Development Program (PEDPII) point to Government spending for primary education being pro-poor-an estimated 56 percent o f all Government subsidies on primary education going to the poor. The monetization o f the Food For Education (FFE) program and the targeted primary education stipends for the poorest forty percent o f children enrolled in primary schools through PEDPII are envisaged to bring more out-of-school children into the formal (Government provided and financed) primary education system. While GOB’S i s committed to ensuring education for all, resource limitations prevent the formal primary education system from reaching all children. It i s estimated that following PEDPII implementation in 2009, approximately 9 percent (1.8 million) will s t i l l be out-of-school. Through the “Reaching Out-of-School Children” Project it i s anticipated that at least 20 percent o f these out-of-school children will be targeted.

As o f year 2000, the number o f out-of-school children constituted approximately 25 percent (3.5 million) o f total primary school cohort (6-10 years age). This number includes children who have never enrolled in school, those who had enrolled and dropped out from the formal primary education system, street children and migration o f displaced families from rural to urban areas. I t was estimated that over six mill ion (19 percent) children between the ages o f 5-14 were economically active, with more than 80 percent engaged in agricultural a~ t iv i t ies .~ I t i s estimated that the earnings per worhng child i s around Tk. 12,000 p.a. (Child Labor Survey 2003). The opportunity cost o f bringing al l these children into school will be Tk.72 billion. A proportion o f these children will be absorbed into the formal primary education system with the stipends that the Government i s providing through PEDPII. If the remaining children are enrolled in NFPE Centers, the cost implication will be Tk.21.6 bi l l ion (1.8 mil l ion x Tk.12,000).

Poverty Targeting

In the context o f non-formal primary education, the majority o f children enrolled in NFPE LCs are from poor households. The poor account for nearly 50 percent o f the total population. About 27 percent o f all children 6-10 years o ld belong to the 20 percent poorest population, while only 12 percent belong to the richest 20 percent (Government’s Poverty Reduction Strategy and the Bangladesh Public Expenditure Review (2001)). Overall, 3 out o f 5 children in this age group come from poor households and 2 out o f 5 come from non-poor households. The enrollment rate i s lower among the poor.

In 2000 on average parents had an out-of-pocket expense o f about Tk. 1,000 per child in FPE schools. This was approximately 2 percent of average household income in Bangladesh. I t i s reported that while Government schools did not charge any tuition, over 90 percent o f NFPE Centers charged some tuition” - roughly Tk. 50-100 per annum.

World Bank Education Sector Review (2000). Volume 1, pages 51-52. lo Eleven expenditure heads constitute private expenditure for schooling: admissionheadmission fee, monthly tuition, buyinglcollecting textbooks, buyinglcollecting supplementary books, stationery, school dress, examination

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Education allowances under the “Reaching Out-of-School Children Project” will essentially be pro-poor. An estimated 500,000 students are expected to benefit from education allowances in the form o f demand- side financing through stipends and supply-side support through grants to LCs for improvements in educational quality. This constitutes approximately 9 percent o f out-of-school children as o f year 2003. Whi le the amount per student might not entirely cover the opportunity cost o f attending school, i t i s envisaged that i t will compensate students for attending a certain number o f hours o f school annually. Considering that LCs are more often than not operating at maximum capacity, the grant through the Project will help to set up new LCs. The quality improvements encouraged through the Project will benefit the wider NFPE population.

Part 11. Financial Analysis

Long-term sustainability o f the benefits o f the “Reaching Out-of-School Children” Project will be dependant on two key factors: (i) the availability o f revenue to meet the additional recurrent costs that will inevitably arise as a result o f adopting the strategy o f providing demand-side education allowances and supply-side grants; and (ii) the willingness o f Government, partner development agencies, and NGOs to meet those new recurrent costs at possibly the expense o f other budget claims. The Govemment has indicated i t s commitment to continue long-term support for the non-formal primary education sector, recognizing the growing value o f altemative methods o f education service delivery towards supporting the achievement o f the EFA goal. GOB has made it clear that it regards the successful development and continuance o f high-quality primary education as one o f the highest priorities. During the course o f implementing the “Reaching Out-of-School Children” Project, Govemment commitment to gradually absorb NFPE costs will be sought.

In the context o f PEDPII a detailed fiscal analysis was carried out. Using the PEDPII estimated GDP growth and education budget projections, the additional budgetary implications for mainstreaming NFPE and the remaining out-of-school children have been estimated and analyzed for a base-case scenario. The results o f the base-case scenario show that total Govemment budget as a percentage o f GDP could increase by about 41 percent over the period 2003-09, i.e., from $6.78 bil l ion in 2001-02 to $9.57 bil l ion in 2008-09. As a result o f the increase in overall Government budget, the allocation for education i s similarly projected to increase by approximately 40 percent over the period 2003-09 (from $1.02 bil l ion in 200 1-02 to $1.43 bil l ion in 2008-09), with the allocation for primary education following the same trend, i.e., rising by about 41 percent over the same period (from $452.5 mil l ion in 2001-02 to $665.9 mill ion in 2008-09).

The additional annual recurrent cost implications o f supporting students attending leaming centers will range from about $40-44 mil l ion (as between 2,000,000-2,200,000 students wil l be enrolled in these centers at any one point in time). The recurrent cost implications o f PEDP I1 are $450.2 in 2009/10. If leaming centers are going to be even partially (50 percent) supported through the GOB budget following the end o f the Project, the recurrent cost implications for GOB in 2009/10 will not exceed $475 mill ion (an increase o f less than 6 percent). Given that the total costs under PEDP I1 (recurrent+development) fall well within the education budget projections for 2009/10, absorbing the additional recurrent costs envisaged here through partial support for the leaming centers should be sustainable for GOB.

~

fees, various other fees (e.g., fees for religious festivals, social functions, amusements, etc.) transport for schooling, honorarium for private tutors, and transport for private tutoring.

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Annex 10: Safeguard Policy Issues

BANGLADESH: Reaching Out-0f-School Children Project

NGO Household characteristics households

Household size (person) 5.1 Years o f schooling, father 1 .o Per capita monthly total expenditure (taka) 830 Percent o f households with per capita expenditure less than $1 a day 96.7 Percent o f households wi th per capita expenditure less than $0.50 a day 76.7

Social Assessment

All survey households First tercile

(LOW income) All 5.7 5.3 1.9 2.9 593 1,065

100.0 89.8

100.0 46.0

Poverty i s one o f the major barriers hindering progress towards Education For All (EFA). Currently around 25 percent children between age 6-10 are out o f school (Education Watch, 1999 and H IES 2000), and among these children, 79 percent are poor. Children, especially girls from vulnerable groups such as poorest families, tribal population, children with disabilities (CWD), children living in disaster prone areas - such as coastal islands, river erosion and drought areas, and urban slum are not able to attend school. Majority o f these children start working at an early age. Lack o f physical facilities and difficult terrain in remote areas create serious barriers for children in accessing education. An estimated 6.5 mill ion children (19 percent o f total) are working. Research indicate that only 4 percent o f children with disabilities (CWD) are able to attend school. Non-formal education LCs are able to increase access to many children from vulnerable groups. Community participation need to be strengthened by establishing Center management Committee (CMC) for ensuring social mobilization for EFA and improving quality o f education for children.

Other 0.0

LCs, mainly operated by NGO’s are able to increase access to primary education to many children from vulnerable groups. As can be seen from Table 1, children going to these schools come f iom poorer families (77 percent o f households with a per capita income o f less than 50 cents per day as compared to 46 o f households overall), and families in which the education level o f parents i s lower as compared to the norm.

3.3 8.3

Principal occupation of household head (percent): Salaried Day labor Farmer Businessltrade Rickshawltricycle van puller

0.0 46.7 36.7 10.0 6.7

3.9 7.0 38.6 25.3 38.6 39.5 12.4 15.0 3.3 4.9

The overall costs o f education for children in these centers are also significantly lower than they are in formal primary schools, making them more attractive to poor households.

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Direct Costs Indirect Costs Boys Girls Boys Girls

NGO LCs 68 33 376 489 Formal Primary Schools 72 57 105 1 755

Given that LCs are geared towards reaching the most disadvantaged, the key objective o f this Project i s to provide access to quality primary education to out-of-school children to enroll in LCs, and support GOB towards achieving i t s national EFA goals. Community participation need to be strengthened in these LCs by establishing Center Management Committees (CMC) for ensuring social mobilization for EFA and improving quality o f education for children. Social development outcomes o f the Project will include (a) increasing enrolment and completion in LCs o f CWD, tribal, street children, child labor and poor children, (b) retaining children from the vulnerable groups in LCs, (c) strengthening o f social capital as measured by participation o f parents o f vulnerable groups in CMC.

Total Costs Boys Girls 444 522 1123 8 12

A rapid social and environmental assessment carried out for this Project indicated that the majority (over 80 percent) students and their guardians are highly satisfied with the teaching in the learning centers. Each learning center has a CMC including teacher, local promoter and mothers o f the students. CMC, together with the community provides security to the center and they visit the center every week for cleaning the premises. This Project will strengthen the CMC, especially for ensuring social mobilization for EFA, improving the healthy environment o f learning centers and enhancing quality o f education for children.

MoPME will carry out a baseline survey on the existing education situation o f vulnerable groups during the first year o f implementation, include key indicators in EMIS and conduct annual assessment for monitoring their progress.

Tribal strategy. I t i s estimated that at present nearly half o f tribal children (0.15 million) in the primary school age group (6-10) are out o f school. The tribal strategy proposes to improve access o f the tribal children using the following intervention and monitoring their progress. In the context o f preparing the Second Primary Education Development Program (PEDPII), a Macro plan for the overall development o f tribal children was developed by MoPME in consultation with tribal population, local Government, NGOs and MoPME officials to address the needs o f tribal children. The plan, developed in 2003, wi l l be used for ROSC as well, and implemented in the Project Upazilas with tribal populations.

Environmental Guidelines

A healthy environment i s the prerequisite for better education. To ensure a healthy environment in the learning centers, this Guideline has been prepared in consultation with the community and students. The CMC, together with community will follow this Guideline for ensuring provision o f healthy school environment, safe water and hygienic sanitation for students.

Arsenic contamination in groundwater in Bangladesh has emerged as a major public health issue. Therefore, it i s essential that no school going students are exposed to high level o f arsenic or bacteria by drinking water from contaminated sources. Sanitation facilities are required to stop environmental degradation. Any potential construction and use o f latrines by the community will need to adopt appropriate construction and maintenance practices, taking into account proper water supply, ventilation, safety and hygiene.

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An environmental assessment was carried out for identifying environmental health concerns o f children attending non-formal learning centers. The findings include that most learning centers, both in urban and rural areas have relatively poor infrastructure - usually a 25 ft by 15 ft room wi th 8 ft ceiling, made o f C I sheet, wood, bamboo and other local low cost materials. The centers do not have proper ventilation for light and air. Due to this problem, learners suffer from extreme heat in summer and in the rainy season room becomes dark. Most o f the centers do not have electricity. The learning centers do not have tube well o f their own. Similarly, the schools do not have sanitation facilities o f their own. Learners are often using tube wells and the toilets o f the house owner that are often unhygienic. The water and sanitation facilities availed by the students are also unsafe. A majority o f the tubewells are painted red, which means arsenic levels are over the permissible limit.

Learning centers have earthen floor and the floor i s usually covered by thin jute mats. Most o f the students opined that the earthen floor remains damp and dusty, and due to this children sometime become sick. Many students had sk in diseases, which could be caused by improper ventilation, dust from the earthen floor, etc.

The CMC will develop a proposal based on the following actions for improved safety and healthy condition for the learning centers:

(a) Schools having earthen floor should use plastic sheets and mats. (b) Safe drinking water could be supplied to the students by providing a water jar, and low cost water

f i l ter (available in local markets) in the schools or giving easy access to nearby safe water sources. Locally developed Pitcher column could be installed in every learning center for drinking water and this will cost tk.150-200.

include issues environmental issues including safe water and hygienic sanitation.

safe water and use o f proper sanitation facilities.

(c) Low cost hygienic toilets should be installed in the school premises. Awareness programs should

(d) Students should be given lessons on hygienic practices, such as washing hands with soap, drinking o f

(e) Monthly primary health care programs should be introduced in the schools. (0 School-houses should be more spacious wi th two doors and sufficient lighting.

Community participation needs to be ensured for a healthy school environment, safe water and sanitation. A variety o f mechanism have been adopted in Bangladesh for the provision o f safe water, which includes deep tube well (DTW), dug well (DW), pond sand filters (PSF), rain water harvesting and arsenic removal filters. Under the Total Sanitation Movement, cost effective and safe sanitation facilities are being provided in all households in rural and urban areas. The CMC, in consultation with the community, should decide on the mechanism for providing safe water and sanitation to the students, possibly using a portion o f the grants allocation to do so.

Monitoring o f Project implementation wil l include regular assessment o f water and sanitation facilities by the project implementation unit. Monitoring reports will include the following information:

(a) (b) (c) (d) (e)

I s safe water available in learning centers? Are students drinking safe water? Are sanitation facilities available to students? Are these sanitation facilities functioning hygienically? I s the health condition o f children improved?

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Annex 11 : Project Preparation and Supervision BANGLADESH: Reaching Out-Of-School Children Project

Planned Actual PCN review 291 10103 11/03/2003 Init ial PJD to PIC Initial ISDS to PIC Appraisal Negotiations BoardfRVP approval Planned date o f effectiveness Planned date o f mid-term review

311 Of2004 31 10/2004 3/25/2004 5/7/2004 61 1712004 713 1/2004 7/10/2007

3/3/2004 3/3/2004 3/25/04

51 1412004

Planned closing date 6/30/20 10

Key institutions responsible for preparation o f the Project: Ministry o f Primary and Mass Education (MoPME), Directorate o f Primary Education (DPE).

Bank staff and consultants who worked on the Project included:

Name Title Unit Hena Mukherjee Lead Education Specialist SASHD

Amit Dar Sr. Economist SASHD

Irajen Appasamy Operations Officer SASHD Nilufar Ahmad Sr. Social Scientist SASES

Suraiya Zannath Sr. Financial Management Specialist SARFM Carolyn Winter Sr. Education Specialist HDNED Shobhana Sosale Operations Officer ECSHD Kishor Uprety Sr. Counsel LEGMS Mahmudul Alam Sr. Education Economist SASHD Raj at Narula Sr. Finance Officer LOAG2 Fatema Rosalynn Khan Research Associate SASHD Yoko Nagashima Education Specialist (Consultant) SASHD Nazma Sultana Program Assistant SASHD Bertha M. Mburugu Program Assistant SASHD

(Co-Task Team Leader)

(Co-Task Team Leader)

Zafiul Islam Sr. Procurement Specialist S A R P S

Consultants Beatrice Avalos Education Quality Hon Chan Chai Shiva Raj Lohani Scherezad Monami Latif Management Mokhlesur Rahman Maria Elena Andersen Maria Eitel

Monitoring and Evaluation Education allowances and Grants

Management, Procurement and Costing Learning Center Grants

Communications and Social Awareness

74

Bank funds expended to date on Project preparation: 1. Bank resources: $240,000 2. Trust funds: $55,000 3. Total: $295,000

Estimated Approval and Supervision costs: 1. Remaining costs to approval: $20,000 2. Estimated annual supervision cost: $75,000

75

Annex 12: Documents in the Project File BANGLADESH: Reaching Out-Of-School Children Project

A. PROJECT DOCUMENTS

Government o f Bangladesh. Draft Operational Manuals, 2004: School Grants Educational Allowances Monitoring and Evaluation Supervision o f Teachers

B. BANK STAFF ASSESSMENTS

World Bank. Bangladesh Education Sector Review, 2000.

World Bank. Country Assistance Strategy, 200 1.

World Bank. Bangladesh Country Assistance Strategy (Presented to the Board on December 19,2002).

World Bank. Poverty in Bangladesh: Building on Progress, 2002.

World Bank. Bangladesh Public Expenditure Review, 2002.

World Bank. Country Assistance Strategy Progress Report, 2003.

C. OTHER

Government o f Bangladesh. Macro Plan for Second Phase o f Primary Education Development (PEDPII), January 2003.

Government o f Bangladesh. Interim Poverty Reduction Strategy Paper, March 2003.

Government o f Bangladesh. Education For All: National Plan o f Action 200 1-1 5,2003.

Asian Development Bank, Report and Recommendations o f the President, Second Primary Education Development Program, September 2003.

PEDP I Appraisal, Supervision and Mid-term Review Reports.

Campaign for Popular Education, Education Watch Report: A Question o f Quality, 2000.

Campaign for Popular Education, Education Watch Report: Literacy in Bangladesh- Need for a New Vision, 2002.

DFID-EU, Scoping Study o f Potential Mechanisms for Strategic Financing o f NGO Provision o f Health and Education Services, January 2004.

76

Annex 13: Statement of Loans and Credits BANGLADESH: Reaching Out of School Children

Difference between expected and actual

disbursements Original Amount in US$ Mil l ions

Proiect ID F Y Pumose IBRD IDA SF GEF Cancel. Undisb. Orig. Frm. Rev’d

PO74966

PO53578 PO62916 PO7 1435 PO8 1849

PO44876 PO75016

PO74040 PO7473 1 PO7 1794

PO50752 PO57833

PO59143 PO69933 PO44810 PO4481 1 PO50751 PO49587 PO09468

PO4 1887 PO37294

PO09524 PO50745 PO49790 PO44789

PO37857

2004

2003

2003 2003 2003

2002 2002 2002 2002

2002 2001

2001 2001 2001 2001 2000 2000 2000 2000

1999 1999 1999 1999 1999 1998 1998

Primary Education Development Program I1 Social Investment Program Project Central Bank Strengthening Project Rural Transport Improvement Project

B D : Telecommunications Technical Assist. Female Secondary School Assis. I1 Public Procurement Reform Project

Renewable Energy Development Financial Services for the Poorest Rural Elect. Renewable Energy Dev.

Post-Literacy & Continuing Education Air Quality Management Project

Microfinance I1 HIV/AIDS Prevention

Legal & Judicial Capacity Building Financial Institutions Development National Nutrition Program Aquatic Biodiversity Conservation

Fourth Fisheries Municipal Services Third Road Rehabilitation & Maintenance

Dhaka Urban Transport Arsenic Mitigation Water Supply

Export Diversification BD Private Sector Infrastructure Dev Health and Population Program

0.00 150.00

0.00 18.24 0.00 37.00 0.00 190.00 0.00 9.12

0.00 120.90 0.00 4.50 0.00 0.00 0.00 5.00 0.00 190.98 0.00 53.30

0.00 4.71

0.00 151.00 0.00 40.00 0.00 30.60 0.00 46.90 0.00 92.00 0.00 0.00 0.00 28.00 0.00 138.60 0.00 273.00

0.00 177.00 0.00 32.40 0.00 32.00 0.00 235.00 0.00 250.00

0.00

0.00 0.00

0.00 0.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00 0.00

0.00

0.00 0.00 0.00 0.00

0.00 0.00 8.20

0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00 5.00

5.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

0.00

0.00 0.00

0.00 0.00

0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

21.98 0.04

0.00 24.02

1.25

8.25 0.00 0.00

64.89 4.35 0.00 0.00

153.95

18.29 37.05

191.06 9.87

99.04

2.77 7.72 4.44

188.89 43.04

3.45 26.44 14.61

26.56 10.68

50.56 1.85

11.81 83.37 97.93

46.54 15.82 0.24

147.68 0.78 51.61

0.00

2.10 19.32

1.96 -0.06

19.39 1.03

1.05 1.65

82.13

13.22

3.51 -0.20

26.49 12.44 26.02

62.13 4.82

18.83 29.25 88.58

110.54 18.67

0.63 148.65

55.13

0.00

0.00 0.00 0.00

0.00

0.00 0.00 0.00 0.00 0.00

-0.42

0.00 0.00

-2.01

0.00 0.00 6.11

2.66

3.67 0.00

29.11

35.37 0.00 0.00

0.00 0.00

Total: 0.00 2,310.25 0.00 18.20 125.56 1,345.27 747.28 74.49

COUNTRY STATEMENT OF IFC’s

Held and Disbursed Portfolio In Millions o f U S Dollars

Committed Disbursed

IFC IFC

F Y Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic.

2001 BDTEF 13.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

77

1997 DBH 2.33 0.65 0.00 0.00 2.33 0.65 0.00 0.00 1991 Dynamic Textile 1.86 0.00 0.00 1.48 1.86 0.00 0.00 1.48 1998 1985 1998 1998 1998/00 2003 2000 2000

Grameen Phone IDLC IPDC Khulna LafargeISurma RAK Ceramics

Scancem United Leasing

Total portfolio:

6.67 0.00 6.88 14.74 0.00 12.00 9.29 5.00

0.09 0.15 0.00 0.00 0.00 0.00

0.00 0.00

0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00

0.00 6.67 0.09 0.00 0.00 0.00 0.15 0.00 0.00 6.88 0.00 0.00

17.99 14.74 0.00 0.00 15.00 0.00 0.00 0.00 0.00 12.00 0.00 0.00 0.00 9.29 0.00 0.00 0.00 0.00 0.00 0.00

0.00 0.00 0.00

11.99 0.00 0.00 0.00 0.00

71.71 0.89 0.00 34.41 53.77 0.89 0.00 19.47

Approvals Pending Commitment

FY Approval Company Loan Equity Quasi Partic.

2001 BRAC Bank 0.00 3.00 0.00 0.00 2001 Dhaka Westin 8.75 0.00 0.00 0.00 2004 Grameen Phone I1 30.00 0.00 0.00 0.00 1998 Khulna 0.00 3.30 0.00 0.00 2000 USPCL 0.00 3.00 4.00 0.00

Total pending commitment: 38.75 9.30 4.00 0.00

78

Annex 14: Country at a Glance BANGLADESH: Reaching Out of School Children

4.5 4.5 4.5 5.0

POVERTY and SOCIAL

2002

-GDi -0 -GDP

Bangladesh

Gross domestic investment 8.3 9.8 5.8 8.2

-~ ~- Population, mid-year (millions) GNI per capita (Atlas method, US$) GNI (Atlas method, US$ billions)

Average annual growth, 199642

Population ph) Labor force PA) Most recent estimate (latest year available, 1996-02)

Poverty (‘% of population below national poverty line) Urban population (% of total population) Life expectancy at birth (years) infant mortality (per 1,000 live births) Chiid malnutrition (% of children under 5) Access to an improved water source (% ofpopulation) Illiteracy (% ofpopulation age 15+) Gross primary enrollment (% of school-age population)

Male Female

KEY ECONOMIC RATIOS and LONG-TERM TRENDS 1982

- Expotis -0-imports

GDP (US$ biiiions) Gross domestic investmenffGDP Exports of goods and serviceslGDP Gross domestic savingdGDP Gross national savingsiGDP

Current account balance/GDP Interest payments/GDP Total debt/GDP Total debt service/exports Present value of debffGDP Present value of debffexports

18.1 17.8 5.2

12.5 17.9

-4.9 0.3

27.9 17.7

1982-92 199242

GDP 3.8 5.0 (average annual growth)

135.7 380

51.1

1.7 2.8

34 26 62 52 48 97 59

100 100 101

1992

31.7 17.3 7.8

13.9 19.3

-0.4 0.5

42.8 16.2

2001

5.3 3.5

South Asia

1,401 460 640

1.8 2.3

28 63 71

84 44 97

108 89

2001

47.0 23.1 15.4 18.0 22.4

-1.7 0.3

32.4 7.3

20.7 105.4

2002

4.4

Low- income

2,495 430

1,072

1.9 2.3

30 59 81

76 37 95

103 87

2002

47.6 23.1 14.3 18.2 23.4

0.5 0.3

35.8 7.7

2002-06

.~ GDP per capita 1.3 3.2 . . 2.8

STRUCTURE of the ECONOMY

ph of GDP) Agriculture Industry

Services

Private consumption General government consumption Imports of goods and services

Manufacturing

Development diamond*

Life expectancy

-

GNi

capita per

1

Access to imvroved water source

- Bangladesh ~ Low-income group

Economlc ratlos’

Trade

T

Indebtedness

-Bangladesh - Low-income group

31 2 294 241 227 ’5 21 1 225 259 264 10 137 139 156 159 l 5 477 481 500 509

88.4 83.0 78.5 76.6 1 ” b 8, 99 w Of d2 I

79

Bangladesh PRICES and GOVERNMENT FINANCE

Domestic prices (% change) Consumer prices Implicit GDP deflator

Government finance (?A of GDP, includes current grants) Current revenue Current budget balance Overall surplus/deficit

TRADE

(US$ millions) Total exports (fob)

Raw jute Leather and leather products Manufactures

Total imports (cif) Food Fuel and energy Capital goods

Export price index (1995=100) Import price index (1995=100) Terms of trade (1995=100)

BALANCE of PAYMENTS

(US$ millions) Exports of goods and services Imports of goods and services Resource balance

Net income Net current transfers

Current account balance

Financing items (net) Changes in net reserves

Memo: Reserves including gold (US$ millions) Conversion rate (DEC, iocal/US$)

EXTERNAL DEBT and RESOURCE FLOWS

(US$ millions) Total debt outstanding and disbursed

IBRD IDA

Total debt service IBRD IDA

Composition of net resource flows Official grants Official creditors Private creditors Foreign direct investment Portfolio equity

Wodd Bank program Commitments Disbursements Principal repayments Net flows Interest payments Net transfers

1882

9.7

-9.6

1982

1882

840 2,759

-1,919

-97 1,121

-895

387 508

20.0

1882

5,054 55

1,270

220 3 9

759 739 21 7 0

571 188

0 188 12

175

1882

4.5 3.0

8.3 1.9

-4.5

1892

1,986 106 139

1,593 3,526

265 168

1,289

86 107 81

1882

2,468 3,932

-1,464

-89 1,435

-1 18

635 -517

1,600 37.7

1982

13,561 60

4,534

552 7

52

357 623 -19

4 6

353 323 24

300 35

264

2001

1.6 1.6

9.0 1.4

-5.0

2001

6,476 67

254 5,766 9,363

380 848

2,400

112 129 87

2001

7,235 10,103 -2,868

-264 2,316

-816

490 326

1,307 54.0

2001

15,216 17

6,439

671 7

143

287 419 230 174

0

296 312 99

213 50

163

2002

1.9 3.2

10.1 2.1

-4.6

2002

5,929 61

207 5,367 7,697

437 723

2,617

115 106 108

2002

6,794 9,061

-2,267

-319 2,826

240

35 -275

1,583 57.4

2002

17,010 13

7,063

722 7

156

410 220 85 65 -6

479 301 112 190 51

138

10 8 6 4 2 0

I 97 98 99 w 01

~ -GDPdeflator +CPI

Export and Import levels (US$ mlll.)

10,000 T

8,000

6 000

4 wo

I O

I 96 97 98 99 00 01 m

WExporls Wlmprts

' Current account balance to GDP (%)

i 1

/-4'

Composition of 2002 debt (US0 mlll.)

G.494 A:13 F 565

B 7,063

A - IBRD B ~ IDA D -Other multilateral F - Private C-IMF G -Short-term

E ~ Bilateral

80

MAP SECTION