Document of

The World Bank

Report No.13426-PE

STAFF APPRAISAL REPORT

PERU

PRIMARY EDUCATION QUALITY PROJECT

NOVEMBER 14 ,1994

HUMAN RESOURCES DIVISIONCOUNTRY DEPARTMENT IIILATIN AMERICA AND THE CARIBBEAN REGION OFFICE

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CURRENCY EQUIVALENTS(as of August 31, 1 994)

Current Unit = Nuevo Sol (S/.)US$1.00 = S 2.25

US$1 million = S 2.250 millionUS$444,444 = S 1 million

FISCAL YEAR

January 1 - December 31

ACADEMIC YEAR

April 1 - December 1 5

PRINCIPAL ABBREVIATIONS AND ACRONYMS USEDAPAFAS Asociaci6n de Padres de FamiliaADES Areas de Desarrollo EducativoCEI Centros de Educacion InicialCOMUNED Consejo Comunal de Educaci6nDINFE Direcci6n de Infraestructura EducativaDRE Direcci6n Regional de Educaci6nENSA Encuesta Nacional de SaludFONCODES Fondo Nacional de Compensacion y Desarrollo SocialGDP Gross Domestic ProductGOP Government of PeruGTZ German Agency for Bilateral CooperationIDB Inter-American Development BankINFES Instituto Nacional de Infraestructura Educativa y de SaludISP Institutos Superiores Pedag6gicosKfW Kreditanstalt fur WiederaufbauMHC Ministry of Housing and ConstructionMOE Ministry of EducationMEF Ministry of Economy and FinanceMEP Ministry of the PresidencyNEC Nucleos Escolares ComunalesORDES Organismos Regionales de DesarrolloPRONOEI Programas no Escolarizados de Educaci6n InicialOREALC/UNESCO Oficina Regional de las Naciones Unidas Para la Educaci6n y CulturaSENCICO Servicio Nacional de Capacitaci6n para la Industria de la Construcci6nUNDP United Nation Development ProgramUSES Unidades de Servicios Educativos

PERU

STAFF APPRAISAL REPORT

PRIMARY EDUCATION QUALITY PROJECT

Table of Contents

LOAN AND PROJECT SUMMARY ...................................... iii

BASIC DATA SHEET ............................................... iv

1. BACKGROUND, ISSUES AND STRATEGY .... .................... 1A. Economy and Poverty in Peru .... ...................... 1B. Overview of The Education Sector .............................. 3C. Main Issues in Primary Education ............................... 5D. Government Strategy in Primary Education .... ................. 8E. Bank Role and Strategy ...................................... 9F. Lessons Learned .......................................... 10

2. THE PROJECT ........................ ........................ 13A. Project Objectives .. 1 3B. Project Components ....................................... 14C. Project Description ........................................ 1 5

3. PROJECT COSTS, FINANCING, PROCUREMENT AND DISBURSEMENT ........ 27A. Project Costs ...... .............. ........................ 27B. Financing Plan ........................................... 29C. Recurrent Costs Arising from the Project ......... ............... 30D. Project Sustainability ................ ...................... 30E. Procurement ............................................ 31F. Disbursement ............................................ 35G. Accounting and Auditing ............... .................... 36

4. PROJECT IMPLEMENTATION AND MANAGEMENT ........ .. ............ 37A. Status of Preparation ................ ...................... 37B. Implementation Schedule ................................... 37C. Project Management ....................................... 37

This report is based on the findings of en identification misson In November 1993, a preparation missions in January 1994, a preeppreisal n-ossion in April 1994, anden apprasalr mission in June 1994 comprised of Messrs. Ernesto Cuedra Mission Leederl, Donald Winkler ILATADI) Emmanuel Jimenez end Laura Rawlings IPRDPH-,Jamil Selmi tLA2HR), Linda Lsrach and Josd Moscoso (LAlHRI, Richard Moore (LA3PSI Hoveida Nobakht (PMDTRI; and Messrs. Herbert Bergmann (GTZI, ErikaHimmel, Alison McGowan, Jos6 Robles, Alfonso Oporto, Rodolio Sanjurjo. Carlos Ihlie y Cerlos Chemorro (consultanlel. Eduardo Velez (LA2HRI and Vincent Greeney(ASTHR) acted as peer reviewers. The Department Director. Project Advisor, and Sector Division Chief were Mssrs. Yoshiaki Abe, Robert Crown and JulianSchweitzer, respectively

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5. PROJECT BENEFITS AND RISKS ............ .. ................ 39A. Project Benefits ............... .. .................... 39B. Project Risks ....................................... 40C. Environmental Impact ................................. 40

6. AGREEMENTS AND RECOMMENDATIONS ...................... 40

7. LIST OF TABLES IN MAIN REPORTTable 3.1: Summary of Project Costs by Component ............. 27Table 3.2: Summary of Project Costs by Category of

Expenditure ..................................... 28Table 3.3: Financing Plan ................................ 30Table 3.4: Procurement Arrangements ....................... 33Table 3.5: Allocation and Disbursement of IBRD Loan ............. 35Table 3.6: Estimated IBRD Disbursement ..................... 36

8. ANNEXESANNEX 1: SELECTED EDUCATION STATISTICS ................ 42ANNEX 2: PROJECT COST TABLES ........................ 50ANNEX 3: PROJECT IMPLEMENTATION STRATEGY ............. 56ANNEX 4: BANK SUPERVISION REQUIREMENTS ............... 66ANNEX 5: PROPOSED NATIONAL ASSESSMENT SYSTEM ... ..... 69ANNEX 6: TEACHER TRAINING SUBCOMPONENT .............. 71ANNEX 7: INSTRUCTIONAL MATERIAL MODULES .............. 74ANNEX 8: PILOT PROJECT ON DECENTRALIZATION ... ......... 78ANNEX 9: SCHOOL INFRASTRUCTURE COMPONENT ... ......... 87ANNEX 10: DOCUMENTS IN PROJECT FILES .................. 89

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PERUPRIMARY EDUCATION QUALITY PROJECT

LOAN AND PROJECT SUMMARY

Borrower: Government of Peru

Implementing Agencies: MOE, INFES

Beneficiary: Ministry of Education

Poverty: Program of Targeted Interventions

Amount: US$ 146.4 million equivalent

Terms: Repayment in 17 years, including a grace period offive years with loan amortization based on levelrepayments of principal at the Bank's standardvariable rate.

Commitment Fee: 0.75 percent on undisbursed loan balances,beginning 60 days after signing.

Financing Plan: See Schedule paragraph 3.6

Net Present Value: Not Applicable

Staff Appraisal Report N°: 1 3426-PE

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PERUPRIMARY EDUCATION QUALITY PROJECT

BASIC DATA SHEET

DATA YEAR

A. GENERAL COUNTRY DATA:1. Population Estimate (million) 23.163 19932. Area ('000 Square Kilometers) 1,2853. GNP per Capita (US$) 2,113 19934. GNP p/c Average Annual Growth Rate (%) 4.9 19935. Income Share of Poorest 20% (%) 5.6 1986

B. DEMOGRAPHIC DATA:1. Crude Birth Rate (Per 1000) 28.5 19932. Crude Death Rate (Per 1000) 7.4 19933. Annual Rate of Population Growth (%) 2.1 19934. Total Fertility Rate 4 1985-19905. % of Population 0-14 years 36.8 1992

C. EDUCATION DATA:1. Adult Illiteracy Rate (%) 15 19902. Female Illiteracy Rate (%) 21 19903. Educational Attainment (yrs. of educ.)

Female ( >45 years old) 3.0 1992Male ( >45 years old) 4.2 1992Female (15 to 19 years old) 5.7 1992Male (15 to 19 years old) 6.3 1992

4. Gross Enrollment Rates:Primary Education 126 1990Secondary Education 70 1990Tertiary Education 36 1990

5. Net Enrollment Rates:Female (5 to 9 years old) 78.7 1994Male (5 to 9 years old) 79.1 1994Female (10 to 14 years old) 60.0 1994Male (10 to 14 years old) 63.3 1994

6. % of Cohort Completing Grade 6 68.0 19887. Public Education Expenditures:

As % of total Public Spending 11.9 1992As % GDP 2.2 1993

SOURCES: MOE, 1994 School Census; INEI (1993) Censo de Poblaci6n y Vivienda; Cuanto(1993) Peru en Numeros; World Bank, (1994) Country Assistance Strategy; World Bank (1993),World Development Report; and Mission Estimates.

1. BACKGROUND, ISSUES AND STRATEGY

A. Economy and Poverty in Peru

1.1 As a result of bad economic policies and the overexpansion of thestate, the performance of the Peruvian economy after the 1 960s has been poor.By the late 1 970s and into the 1 980s, output growth was well below the rate ofpopulation growth, investment productivity had dropped steadily and inflationpressures mounted. One of the legacies of this poor economic performance is thepersistence of high poverty levels. Poverty is widespread and has worsened overthe last decade.

1.2 Economic strategy. Peru's potential for economic growth has been frustratedduring the past three decades by heavy Government intervention and publicpolicies that seriously distorted most of the markets in the economy. In the lastdecade, during President Garcia's administration (1985-1990), chronic inflation andlow growth was attributed to the fact that Peru was in a debt trap. It was arguedthat servicing the external debt would accelerate devaluation and inflation, erodedomestic savings, and curtail investment. The administration, thus, put a ceiling onforeign debt service, stopped repayments altogether, instituted widespread foreignexchange controls, and increased protection. The Government also raised theminimum wage, expanded credit and subsidies, decreased the value added taxrate, and lowered public sector prices. This strategy led to a high fiscal deficitand, after 1 987, there was a loss of confidence in the economy, inflationrebounded, and economic output and real wages declined sharply. In 1 990,inflation reached an annual rate of 3,000 percent, marking the climax of economicmismanagement.

1.3 After elections in July 1 990, President Alberto Fujimori's administrationbegan a radical stabilization and structural reform program. The first stage of thereform involved actions to stabilize the economy and rebuild ties with theinternational financial community, and the second was on a series of broad-basedstructural measures which aimed at eliminating trade barriers, privatizing publicenterprises and attracting foreign investments. These actions have led toimpressive results in some areas. For example, the public sector fiscal deficitdeclined from 6.5 of GDP in 1990 to approximately 3 percent in 19931/, averageinflation was reduced to approximately 47 percent in 1 993, one of the most opentrade regimes in Latin America was established, foreign investment policies wereliberalized, and GDP increased 7.0 percent during 1 993.

" Note: The deficit for 1993 is still not 100% defined. The IMF estimates 2.8%, the World Bank 3% and thecentral government 1.4%.

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1.4 Poverty. In spite of these achievements, the legacy of economic stagnationand deterioration remains most apparent in the persistence of a high incidence ofpoverty, particularly in certain regions and ethnic groups. According to the 1991Living Standards Survey, half of the households are poor (i.e. the value of totaldaily expenditures is less than the cost of a basic food basket plus an estimate ofminimum non-food expenditures) and one fifth are extremely poor (i.e. the value oftotal daily expenditures is less than the cost of a basic food basket). Theprevalence of poverty is highest in the rural Sierra where two-thirds of thehouseholds are poor and 47 fall into the extreme poverty category. In Lima, only1 0 percent of the households are extremely poor but because of its size, Limacontains the highest number of poor (2.5 million people).2'

1.5 Investing in Human Capital. The economic growth program that has beenestablished by the Fujimori government is a crucial component of a povertyalleviation strategy. Nevertheless, it is not the sole component. Poverty alleviationstrategies also require investments in the human capital of the poor in order toenable them to participate fully in the expanding economy and benefit from it.Thus, the second main element of a poverty alleviation strategy is improved andmore equitably distributed social services.

1.6 To tackle this problem in the short-term and respond to the immediate needsof the poor, the Government of Peru (GOP) created the Social Emergency Programin August 1990, with activities in education, health and nutrition, and employmentpromotion for the poorest; in August 1991, the GOP created a National Fund forSocial Compensation and Development (FONCODES). For 1993, the GOPallocated US$424 million (1 percent of GDP) for poverty alleviation programs andplans to increase its support to a level of 1.5% of GDP by 1995. One half of theseinvestments are to be channelled through FONCODES.

1.7 Addressing these problems in the long-run requires sustainable increases inthe use of both health and education services, and improvements in the quality ofthose services. This proposed project would build on government strategies foreconomic competitiveness and poverty reduction by supporting improvements inthe quality of Peruvian primary education.

2t World Bank (1 993) Peru: Poverty Assessment and Social Policies and Programs for the Poor. Report No.1 1 1 91 -PE.

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B. Overview of The Education Sector

1.8 Structure of the System. The Peruvian educational system consists of fourlevels and is offered in two forms. The four levels and their respective duration are:pre-school, primary (6 years), secondary (5 years), and higher education (3 or 6 yearsdepending on the type of training, university or non-university track). In addition tothese levels, special education and vocational training programs also exist under theauthority of the Ministry of Education (MOE).

1.9 Pre-school, primary, secondary and vocational education are offered in twoforms: escolarizada (schooled) and no-escolarizada (non-schooled). These forms areequivalent to what would be termed formal (escolarizada) and non-formal (no-escolarizada) education in other countries. Although the non-formal form is mostfrequently used for adult education, the GOP has used this form as an alternative forincreasing pre-school coverage. In fact, the majority of non-formal education centersare pre-school centers and consequently, 82% of enrollment in non-formal programscorresponds to pre-school enrollment.

1.10 Educational Coverage. Peru has been very successful in expanding educationalopportunities during the last two decades. According to Government figures, theshare of 6 to 14-year-olds attending school increased steadily from 78% in 1972 to89% in 1991. In fact, Peru presently has one of the highest access rates among LatinAmerican countries for primary, secondary and higher education. In 1 990, Peru's netenrollment rate for primary education was the second highest in Latin America (90%),following Argentina (98%) and Mexico (98%). Peru's gross enrollment for secondaryand higher education in the same year was also the second highest in the region. Insecondary education, Peru's gross enrollment was 70%, following Argentina (74%)and Chile (74%). In higher education, Peru's gross enrollment ratio (36%) closelyfollowed Argentina's (41 %), which is the highest in the region. The third highest isVenezuela with 29% coverage.

1.11 Educational opportunities for women have expanded more quickly than for men,contributing to a narrowing of the educational gender gap. This narrowing can beappreciated through cross-generational comparisons of the number of years ofeducation for men and women. The 1 991 Living Standards Survey indicates that, in1 992, men 45 years or older had on average 4.2 years of education, whereas womenof the same age group only had an average of 3 years. Among those aged 15-19,this difference has been reduced to 6.3 years of education for men and 5.7 years forwomen. Nevertheless, access to educational opportunities remains lower in the ruralareas of the sierra, where illiteracy rates are substantially higher for women than formen. For example, in 1991 in the rural Sierra, 10.5% of the women aged 15-19 wereilliterate versus only 1.7% of the men.

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1.12 Administration and Finance. In 1990, the previous Government initiated a policyof administrative deconcentration whereby the administrative responsibility for theeducation budget was transferred to the Regions. In this new system, the Ministryof Education continues to set standards, to define the educational policy, and tomonitor its application. But in terms of direct financial and managerial responsibility,it exercises its authority only over the Lima-Callao metropolitan region. The otherregions receive their educational budget directly from the Ministry of Finances.

1.13 This change in the distribution of responsibilities between the central andregional authorities and the departure of many professionals as a result of thedownsizing of the civil service under the current government -the number ofemployees of the Ministry of Education (MOE) was reduced from 2,500 to less than500- has negatively affected MOE's ability to perform its planning, monitoring andevaluation functions. At the present time, the MOE has totally lost control over thecollection and production of all statistics regarding educational expenditures and costsin the provinces outside Lima-Callao.

1.14 In 1991, the MOE was further reorganized, changing from a system that wasorganized by educational levels (e.g. primary, secondary, etc.) to one organized byadministrative areas. National direcciones (directorships/units) were created for thefollowing areas: educational technology, teacher training and educational research,supervision and evaluation, and educational promotion, participation and development.Furthermore, the deputy director positions were eliminated and previously separatedplanning, programming, and budgeting functions were consolidated into a newlycreated Oficina de Desarro/lo T6cnico (Office of Technical Development). Personneland information management functions were also consolidated into a new Oficina deAdministraci6n (Administration Office).

1. 1 5 The administration of the sector has also been reorganized to encompass twolevels instead of three (national, regional and district). The traditional structure hasbeen one where: the MOE heads the national level, the Direcciones Regionales deEducaci6n (Regional Education Directorships) and the Sub-Direcciones Regionales deEducacion (Sub-Regional Education Directorships) represent the regional level, theUnidades de Servicios Educativos (Educational Service Units) embody the district level,and the local level is constituted by schools. The recent changes that are beingimplemented entail redefining the role of the regional offices, the DireccionesRegionales de Educacion (DRE), and of the Direcciones Sub-Regionales de Educaci6n(DSRE), and replacing the Unidades de Servicios Educativos (USE) with Areas deDesarrollo Educativo (Education Delegations). The Areas de Desarrollo Educativo(ADE) will be deconcentratedI' entities responsible for collecting, processing andupdating district information; and administering the student achievement tests that

3' These are functionally autonomous entities reporting directly to the Ministry of Education.

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will be developed under MOE direction. In other words, the ADEs will be extendedtechnical units of the MOE in different parts of the country and thus, will depend onand will be accountable to the central ministry.

1.16 Primary and secondary education are mostly publicly funded with limitedparticipation from the private sector and households. Private sector schoolingaccounts for 14% of primary and secondary enrollments and it is mostly confined tourban areas, where 97% of private schools are located; in contrast, the public sectormanages 99% of rural schools. Household spending, quite naturally, is significantlylower for students attending public schools than for those in private schools and thus,it is not surprising that household spending is also greater in urban areas than in ruralareas. It is particularly high in Lima, where household educational expenditures are40% higher than those in other urban areas and four times those in rural areas.

1. 1 7 A positive aspect of the Peruvian education system is the relatively balanceddistribution of resources between primary, secondary, and tertiary education. Unitcosts at the secondary level represent only twice the cost for primary education.Similarly, unit costs in higher education were only 9 times as high as in primaryeducation in 1 965, and the ratio had gone down to 6.6 in 1990. This indicates that,within the context of the general decrease in educational expenditures in real terms,primary education has been relatively better protected than higher education.

C. Main Issues in Primary Education

1.18 Although Peru expanded educational opportunities substantially during the lasttwo decades, the basic educational system confronts problems of poor educationalquality, lack of equity, weak administration and insufficient financing, and inadequateinfrastructure.

1 .19 Educational quality. Although the proportion of each age cohort attending andgraduating from primary school is relatively high compared to other Latin Americancountries, the achievement level of those who graduate is poor. It is estimated that96% of each age cohort enrolls in first grade and that almost 75% of those graduatefrom grade six, but field studies and expert opinions indicate that completion ofprimary school does not assure functional literacy. The number of illiterates increasedby 1.5% between 1980 and 1 986, and a 1981 study revealed that a large percentageof students reaching Grade 6 had not mastered basic skills in mathematics, socialsciences and natural sciences, a situation that probably deteriorated during the lastten years due to decreasing resources in education.

1.20 Important factors contributing to the low quality of education are: (i) inadequateavailability and quality of teaching materials, (ii) inappropriate teaching methods in theclassrooms, and (iii) deficiencies in the curriculum's scope, sequence and adaptability.A dramatic decrease in expenditures in Peru implied a decline in real teachers' salaries

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of almost 70% between July 1985 and July 1993, and in the level of spending oneducational materials. Low salary levels have made teaching very unattractive,leading to a consistent growth in the number of unqualified teachers and thusaffecting educational quality. Presently, almost 49% of teaching positions are heldby non-trained teachers up from 35% in the early 1 980s. Furthermore, according toa 1 992 study of a sample of primary education classrooms, 93% of the students hadno textbooks. These problems are compounded by a curriculum which has aninadequate scope and sequence and which is not flexible enough to adapt to theheterogeneous educational contexts of Peru.

1.21 Equity. The problems of educational quality are worse among the mostdisadvantaged population, increasing the inequities between regions and betweenurban and rural areas. Illiteracy tends to be higher for women living in rural areasthan for men or women living in urban areas and repetition tends to be higher amongrural children living in non-Spanish speaking areas than among children living inpredominantly Spanish speaking urban areas. Furthermore, the regions with thelowest indicators of educational quality (Sierra and Selva) tend to have the highestproportion of uncertified teachers, the highest percentage of schools with noelectricity, water or sewerage, the highest proportion of multigrade schools, and thehighest proportion of illiterates.

1.22 Sectoradministration and finance. Frequent changes in the organization of thesystem and the reduction of the educational budget have weakened the government'sinstitutional capacity for effective financial management and have reduced the amountof financial resources allocated to non-salary expenditures. Furthermore,regionalization efforts have not been accompanied by complementary modificationsof the basic administrative structure of the MOE, which was designed for a centralizedand hierarchical system. The MOE, as a result, was left with limited ability to monitorand manage the national system and has little authority to implement policies forimproving the performance of schools.

1.23 Educational Expenditures. Per student public educational expenditures havedecreased dramatically. When compared to the average per student expenditure for1980-1987, the 1991 per student expenditures for primary, secondary and highereducation were only 27%, 38% and 34%, respectively, of the expenditure levelsduring that period. In comparison to 1 963-1969 expenditures, the 1 991 per studentexpenditures for each educational level reflect an even more drastic reduction,representing less than 1 6% of the per student expenditures for each level during this1960 period.

1.24 The sparse data available indicate that the education budget has diminishedsharply in real terms over the last decade. However, information on the educationalbudget is incomplete and inconsistent. The MOE is only responsible for its ownbudget and the budget of schools in the Lima/Callao province (about 33% of total

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educational expenditures). The education budget for the Regions comes directly fromthe Ministry of Economy and Finance (MEF) but there is little information on how themoney is spent. In addition, the bulk of the school construction budget comes underthe responsibility of the Ministry of the Presidency (MOP), under whose authority theNational Institute for Educational and Health Infrastructure (INFES) operates. It isimpossible, as a result, to have an accurate and reliable picture of the evolution oftotal educational expenditures as well as to analyze public spending in the educationsector by level of education and category of expenditure. In order to improve thiscurrent situation, the Bank is considering financing a sector study on educationalfinance and expenditures.

1.25 Since salaries represent the bulk of the education budget (more than 95 percenton average), the decrease in the budget in real terms implies a strong decline in realsalaries of teachers. While all civil servants have been adversely affected by thistrend, it is estimated that teachers have suffered the worst fall in income among allcategories of government employees. At the same time, non-salary expenditures havebeen drastically cut, meaning that the level of spending on educational materials andmaintenance is absolutely insufficient.

1.26 Infrastructure. Financial difficulties have also affected the physical conditionsof the schooling environment. Only about 30% of the classrooms are in goodconditions, 57% require immediate repair and approximately 13% of the classroomsare unsalvageable. Furthermore, schools in poverty stricken areas, which includesrural and urban-marginal schools, lack basic furniture and only 2.4% of rural schoolshave access to water, sewerage and electricity. In rural areas, school parentassociations (APAFAs) and other members of the community support schoolconstruction and in urban areas, although the participation of APAFAs is smaller, theycollaborate for rehabilitation and maintenance. Nevertheless, APAFAs requiresystematic training to ensure their effective participation in school building,rehabilitation, and maintenance.

1.27 Summary. The low educational quality, the educational inequities betweendifferent regions and between urban and rural areas, the sector's weak administrationand finance system, and the inadequate school infrastructure are major problemswhich the Peruvian educational system faces. They reveal the pressing need to: (i)increase textbook quality and availability in the classroom; (ii) improve teachingconditions and practices and make the teaching profession more attractive; (iii) designand implement a diversified educational strategy that addresses the diverse needs ofthe Peruvian population; (iv) improve the curriculum's scope, sequence andadaptability; (v) improve the financial management and administrative efficiency of thesystem; (vi) design a modern auditing and information system that could help to makemanagers and administrators more accountable; and (vii) improve educationalinfrastructure conditions.

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D. Government Strategy in Primary Education

1.28 Although the GOP lacks a clear strategy for improving the efficiency andquality of education, as part of the preparation of the Primary Education QualityProject, the Government has formulated a long-term strategy for expanding accessand improving quality of primary education. Recently, the GOP produced a draft ofa comprehensive strategy for the sector in a document entitled Long Term EducationDevelopment Plan (1995-2010). The main objectives of this plan are to increasecoverage at the preschool and primary school levels, improve the quality of educationat all levels in order to meet the challenges of a technology-driven economicdevelopment, and to strengthen the institutional framework and the managementcapacity of the education system. Also the MOE, with the assistance of GTZ, hasrecently prepared a set of guidelines for a long term plan to improve bilingualeducation. Progress on the achievement of the goals of this plan will be discussedduring the mid-term review meeting (1.34, 6.1g).

1.29 An important element of the government strategy is to raise teacher salariesgradually over the next ten years. On April and October, 1 994, a 40 and 35 percentrespectivly increases were granted to all teachers. In addition, teachers in rural areasare now receiving a a 25 percent increase in their salary, and principals receive anextra 45 to 70 nuevos soles, according to school size. The ultimate goal of theGovernment is to double teacher salaries in real terms over the next ten years. Asecond element of the strategy is to increase the availability and utilization of teachingmaterials at the classroom level. Assuming that GDP grow at an annual growth rateof five percent during the next five years, the implementation of the educationalstrategy would require that the share of public spending on education in GDPincreases from the current level of 2.2% to a level of 3.3% by the year 2000, whichis not unrealistic given that this is about the same level of what the GOP wasspending on public education during the 1 970s.

1.30 In order to improve management at the school level, the Government is planningto implement a plan to increase public school autonomy and accountability. Schoolswould be granted a high degree of autonomy in determining resource allocation anduse, and in carrying out their pedagogical activities. The Ministry of Educationrecently announced that the policy to increase public school autonomy would be putinto effect in a sample of schools of the Province of Lima and Cuzco at the beginningof the 1 995 academic year and, if successful, progressively extended to the rest ofthe country during the following years.

1.31 The education development plan will be financed by the national budget as wellas resources from the privatization program, loans from multinational and bilateralorganizations such as the World Bank, the Inter-American Development Bank, andKfW, and contributions from bilateral donors (e.g. Spain and Germany). TheGovernment, through the MOE and the MEF, has requested World Bank assistance in

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the areas of quality improvements in primary education, rehabilitation of the primaryschools infrastructure, and modernization of the management of the educationsystem. Parallel to this, the Peruvian Government has also asked the Inter-AmericanDevelopment Bank (IDB) financial support for a project to expand access to preschooleducation; improve the quality and relevance of secondary education; reformvocational and technical education; and to strengthen the MOE's strategic planningcapacity. The GOP has also requested from the German Government financial supportto implement the teacher training component of the current project and technicalassistance for the preparation of a project to reform pre-service teacher training anda bilingual education program. To ensure that these projects complement each other,IDB, KfW, GTZ and World Bank staff have been in close contact throughout theproject preparation period.

E. Bank Role and Strategy

1.32 As presented in the Country Assistance Strategy (September 1 9, 1 994 draftversion). the Bank's country strategy for Peru focuses on four main long-termobjectives: (i) sustaining macroeconomic stabilization; (ii) fostering private sectordevelopment; (iii) public sector reform and institution building; (iv) alleviating povertyand promoting human resource development; and (v) rehabilitating key infrastructureand reforming related policies. In regards to the fourth objective, the Bank specificallyaims at assisting the Government in formulating and implementing a povertyalleviation strategy, providing social services for the poor, and improving existingsocial programs. The Bank's work in the social sectors would also increase thelikelihood that the adjustment program would be maintained. Greater participationfrom community organizations and other non-governmental organizations will implyless reliance on the public sector and a larger private sector role in the provision ofsocial services.

1.33 Within this framework, the Bank's recent poverty assessment analyzed themost recent information about the characteristics of poverty and identified the mainpriorities for social programs. The Basic Health and Nutrition Project, approved by theBoard last February, will assist in the implementation of the poverty alleviationstrategy, the national nutrition policy, and reforms in food assistance programs anda subsequent health operation would build on the experience of this project. A loanfor Peru's social development fund (FONCODES), approved by the Board lastDecember, will assist the government in carrying out local initiatives to rehabilitateeconomic and social infrastructure and to provide direct assistance in health, foodproduction and distribution, education, and sanitation.

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1.34 In collaboration with the Government of Peru, UNESCO, GTZ, and UNDP, theBank prepared a primary education sector report to help identify investment prioritiesfor improving the quality of educational services and the efficiency of resource use inthe sector. Discussions of this report were held at a one-week seminar (organized incollaboration with the MOE, GTZ, UNDP, and UNESCO-OREALC) in whichrepresentatives of MOE, MOP, MEF, teacher training institutes, NGOs, universities,research institutes, and donor institutions participated, resulting in an overallconsensus on the main problems and priorities for primary education. Based on thefindings of the sector report and the results of the seminar, the GOP identified fivepriority areas for investment (instructional materials, teacher training, public schoolautonomy and accountability, school infrastructure, and bilingual-interculturaleducation) and it is developing a comprehensive long-term education strategy. Toameliorate current deficiencies on educational budget information, the Bank isconsidering financing a sector study on educational expenditures and finance. Theproposed project would finance the first four prioritized areas while the GOP wouldfinance a Bilingual-intercultural Education Program. During negotiations the Peruviandelegation presented to the Bank satisfactory evidence that the Ministry of Educationis actively working toward the completion of a comprehensive Bilingual-InterculturalEducation Plan. It is expected that this Plan would be finalized by the end of 1 995.For this purpose, it has created a "Comisi6n Permanente de Educaci6n Interculturaly Educaci6n Bilingue", drafted a general framework for the development of the Plan,and allocated almost US$4.5 million to the MOE to begin the implementation of theplan during the 1995 academic year. The Peruvian delegation and the Bank agreedthat the MOE would send to the Bank, no later than December 31, 1 995, a copy ofthe Bilingual-Intercultural Plan (6.le), and that progress toward the achievement ofthis Plan would be examined as part of the mid-term review of the Project (1.28,6.1g).

F. Lessons Learned

1 .35 The lessons from the Primary Education (Second Education) Project (Loan 2465-PE) in Peru and from Bank's experience with education projects in other countrieshave been examined and have influenced the proposed strategy for this project.These lessons relate to issues of sustainability, effective implementation, monitoringand evaluation, and sector specific issues such as textbooks and instructionalmaterials and teacher training.

1.36 Sustainability. To increase the likelihood that education interventions financedby the Bank will continue to produce benefits beyond project completion, countriesmust develop a sense of ownership of the project. Engaging relevant policy makersand technical staff in project preparation from early stages of project identification anddesign is one of the best strategies to achieve this goal. Also, local involvement inproject preparation helps to ensure that project goals are in line with national goals.Other important elements for project sustainability are: (i) defining both long and short

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term project objectives to facilitate implementation and continuous monitoring andevaluation; (ii) confronting from the very beginning, the issue of adequate initial andfuture funding capacity for different project components, and (iii) defining andaddressing the weaknesses in the MOE's institutional capacity for projectimplementation, monitoring and evaluation.

1.37 Issues of sustainability have been addressed in the preparation of the proposedproject by: (i) carrying out a one-week seminar in which the education sector reportwas discussed among a diverse group of educational actors and which resulted in anoverall consensus on the main problems and priorities for primary education; (ii)ensuring active participation of MOE staff and peruvian educators in project definitionand design; (iii) addressing issues of long term financing from the very beginning andensuring that all components include a sustainability plan; and (iv) assuring that theProject Coordination Unit only plays a coordination role for MOE units that will beresponsible for the direct execution of project components.

1.38 Effective Implementation. In order to ensure effective implementation, thePrimary Education (Second Education) Project (Loan 2465-PE) confirms the value of:(i) relying on clear feasibility criteria; (ii) developing project administration from thebeginning, attempting among other things that personnel changes do not compromisethe continuity or the orientation of the project; (iii) ensuring that project monitoringis adequate and timely to enable correction of factors which might affect theexecution and results of the project; and (iv) holding a project launch workshop inorder to strengthen administration capacity and avoid unnecessary delays andproblems during later stages of project development and implementation.

1.39 Considering these factors for effective implementation, the proposed projectpays special attention to: (i) elaborating a project design that matches clear feasibilitycriteria; (ii) developing grounds for project administration from the very beginning; (iv)granting special attention to the needs of components requiring insterinstitutionalparticipation; (iii) institutionalizing adequate and timely monitoring and evaluationprocedures; and (iv) carrying out project launch workshops during early stages ofproject development (1.43, 4.7). Furthermore, through technical assistance from theBank's training department and foreign consultants, a Computerized ProjectManagement system (CPM) was developed and training on CPM usage was providedto key staff involved in project preparation.

1.40 Monitoring and Evaluation (M&E). Institutionalization of M&E activities as anintegral function of planning and management of the education sector has beenidentified as a key element to assess the effectiveness and sustainability of a project.As mentioned in the previous paragraph, this project would provide for regularlyscheduled monitoring and evaluation to permit adjustments in implementation(6.1c,d,g) and would include provisions for a mid-term review (2.26, 6.1h).Furthermore, it would support improvements in the MOE's capacity to monitor the

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educational system by strengthening the information management systems (2.26) andby supporting the development of a national student assessment system (2.27). Thedevelopment of the student assessment system would take into account the lessonslearned from reviews of country experiences in the area of student assessment.4 'The reviews suggests that in order to strengthen countries' capacity to use the resultsof a student achievement system, projects must: (i) define clearly the objectives ofthe assessment, (ii) focus on improving institutional quality before addressing eithertechnical quality issues or dissemination issues; (iii) pay close attention to importanttechnical details in the test development process; (iv) design a clear promotion anddissemination plan targeted at different audiences; and (v) include funds for researchas part of the assessment program.

1.41 Textbooks and Instructional Materials. The success of a textbook componentis directly related to the extent to which the project design addresses all aspects ofthe system to provide textbooks, i.e. preparation, manufacturing, distribution andfinancing. This does not mean that the project has to finance each aspect. The keyproblem areas encountered in textbook programs are: (i) institutional arrangements,poor distribution and poor system coordination; (ii) inadequate attention given to thequality and appropriateness of the books provided; (iii) neglect of aspects related tobook utilization, such as teacher training and distribution, and (iv) conflicts betweengovernment and local publishers. The proposed project focuses on issues of qualityand appropriateness of textbooks and instructional materials by ensuring that thetextbooks and materials are intimately linked with the curriculum reform and bysupporting quality improvement strategies.

1.42 Teacher training. For components supporting in-service teacher training,experience has shown that it is crucial to make a clear distinction between activitiesdesigned to certify or license untrained teachers and those aiming at upgrading thelevel of knowledge and skills of current teachers. Generally, programs designed todeal with special issues, such as training and textbooks, are successful only whenthey are intensive and when they relate directly to the participant's work context.The most effective programs are those which are locally initiated and implemented.

1.43 The proposed project takes these lessons into consideration by: (i) financingprograms for upgrading teachers and supporting the development of a separatestrategy for revamping the teacher certification system; (ii) financing training programsthat are practice-oriented and are linked with the new textbooks and instructionalmaterials; (iii) stimulating local implementation of training programs; (iv) conducting

4' Horn,R., Wolff, L. and Velez, E. (1991). Developing Educational Assessment Systems in Latin America: AReview of Issues and Recent Experience. Latin America and the Caribbean Technical Department, RegionalStudies Program, Report No. 9. World Bank, Washington D.C.; and Larach, L. and Lockheed, M. (1992).World Bank Lending for Educational Testing: A General Operational Review. Population and Human ResourcesDepartment, Report No. PHREE/92/62R. World Bank, Washington, D.C.

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a national project launch workshop which would be followed up by a series of similarregional workshops (4.7); and (v) conditioning disbursement for civil works to theachievement of previously agreed targets for textbook distribution and teacher training(6.4a).

2. THE PROJECT

A. Project Objectives

2.1 The project is designed to assist the Government to increase the quality ofprimary education in order to improve student achievement and reduce repetition anddropout rates. Considering that a key contributing factor to the successfulimplementation of quality improvements interventions would be the introduction ofmeasures to strengthen the management capacity of the MOE and of the schoolsthemselves another goal of the project is to improve educational management. Thespecific objectives of the project would be to: (i) improve teaching conditions withinprimary school classrooms; (ii) strengthen public school management; (iii) improve theplanning monitoring and management capacity of central, departmental and localeducation authorities; and (iv) improve educational infrastructure. The project wouldalso attempt to increase the educational systems' equity by ensuring that priority isgiven in all activities to poor urban and rural areas.

2.2 The project will benefit approximately 3.5 million children in grades one to six,11 0,000 teachers and 25,000 primary school principals and administrators. Theimprovement of school facilities will be targeted to those areas of the country whichpresent the highest proportion of unsalvageable schools, the lowest proportion ofchildren enrolled in primary education, and the highest proportion of population livingunder extreme poverty conditions".

2.3 As part of its long term education strategy, the Peruvian Government has alsoasked the Inter-American Development Bank (IDB) to finance a parallel loan to theeducation sector. The main components of the proposed loan are: (i) expansion ofaccess to preschool education; (ii) improvement of secondary education; (iii) reformof vocational and technical education; and (iv) strengthening the capacity of the MOEfor strategic planning. Also, the GOP has requested from the German Governmentfinancial and technical assistance to implement a reform of pre-service teacher trainingprograms. To ensure that the three projects complement each other, IDB, KfW, GTZand World Bank staff have been in close contact throughout the project preparation

5' According to the 1991 Living Standards Measurement Survey, a household is classified as extremely poorwhen the value of its total daily expenditures is less than the cost of a basic food basket. Data for identifyingtarget areas for the project would come from a recent work prepared at FONCODES for its publication "ElMapa de la Inversi6n Social", FONCODES-UNICEF, 1 994.

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period. During appraisal the Government rejected the idea of cofinancing the schoolrehabilitation component of the proposed Project with the IDB because it is planningto request from IDB the financing of rehabilitation and construction of preschoolfacilities.

B. Project Components

2.4 The proposed project would consist of three components:

(a) an Educational Quality (US$88.1 million, or 35 percent of total base costs)component to support improvements in: (i) the availability and quality of textbooksand instructional materials; (ii) competencies of primary school teachers; and (iii) thecurriculum's scope, sequence and adaptability. The project would finance theacquisition, production and distribution of teaching materials, such as textbooks,reading materials, teacher's guides, and non-printed didactic materials; specializedtraining programs for teachers to promote the effective use of the instructionalmaterials distributed under the project; a voucher system to develop a permanentteacher training capacity in the country; dissemination and communicationcampaigns, technical studies and technical assistance.

(b) A Modernization of EducationalAdministration (US$44 million, or 17 percentof total base costs) component to: (i) strengthen the management capacity of theeducation sector at the central, departmental and local levels; (ii) implement,monitor, and evaluate the transfer of various budgetary and management functionsfrom the MOE, and USES to the schools; (iii) develop information managementcapabilities at the central, departmental, and local levels; and (iv) establish a modernstudent assessment system. More specifically, the component would support theestablishment of a project management and evaluation system, a nationaleducational management information system, and a national student assessmentsystem for monitoring educational quality. It would also support efforts to increasepublic school autonomy and accountability by financing experimental pilots in orderto evaluate different alternative models of school management and governance.The project would finance management training, technical assistance forinstitutional development, projectimplementation, dissemination and communicationcampaigns, computer hardware and software, and special studies.

(c) an Infrastructure Improvement (US$121.8 million, or 48 percent of projectcosts) component to support the improvement of teaching and learning conditionsby rehabilitating and replacing primary school infrastructure in rural and urban poorareas. The resources will primarily be targeted at financing the rehabilitation and

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replacement of primary school classrooms in thirteen departments6 ' where theproportion of unsalvageable classrooms is above the national average, theproportion of student enrollment is below the national average, and the proportionof population living under extreme poverty conditions is above the national average.The project would finance rehabilitation and replacement of primary schoolclassrooms, training of school principals and representatives of parents associationsin school maintenance routines, the update of the national cadastre of educationalinfrastructure, and the development of a computerized monitoring system tostrengthen the MOE's capacity to plan and monitor school building, rehabilitationand maintenance.

C. Project Description

Component 1: Educational Quality

Sub-Component Curriculum

2.5 The curriculum, in general, does not need to be reformed. However, there aredeficiencies in the curriculum's coverage, relevance and sequencing that should becorrected. The coverage is too broad, resulting in an excessive and unreasonablenumber of topics to be covered in a school year, and the topics are presented inisolated segments, without creating linkages and drawing relationships among them.Furthermore, the curriculum is not flexible enough to adapt to the country'sheterogeneous schooling environments.

a) Curriculum Improvement

2.6 The objective of this component is to adjust the present curriculum byimproving content linkages between and within grades and by making it more flexible,diversified and responsive to the cultural and social diversity of Peru. The MOE hasalready adjusted the curriculum for pre-school and first grade and is in the process ofadjusting the curriculum for grade two. In order to complete this process the projectwould foster adjustment to single teacher schools and grades three to six curriculum,through a series of local and national brain-storming sessions, seminars, andworkshops in which school teachers, university professors and curriculum specialistswould discuss a draft adjusted curriculum prepared by a group of experts workingunder the direction of MOE's Division of Educational Plans and Programs. It isexpected that this work would be completed by the end of the third year of theproject, and that the curriculum changes for each grade would be completed one yearbefore the scheduled distribution of instructional materials for the corresponding

6/ See Annex 3 for a list of these departments.

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grade. The project would finance technical assistance, seminars, and the publicationand dissemination of the adjusted curriculum.

Sub-Component Instructional Materials

2.7 Teaching is a difficult craft requiring not only high interpersonal andcommunication skills but also appropriate instructional materials and methods. InPeru, a large proportion of all teaching is done by untrained teachers who have verylittle access to appropriate instructional materials. This results not only in poorlearning achievement but also in early departure from the system. In order to begincorrecting this situation, the current project would provide textbooks and workbooksto students; reading and non-printed didactic materials to each classroom; andteachers guides to teachers. The project would also promote the adequate use ofthese materials by training teachers and principals on how to use and care for them,and on classroom and school management techniques.

a) Textbooks, Workbooks and Teachers Guides

2.8 As a result of the lack of a textbook policy and the economic crisis of the lastdecade, most students attending public primary schools do not have textbooks, andthe few books that they do have are of very poor quality in terms of content, artwork, and physical presentation. The objective of this component is to provideprimary school students with textbooks and workbooks, and teachers with teachingguides. In order to respond to the challenges of the new curriculum, the projectwould distribute one grade-specific "integrated" textbook and one correspondingworkbook to each student in first and second grade, including students in single-teacher (multigrade) schools. For grades three to six, all students, excluding studentsin single-teacher schools, would receive one "integrated" textbook and itscorresponding workbook and one additional workbook for math. Students in gradesthree to six in single-teacher schools would receive two textbooks (math andlanguage), which would have the workbooks incorporated. All teachers would receivea didactic guide that would correspond to the distributed textbooks and workbooks.

b) Supplementary Reading Books

2.9 Almost 30 percent of students repeat first grade, 23 percent repeat secondgrade, and 1 5 percent repeat third grade. The high incidence of repetition in the firstthree grades is an indication of the difficulties that students confront when learninghow to read and write. As a matter of fact, reading materials are almost neveravailable in classrooms and when they are available, they are of poor quality and arenot used properly. The few schools that have school libraries do not make active useof them either because books and other teaching materials are too old or becauseteachers are not used to asking students to go to the library. Consequently,independent reading and writing is rarely carried out during class time in Peruvian

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schools and when it is carried out, not much attention is given to students' interestsand/or reading abilities. To help overcome this problem, the project would createclassroom-based reading libraries to encourage independent reading in the classroom.Classroom libraries would consist of a collection of reading materials that would varyby grades in terms of the number of titles and copies7'.

c) Non-Printed Didactic Materials

2.10 To promote a positive modification of teaching style and to encourage activelearning on the part of students, the project would provide non-printed didacticmaterials (e.g. learning games, puzzles, alphabet blocks and posters) to all primaryschools. The non-printed didactic materials would be grouped by learning areas (e.g.communication, math and logic, psychomotor skills, arts and creativity, and ecologyand science) and by grade, within each area.

Sub-Component In-Service Teacher Training

2.1 1 In Peru, almost 50 percent of the teachers have less than five years of teachingexperience and 49 percent of them are not certified. Often, the inexperiencedteachers only master a teacher-centered instructional technique. This teachingmethod assumes that students are more or less alike and that they learn at the samepace. This assumption, however, does not hold for most Peruvian classrooms whereover-age students are the rule rather than the exception. Due to the lack of time toprepare lesson plans and the shortage of teaching materials, more experienced andcertified teachers are also driven to use teacher-centered teaching methods,perpetuating the dependency of the student on the teacher. Furthermore, Peru doesnot have a continuous and solid national program for in-service teacher training andthe courses that are offered tend to be not pertinent. In response to these problems,the proposed subcomponent aims at: (i) the provision of in-service teacher training instudent-centered teaching methods which stimulate active learning, in the use of newcurricula and teaching materials provided by the project, and in the effective use ofinstructional time, and (ii) the development of a permanent capacity for in-serviceteacher training.

a) In-Service Teacher Training

2.1 2 Teacher competencies in student-centered instructional methods and inclassroom management would be strengthened through specifically designed in-service teacher training seminars. Through these seminars, teachers would receiveinformation about the content, pedagogy, and structure of the new curriculum; andwould get training on how to use the teaching materials distributed by the project,

7' Annex 6 provides further details on the type and number of library books that would be distributed by theproject.

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how to better organize and administer teaching time, and how to promote activelearning habits. In-service training would be delivered on a semiannual basis toteachers grouped by the grades they teach, and special training would be designedfor multigrade teachers8". Each group would receive a total of three weeks oftraining, supplemental by an in-school follow-up program. The first session of twoweeks would take place in March (just before the beginning of the school year) andthe third week would occur in August, during mid-term vacations. The follow-upprogram, designed to assist teachers in applying new practices in their classroom,would include a series of visits in which teacher trainers would visit classrooms,provide teaching demonstrations and work with groups of teachers and princiapls.Each group of ten teachers would receive three two-day follow-up visits during theschool year.

2.1 3 Given the key role of principals in ensuring that teachers change their teachingpractices and that teaching materials are used properly, the project would also trainelementary school principals in pedagogical supervision methods. A week oforientation at the beginning of the project would inform principals about the scope andobjectives of the project, about the changes in teaching practices sought by theproject, and about their role as facilitators of the desired changes. A second week oftraining in the fourth year of the project would provide more techniques foreducational supervision, as well as strategies for continuing to strengthen the role ofprincipals as instructional leaders after the conclusion of the project. Additionally, aspart of the institutional strengthening component, principals would receive training inschool management and administration.

2.14 The organization and delivery of the training would be contracted out in eachdepartment to teacher training institutes and universities. To ensure that the trainingoffered by the contractors meets minimum quality standards, promotes active learningand the use of teaching materials, and covers a predefined minimum set of contents,the MOE would develop training guidelines to be used by the training institutions fordesigning the necessary training materials and teaching methodologies. The selectionof the teacher training contractors would be done by the MOE, notwithstanding theregional secretaries of education would be asked to collaborate by providinginformation about possible contractors. This implementation strategy would helpstrengthen local teacher training capacity and develop a teacher training capacity thatis responsive to the diversity of local conditions. The project would finance the costof technical assistance, the development, production and distribution of trainingmaterials, per-diem and travel costs of trainees, and costs of orientation seminars andtraining workshops.

8a Annex 5 provides further details on the activities of this subcomponent.

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b) Development of a Permanent Capacity for In-Service Teacher Training

2.15 Although the in-service training programs that would be offered during theproject's life would help strengthen the capacities of the existing teaching force andwould strengthen national training capacity by contracting local institutions, it wouldnot assure the development of a permanent capacity for in-service teacher training.The subcomponent would foster such capacity by establishing a voucher system thatwould finance the participation of primary school teachers in-service training coursesand seminars offered by private and public universities and teacher training institutes.The voucher system would be piloted in the third year of the project, and implementedduring the last year of the project; information and guidelines about this new systemwould be included in the principal's training provided in that year.

2.1 6 It is expected that the system would: (i) create the necessary conditions topromote competition among universities and teacher training institutes to offer teachertraining courses that are of high quality and that are relevant to the diverse teachingconditions prevailing in Peru; and (ii) strengthen the GOP's efforts to increase publicschool autonomy and accountability by giving each school council full authority onwhich teacher should receive training, and on where and what type of training theyshould receive. The project would finance the voucher system and technicalassistance.

Component 2: Institutional Development

2.17 Weakened by the drastic reduction in personnel in 1992 and the loss offinancial control over all schools outside the province of Lima and Callao, the MOE'scapacity to manage the school system and to carry out any significant reform isseverely limited. Therefore, a key contributing factor to the successfulimplementation of the proposed project would be the introduction of measures tostrengthen the management capacity of the MOE and of the schools themselves. Theproject would improve the management efficiency of the system through programsthat aim at: (i) strengthening the planning, administrative, supervision and monitoringcapacity of the MOE at national and provincial levels; (ii) supporting theimplementation and evaluation of a pilot plan to increase public school autonomy; (iii)developing a management information system; and (iv) establishing a national studentassessment system for monitoring educational quality.

a) Modernization of Educational Administration

2.1 8 A preliminary evaluation of the management capacity of the MOE has revealedthe need for an in-depth management audit to spell out the necessary structural andprocedural changes and the capacity-building actions required to modernize themanagement of the educational system. The project would support such in-depthaudits in two phases. The first phase would define the new structure, functions and

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processes of the MOE and its intermediary bodies at the regional level, taking intoaccount the management implications and the organizational impact of the proposedplan to increase public school autonomy and accountability. The second phase wouldtranslate the results of the first audit into a detailed strategy and action-plan outliningthe recruitment and training needs of MOE staff under the new structure. The auditswould be carried out during the first eighteen months after the date of projecteffectiveness. The results and recommendations of the audits would be presented tothe Bank for review and comments. No later than ninety days after completion of theaudits would a joint review meeting between the MOE and the Bank be organized toagree on an action plan to implement the recommendations.

2.19 Based on the results of the management audit, this sub-component wouldsupport the implementation of the action-plan agreed between the Bank and the MOE.Activities to be financed under this sub-component would include: (i) reorganizationof the MOE, (ii) preparation of the laws and regulations that would need to bemodified for an effective implementation of the plan to increase public schoolautonomy, (iii) recruitment of key professional personnel, and (iv) training of seniorand mid-level staff of the MOE and its intermediary bodies in management, planning,monitoring and supervision. The project would finance training, and technicalassistance. As a condition of disbursement, the MOE and the Bank shall agree on theaction-plan based on the results and recommendations of the management auditreview (6.4b).

b) Plan to Promote Public School Autonomy

2.20 Public School Autonomy. The project would assist the Government inimplementing their plan increase public school autonomy and accountability whichwould consist of transferring the financial, administrative and pedagogicalresponsibility for school management from the provincial units of the MOE (USEs andADEs) directly to the schools. As a first step, a pilot plan for increasing public schoolautonomy would be introduced in approximately 300 public primary and secondaryschools in Lima and Cuzco during the 1 995 academic year. This pilot project aims totest whether giving schools increased autonomy results in improved administrativeefficiency, academic performance and internal efficiency within the education sector.As a second step, the Government would gradually expand the plan for increasedpublic school autonomy to the rest of the schools based on a program and animplementation plan which the MOE would develop based on the results of the pilot.

2.21 All of the schools participating in the public school autonomy experiment wouldbe given the greatest degree of autonomy presently possible under current laws. Thiswould include the authority to: (i) manage their own budgets in all aspects exceptsetting teachers' salaries, (ii) hire the candidate of their choice for vacancies, and (iii)make all pedagogical and organizational decisions internal to the school.

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2.22 Two basic management models would be implemented to test the optimaladministrative structure under which the autonomy would function. The modelswould vary according to the balance of authority between the school director and theschool council. A third model, which would only be a variation of the model underwhich the school council has greater authority, would introduce incentives aimed atimproving school efficiency.

2.23 Evaluation. An impact evaluation would be carried out of the public schoolautonomy pilot. The evaluation would use a randomized control methodology toassess whether the quality and efficiency of the education system has improved asa result of the plan to increase public school autonomy and accountability. For thepurpose of the evaluation, the treatment schools and approximately 100 randomly-selected control schools would be studied using baseline and follow-up applicationsof student achievement tests, surveys, observation guides and reviews ofadministrative records.

2.24 This evaluation would receive the support of the World Bank's Poverty andHuman Resources Division of the Policy Research Department and the ResearchCommittee since it is one of four projects within a World Bank evaluation researchproject, Impact Evaluation of Education Projects: Decentralization and PrivatizationIssues, that seeks to develop and integrate impact evaluation strategies into projectsthat aim to devolve financial planning and educational decisionmaking to local levels.This collaboration would enhance not only the technical quality of the project butwould build local capacity in both the MOE and the research institute responsible forconducting the evaluation. The project would support the implementation, monitoringand evaluation of the pilot experiments. This would involve training and technicalassistance.

c) Management Information System

2.25 Preliminary observations indicate that the present information system of theMOE is inadequate. The existing hardware and software are obsolete, the technicalcapacity to use and maintain the system is weak, and processes and applications atthe provincial and local levels are not standardized. As a result, the informationproduced is outdated, unreliable, and in most cases irrelevant. The project wouldsupport a complete overhaul of the system, focusing on timeliness and usefulness ofthe information.

2.26 The main objective of this sub-component would be to establish a sound andmodern data collection and information management structure to support theplanning, monitoring and decision-making activities of the MOE. The system wouldbe designed to supply the MOE and its decentralized units with appropriate computerequipment, develop the necessary applications for supporting the operationalprocedures and management processes of the sector, and strengthen the technical

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capacity of the staff in charge of running the information system. The managementinformation system would ensure that relevant data and information are available ina timely fashion. Five information sub-systems would be put in place: (i) humanresources (administration of the teaching staff, remuneration, and promotions); (ii)office automatization (record and documents flow); (iii) administration and finance(budget, accounting, stock monitoring, and auditing); (iv) student flow and schoolresources; and (v) geographical educational system information. Besides this sub-component would support the equipment of computers and software requirements ofthe rest of the sub-components of the project. Specifically, the project would financethe purchase of computers and software, technical assistance, studies on data needsand utilization, and training on data collection and aggregation, data entry, andcomputer fundamentals. In order to strengthen the MOE's capacity to target itsprograms to the neediest groups, the Government and the Bank agreed duringnegotiations that the MOE's project annual progress reports would include, wheneverpossible, breakdown of the information by gender and ethnic groups.

d) Student Assessment System

2.27 Peru's experience with assessing learning of primary students at a national levelis minimal and the few experiences that have been carried out have not assessedlearning of public and private school students in a systematic way and on a regularbasis. Considering the country's limited experience in this area and the need for astudent assessment system that can provide quality control and decision-analysistools to national, regional and local authorities, this subcomponent aims at: (i)developing a national student assessment system which would provide periodic, validand reliable information on the progress toward national achievement goals in orderto inform primary education policy decisions; (ii) strengthening MOE's capacity to seekand use timely, reliable and valid information; and (iii) fostering a culture of evaluation.During the project's life, math, language and natural and social science achievementtests would be administered to a sample of fourth and sixth grade students.9'Furthermore, in addition to the national samples, the system would administer teststo schools involved in the pilot program to increase public school autonomy andaccountability in order to facilitate a longitudinal study of the impact of that program.

2.28 The MOE would be responsible for the general management, logistical support,promotion, dissemination and utilization of the system. All processes related tocoordinating and managing test development and administration, and data processingand analysis would be contracted to an autonomous institution such as a universityor an independent research institute, whose performance would be closely evaluatedon a regular basis. A technical committee, constituted by two or three MOE staff,would participate in the activities of the external institution, serving as a linkage

9' For design details of the proposed national assessment system, see Annex 4.

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between the MOE and the external entity and receiving continuous institution-basedtraining. These implementation arrangement are not only in line with thegovernment's new public sector management policies but also would serve tostrengthen the MOE's capacity for developing and managing a timely assessmentsystem of high quality.

2.29 The MOE's capacity to carry out its functions efficiently and effectively wouldbe strengthened by: (i) providing in-country workshops on related areas; (ii) financingstudy tours to foreign institutions with experience in assessment; and (iii) ensuringthat the members of the technical committee receive adequate institution-basedtraining. Initially, the MOE would rely on consultants for support in monitoring andsupervising the quality of the products and processes carried out by the externalinstitution; by the end of the project, however, it is expected that the technicalcommittee will take on the responsibilities of these consultants. In other words, theinstitution-based training of the technical committee would assist in ensuringsustainability not only through capacity building but also through cost reduction.

2.30 In order to strengthen the general national assessment capacity and to fostera culture of evaluation, the MOE would: (i) inform and motivate the general publicabout the meaning and importance of assessment through special promotionalcampaigns; (ii) encourage further analysis of the assessment results by sponsoringcompetitions for research grants; and (iii) finance university graduate training ineducational measurement and research for one or two individuals selected through acompetitive process (with the requirement that these individuals make a firmcommitment to contribute to the assessment system after completing their training).

Component 3: Infrastructure Improvement

2.31 During the last two decades, underfunding of capital investment in theeducation sector has led to the collapse of the school maintenance program and tounder-investment in school infrastructure, particularly in rural and newly emergingurban areas. Consequently, only 30 percent of the classrooms are in good conditionsand almost 1 3 percent of poor classrooms have deteriorated to such degree that theyare now considered unsalvageable. Resource constraints have also weakened thecapacity of the public sector, especially the MOE, to plan and manage its schoolinfrastructure program. In order to assist the government to improve physicalteaching conditions, the project would finance the construction, rehabilitation, andfurnishing of unsalvageable and highly deteriorated classrooms in rural and poor urbanareas, a school maintenance training program for principals and representatives ofparent associations, the update of the national cadastre of educational infrastructure,and the strengthening of the capacity of the MOE to estimate the demand for newschools and to plan and monitor school maintenance.

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2.32 To ensure that implementation of project activities related to infrastructure donot take precedence over the implementation of quality improvement activities, theGOP and the Bank agreed during appraisal that disbursement for civil works andschool furniture, excluding bookshelves, would be conditional upon achievement ofspecific annual targets for textbook distribution and teacher training. To this effect,a disbursement condition will be included providing that no withdrawals for civil worksand school furniture, excluding bookshelves, shall be made unless they relate to atargeted schools included in an annual plan approved by the Bank (6.4a). Duringnegotiations, planned targets (in number of school) were agreed for civil works andschool furniture as well as implementation targets for teacher training and textbookdistribution (6.2a). During annual reviews, the achievement of the implementationtargets for teacher training and textbook distribution will be evaluated (6. 1 g). On thebasis of this evaluation the final number of targeted schools to be rehabilitated andfurnished will be agreed as part of the respective annual plan (6.1g). In other words,if the textbook and teacher training implementation targets are met, then the plannedannual disbursement ceiling for civil works would remain intact. However, if thetextbook and teacher training implementation targets are not met, then the plannedannual disbursement ceiling for civil works and school furniture would be reducedaccordingly, as agreed between the Bank and the GOP during each annual reviewmeeting.

2.33 In Peru, school infrastructure programs are managed jointly by the NationalInstitute for Education and Health Infrastructure (INFES) and the MOE'S Directorateof Educational Infrastructure (DINFE). INFES was created in 1992 under the authorityof the MOP and was given the responsibility for building and maintaining schools andhealth facilities. DINFE was given the responsibility for elaborating a national schoolinfrastructure plan and for keeping and updating a national registry of school buildings.In addition to these two entities, in 1991 the GOP created a social development fund(FONCODES) to mitigate the social costs of economic adjustment. BetweenNovember 1991 and April 1994, FONCODES financed a total of 5,68410' schoolrehabilitation projects at a total cost of almost US$1 21.5 million.

2.34 At the beginning of 1994, FONCODES, INFES and MOE signed an agreementwhereby MOE was given full responsibility to coordinate school infrastructureoperations in the whole country. Under the proposed project MOE's mainresponsibility would be to identify schools that need rehabilitation and for developinga monitoring system for school maintenance. INFES would be responsible fordesigning and procuring school furniture, and for designing, contracting out,supervising and monitoring all civil works. Rehabilitation works in remote locations,where contract bidding would be improbable, would be done through directcontracting procedures. It is estimated that a total of up to US$11.7 million

l'° A total of 2,838 of these projects have been completed at a costs of US$48,374,351; 2,439 are underimplementation at a costs of US$66,254,259; and 407 have been approved at a costs of US$6,783,138.

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equivalent would be done using these contracting procedures. The implementationof the school maintenance training program would be done by the National TrainingService for the Construction Sector (SENCICO) which is an autonomous institutionunder the authority of the Ministry of Housing and Construction.

a) School Rehabilitation

2.35 Under this sub-component the project would finance the construction ofapproximately 4,200 classrooms to replace nearly 33 percent of the total estimatednumber of unsalvageable classrooms in the country, and the rehabilitation ofapproximately 1,270 classrooms in the same schools which would also benefit fromthe replacement of unsalvageable classrooms. Overall, it is estimated that the projectwould benefit approximately 1,750 primary schools of a total of approximately23,300. The program would be targeted to those departments which have aproportion of unsalvageable classrooms above the national average, a proportion ofstudent enrollment below the national average, and where the proportion of populationliving under extreme poverty conditions is above the national average. In addition, theproject would improve sanitation in all targeted schools by building bathrooms, andwould recondition classroom and office space in the same schools. DINFE would beresponsible for selecting school sites while INFES would contract out and superviseall civil works activities related to this sub-component. To ensure the adequacy ofprices INFES will use a system of standard regional unit prices to guide the negotiationof contracts for the civil works implemented through direct contracting (3.1 3, 6.1 k).

2.36 In order to reduce the risk of overlapping and duplicating infrastructureprograms implemented by FONCODES and INFES, the Government brought tonegotiations a final list of the selected departments that would participate in theproposed project"'. At negotiations, the World Bank received assurances from theGovernment that the current agreement between FONCODES, INFES and MOE will beamended stating that FONCODES would not finance community based project for therehabilitation of targeted primary schools included in the annual project plan and thatINFES not finance any infrastructure related to primary schools in the abovementioned targeted schools (6.1j, 6.3b). Prior to effectiveness the MOE andFONCODES should have amended the current agreement between FONCODES, INFESand MOE (signed in January, 1994), and signed a subsidiary agreement with INFESfor the implementation of this component (6.3b,d).

'" See Annex 3 for the list of he selected departments.

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b) School Maintenance

2.37 To assist all schools implementing a continuous school maintenance program,under this sub-component the project would finance training of school principals andAPAFAs in school maintenance routines, updating and publishing 3,000 manuals withtechnical specifications for school buildings and classroom furniture, and developing,producing and distributing 25,000 school maintenance manuals to primary schoolsand parent associations. The development of the manuals would be done by DINFEin coordination with SENCICO, while the training itself would be conducted bySENCICO. Prior to negotiations, the World Bank revised a draft subsidiary agreementbetween the MOE and SENCICO for the implementation of this sub-component. Acondition of effectiveness would be the signing of the subsidiary agreement betweenthe MOE and SENCICO (6.3b).

c) School Furnishing

2.38 Under this sub-component the project would completely furnish all theclassrooms built under the project and approximately 30 percent of the furniture onthe rehabilitated classrooms. The project would also provide office furniture toapproximately 490 schools already participating in the classroom construction sub-component. In addition, the project would provide bookshelves to all primary schoolclassrooms to store the textbooks, non-printed instructional materials and librarybooks that would be distributed under the project. DINFE would be responsible forselecting school sites and for defining the technical specifications for classroom andoffice furniture, and bookshelves, while INFES would procure the furniture. Prior tonegotiations, the World Bank revised a draft subsidiary agreement between the MOEand INFES for the implementation of this sub-component. A condition ofeffectiveness would be the signing of the subsidiary agreement between the MOE andINFES (6.3b).

d) School Mapping System and Infrastructure Monitoring System

2.39 To strengthen MOE's capacity to plan and coordinate all school infrastructureoperations at the national level, the proposed project would support the developmentof a computerized school mapping and infrastructure monitoring system, and theupdate and computarization of the cadastre of school buildings. The project wouldfinance data collection, technical assistance, hardware, software, and all necessarytraining for establishing, operating, and maintaining the systems. DINFE would beresponsible for all aspects related to the implementation of this sub-component.

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3. PROJECT COSTS, FINANCING, PROCUREMENT AND DISBURSEMENT

A. Project Costs

3.1 Total project costs, including physical and price contingencies, are estimatedat US$298.6 million. Foreign exchange costs, local costs excluding taxes, and dutiesand taxes amount to US$22.1 million (7 percent), US$234.4 million (78 percent) andUS$44.3 million (15 percent) of total project costs, respectively. Base costs areestimated at US$253.9 million (US$19.5 million in foreign exchange costs, US$196.7million for local costs excluding taxes, and US$44.3 million for duties and taxes).Table 3.1 and 3.2 summarize the estimated project costs by component andexpenditure account. Annex 2 provides a further breakdown of project costs.

Table 3.1: Summary of Project Costs by Component

(US$ Million)

% TotalLocal Foreign Total Base Costs

1. Infrastructure Improvement 121.5 0.3 121.8 48

2. Improving Educational Quality 77.2 10.9 88.1 35

3. Institutional Development 35.7 8.3 44.0 17

Total BASELINE COSTS 234.4 19.5 253.9 100

Physical Contingencies 15.0 .8 15.8 6

Price Contingencies 27.1 1.8 28.9 11

Total PROJECT COSTS 276.5 22.1 298.6 118Less Taxes 44.3

3.2 Base Costs. Base costs are expressed in July 1994 prices. Estimated costsof civil works and school furniture were based on recent experience in the country.Estimated costs of equipment and vehicles were based on prices of similar importedor locally available items. Estimated costs of instructional materials and disseminationand promotion seminars were based on recent price quotations, past experience, andexpert opinion. Costs for overseas and domestic training and foreign and localtechnical assistance were based on prevailing standards. All recurrent costs werebased on current estimates of salaries, equipment maintenance, office materials andother operating expenses.

3.3 Contingencies. Total contingencies amount to US$44.7 million (US$16 millionfor physical contingencies and US$29.3 million for price contingencies), or 1 5 percentof total project costs. Physical contingencies were applied to base costs as follows:9.5 percent for civil works; 5 percent for equipment, vehicles, training, furniture,instructional materials, seminars, and recurrent costs; and 0 percent for technical

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assistance. On the basis of World Bank estimates of local inflation rates for the lifeof the project, price contingencies of 15 percent for 1994, 12.2 percent for 1995,and 10 percent in subsequent years were applied to local cost components of allcomponents. Foreign price contingencies of 3.2 percent for all project years wereapplied to foreign cost components of all components. This is the expected rate ofincrease for international prices during the life of the project. The estimated exchangerates (local/foreign) were 2.19 for 1994, 2.5 for 1995, 2.7 for 1996, 2.9 for 1997,and 3.1 for 1998.

Table 3.2: Summary of Project Costs by Category of Expenditure

(US$ Million)% Total

Local Foreign Total Base Costs

I. Investment CostsA. Civil Works 96.9 -- 96.9 38B. Equipment 4.9 3.8 8.7 3C. Vehicles 0.0 0.1 0.1 --

D. Technical Assistance 20.9 3.3 24.2 10

E. Training 46.3 1.9 48.3 19

F. Furniture 20.7 -- 20.7 8

G. Instructional Materials 35.9 10.5 46.4 18

H. Seminars 2.4 -- 2.4 1Total Investment Costs 228.1 19.5 247.6 98

II. Recurrent CostsA. Salaries 0.5 -- 0.5 --

B. Equipment Maintenance 0.1 -- 0.1 --

C. Office Materials & Operational Costs 5.8 -- 5.8 2

Total Recurrent Costs 6.3 -- 6.3 2Total BASELINE COSTS 234.4 19.6 253.9 100

Physical Contingencies 15.0 .8 15.8 6

Price Contingencies 27.1 1.8 28.9 11

Total PROJECT COSTS 276.5 22.1 298.6 118

3.4 Foreign Exchange. The foreign exchange component, estimated at US$22million, or 7 percent of total project cost, is based on past experience and expertadvice. In general, foreign exchange estimates were based on the followingpercentages of the costs excluding taxes: (i) 100% for equipment and vehicles; (ii)50% for non-printed instructional materials; (iii) 30% for service contracts fortechnical assistance; (iv) 20% for printed instructional materials; (v) 1 0% for training;and (vi) 0% for civil works, individual consultant contracts for technical assistance,furniture, library materials and all recurrent costs. However, in particular cases whereit was clear that the foreign exchange costs would be higher or less than the

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estimated percentage, these percentages were adjusted. The percentage for theforeign exchange component of teacher training activities, for example, was adjustedto 0%.

3.5 Taxes and Duties. Local taxes and duties amount to approximately US$44.3million or 1 5 percent of total project costs. Locally procured goods and services aresubject to a value added (IGV) tax of 1 8 percent. Individual consultant contracts aresubject to an income tax of 1 0 percent. All imported goods are subject to dutiesequal to 19.8 percent.

B. Financing Plan

3.6 The proposed project would be financed by a Bank loan of US$146.4 million.The proposed loan would finance 49 percent of total project cost, or 58 percent netof duties and taxes. The loan would cover 34 percent of foreign exchangeexpenditures (US$7.6 million) and 50 percent of the local exchange expenditures(US$138.8 million). The government of Peru (GOP) would finance the remainingUS$152.2 million which includes US$44.3 million in duties and taxes. The loanwould be for 1 7 years at the Bank's standard variable interest rate, on a fixedamortization schedule including a five year grace period. Table 3.3 presents thefinancing plan and loan allocations by category of expenditure.

3.7 Retroactive financing. Retroactive financing of up to US$14.6 million will beprovided for expenditures made in accordance with Bank procurement guidelines fora period covering July 5, 1 994 (project appraisal) to the date of loan signing. Thisperiod can not exceed twelve months prior to loan signing. Retroactive financing isrecommended to ensure that technical assistance and civil works necessary for thetimely implementation of the project begins with sufficient lead time.

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Table 3.3: Financing Plan(US$ Million)

ProposedIBRD Loan Government Total IBRD %

Civil Works 99.3 17.9 117.2 84.7

Equipment 7.1 2.5 9.6 73.5

Vehicles 0.1 0.0 0.1 70.7

Technical Assistance 19.5 7.2 26.7 73.0

Training 0 56.3 56.3 0

Furniture 20.4 3.7 24.1 84.7

Instructional Materials 0 54.5 54.5 0

Seminars 0 2.7 2.7 0

Salaries 0 0.5 0.5 0

Equipment Maintenance 0 0.1 0.1 0

Office Materials and 0 6.8 6.8 0Operational Costs

TOTAL 146.4 152.2 298.6 49.0

C. Recurrent Costs Arising from the Project

3.8 To ensure the long term sustainability of the investments associated with theproject, it is important that the MOE be in a position to carry on the expenditureslinked to the implementation of project activities after project completion and tointegrate them as part of the sector's recurrent costs. The additional annual recurrentexpenditures at the end of the project are estimated at about US$24 million in 1 994prices, representing about 3.3% of the MOE's recurrent budget for 1994. Theestimated increase in recurrent expenditures will consist mainly of educationalmaterials (textbooks, teacher's guides), teacher training, and school maintenance.

D. Project Sustainability

3.9 The effect of the proposed project on total educational expenditures and theability of the GOP to finance the resulting increase in a sustainable manner has beencarefully discussed with the Government. The Government prepared a long termsustainability plan outlining its strategy to improve the quality of education in Peru andprojecting the financial needs of the sector until 2010. According to this plan, it isexpected that by the end of the Project the Government would be allocating toeducation an estimated 16% of total government expenditures, which represent anincrease of two percentage point from the current level of 14%. The budgetaryestimates of the plan, calculated for both investments and recurrent expenditures,

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would be used as the basis for annual discussions with the Government on budgetallocations for the following year. The plan also identifies the budget line items, suchas educational materials and teacher training, that would be monitored during projectimplementation to ensure adequate counterpart financing of the project.

E. Procurement

3.10 Since the annual budget law provides that good and works financed byinternational financial institutions will be procured in accordance with the requirementsof these institutions, Bank procurement guidelines will be followed for the proposedproject. The project would involve the procurement of civil works, school furniture,textbooks, workbooks, reading books, teacher's guides, computers and officeequipment, travel expenses, and consultant services, including studies, technicalassistance, training, auditing and supervision. During negotiations the Governmentand the Bank agree that the executing agencies would use standard biddingdocuments for the procurement of civil works, goods, equipment, and services (6.11).

3.11 The capacity of the MOE to handle the procurement of goods was assessedduring pre-appraisal, concluding that it would require technical assistance andcomputer equipment in order to bring its procurement capacity up to Bank standards.During appraisal these requirements were defined more clearly and were included aspart of institutional strengthening component of the project.

3.1 2 The total costs of civil works, including contingencies, is estimated at aboutUS$117.2 million equivalent, for the construction, rehabilitation and furnishing ofprimary schools. Since it is estimated that civil work packages would not exceedUS$3.0 million, and thus are unlikely to interest foreign contractors, no internationalcompetitive bidding (ICB) is anticipated for the procurement of civil works. Packagesof civil works of US$90,000 or more per contract would be awarded on the basis onlocal competitive bidding (LCB) procedures. Below this limit, local shopping -withthree price quotations- would be followed up to an aggregated amount of US$29.3million. In cases where it is not possible to obtain competitive proposals acceptableto the Bank, direct contracting for civil works in remote areas, estimated to cost notmore than the equivalent of US$75,000 per contract, up to an aggregated amountequivalent to US$11.7 million, would also be accepted. It is expected that LCBpackages would add up to a total estimated at US$76.2 million equivalent. Mostrehabilitation works in remote locations, where contract bidding would be improbable,would be done under direct contracting. At negotiations the Government and theBank agreed that in order to assess the adequacy of prices, MOE will require thatINFES uses a system of standard regional unit prices, acceptable to the Bank, to guidethe negotiation of contracts for civil works implemented through direct contracting.This system will be reviewed twice a year by the Bank, MOE, and INFES to assess theadequacy of prices (6.1 k).

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3.13 The total cost of furniture, including contingencies, is estimated at aboutUS$24.1 million equivalent. Given that school furniture would only be procured forclassrooms in rehabilitated schools that are fairly dispersed it would not possible topackage this type of furniture in a way to make ICB feasible. Packages for contractshigher than US$50,000 equivalent would be procured through LCB procedures. Localshopping, will be permitted up to an aggregate limit of US$2.4 million for packagesof furniture estimated to cost up to US$50,000 equivalent. If applicable, packagesvalued at US$250,000 equivalent or more would be procured through LimitedInternational Bidding (LIB).

3.14 The total cost of instructional materials (including textbooks, reading books andteacher's guides) is estimated at about US$54.3 million equivalent, includingcontingencies. They will be financed entirely trough counterpart funding, and wouldbe procured according to local procedures already in place.

3.1 5 The total costs of office equipment, computer systems, and vehicles isestimated at about US$9.7 million equivalent including contingencies. Theprocurement of computer systems and vehicle would be done through LIB proceduresamong manufacturers who have established maintenance facilities in Peru. Contractsestimated to cost the equivalent of US$50,000 or less may be procured underlocal/international shopping acceptable to the Bank, up to a limit of US$1.5 millionequivalent.

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Table 3.4: Procurement Arrangements(US$ million equivalent)Procurement Methods

ConsultingLCB' Other Services NBFd Total

A. Civil Works 76.2 41.0 117.2(64.5) (34.8)b (99.3)

B. Equipment -- 9.6 -- -- 9.6

-- (7. l)b4c (7.1)

C. Fumiture 21.7 2.4 -- -- 24.1(18.4) (2.0)b (20.4)

D. Vehicles -- 0.1 -- -- 0.1

(0. 1)C (0.1)

E. Instructional Materials

Printed Material -- -- -- 35.5 35.5

Non-Printed Materials -- -- -- 14.9 14.9

Library Materials -- -- -- 4.1 4.1

F. Technical Assistance -- -- 26.8 -- 26.8

(19.5) (19.5)

G. Training -- -- -- 56.3 56.3

H. Seminars -- -- -- 2.7 2.7

I. Recurrent Costs -- -- -- 7.4 7.4

Total 97.9 53.1 26.8 120.9 298.6

(82.9) (44.0) (19.5) (0.0) (146.4)

-. Local Competitive Bidding

b Local and Intemational Shopping

c. Limited Intemational Bidding

d Not Bank-Financed

Note: Values in parentheses represent IBRD financing.

3.1 6 The total costs of technical assistance and consultant services is estimated atabout US$26.8 million equivalent. Consultants carrying out studies and technicalassistance would be hired following the Bank's Guidelines for the Use of Consultantsby World Bank Borrowers and by the World Bank as ExecutingAgency (August 1981).Contracts for small consulting services valued at US$100,000 equivalent or less forconsulting firms and at US$50,000 equivalent or less for individuals, up to anaggregate amount of US$10.0 million equivalent, would be formalized on the basis

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of standard terms of reference and employment conditions and would not require priorreview by the Bank.

3.1 7 The total costs of training, seminars, and recurrent costs will be financedthrough counterpart funding, and procured according to local procedures already inplace. The total costs of these components, including contingencies, are US$56.3million, US$2.7 million and US$7.4 million respectively.

3.18 MOE has agreed to use Standard Documents issued by the Bank for LIB and forhiring consultants during project implementation. LCB standard bidding documentswhich have already been agreed with the GOP and are in use for Bank-financedprojects may continue to be used. Changes needed to suit project requirementswould be approved by the Bank. During negotiations the Government presented tothe Bank model bidding documents which were considered acceptable for theprocurement of civil works, goods and services.

3.1 9 Bank Review Reguirements. The Bank will review and approve before contractaward: (a) all procurement documentation for LIB contracts; (b) the first two LCBcontracts for goods and civil works, regardless of size; (c) all contracts for civil worksabove US$350,000 equivalent; and (d) all LCB contracts for goods in excess ofUS$200,000. For consulting firms on contracts estimated to cost less thanUS$100,000 equivalent, and for individual consultants on contracts estimated to costless than US$50,000 equivalent, the Bank's prior review will cover only terms ofreference, except in cases of employment of single source selection firms. In all othercases prior review for consulting services would follow the August 1981 " BankGuidelines for the Use of Consultants by World Bank Borrowers and by the WorldBank as Executing Agency. Prior Bank review of procurement documentation wouldcover about 60% of the total amount of goods and services financed by the Bank.All procurement documentation would also be subject to selective ex-post review bythe Bank and external auditors. The ex-post review of contracts with consulting firmsand individuals, for which only terms or reference are subject to prior review, willcover no less than one in five contracts.

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F. Disbursement

3.20 The project's completion date would be December 1 999, and the Closing Datewould be June 2000. The proceeds of the loan would be disbursed during a five-yearperiod as follows:

Table 3.5: Allocation and Disbursement of IBRD Loan

Amount of theLoan Allocated Percent of Expenditures(US$ million) to be financed

1. Civil Works 90.7 85% of localexpenditures

2. Furniture 19.5 85% of localexpenditures

3. Equipment and 6.8 100% of foreign andVehicles 53% of local

expenditures4. Consultant Services

(a) for instructional materials 4.6 100% of foreign andand training of teachers and 70% of localschool principals expenditures

(b) for the modernization of 14.7 100% of foreign andeducational administration 70% of local

expenditures

5. Unallocated 10.1

TOTAL 146.4

3.21 Withdrawals for civil works and school furniture, excluding bookshelves, wouldbe conditioned to the GOP meeting the annual targets for distributions of textbooksand training of teachers as agreed during negotiations (2.32, 6.4a).

3.22 The proceeds of the loan would be disbursed against expenditures that wouldbe submitted to the Bank and fully documented for contracts valued at more thanUS$350,000 equivalent for civil works; more than US$200,000 equivalent for goods;and at US$100,000 or more for consultant services provided by firms and atUS$50,000 or more for individual consultant services. Claims for expenditures oflesser amounts would be disbursed against presentation of Statements of Expenditure(SOEs), for which the supporting documentation would be retained by MOE forinspection by the Bank and external auditors. All expenditures, SOEs andprocurement documents would be transmitted to the Bank through the PIU.

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Table 3.6: Estimated IBRD DisbursementTotal Costs, Including Contingencies

(US$ Million)

Bank Fiscal Year FY95 FY96 FY97 FY98 FY99

Annual 24.2 44.4 42.7 26.8 8.3

Cumulative 24.2 68.6 111.3 138.1 146.4

3.23 To ensure the efficient and timely implementation of the project, thegovernment would set up a Special Account in U.S. dollars in a commercial banksatisfactory to the Bank with an initial deposit of US$7.0 million equivalent,corresponding to about four months of project expenditures. Funds from the SpecialAccount will be available for financing only the Bank's share of eligible project costs.

3.24 The Bank will replenish the Special Account as requested upon receipt ofsatisfactory evidence that expenditures paid were eligible for financing out of theaccount. Replenishment requests will be sent to the Bank at agreed intervals.

G. Accounting and Auditing

3.25 Each of the project executing agencies (MOE and INFES) would establish andmaintain separate accounts and records for project expenditures of the projectcomponent or subcomponent under their responsibility. The PIU would maintain aconsolidated account of all expenditures under the project. These accounts would beaudited annually by independent auditors satisfactory to the Bank (6.1 i). The auditreports, which would also include an annual audit of the financial statements of theproject account maintained by INFES and a separate opinion on the adequacy ofstatements of expenditures, would be forwarded to the Bank no later that six monthsafter the end of each fiscal year (6.1 i).

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4. PROJECT IMPLEMENTATION AND MANAGEMENT

A. Status of Preparation

4.1 Project preparation benefitted greatly from a US$861,000 grant from theJapanese Government. The Japanese grant financed a school census, consultantassistance, training on project costing and scheduling, and pre-investment studies.The consultant assistance as well as the training that was financed were key toensuring involvement of Peruvian NGOs and experts in the project preparationprocess, providing crucial background information on sector management, andsupporting the Project Preparation Unit through adequate training and assistance insetting up adequate project monitoring and evaluation procedures.

B. Implementation Schedule

4.2 The project is expected to be implemented over a five year period from January1995 to December 1999. The MOE and the Bank would update and review theimplementation schedule during the annual reviews (see para. 4.9) based on theimplementation schedule and monitoring matrix shown in Annex 3.

C. Project Management

4.3 Project implementation would be carried out within the existing organizationalstructure of the MOE supported by a Project Implementation Unit (PIU) and theparticipation, via implementation agreements, of MOP's autonomous agency INFES,and the MHC's autonomous agency SENCICO. To carry out its obligations, MOE,INFES, and SENCICO would be directly responsible for contracting out services forimplementing the different components of the project and for ensuring that thecomponents are implemented according to project objectives.

4.4 MOE, through the directorates of Education Technology, Educational Researchand Training, Supervision, Infrastructure, Statistics, Planning, and Rationalizationwould participate in the implementation, monitoring and evaluation of the differentcomponents of the project. The DRE, DSRE, USEs, and ADES would be involved inproject implementation by assisting the MOE with the selection of textbooks andteacher training institutes. In all instances, the PIU would provide technical assistanceand general support for coordinating implementation. Annex 3 provides a list of allexecuting agencies and describes their individual roles in each of the projects'components or sub-components.

4.5 The PIU, reporting directly to the Minister of Education, would coordinateproject activities. The PIU would be responsible for consolidating the yearly workplans, coordinating activities among participating agencies, providing administrativebackup services, and carrying out project monitoring and evaluation. The PIU wouldbe established and staffed on a full-time basis with a Director, a planning specialist,a procurement expert, an accountant, and five education specialists. Support to theprofessional staff, would be provided by four mid-level technical staff and five support

38

staff. The organization and modus operandi of the PIU is presented in Annex 3.During negotiations, the Government and the Bank agreed that the PIU would operatewithin the MOE during the life of the Project, with an internal structure, functions, andstaffing acceptable to the Bank (6.1a). To facilitate project implementation andcoordination between units within the MOE and the PIU, the MOE created a high levelAdvisory Council headed by the Minister of Education and comprised of the Vice-Minister, the Chiefs of MOE's National Directorates, and the coordinator of the PIU(6.1b). A condition of loan effectiveness would be the creation of the AdvisoryCouncil (6.3e) and the appointment of the planning specialist, the procurement expert,and at least three (3) of the educational specialists, with qualifications and experiencesatisfactory to the Bank (6.3c).

4.6 To guide project implementation, the PIU has prepared a Project OperationalManual. A draft copy of the manual was presented to the Bank prior to negotiations.As condition of effectiveness, the MOE should have adopted the Operational Manual,which should contain a description of procedures for project implementationsatisfactory to the Bank (6.3a).

4.7 To facilitate project implementation and to gain support from stakeholders, theMOE would organize a four day project launch workshop with the participation ofMOE staff and regional coordinators. During this workshop, in addition to presentingthe project, members of the PIU would present the major findings andrecommendations of the recently completed education sector report, and the GOPlong term strategy and investment plan for the education sector. The workshopwould be organized in such a way as to ensure maximum participation andinvolvement from all participants. After finishing the national workshop the PIU wouldsponsor regional workshop conducted by the regional project coordinators withassistance from the PIU. Participants to the regional workshop would include stafffrom the DREs, representatives from teachers and principals, and educators workingin universities and teacher training institutes. Partial funding of these workshopswould come from GTZ.

D. Project Monitoring, Supervision and Evaluation

4.8 The PIU would be responsible for overall project monitoring and evaluation onthe basis of project monitoring indicators. During negotiations, agreements werereached on the final monitoring and evaluation indicators (see Annex 3) and on thesystem that would be used for tracking progress of project implementation using theabove mentioned indicators. Once a year, the PIU would consolidate and send to theBank for review: (i) annual project implementation reports assessing progress towardmeeting the targets in the implementation schedules; (ii) a work plan for theimplementation of project components during the following fiscal year. This plan shallinclude, inter-alia, the number of targeted schools to be rehabilitated and equipped inthe following year; and (iii) annual reports describing progress in the implementationof the education strategy which should include, whenever possible, MOE's statisticswith a breakdown of key indicators by gender and ethnic groups (6.1d).

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4.9 Once a year, MOE and the Bank would conduct joint project implementationreviews to: (i) analyze the previous year's performance and MOE's project budgetallocations for the following fiscal year; (ii) analyze the proposed work plan andbudget for the following year; (iii) review progress in the implementation of theeducation strategy; (iv) discuss and agree on adjustment in the project implementationschedule; (v) discuss the long term sustainability of the project investments; and (vi)review the performance of the INFES and SENCICO agreements (6.1g). The agreedtargets for distribution of textbooks and teacher training would be considered asbench mark for the targets agreed for disbursement of loan proceeds related to civilworks.

4.10 At negotiations the Government and the Bank agreed that: (i) MOE wouldconduct, with prior approval of the terms of reference by the Bank and no later than30 months after loan effectiveness, a mid-term review to analyze, inter alia, progresstowards the achievement of the Bilingual-intercultural Plan goals and the projectimplementation experience and possible project impact, with focus on the monitoringindicators presented in Annex 3 (6.1h); (ii) submit to the Bank not later thanDecember 31 of each year of project execution, starting in 1996, reports on theprogress in the achievement of the goals of the Long-Term Education DevelopmentPlan (6.1f); (iii) all project accounts will be audited annually in accordance withappropriate auditing principles by independent auditors acceptable to the Bank. Theseaudits would be submitted to the Bank within four months of the end of each fiscalyear (6.1i); and (iv) standard bidding document and letters of invitation satisfactoryto the Bank will be used in all procurement financed by the Bank under the project(6.11).

5. PROJECT BENEFITS AND RISKS

A. Project Benefits

5.1 The main benefits of the project would be improvements in the quality andinternal efficiency of primary education which would result in: (i) increased graduationrates; (ii) reduced resource wastage from reduction of repetition and dropout; and (iii)improvements in the learning achievement of primary students. Other benefits wouldbe increases in equity among regions and between urban and rural areas andimprovement in the MOE's capacity to formulate policies that respond to local needs,to monitor school quality, and to assist local level education authorities in improvingthe efficiency and quality of their systems.

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B. Project Risks

5.2 Main project risks are associated with: (i) the lack of capacity at the central(MOE) and departmental level to implement policies and programs, (ii) possibleopposition of departmental and local authorities to the strategy to increase publicschool autonomy and accountability proposed by the Central Government; and (iii)possible changes in government priorities, resulting from the inauguration of a newadministration in 1995. To strengthen MOE's implementation capacity of large scalenational programs the Bank has been providing during project preparation technicalassistance to the MOE's project preparation team on computerized projectmanagement (CPM) techniques. The financial support of a Japanese Grant allowedthe MOE to procure training for the staff of the Project Preparation Unit is thesetechniques which were used for the preparation of detailed project implementationplans. During implementation, the project will support the creation of a small ProjectImplementation Unit (PIU) responsible for providing project management support andtechnical assistance to the MOE's operational departments. This unit would developand implement standard procurement, monitoring, evaluation, and accountingprocedures to be used by the project and the MOE for the procurement of good andservices. Also the project would finance training on project management, monitoringand implementation of the staff of the MOE's departments responsible for instructionalmaterials, student assessment, teacher training, planning, and school infrastructure.Although the risk of opposition of local governments is more difficult to control, theproject would try to overcome this obstacle by promoting early involvement ofdepartmental and local educational authorities both in the initiation of each activityand in its implementation.

C. Environmental Impact

5.3 Since it mainly involves the rehabilitation of existing schools, acquisition ofmaterials, training, and technical assistance, the project is not expected to have anysignificant environmental impacts.

6. AGREEMENTS AND RECOMMENDATIONS

Agreements Reached

6.1 At negotiations, assurances were obtained that the Borrower will:

(a) operate and maintain, during the execution of the project, the PIU withan internal structure, functions and staffing satisfactory to the Bank(4.5);

(b) operate and maintain, during the execution of the project, a high levelAdvisory Council (4.5);

(c) submit to the Bank, not later than December 31 of each year of projectimplementation, progress reports on the Project including, inter-alia: (i)information on the progress achieved in the implementation of theproject and on the achievement of its objectives based, inter-alia, on the

41

monitoring indicators; (ii) assessment of the problems and issues derivedfrom the implementation of the project; and (iii) information on thecompliance by INFES and SENCICO of their obligations under theirrespective participating agreements (1.40);

(d) furnish to the Bank, for its review and approval, not later than December31 of each year of project execution, a proposed annual investment planproviding for the activities, implementation schedule, and proposedbudget for each component of the project during the upcoming year(1.40, 4.8);

(e) submit to the Bank, no later than December 31, 1995, a copy of theBilingual Education Plan (1.34);

(f) submit to the Bank not later than December 31 of each year of projectexecution, starting in 1 996, reports on the progress in the achievementof the goals of the Long-Term Education Development Plan (4.10);

(g) hold annual reviews jointly with the Bank not later than January 31 ofeach year of project execution, starting in 1 996. Such reviews wouldbe based on the annual progress reports and would focus, inter alia, onthe: (i) evaluation of progress in the implementation and achievementsof the project based on, among other factors, the monitoring indicatorsand the Long-Term Education DevelopmentPlan; (ii) the proposed annualinvestment plan for the project, including the specific level of schoolclassrooms to be constructed, rehabilitated and equipped; (iii) anychanges in the project design and implementation that may benecessary; and (iv) performance of the INFES and SENCICO agreements(2.34, 4.9);

(h) conduct jointly with the Bank, 30 months after effectiveness, a mid-termimplementation review of the project to analyze project implementationexperience and possible project impact, and progress in the achievementof the goals of the Bilingual Education Plan (1.28, 1.34, 1.40, 4.10);

(i) maintain through the PIU a consolidated account of all expendituresunder the project. These accounts would be audited annually byindependent auditors satisfactory to the Bank. The audit reports wouldbe forwarded to the Bank no later than six months after the end of eachfiscal year (3.25, 4.10);

(j) ensure that INFES would not finance any infrastructure related toprimary schools in the targeted schools included in the annual projectplan approved by the Bank, and that FONCODES would not financecommunity based projects for the rehabilitation of any of the abovementioned targeted primary schools classrooms (2.36);

(k) require that INFES uses a system of standard regional unit prices,acceptable to the Bank, to guide the negotiation of contracts for civilworks implemented through direct contracting. This system will bereviewed twice a year by the Bank, MOE, and INFES to assess howadequate are the prices been used (2.35, 3.12); and

(I) would use standard bidding documents for the procurement of civilworks, goods, equipment, and services (3.10, 4.10).

42

6.2 Also, during negotiations, agreements were reached on:

(a) a list of monitoring and evaluation indicators including the definition ofimplementation targets for civil works, school furniture, teacher training,and textbook distribution (2.32); and

(b) a final list of the departments that would participate on the schoolrehabilitation program (2.4c).

6.3 As condition of loan effectiveness the MOE would have:

(a) adopted the Operational Manual, which should contain a description ofprocedures for project implementation satisfactory to the Bank (4.6);

(b) add to the MOE-INFES-FONCODES agreement and addendum wherebyFONCODES commits to not finance community based projects for therehabilitation of any of the targeted primary schools classrooms coveredin the project's annual plan (2.36);

(c) appointed the planning specialist, the procurement expert, and at leastthree (3) of the educational specialists, with qualifications andexperience satisfactory to the Bank (4.5);

(d) signed the subsidiary agreement with INFES and SENCICO (2.36, 2.37,2.38); and

(e) established the Advisory Council on the basis of terms of referenceacceptable to the Bank (4.5).

6.4 As condition of disbursement:

(a) withdrawals of loan proceeds for the construction, rehabilitation,improvement, furnishing or provision of office furniture would beconditioned to targeted schools included in the annual plan approved bythe Bank. The number of targeted schools to be included in the annualplans would be determined on the basis of the achievement of the annualimplementation targets for textbooks distribution and teacher training tobe agreed at negotiations (1.43, 2.32, 3.21); and

(b) withdrawal of loan proceeds for technical assistance related to themodernization of educational management would be conditioned to theGovernment and the Bank reaching agreement on an action-plan forupgrading management capacity, based on the results of themanagement studies (2.19).

6.5 With the above conditions and assurances, the project constitutes a suitablebasis for a Bank loan of US$146.4 million equivalent to the Republic of Peru for aperiod of 1 7 years, including a grace period of five years, with loan amortization basedon level repayment of principal at the Bank's standard variable rate.

43

Annex 1Page 1 of 8

ANNEX 1: SELECTED EDUCATION STATISTICS

Annex 1, Table 1: Enrollment Rates by Level, 1990

Country Primary Secondary Higher

Peru 90 70 36

Argentina (1989) 98 74 41

Bolivia 82 34 17

Brazil 88 39 12

Colombia 73 52 14

Costa Rica 87 42 26

Chile 86 74 19

Ecuador (1989) 80 56 25

Mexico 98 53 14

Venezuela 61 35 29

Average Latin America 88 49 16

Source: For secondary and higher it shows the gross enrollment rate

Annex 1, Table 2: Public School Enrollment and Classroom Size, 1980 and 1990

1980 1990Educational Students Classrooms Stud/Class Students Classrooms Stud/ClassLevelPre-school 167,373 4,745 35.3 412,699 8,325 49.6Primary 2,816,580 67,558 41.7 3,418,421 86,193 39.7

Secondary 979,858 20,213 48.5 1,447,559 27,915 51.9

Higher 32,586 401 81.3 134,093 2,257 59.4

Vocational 60,120 1,288 46.7 137,171 2,260 60.7

Special 5.820 568 10.2 16,817 1,234 13.6

TOTAL 4,062,337 94,773 42.9 5,566,760 128,184 43.4

Source: Estadisticas de la Educaci6n 1980 and 1990 M.E.

Annex 1. Table 3: Average Grades Completed by Population Age Five and Older by Gender and Department, 1972, 1981.1985 and 1990

1972 1981 1985 1990Department Total Male Female Total Male Female Total Male Female Total Male FemaleNational Total 3.7 4.2 3.2 5.1 5.6 4.7 5.9 6.5 5.3 6.7 7.3 6.1Amazonas 2.9 3.4 2.3 3.5 3.9 3.0 3.8 4.2 3.4 4.1 4.5 3.7Ancash 2.5 3.0 2.0 4.0 4.5 3.6 4.7 5.3 4.1 5.5 6.1 4.9Apurimac 1.8 2.5 1.1 2.6 3.3 2.0 3.1 3.9 2.3 3.6 4.4 2.7Arequipa 3.4 4.0 2.9 6.1 6.4 5.7 6.3 6.6 6.0 7.3 7.5 7.1Ayacucho 1.9 2.6 1.3 3.1 3.7 2.5 3.4 4.1 2.7 3.9 4.6 3.3Cajamarca 2.1 2.7 1.6 3.1 3.6 2.6 3.8 4.4 3.2 4.4 5.0 3.8Callao 5.6 6.0 5.2 7.6 7.5 7.7 7.3 7.7 6.9 7.9 8.3 7.5Cusco 2.1 2.8 1.5 3.8 4.3 3.2 4.2 4.8 3.6 5.0 5.5 4.5Huancavelica 1.7 2.3 1.1 2.9 3.6 2.2 3.4 4.2 2.6 4.0 4.9 3.1Huanuco 2.2 2.8 1.7 3.4 3.9 2.8 3.9 4.5 3.3 4.5 5.1 3.9Ica 4.4 4.8 2.6 4.8 5.6 4.2 6.3 7.4 5.3 7.0 8.0 5.7Junin 3.4 4.2 2.6 4.8 5.4 4.2 5.2 5.9 4.6 5.8 6.4 5.2La Libertad 3.0 3.4 2.5 5.0 5.2 4.7 5.3 5.5 5.1 6.1 6.3 6.0Lambayeque 3.5 3.9 3.2 5.1 5.4 4.9 5.5 5.8 5.2 6.2 6.5 5.9Lima 4.4 4.9 3.9 7.1 7.5 6.7 7.3 7.7 6.9 8.3 8.7 8.0Loreto 2.7 3.2 2.2 4.2 4.5 3.9 4.7 5.0 4.4 5.4 5.7 5.1Madre de Dios 3.0 3.7 2.4 4.9 5.4 4.2 5.5 6.1 4.9 6.4 6.9 5.9Moquegua 3.7 4.3 3.1 5.7 6.1 5.2 6.0 6.4 5.6 6.8 7.2 6.5Pasco 2.6 3.3 1.9 4.4 5.0 3.8 5.0 5.7 4.3 5.9 6.5 5.2Piura 2.8 3.1 2.5 4.2 4.4 3.9 4.6 4.8 4.4 5.2 5.4 5.1Puno 2.2 3.0 1.4 3.5 4.2 2.8 4.0 4.8 3.2 4.6 5.4 3.8San Martin 3.4 3.8 3.0 4.2 4.6 3.8 4.5 4.9 4.1 4.9 5.3 4.5Tacna 4.3 4.9 3,7 6.2 6.7 5.7 6.4 6.9 5.9 7.2 7.6 6.7Tumbes 3.6 3.9 3.3 5.3 5.6 5.0 6.0 6.3 5.7 6.9 7.2 6.5Ucayali 3.2 3.5 2.7 4.6 4.9 4.2 4.9 5.2 4.6 5.5 5.8 5.2Source: OSP/DIPEVE

* Estimates

CD>

o x#I. -A

45

Annex 1Page 3 of 8

Annex 1, Table 4: Percentage of Over-age Students in Primary and Secondary School by Department, 1986

LevelDepartments Primary Secondary

Amazonas 22.28 26.27Ancash 22.99 23.81Apurimac 22.28 26.27Arequipa 15.41 16.71Ayacucho 31.81 33.23

Cajamarca 18.92 17.70Callao 12.75 15.42Cusco 30.91 36.91Huancayo 19.44 22.76Huanuco 18.92 17.70Ica 17.87 20.79Junfn 21.67 24.75La Libertad 9.68 9.63Lambayeque 9.30 8.65Lima 12.75 15.42Loreto 31.32 32.69Madre de Dios 27.29 35.66Moquegua 15.19 17.36Pasco 13.88 13.92Piura 20.40 21.48Puno 22.28 26.27San Martin 23.91 24.97Tacna 6.08 8.60Tumbes 8.50 7.98Ucayali 16.38 7.91

Average 18.9 20.5Maximum 31.8 36.9Minimum 6.1 7.9

Source: Planes de Tabulaci6n DD.ZZ.EE. 1986

46

Annex 1Page 4 of 8

Annex 1, Table 5: Certified Public School Teachers, 1950-1990

Year Total % Certified % Non-Certified %

1950 24,433 100 16,630 68.06 7,803 31.941960 43,710 100 29,599 67.72 14,111 32.281970 101,729 100 71,559 70.34 30,170 29.661980 125,640 100 101,306 80.63 24,334 19.371990 256,648 100 126,875 49.44 129,773 50.56Source: Ministerio de Educaci6n - Direcci6n de Estadistica

Annex 1, Table 6: Teachers Public School Teaching Experience*, 1992

Years Experience Teachers %

0-4 113,445 49.55-9 49,045 21.4

10-14 26,356 11.515-19 13,751 6.020-24 16,730 7.325-29 7,792 3.4

30-34 1,833 0.835 115 0.5

+ 35 115 0.5TOTAL 229,182 100

* Based on payroll up ro AugustSource: Distribuci6n de Personal Docente por Niveles y Tiempo de Servicio

Annex 1, Table 7: Percentage of Teachers by Area and by Educational Levels and Forms, 1981

Levels and Forms Total Urban Rural

National Total 100.0 70.3 29.7Preschool 100.0 85.8 14.2Primary (non-adults) 100.0 60.3 39.7Primary (adults) 100.0 97.5 2.5Secondary (non-adults) 100.0 92.4 7.6Secondary (adults) 100.0 98.9 1.1Teacher Education 100.0 100.0 -.-

Technical-oriented Higher Education 100.0 100.0 -.-

Others 100.0 98.2 1.8Source: Estadistica de Educaci6n 1981 (Encuesta Nacional CC.EE), April 1981

47

Annex 1Page 5 of 8

Annex 1, Table 8: Administrative Personnel by Educational Levels, 1985-1990, Public Only

1970 1980 1985 1986 1987 1988 1989 1990

Administrative Units 2,170 7,496 5,594 6,400 6,676 7,669 9,707 10,165(total)

Central Staff 1,544 1,830 744 1,247 1,366 1,260 1,249 1,298

Inte 77 78 81 81 82 82

Inide 356 109 169 227 228 228 225

Autonomous bodies 393 396 492 192 1,751 1,826

Decentralized bodies 626 5,310 4,271 4,510 4,510 5,908 6,397 6,734

Level and forms (total) 15,201 10,262 16,256 16,791 17,091 32,461 43,118 43,108

Pre-school 441 442 1,134 1,193 1,193 3,705 4,023 4,120

Primary (non-adults) 3,032 1,564 2,563 4,137 4,137 6,193 13,437 13,001

Primary (adults) 1,873 1,206 100 95 95 260 260 260

Secondary (non-adults) 9,401 6,455 10,191 8,598 8,598 17,110 20,002 20,257

Secondary (adults) 118 657 657 1,226 1,226 1,226

Special 196 257 315 283 283 652 730 741

Vocational 258 338 414 398 698 827 854 865

Higher 1,421 1,430 1,430 2,488 2,586 2,638

TOTAL 17,371 17,758 21,850 23,191 23,767 40,130 52,825 53,273

Source: Plazas Administrativas Presupuestadas por Grupos Ocupacionales (Documento de Trabajo)

Annex 1, Table 9: Multigrade Schools by Area 1990

Total Multigrade Non-Multierade

# % # 0 Public and Private

National Total 46,988 (100) 17,364 (100) 29,624 (100)

Urban 20,709 (44) 3,389 (20) 17,320 (58)

Rural 26,279 (56) 13,975 (80) 12,304 (42)

Public

National Total 40,683 (100) 16,509 (100) 24,174 (100)

Urban 14,587 (136) 2.535 (15) 12,052 (50)

Rural 26,096 (64) 13,974 (85) 12,122 (50)

Source: Padr6n de Centros Educativos - 1990, Direcci6n de Estadfstica, Ministerio de Educaci6n

48

Annex 1Page 6 of 8

Annex 1, Table 10: Activities of the National Institute for Educational Infrastructure (000's New Soles, 1990)

Category 1990 % 1991 % 1st %semester, 1992

Adminstration 127.4 8.2% 109.9 2.7% 166.8 4.1%School building 531.4 34.2% 842.3 20.7% 1399.8 34.4%Instructional Materials 116.5 7.5% 638.8 15.7% 415.0 10.2%Furniture 138.3 8.9% 305.2 7.5% 305.2 7.5%Laboratories 94.8 6.1% 455.7 11.2% 260.4 6.4%School Rehabilitation 351.2 22.6% 1436.4 35.3% 1379.4 33.9%Libraries 115.0 7.4% 85.5 2.1% 130.2 3.2%Others 79.2 5.1% 195.3 4.8% 12.2 0.3%

TOTAL 1553.9 100.0% 4069.1 100.0% 4069.1 100.0%

Source: Ministerio de Economia y Finanzas y Banco Central

Annex 1, Table 11: Real Expenditures in Education* 1990-1992 (000's 1990 New Soles)

Categories 1990 % 1991 % 1992 %

Public Education Escol. 105,852 73.6% 25,423 26.6% 12,164 27.0%

Regions 34,503 24.0% 63,403 66.4% 31,633 70.2%

ME Central Adm. 1,358 0.9% 2,182 2.3% 274 0.6%

Inide 111 0.1% 59 0.1% 21 0.0%

Inte 50 0.0% 32 0.0% 8 0.0%

Pedagogical Inst. 161 0.1% 159 0.2% 55 0.1%

Escuelas Nacionales 202 0.1 % 118 0.1 % 56 0.1 %

Educational Inf. Inst. 1,554 1.1% 4,069 4.3% 834 1.9%

TOTAL 143,791 100.0% 95,445 100.0% 45,045 100.0%

Source: Banco Central (1993). Estrategias de Alivio de la Pobreza

49

Annex 1Page 7 of 8

Annex 1, Table 12: Teachers, Students and Real Expenditures in Education by Regions, 1990-91Teachers* Students* Expenditures Expend/Teach Expend/Stud Stud/Teach

(000's) (000' s) (000s new soles 90) (new soles 90) (new soles 90) ratio

Departments 1990 1991 1990 1991 1990 1991 1990 1991 1990 1991 1990 1991

Amazonas 4 4 106 96 1,442 340 15 27 24Ancash 12 12 315 317 4,516 379 14 26 26Apurimac 5 5 141 132 1,514 303 11 28 26Arequipa 8 8 230 225 6,996 3,336 854 402 30 15 29 28Ayacucho 7 7 182 178 2,683 366 15 26 25Cajamarca 14 14 374 378 4,785 331 13 27 27Cuzco 10 10 309 308 4,307 412 14 31 31Huancavelica 5 5 137 128 1,678 354 13 27 26Huanuco 6 6 189 184 2,585 418 14 32 31Ica 6 6 170 165 2,558 409 16 28 28Junin 12 12 318 315 4,453 376 14 27 26La Libertad 11 11 305 304 5,115 463 17 28 28Lambayeque 8 9 245 239 3,213 368 13 31 27Loreto 8 9 223 216 5,136 3,258 618 380 23 15 28 24Madre Dios 1 1 28 15 347 329 23 28 15Moquegua 2 2 41 30 1,213 717 780 449 29 24 21 15Pasco 3 3 78 68 1,108 343 16 26 23Piura 12 12 384 383 7,442 4,636 610 371 19 12 32 32Puno 12 13 336 362 7,997 5,254 649 409 24 14 28 28San Martin 6 6 165 151 2,186 354 14 28 25Tacna 2 2 62 52 1,859 1,214 862 549 30 23 31 26Tumbes 2 2 57 46 1,559 1,089 483 23 29 23Ucayalli 3 4 65 54 2,302 1,410 391 26 22 14Regions Total 159 165 4,458 4,346 98,562 63,403 619 385 22 15 28 26Lima and 58 60 1,423 1,373 36,033 24,319 617 408 25 18 25 23CallaoTOTAL 217 225 5,881 5,719 134,595 87,722 618 391 23 15 27 25

Source: MED, Inst. Nac. de Estadisticas, Banco Central* Includes preschool, primary and secondary public schools.

50

Annex 1Page 8 of 8

Annex 1, Table 13: Indices of Real Education Expenditure Relative to Total

Budget, GDP and Total Enrollment', 1970-1992 (base yr. 1970)

Year Total Educ. Educ/ Educ/ Exp/

Exp Exp Tot. Exp GDP Stud

1970 100.0 100.0 18.8% 3.2% 100.0

1971 112.6 107.8 18.0% 3.3% 102.8

1972 119.5 117.4 18.5% 3.5% 106.2

1973 138.5 136.5 18.6% 3.7% 115.2

1974 140.7 131.3 18.2% 3.4% 109.5

1975 151.4 140.7 17.5% 3.5% 107.1

1976 151.9 135.8 16.8% 3.4% 98.2

1977 167.1 121.0 13.7% 3.1% 84.5

1978 170.4 105.1 11.6% 2.6% 70.9

1979 168.1 109.4 12.3% 2.5% 73.3

1980 203.7 142.8 13.2% 3.0% 93.8

1981 192.9 152.2 14.9% 3.2% 96.0

1982 187.2 136.4 13.7% 2.9% 81.5

1983 187.1 119.7 12.1% 3.0% 70.1

1984 197.0 124.0 11.9% 2.9% 70.4

1985 195.0 121.9 11.8% 2.8% 67.6

1986 189.7 164.7 16.4% 3.5% 87.7

1987 174.3 116.7 12.6% 2.3% 60.6

1988 123.9 96.3 14.7% 2.4% 48.5

1989 85.7 70.8 12.5% 2.4% 34.6

1990 77.8 44.7 9.2% 1.9% 21.2

1991 59.3 40.8 11.1% 1.5% 19.51992 60.3 44.9 11.9% 1.7% 20.9

Source: Banco Central (1993)* Education expenditure includes budgets for universities and other decentralizedpublic institutions. Total enrollment includes all public school students.

51

Annex 2Page 1 of 6

ANNEX 2: PROJECT COSTS TABLES

Annex 2, Table 1: Primary Education Quality Project, Project Components by Year--Base Casts(US$'000)

Base Cost

1994 1995 1996 1997 1998 Total

A. Improving Educational Quality

Curriculum Improvement 158.9 498.5 292.2 308.3 46.1 1,304.0

Improving Availability and Quality/of Instructional 349.2 5,903.5 11,202.5 16,763.6 13,218.1 47,436.9Materials

Improving In-service Teacher Training 175.3 9,008.7 9,532.3 11,248.3 9,358.6 39,323.3

Subtotal Improving Educational Quality 683.4 15,410.7 21,027.0 28,320.3 22,622.8 88,064.2

8. Institutional Strengthening

Modernization of MOE's Management Capacity 627.5 1,838.3 7,797.1 1,391.9 1,301.5 12,956.3

Decentralization 772.9 1,632.5 2,158.4 2,416.4 3,528.9 10,509.1

Establishing a Management Information System 2,014.2 7,542.0 1,454.0 1,369.3 1,095.7 13,475.2

Establishing a National Student Assessment 104.3 272.4 608.4 328.6 740.1 2,053.9System

Project Implementation Unit 1,099.1 1,215.0 1,083.1 891.8 729.4 5,018.3

Subtotal Institu:ional Strengthening 4,618.0 12,500.1 13,101.0 6,398.0 7,395.6 44,012.8

C. Infrastructure Improvement

School Furnishing 0.0 4,760.3 6,543.8 5,403.0 3,681.4 20,388.5

School Rehabilitation and Maintenance 57.1 26,815.3 34,055.6 27,905.8 9,917.9 98,751.7

Strengthening MOE's Infrastructure and Planning 169.4 623.0 610.0 629.8 616.9 2,649.1Capacity

Subtotal Infrastructure Improvement 226.6 32,198.6 41,209.3 33,938.6 14,216.2 121,789.3

Total Baseline Costs 5,528.0 60,109.4 75,337.4 68,656.9 44,234.7 253,866.3

Physical Contingencies 136.4 3,926.3 4,979.5 4,395.1 2,371.1 15,808.4

Price ContingenciesInflation

Local 297.6 12,625.7 26,758.3 33,013.4 26,867.1 99,562.1

Foreign 22.5 267.8 351.4 586.7 614.1 1,842.5

Subtotal Inflation 320.1 12,893.5 27,109.7 33,600.1 27,481.2 101,404.6

Devaluation 0.0 (8,627.2) (19,251.6i (24,489.0) (20.139.6) (72,507.5)

Subtotal Price Contingencies 320.1 4,266.3 7,858.1 9,111.1 7,341.6 28,897.1

Total Project Costs 5,984.5 68,301.9 88,174.9 82,163.1 53,947.3 298,571.8

Taxes 971.5 10,805.8 12,355.1 12,189.0 7,975.7 44,297.1

Foreign Exchange 1,429.9 5,788.4 4,633.0 5,614.6 4,643.1 22,109.0

An 2. Tble 2: P.e. P Eb E can utady Prject Eunltze Accmant bv Cauaqam-Totl Coats

MPROVUG EDUCATNAL 1IFRASTRUCTUREQUALrTY lTrIUTHlMAL STRENGTHEWG MPROVENIENT

Improving Estellisng StrergtheringAvSilty Improving Modernization Estabhalng a a Naiolnal MOE's

Ved (alty/of inSrvic of MOE's Managemnt Studet Project School intrastructureCurriulum nlntructorai Teachr Management Informatin Asesammnt ImplementatIon School Rehhbltkon *nd Plarning

Improvement Matrlais Trainin Capacty DecentralIzaton Systent System Urit Furnishing and Maintrwen Capecity Total

1. Invetment CostaA. CM Worka 0.0 0.0 0.0 887.6 0.0 0.0 20.8 277.0 0.0 115,988.1 0.0 117,173.56. EuJIpmen

Computr *nd reloted 11.3 21.4 30.2 21.5 13.2 8,053.7 21.6 40.9 0.0 5.7 12.6 8,232.1

Othws 6.2 6.2 9.6 513.6 6.4 0.0 8.1 16.8 0.0 0.0 14.7 581.5Telephone Un 2.0 2.0 2.0 772.2 2.0 0.0 2.0 3.9 0.0 2.0 0.0 788.0

Subtotal Equ _mnt 19.5 29.5 41.7 1,307.3 21.6 8.053.7 31.7 61.6 0.0 7.6 27.3 9,601.6C. Vydde 0.0 0.0 0.0 0.0 0.0 0.0 0.0 31.5 0.0 0.0 31.5 62.9D. Tecncal Asalstance

ServIc Contracts 0.0 493.8 491.9 5.819.1 1.580.5 4,626.5 1,410.7 951.4 240.7 2,693.0 163.3 18,470.9nivwkil Contrwct 588.4 410.2 7063 3225 1.087,4 719.8 467.0 3.587.5 0.0 367.9 42.2 8.305 1

Subtotal Trlmcal 588.4 903.9 1,198.2 6,147.5 2,667.9 5,346.3 1,877.7 4,538.9 240.7 3,060.9 205.6 26.776.0 tJmAssistanceE. Training 67.1 64.5 42,733.6 2,199.8 6,394.5 1.542.8 139.4 367.3 0.0 0.0 2,787.6 56,296.6F. Furniture 7.9 7.9 6.9 522.1 8.8 0.0 3.2 44.3 23,501.6 0.0 2.7 24.105.20. ktbncdonad Matwda

Printed Matwias 0.0 35,457.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 35,457.0Non-printed MateIas 0.0 14,901.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 14,901.6UIbrey Matertis 0.0 4.149.4 0,0 0.0 .000 0.0 0.0 0.0 0.0 0.0 4.149.4

Subtotal Inatructional 0.0 54,508.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 54,508.0MateriasH. Semninrs 668.3 00 0.0 0.0 0.0 154.9 0.0 0.0 00 0.0 2.682.6Toat Inve sment Costs 1,351.1 55,513.8 45,839.9 11,064.3 9,092.8 14.942.8 2,227.8 5,320.5 23,742.3 119,056.6 3,054.7 291,206.5

II. Recurent CostsA. SalarI 40.3 69.1 0.0 394.9 0.0 0.0 24.2 0.0 0.0 0.0 0.0 528.6B. Equipment Mainte 4.5 9.1 12.1 9.3 10.8 0.0 8.1 22.1 0.0 0.0 0.0 76.2C. Office Matedrs wnd 68.0 47.3 63.1 3,490.1 2,766.1 0.0 47.3 214.1 0.0 47.3 17.1 6,760.6Operaional CostaTota Recurrwnt Costs 112.9 125.6 75.2 3894.3 2.777.0 0.0 79.6 236.2 0.0 47.3 17.1 7.365.3Total Project Cost 1,464.0 55,639.4 45,915.1 14,958.7 11,869.7 14,942.8 2,307.4 5,556.8 23,742.3 119,103.9 3,071.8 298,571.8

Taxes 180.8 8,457.7 6,968.9 1,104.6 1,600.4 3,215.7 298.9 667.3 3,585.0 17,743.8 473.9 44,297.1Foreign Excag 78.1 12,387.9 152.5 778.0 2,152.6 4,773.5 832.8 641.0 0.0 4.0 308.5 22,109.0

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Annex 2. Tabe 3: Pwr, Primry Education Qualty Projct, Expencture Account by Components - Base Costs(USS'OOO)

IMPROVING EDUCATIONAL OUAUTY INSTITUTIONAL STRENGTHENING INFRASTRUCTURE IMPROVEMENT

Improving EstaNlhNng a StrengtheingAv rabOty mid Improving Modernizeto EatabsNng a National Schod MOE's

Gumty/of Ire-Sevice of MOE's Magm nt Student Project Rehablitation IrnfrastructureCurricutum Instructinl Teacher Mangement Informaton Assmwnt Implmenttation School and end Planning

Improvemen Mateias Trainng Capacity Decentrlztkdlon System Systwn Unit Furnising Maintennc Capacty Total

1. Ilvestment CostsA. Civil Works 0.0 0.0 0.0 742.2 0.0 0.0 17.7 236.0 0.0 95,932.8 0.0 96,928.7B. Equipment

Computers and 10.6 20.1 28.3 20.2 12.4 7,250.6 20.2 37.8 0.0 5.3 11.8 7,417.2related equripment

Others 5.8 5.8 9.0 454.2 6.0 0.0 7.6 14.8 0.0 0.0 13.8 516.9Telephone Une 1.8 1.8 1.8 704.6 1.8 0.0 1.8 3.7 0.0 1.8 0,0 719.3

InstallationSubtotal Equipment 18.2 27.7 39.1 1,179.1 20.2 7,250.6 29.6 56.2 0.0 7.1 25.6 8,653.4C. Vehicles 0.0 0.0 0.0 0.0 0.0 0.0 0.0 29.5 0.0 0.0 29.5 59.0D. Technical Assistance

Service Contracts 0.0 442.0 450.0 5,082.5 1,475.5 4,256.1 1,254.8 875.9 218.0 2,439.0 149.4 16,643.2Individual Contracts 544.2 372.3 642.4 299.2 986.9 654.0 423.1 3,254.1 0.0 332.0 38.8 7,546.9

Subtotal Technical Assistance 544.2 814.3 1,092.4 5,381.8 2,462.3 4,910.1 1,677.9 4,130.0 218.0 2,771.0 188.2 24,190.1E. Training 60.1 55.3 36,469.6 1,881.7 5,646.1 1,314.5 124.9 324.5 0.0 0.0 2,388.6 48,265.4F. Furniture 7.0 7.0 6.1 452.5 7.8 0.0 2.8 39.2 20,170.5 0.0 2.4 20,695.2G. Instructional Materials

Printed Materials 0.0 30,024.8 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 30,024.8Non-printed Materials 0.0 12,856.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 12,856.5Ubrary Materials 0.0 3,543.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 3,543.4

Subtotal Instructional Materials 0.0 46,424.7 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 46,424.7H. Seminars 576.3 0.0 1651.5 0.0 0.0 0.0 132.6 0. 0.0 0.0 0.0 2,360.4

Total Investment Costs 1,205.8 47,329.0 39,258.7 9,637.2 8,136.5 13,475.2 1,985.5 4,815.3 20,388.5 98,710.9 2,634.3 247_576.9II. Recurrent Costs

A. Salaries 35.8 59.4 0.0 342.7 0.0 0.0 20.8 0.0 0.0 0.0 0.0 458.6B. Equipment Maintenance 3.9 7.8 10.3 7.9 9.2 0.0 6.9 18.9 0.0 0.0 0.0 64.7C. Office Materials and 58.6 40.8 54.4 2,968.4 2,363.4 0.0 40.8 184.1 0.0 40.8 14.8 5,766.1

Operational CostsTotal Recurrent Costs 982 108.0 64.6 3.319.0 2.372.6 0.0 68.4 203.0 0.0 40.8 14.8 6.289.4Total BASELINE COSTS 1,304.0 47,436.9 39,323.3 12,956.3 10,509.1 13,475.2 2,053.9 5,018.3 20,388.5 98.751,7 2,649.1 253,866.3

Physical contingencies 37.9 2,343.1 1,911.5 631.0 133.4 428.3 19.5 54.9 1,008.5 9,115.9 124.4 15,808.4Price Contingencies

InflationLocal 403.4 17,315,9 17,652.8 4,673.7 3,680.3 2,493.4 558.7 1,468.2 8,786.9 41,523.0 1,005.8 99,562.1Foreign 3.5 1,189.4 9.9 54.6 209.3 236.4 76.8 38.8 0.0 0.1 23.6 1,842.5

Subtotal Inflation 406.8 18,505.3 17,662.7 4,728.4 3,889.6 2,729.8 635.6 1,507.0 8,786.9 41,523.0 1,029.3 101 404.6Devaluation 1284.71 112,645.9) (12,982.41 13,357.11 12,662.41 11,690.51 1401.6) (1 023.4) 16,441.6) (30,286.7) 1731.1) i72,507.51Subtotal Price Contingencies 122.1 5.859.4 4.680.3 1.371.3 1.227.2 1.039.3 233.9 483.6 2 3345.3 11.236.3 298.3 28,897.1

Total PROJECT COSTS 1,464.0 55,639.4 45,915.1 14,958.7 11,869.7 14,942.8 2,307.4 5,556.8 23,742.3 119,103.9 3,071.8 298,571.8Taxes 180.9 8,457.7 6,968.9 1,104.6 1,600,4 3,215.7 298.9 667.3 3,585.0 17,743.8 473.9 44,297.1Foreign Exchange 78.1 12,387.9 152.5 778.0 2.152.6 4,773.5 832.8 641.0 4.0 308.5 22.109.0

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Annex 2Page 4 of 6

Annex 2. Table 4: Peru, Primary Education Quality Project, Components by Financiers(US $'000)

Intemational Bank ForReconstruction and

Development Govemment of Peru Total

Local (Excl. Duties &Amount % Amount % Amount % For. Exch. Taxes) Taxes

A. Improving Educational Quality

Curriculum Improvement 450.2 30.8 1,013.8 69.2 1,464.0 0.5 78.1 1,205.1 180.8Improving Availability and Quality/of 687.7 1.2 54,951.7 98.8 55,639.4 18.6 12,387,9 34,793.8 8,457.7Instructional MaterialsImproving In-service Teacher Training 910.8 2.0 45,004.2 98.0 45,915.1 15.4 152.5 38,793.7 6,968.9

Subtotal Improving Educational Quality 2,048.7 2.0 100,969.7 98.0 103,018.5 34.5 12,618.5 74,792.6 15,607.4B. Institutional Strengthening

Modernization of MOE's Management 6,715.4 44.9 8,243.2 55.1 14,958.7 5.0 778.0 13,076.1 1,104.6Capacity

Decentralization 1,970.6 16.6 9,899.1 83.4 11,869.7 4.0 2,152.6 8,116.7 1,600.4Establishing a Management Information 9,747.2 65.2 5,195.5 34.8 14,942.8 5.0 4,773.5 6,953.5 3,215.7SystemEstablishing a National Student 1,413.8 61.3 893.6 38.7 2,307.4 0.8 832.8 1,175.7 298.9Assessment SystemProject Implementation Unit 3,654.4 65.8 1,902.4 34.2 5,556.8 1.9 641.0 4,248.4 667.3

Subtotal Institutional Strengthening 23,501.4 47.3 26,133.9 52.7 49,635.3 16.6 9,178.0 33,570,4 6,886.9C. Infrastructure Improvement

School Furnishing 20,092.3 84.6 3,650.0 15.4 23,742.3 8.0 0.0 20,157.3 3,585.0School Rehabilitation and Maintenance 100,535.1 84.4 18,568.8 15.6 119,103.9 39.9 4.0 101,356.1 17,743.8Strengthening MOE's Infrastructure and 194.2 6.3 2,877.6 93.7 3,071.8 1.0 308.5 2,289.3 473.9Planning Capacity

Total Disbursement 146,371.7 49.0 152,200.1 51.0 298,571.8 100.0 22,109.0 232,165.8 44,297.1

Annex 2, Table 5: Peru, Primary Education Quality Project, Allocation of Loan Proceeds(US$'000)

Loan AmountsSuggested Allocation of

Loan Pfoceeds Total Project Cost Average Unallocated AllocatedDisbursement

Loan DisbursementArnount % Total Local Foreign Total Loca Foreing Total Total Local Foreign Total Local Foreign

I

A. Civil Works 90.684.6 84.7 117,173.5 117,173.5 0.0 84.7 84.7 0.0 99,299.6 8,615.0 8.615.0 0.0 90,684.6 90,684.6 0.0

B. Furniture 19,455.4 84.7 24,105,2 24,105.2 0.0 84.7 84.7 0.0 20,428.1 972.8 972.8 0.0 19,455.4 19,455.4 0.0

C. Equipment and Vehicles

Equipment 6.737.1 73.5 9,601.6 5,458.2 4,143.3 73.5 53.3 100.0 7.053.0 315.9 118.6 197.3 6,737.1 2,791.1 3,946.0

Vehicles 42.4 70.7 62.9 18.4 44.5 70.7 0.0 100.0 44.5 2.1 0.0 2.1 42.4 0.0 42.4

Subtotal Equipment and 6,779.5 0.0 9,664.5 5,476.6 4,187.9 0.0 0.0 0.0 7,097.5 318.0 118.6 199.4 6,779.5 2,791.1 3.988.4Vehicles LJ

tJlD. Instructional Materials

Printed Materials 0.0 0.0 35,457.0 29,491.5 5,965.5 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Non-printed Materials 0.0 0.0 14,901.6 8,624.9 6,276.8 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Ubrary Materials 0.0 0.0 4,149.4 4,149.4 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Subtotal Instructional Materials 0.0 0.0 54,508.0 42,265.7 12,242.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

E. Technical Assistance 19,341.4 73.0 26,776.0 23,273.4 3,502.6 73.0 69.5 96.5 19,546.5 205.0 196.0 9.0 19,341.4 15,968.8 3,372.6

F. Training 0.0 0.0 56,296.6 54,120.4 2,176.2 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

G. Serninars 0.0 0.0 2,682.6 2,682.6 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

H. Recurrent Costs 0.0 0.0 7,365.3 7,365.3 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

UnaHocated 10,110.8 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Total 146,371.7 49.0 298,571.8 276,462.8 22,109.0 0.0 0.0 0.0 146,371. 10,110.8 9,902.4 208.4 136,260. 128,899. 7,361.0

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Annex 2Page 6 of 6

Annex 2, Table 6: Peru, Primary Educaton Quality Project, Disbursement Account By Financiers(US$'OOO)

International Srankfor Reconstructionand Devolopment Government of Peru Total

Local Duties &Amount % Amount % Amount % Foreign Exch. (Exc. Taxes) Taxes

1. Civil Works 99,299.6 84.7 17,873.9 15.3 117,173.5 39.2 0.0 99,299.6 17,873.92. Equipment 7,053.0 73.5 2,548.6 26.5 9,601.6 3.2 4,143.3 2,909.6 2,548.63. Furniture 20,428.1 84.7 3,677.1 15.3 24,105.2 8.1 0.0 20,428.1 3,677.14. Vehicles 44.5 70.7 18.4 29.3 62.9 0.0 44.5 0.0 18.45. Printed Materials 0.0 0.0 35,457.0 100.0 35,457.0 11.9 5,965.5 24,082.8 5,408.76. Non-Printed Matenals 0.0 0.0 14,901.6 100.0 14,901.6 5.0 6,276.8 6,351.7 2,273.17. Library Materials 0.0 0.0 4,149.4 100.0 4,149.4 1.4 0.0 3,516.4 633.08. Technical Assistance 19,546.5 73.0 7,229.5 27.0 26,776.0 9.0 3,502.6 20,951.9 2,321.59. Training 0.0 0.0 56,296.6 100.0 56,296.6 18.9 2,176.2 45,558.0 8,562.410. Seminars 0.0 0.0 2,682.6 100.0 2,682.6 0.9 0.0 2,273.4 409.2

11. Recurrent Costs 0.0 0.0 7,365.3 100.0 7,365.3 2.5 0.0 6,794.2 571.2

Total 146,371.7 49.0 152,200.1 51.0 298,571.8 100.0 22,109.0 232,165.8 44,297.1

Annex 2. Table 7: Peru. Prtnwy Educatlon Qualty Proect, Procurement Accounts by Finaniers1US$'OOO

Intemational Sank forReconstruction and

Deveopnnt Goveme nt of Peru Total

Local lExcl. Duties &Anount % Amount . Amount % Foregn Exchange Taxesl Taxes

A. Civil Works 99,299.6 84.7 17,873.9 15.3 117,173.5 39.2 0.0 99,299.6 17,873.9S. Equipment 7,053.0 73.5 2,548.6 26.5 9,601.6 3.2 4,143.3 2,909.6 2,548.6C. Furniture 20,428.1 84.7 3,677.1 15.3 24,105.2 8.1 0.0 20,428.1 3,677.1

D. Vehicles 44.5 70.7 18.4 29.3 62.9 0.0 44.5 0.0 18 4E. Instructional MaterialsPrinted Materials 0.0 0.0 35,457.0 100.0 35,457.0 11.9 5,965.5 24,082.8 5,408.7

Non-printed Matefials 0.0 0.0 14,901.6 100.0 14,901.6 5.0 6,276.8 6,351.7 2,273.1Library Materials 0.0 0.0 4,149.4 100.0 4,149.4 1.4 0.0 3,516.4 633.0

Subtotal Instructional Materials 0.0 0.0 54,508.0 100.0 54,508.0 18.3 12,242.3 33,950.9 8,314.8F. Technical Assistance 19,546.5 73.0 7,229.5 27.0 26,776.0 9.0 3,502.6 20,951.9 2,321.5G. Training 0.0 0.0 56,29e.6 100.0 56,296.6 18.9 2,176.2 45,558.0 8,562.4H. Seminars 0.0 0.0 2.682.6 100.0 2,682.6 0.9 0.0 2,273.4 409.2I. Recurrent Costs 0.0 0.0 7,365.3 100.0 7,3e5.3 2.5 0.0 6,794.2 571.2

146,371.7 49.0 152,200.1 51.0 298,571.8 100.0 22,109.0 232,165.8 44,297.1

57 Annex 3Page 1 of 10

ANNEX 3: PROJECT IMPLEMENTATION STRATEGY

1. The Ministry of Education (MOE) will be responsible for coordinating andimplementing the project through: (a) its National Directorates, (b) its recentlyestablished Project Implementation Unit (PIU), and (c) an Advisory Council headedby the Minister of Education and composed of the National Project Director, theVice-Minister, and the General Secretary of Education. The National Institute forEducation and Health Infrastructure (INFES), and the National Service for Trainingthe Construction Industry (SENCICO) will also participate in projectimplementation.

2. In order to describe the main responsibilities of the different implementingunits involved in the project, and to help understand how they relate to each other,the project implementation cycle has been divided into eight different functions: (i)policy advice and inter-institutional coordination; (ii) general coordination; (iii)definition and production of technical specifications, standards and guidelines; (iv)selection of goods (e.g textbooks) and services (consultants); (v) procurement; (vi)logistical support for implementing activities in the field; (vii) administration offinancial resources; and (viii) monitoring, control and evaluation of projectactivities. The matrix presented in Annex 3: Table 1 summarizes the functions ofentities involved in project implementation and Annex 3: Table 2 providesmonitoring indicators for each component. What follows is a brief description ofthe project's organizational linkages within the MOE and with other institutions.

Ministry of Education (MOE)3. The project's organizational linkages within the MOE are described below.Annex 3: Chart 1 provides a diagram of these relationships.

4. National Directorates. Each subcomponent will be adopted and implementedby one of the National Directorates or similar sections of the MOE, which willreceive technical, administrative, and operational support from the ProjectImplementation Unit.

* The National Directorate for Educational Technology (NDET) would directthe Curriculum Improvement and the Instructional Materials subcomponents.The Division of Educational Plans and Programs (DEPP) of this Directoratewould be responsible for all technical and selection activities related to thecurriculum improvement plan. The Division of Educational Resources (DER)would be responsible for technical and selection activities related to theinstructional materials subcomponent. This will involve providing technicalspecifications and selecting textbooks and workbooks, teaching guides,supplementary reading books, and non-printed didactic materials.

58 Annex 3Page 2 of 10

* The National Directorate for Educational Research and Training (NDERT)will be responsible for the In-Service Teacher Training Component throughits Division of Teacher Training (DTT). This division will be responsible forall technical and selection activities included in the teacher training sub-component, such as designing and organizing in-service teacher trainingseminars and workshops, developing training guidelines for traininginstitutions selected to deliver the seminars and workshops, and designingthe voucher system.

* Due to the high-level political and policy decisions involved in theInstitutional Strengthening component, the subcomponents of thiscomponent will be coordinated by a key advisor of the Ministry of Education.Nevertheless, each subcomponent will be implemented and directed bydifferent sections of the MOE. The Office of Technical Development (OTD)will be responsible for the Modernization of MOE's Management Capacityand Decentralization subcomponents through the Division of Rationalization(DR). More specifically, the Division would be responsible for supervisingthe management studies, monitoring the decentralization pilot experimentand, based on the results of the management studies, overseeing the action-plan agreed between the Bank and the MOE. The Office of Administration(OA), through its Division of Information (DINFO), will be responsible forimplementing the Management Information System subcomponent; and theNational Directorate of Educational Supervision and Evaluation (NDESE) willbe responsible, through its Division of Evaluation (DE), for all technical andselection activities of the National Student Assessment Systemsubcomponent.

* The Division of Infrastructure (DINFE) of the Office of TechnicalDevelopment will be responsible for technical and selection activities of theInfrastructure Component. These activities will involve, among others,monitoring the work carried out by INFES.

* The regional authorities will provide logistical and monitoring support tothe Project Implementation Unit for those components being implemented intheir area.

5. Project Implementation Unit (PIU). The PIU will be considered a "ProyectoEspecial" (Special Project), which means that it has technical, administrative andfinancial autonomy but is accountable to the Minister of Education. It's mainfunctions will be to carry out project procurement activities, coordinate betweendifferent entities involved in project implementation, and assure that all projectcomponents are implemented in accordance with the technical and legalrequirements stipulated in the loan agreement signed between the GOP andtheBank, as described in the operational manual. In other words, it will support the

59 Annex 3Page 3 of 10

work of the National Directorates and will serve as the technical, administrative,and operational counterpart of the Bank during the life of the project.

6. To perform these functions, the PIU will be headed by a professional withexperience in the management of internationally-funded projects and will consist of5 substantive and 4 support units. The substantive units are: (i) instructionalmaterials; (ii) teacher training; (iii) curriculum; (iv) infrastructure; and (v)institutional strengthening. The institutional strengthening unit will encompassthree sub-units: (i) institutional strengthening and decentralization; (ii) managementinformation systems; and (iii) national student assessment. The four support unitsare: (i) procurement (supported by a Technical Evaluation Committee); (ii) projectplanning and control; (iii) legal aspects; and (iv) administration and logistics.Consultants with specialized expertise not available within the MOE will becontracted as needed with project funds throughout the life of the project and thePIU will rely on regional offices for support in project logistics, supervision, andmonitoring.

7. Advisory Council. The Advisory Council (headed by the Minister of Educationand comprising the Vice Minister, the General Secretary of Education, and theProject Director) will support project implementation by ensuring coordinationbetween the PIU and the different executing agencies and facilitating the resolutionof conflicts that may arise during the life of the project. In order to ensureinstitutionalization of the project and its effective implementation, the MOE willalso include the Directors as permanent members of the Advisory Council.

National Institute for Education and Health Infrastructure (INFES)8. INFES, under the supervision of the MOE's Infrastructure Division, will beresponsible for implementing the school rehabilitation and maintenancesubcomponent and the school furnishing subcomponent. This will involvedesigning, contracting out, supervising and monitoring all civil works as well asdesigning and procuring school furniture.

National Service for Training the Construction Industry (SENCICO)9. Based on the technical specifications provided by the MOE's InfrastructureDivision, SENCICO will be responsible for all training activities that aim atimproving schools' capacity for infrastructure maintenance. This will involveselecting and/or producing the appropriate maintenance manuals and trainingmaterials, delivering the training to all participating schools, and providingmultigrade schools with the basic tools for maintenance activities.

Annex 3, Table 1: Areas of Responsibility of Implementing Agencies

IMPLEMENTING AGENCY

Ministry of Education

Subcomponents Advisory PIU DEPP DER DTT DR DINFO DE D RINFES & UNDPCouncil OffNO E DNF eicesl SENCICO

1. Curriculum Improvement I M-P-S-C T-S M-L A

2. Instructional Materials I M-P-S-C T-S M-L A

3. In-service Teacher Training I M-P-C T-S M-L A

4. School Furnishing I M-P-C T-M M-L S-P-L A

5. School Rehabilitation and Maintenance I M-P-C T-M M-L S-P-L A

6. Strengthening MOE's Infrastructure Capacity I M-P-C T-S M-L A

7. Modernization of MOE's Mgt. Capacity I M-P-S-C T-S M-L A

8. Decentralization I M-P-C T-S M-L A

9. Management Information System I M-P-C T-S M-L A

10. Student Assessment I M-P-C T-S-M M-L A

PIU = Ministry of Education: Project Implementation UnitDEPP = Ministry of Education: Division of Educational Plans and

Programs oDER = Ministry of Education: Division of Educational ResourcesDTT = Ministry of Education: Division of Teacher TrainingDR = Ministry of Education: Division of RationalizationDINFO = Ministry of Education: Division of InformationDE Ministry of Education: Division of EvaluationDINFE = Ministry of Education: Division of InfrastructureINFES = National Institute for Education and Health InfrastructureSENCICO= National Service for Training the Construction IndustryUNDP = United Nations Development Program

I = Inter-institutional Coordination & Policy AdviceC = General CoordinationT = Definition and production of Technical Specifications, Standards and GuidelinesS = Selection of Good and ServicesA = Administration of Financial ResourcesP = Procurement -o

L = Logistical Support X

M = Monitor - Control - Evaluation coCD >-o :3o CD

X

0

61 Annex 3Page 5 of 10

Annex 3, Table 2: Peru Primary Education Quality ProjectMatrix of Monitoring Indicators

Components | Subcomponents [ Indicators [ Q 1994 [ 1995 | 1996 | 1997 J 1998

Improving Educational Curriculum Curriculums 10 40% 60%Quality Improvement improved

Pilot curriculums 2 50% 50%evaluated

Final curriculums 12 8% 16% 67% 9%evaluated I

Institutional 4 25% 50% 25%StrengtheningActivitiesDeveloped _

In-service Directors 17742 100%Teacher InformedTraining

Directors and 126331 20% 27% 31% 22%Teachers Trained

Teachers with 16690 2% 98%Vouchers

Promotion 6 17% 33% 17% 17% 17%Seminars

Seminars for 20 50% 25% 25%ImplementingEntities

Training 384 25% 25 % 25 % 25%Seminars (byimplementingentities)

DTT's critical 53 95% 85% 60% 40% 20%activitiesrequiringconsultantinvolvement (as% of total per

year)_____ __

Instructional Textbooks 5109924 17% 27% 26% 30%Materials Distributed

Workbooks 12951550 6% 20% 34% 40%Distributed

Pedagogical 247051 10% 24% 38% 28%guidesDistributed

Texts/Workbooks 288508 78% 22%UnidocentalSchools

62 Annex 3Page 6 of 10

Components Subcomponents Indicators Q 1994 1995 1996 1997 1998

Non-printed 122128 20% 29% 36% 15%MaterialsModulesDistributed

Library Materials 122128 20% 29% 36% 15%ModulesDistributed

Developmentof 3 33% 42% 9% 8% 8%SupportInstruments

Activities to be 12 8% 10% 45% 81% 100%adopted by DER(cumulative)

Modernization of Modemization Studies 12 67% 8% 8% 17%Educational Administration of Management Completed

MOE Central 300 20% 30% 25% 25Level TrainingImplemented

MOE Regional 2400 40% 30% 30%Level TrainingImplemented

Pilot Plan for Autonomous 38,287 1% 12% 33% 55%Public School SchoolsAutonomy

School Autonomy 1 70% 30%Plan (cumulative)

Data Collection 3 10% 60% 30%Events

Training of 38,287 1% 12% 33% 55%Principals

Training of 38,287 1% 12% 33% 55%School Councils

Training of 38,287 1% 12% 33% 55%SchoolAdministrators

Training of 230 1% 12% 33% 55%Supervisors .

Impact Study 4 25% 25% 25% 25%Repons

MIS Systems in 20 10% 50% 30% 10%Operation

Nodes installed at 60 20% 80%central level

Nodes installed at 344 8% 45% 47%decentralizedlevels

63 Annex 3Page 7 of 10

Components Subcomponents Indicators Q 1994 199"5 16 1997 1998

# of staff 650 23% 46% 23 % 8 %receiving trainingat central level

of staff 5558 16% 28% 28% 28%receiving trainingat decentralizedlevels

National Student Promotion 12 10% 10% 35% 10% 35%Assessment ActivitiesSystem

Pilot 3 33% 33% 33%administrations

Final 2 50% 50%administrations

Dissemination 3 100%Activities

Individuals 2 100%receivingscholarships joinMOE

Personnel of 2 100%technical teampromoted l

Research Grants 4 50% 50%

Evaluation Study 1 50% 50%

Infrastructure Improvement School Urban 2259 22% 24% 26% 20% 8%rehabilitation Classroomsand maintenance Replaced

Rural Classrooms 1941 8% 25% 32 % 26% 9%Replaced

Studies for 4 25% 25 % 25% 25%identification ofpotentialclassrooms

Identification of 1750 39% 31% 23 % 7 %eligibleclassrooms

Urban technical 377 22% 24% 26% 20% 8%dossier bided on

Rural technical 1373 2% 25% 34% 29% 10%dossier bided on _

64 Annex 3Page 8 of 10

Components Subcomponents Indicators Q 1994 1995 199 | 1997 1998

School Rural New 1941 8% 25% 32% 26% 9%Fumishing classrooms

equipped

Urban new 2259 22% 24% 26% 20% 8%ClassroomsEquipped

Classrooms with 98260 25% 25% 25% 25%Bookshelves

Strengthening Cadastre: 25 25% 25% 25% 25%MOE's Departmentsinfrastructure legally sanitizedplanningcapacity Structure 2 50% 50%

Inventory:CompletedCensus

Norms and 460 25% 25 % 25% 25%Training:National TrainingEvents

65 Annex 3Page 9 of 10

Annex 3, Table 3: Peru Primary Education Quality ProjectList of Departments

1. CAJAMARCA2. HUANCAVELICA3. LORETO4. PUNO5. CUZCO6. ANCASH7. JUNIN8. LIMA9. SAN MARTIN10. APURIMAC11. HUANUCO12. LA LIBERTAD13. AMAZONAS

66 Annex 3Page 10 of 10

PROJECT IMPLEMENTATION UNIT (PIU)ARTICULATION WITHIN THE MINISTRY OF EDUCATION

Ministro - - - - - - - - -- Consejo Consultiv|

I~~~~~~~|Programs Especial |

MECEP

tPIU)

* Oficina de

Oficins General ~~~~~~~Desarrollo TecniCO 7Of icina General . Dide Administracion . . . . . .r.. . ..

Diraccion de

'~~~~~~~ ~~~ - - -- -: -Informatica -

. .~~~~. . .. ....

Direccion NacionalI Direccion Nacional Direccion Necional 0recc on Nac onalPromocion, Particip. S on y Eva- de Tecnolog i Investigc ion Educ.y Desarrollo Educ. Luacion Educativa Educativa Capacitacion

Docente

4 Direccion de | 4 Dir. Planes-l - Evaluacion - y Programes cion Docenta j

Project's Consultants - Educativos

67

Annex 4Page 1 of 3

ANNEX 4: BANK SUPERVISION REQUIREMENTSnn

1. Due to the MOE's weak institutional capacity and the need to ensure timelyimplementation of the project instructional materials and teacher trainingcomponents, the Bank will need to provide intensive supervision to the project. Toreduce the costs of supervision the Bank would coordinate its supervision missionswith KfW who would be providing parallel financing to the teacher training sub-component.

2. Supervision Tasks. Supervision activities would include the following tasks:

(a) Supervision Missions: To adequately supervise the project, the Bankwould need approximately two supervision missions of about twoweeks each per year. The missions team will be comprised by theTask Manager, an architect and one or two consultants specializing inaspects relevant to the project (i.e. project finances and control,student assessment, management information systems, textbooks andinstructional materials, teacher training). Each mission would includevisits to provinces where rehabilitation is taking place and would beplanned so at to complement the supervision missions of both IDB andKfW.

(b) Annual Reviews: During the first quarter of each calendar year theBank will conduct joint annual project implementation reviews withthe GOP to assess progress on the implementation of the project'squality components (textbooks, teacher training) and the bilingualeducation plan, and to revise the school rehabilitation targets for thatyear.

(c) Procurement Reviews: Procurement reviews will be carried out in thefield during the annual review meetings, requiring about one staffweek.

(d) ADwroval of terms of reference and candidates for technicalassistance: It is estimated that this task should take about two staffweeks per year, with much of the complementary review functiontaking place in the field during supervision.

68

Annex 4Page 2 of 3

(e) lmoact Evaluation - Decentralization Experiment: The supervision ofthis activity will be supported by PRDPH and LATAD, requiringapproximately a total of eight staff weeks annually during the firstfour years of the project.

(f) Mid-Term review: The Mid-Term Review, scheduled for the firstquarter of the calendar year 1997, would require three weeks.

(g) Routine sugervision and internal administration: It is expected that anadditional eight to nine staff weeks per year would be needed atHeadquarters for the various activities of internal reporting,coordination with IDB and KfW, mission preparation, and routinecorrespondence.

3. Supervision Plan. Based on the above supervision requirements, thefollowing supervision calendar is proposed for the project:

FY1 995:Project Launch

Task ManagerProcurement SpecialistFinance specialistArchitect

Supervision MissionTask ManagerArchitectImpact Evaluation Specialist

FY1996 - FY1999:Supervision Missions. Two per year comprised of a combination of the followingstaff:

Task ManagerFinance specialistArchitectImpact Evaluation SpecialistPublic Sector Management specialist

69

Annex 4Page 3 of 3

FY1997Mid-Term Review

Task ManagerFinance specialistArchitectImpact Evaluation specialistPublic Sector Management specialist

FY1999Project Completion Report Preparation Mission

Task ManagerFinance specialist

4. Resource Requirements. Based on the supervision tasks and calendaroutlined above, the total estimated staff weeks (including consultants) per year forthe project are: FY1995 35; FT1996 32; FY1997 40; FY1998 32; FY1999 30.

70 Annex 5Page 1 of 2

ANNEX 5: PROPOSED NATIONAL ASSESSMENT SYSTEM

GENERAL Program Mgt. The Ministry of Education will be responsible for the general management,INFORMATION logistical support and promotion, dissemination and utilization of the system.

An autonomous institution will be contracted to be in charge of processesrelated to coordinating and managing test development and administration, anddata processing and analysis.

General system Provide periodic, valid and reliable information on the progress towards nationalobjective achievement goals in order to inform educational decisions for primary

education.

Yr. administered 1995: Pilot Language and Math (L&M) for 4th grade; 1996: Nationaladministration L&M for 4th grade; 1 997: Pilot administration L&M and Naturaland Social Sciences (N&SS) for 6th grade; 1 998: National administration L&Mand N&SS for 6th grade and pilot L&M and N&SS for 4th grade. A psycho-social development assessment for 4th and 6th grade would be also be pilotedin 1997 and administered in 1998.

DETAILS OF Grades 4th and 6th grade.DESIGN Subjects Initially only Language and Math. Natural and Social Sciences would be added

in Yr. 4.

N To be determined after collecting information and carrying out detailed analysisof sample design. Cost tables were based on the following estimates for bothgrades: 3,000 students for pilot administration and 50,000 students fornational administrations. Tests would be also be administered to an additionalmaximum of 600 schools involved in the impact evaluation of thedecentralization process.

Behavioral Knowledge and those others that are contemplated in the present curricularobjective program for each subject at the particular grade. In Language, both literacy and

reading comprehension.

Item type Multiple-choice and an essay section for language.

# of items and 0 Versions: 2 for Language and Math and 4 for Natural and Social Sciences.versions * Items for 4th grade: Language (40); Math (40); Social sciences - history and

geography - (30); Natural Sciences (30).* Items for 6th grade: Language (50); Math (50); Social sciences - history andgeography - (30); Natural Sciences (30).

Standardization Content, Administration and Scoring

Reference Criterion-referenced.

Equating Efforts would be made to equate tests to those used in the decentralizationimpact evaluation study.

Supplementary With each test administration, surveys for school directors, teachers andinformation parents would be carried out. Information would be collected on: (a) school-

related variables: e.g. teacher characteristics, textbook availability, hours ofinstruction, etc.; and (b) external variables: e.g. socio-economic, parent'sexpectations, parental support in school task, parental schooling, etc.

71 Annex 5Page 2 of 2

DETAILS ON Test piloted Yes (see above in Yr. administered).ADMINISTRATION Reliability and Yes.AND ANALYSIS validity analysis l

Analysis and l A study would be carried out to test the feasibility of using bubble answerfurther research sheets in order to speed data processing with optical scanners.

* Thorough psychometric analysis of tests and statistical analysis of results.* Data would be made available to those interested in carrying out furtheranalyses and incentives, such as ME-sponsored competitions, would beprovided to stimulate related research. Attention would be given to stimulatingevaluations and research on different testing methodologies (e.g.experimentation with different item types).

DETAILS ON Promoting test Activities will be carried out that will sensitize the education community and thePROMOTION, public in general of the meaning and importance of the national assessmentDISSEMINATION, (e.g. a nation-wide competition among school children would be carried out forAND the design of a logo and/or poster).INFORMATION To whom dissem. Central and regional authorities, parents, teachers and general public.USE

How and when of Different reports will be prepared for different audiences and other forms ofdissemination dissemination (e.g. seminars) will also be used. Dissemination process will be

carried out approximately 4 months after national administration but a datacenter will be maintained year round in order to respond to ad hoc demands forinformation.

Evaluation of An evaluation will be carried out in 1997.information use

72

Annex 6page 1 of 2

ANNEX 6: TEACHER TRAINING SUBCOMPONENT

The teacher training subcomponent includes three main activities : (i) carrying out specificin-service teacher training programs; (ii) providing training for directors; and (iii)institutionalizing a teacher training voucher system. The purpose, main characteristics, andgeneral implementation strategy of these activities are described in the following table:

Annex 6, Table 1: Summary Description of Teacher Training ComponentIin-service teacher training JTraining for directors | Voucher System

Purpose and * Provide a short term solution to some * Strengthen the capacity of * Develop a permanentbrief of the weaknesses of the present teaching directors in pedagogical capacity for in-service teacherdescription force. supervision and support training by building on local

* Strengthen local decentralized methods. in-service teacher traininginstitutional capacity for delivering * Training would inform capacity fostered by theappropriate and quality in-service directors of the content being project.training. taught in project- sponsored in- * Each school would receive* Training would promote the use of service teacher training and vouchers for training teachersstudent-centered teaching methods by would ensure that they selected by the schools.training teachers on how to effectively understand their role in theuse instructional time and the quality improvement initiatives.instructional materials provided by theproject, and on how to stimulate activelearning habits.

To whom * Training schedule would coincide with 1995: 15635 directors 1988: Voucher systemand when distribution of textbooks and teaching 1998: 15635 directors introduced for all public

materials. schools.1995: 22360 Grade I teachers1996: 35832 Grade 2 & 3 teachers1997: 33986 Grade 4 & 5 teachers;

10132 multigrade schoolteachers.

How (mgt. * Organization and delivery of training * Same as for "in-service * Training would be offeredstrategy) would be contracted out in each teacher training." by private and public

department to teacher training institutes universities and teacherand universities. training institutes* MOE would develop training * MOE's role would: (i)guidelines to be used by the training provide vouchers to schoolsinstitutions for designing the necessary and (ii) pre-approve andtraining materials and teaching certify the list of courses andmethodologies. seminars that would be* Teachers would receive certificate offered by the implementingbased on their learning achievement. entities.* Information system would be * Schools would selectintroduced to monitor training received teachers to participate inby teachers and their performance in the training courses and financevarious training sessions. their participation with the

vouchers.

73

Annex 6page 2 of 2

The in-service teacher training that would be provided during the project's life and theproposed voucher system attempt to correct many of the weaknesses of the present in-serviceteacher training that is provide. The following table highlights the differences in approach:

Annex 6, Table 2: Comparing Present and Proposed In-service Teacher Training System

Present In-Service Teacher Training | Proposed In-Service Teacher Training System

Centralized system: MOE is responsible for defining Decentralized system: MOE would: (i) develop trainingtraining policies and strategies and for planning and guidelines that would be used by the contracted trainingimplementing the training programs. institutions for designing the necessary training materials

and teaching methodologies; and (ii) approve and certifylcourses offered by private and public institutions.

MOE's approach to planning is top-down, with no school Schools would be responsible in the short and long terminvolvement in the process. for defining their needs, structuring their programs,

identifying appropriate finance and technical assistance,and organizing the training of their personnel.

Attendance is certified. Learning is certified.

One-shot approach. Continuous, permanent system established.

Training linked to informing on new educational policies. Training directed towards improving teaching process inthe classroom.

Lecture style, theoretical classes. Workshop style, practical classes.

Mass training of 100 teachers at one time. Size of group to be trained: maximum of 30 teachers perclass.

Training not adapted to different needs of Peru's Training would be diversified, particularly providingheterogeneous schooling environments. special training for teachers in multigrade classrooms.

Training not taken into consideration for promotions. Performance in training taken into consideration forpromotions.

Monitoring is weak and difficult. A permanent Evaluation and Monitoring System oftrained teachers would be maintained by implementinginstitutions.

74

Annex 7Page 1 of 4

ANNEX 7: INSTRUCTIONAL MATERIALS MODULES

Annex 7, Table 1: CLASSROOM LIBRARY

I. Modules for Multigrade School

GRADE

Type 1 2 3 4 5 6 Total

Fiction 5 4 4 3 2 2 20

Non-Fiction 2 3 4 3 3 2 17

Reference - I - - 1 1 3

Total 7 8 8 6 6 5 40

II. Modules for Non-Multigrade Schools

GRADE

Type 1 2 3 4 5 6 Total

Fiction 18 18 17 15 15 15 98

Non-Fiction 10 10 11 11 11 11 64

Reference 2 2 2 4 4 4 18

Total 30 30 30 30 30 30 180

75

Annex 7Page 2 of 4

Annex 7, Table 2: NON-PRINTED DIDACTIC MATERIALS

1. Module for First and Second Grade

Relationship Activity

Area Content Puzzles Bingo Cards Cards Total

Communication Alphabet 5 1 7

Concepts 5 1 1 - 7

Follow Instructions - - I 1 2

Forms & Colors 3 1 - 1 5

Critical Thinking 2 - 1 - 3

Logic/Math Numbering 5 - - 1 6

Knowledge - I 1 1 3

Application

Total 20 4 4 5 33

II. Module for Third and Fourth Grade

Relationship Activity Posters/

Area Content Bingo Cards Cards Maps Total

Communication Concept 2 2 - 2 6

Critical Thinking - 1 1 1 3

Socialization - - 1 2 3

Self-esteem - - 1 2 3

Logic/Math Knowledge 2 1 1 - 4

Time I I - - 2

Science/Ecology Ecology - I I 1 3

Health 1 - 1 2 4

Total 6 6 6 10 28

76

Annex 7Page 3 of 4

III. Module For Fifth and Sixth Grade

Relationship Activity Posters/

Area Content Bingo Cards Cards 3D Models Total

Communication Concepts 1 - - 2 3

Habits/Studies - - I 1 2

Socialization - - I 1 2

Geography I I 1 3 6

Logic/Math Knowledge I - 1 - 2

Application

Time - 1 - I

Geometry - I - 1 2

Science/Ecology Ecology - I - 1 2

Human Body - - 1 3 4

Total 3 4 5 11 24

77

Annex 7Page 4 of 4

IV. Module for Multigrade SchoolsRelationship Cards Activity Posters/

Area Content Puzzles Bingo Cards Maps TOtal

Communication Alphabet I - I I - 3

Concepts I 1 2 - 2 6

II [. 111 11,111

Instructions - - - I -

Forms/Colors I - - - -

Critical Thinking - - I - - 1II

Habits/Studies - - - I

111

Socialization I - -

III

Self-esteem - - - - III

Geography - - I - 1 2

Logic/Math Numbering - - I - -

Knowledge Application - 2 2 1 - 5

Time - - 2 - - 211

III

Geometry - - - -I

III

Science/Ecology Ecology - - I I 1 3

Health I I 1 3

Human Body - - - - I 1

Total 3 3 13 7 7 33

*1 = Taken from proposed module for first and second grades;

11 = Taken from proposed module for third and fourth grades;

111= Taken from proposed module for fifth and sixth grades.

78 Annex 8Page 1 of 9

ANNEX 8: PILOT PROJECT ON DECENTRALIZATION

A. Historical Context

Peru's experience with decentralization of education decisionmaking dates from1 963 with the creation of regional offices of the Ministry of Education. In 1 970,subregional offices were created, and in 1 985 these were reorganized and renamededucational service units, or Unidades de Servicios Educativos (USEs). Moreimportantly, in 1 985, regional governments were created and directly financed bythe Ministry of Economy and Finance, resulting in diminished control by theMinistry of Education over its regional offices and USEs. Other intermediaryorganizations, Areas de Desarollo Educativo (ADEs), were recently created by theMinistry of Education to replace USEs, but this effort is only incompletelyimplemented. In regions where ADEs exist, they are meant to provide the servicefunction of the USEs, but their supervisory and administrative responsibilities overthe schools, or Centros Educativos (CEs) reside with the regional educationdirectorates. USEs, ADEs and the regional education directorates are alsocollectively known as Organismos Intermedios (Ols).

By the time the Fujimori Administration took office in 1990, it was obvious thatthe 1 985 reform had seriously reduced accountability in Peru's educational system,resulting in, among other things, large increases in the educational bureaucracywithout corresponding improvements in educational quality. Recognizing this, theMinistry of Education has, since 1 992, developed a series of proposals forrestoring accountability and improving quality in education. Proposals to contractthe management of primary-secondary schools to private and non-profitorganizations encountered significant political opposition and resulted in theirdefeat.

B. Changing Public School Management

The continuing need to increase accountability and improve quality in publicschools has led the Ministry of Education to develop a new proposal for improvingpublic school management by strengthening schools' autonomy and authority.Because of uncertainty concerning local capacity for implementation and possibleeffects on school quality, the government is conducting the experiment on a pilotbasis.

79 Annex 8Page 2 of 9

Local school management is defined by which decisions are made and who makesthe decision. Variations in these two elements define the alternative managementmodels which will be evaluated in terms of their effects on school performance.

Budget and Administration

For the purposes of this research, school management comprises decisions about:(a) the budget; (b) the employment, assignment, compensation, and release ofpersonnel; (c) teaching and pedagogy; and (d) the internal administration of theschool (or centro educativo).

The basic hypothesis to be tested is that a system which transfers more decision-making authority over points a-d from the 01 level to the school level will result inimprovements in schooling outcomes, as measured by student performance,teaching practices and the efficiency of school management as measured by unitcosts and other indicators. The underlying premise is that schools and parentshave more information and can react more nimbly to changing needs than largebureaucratized Ols.

(a) The Budget. At present, the school director has almost no controlover the size of the school's budget or its allocation. Teaching andadministrative personnel are appointed and paid by the 01. Goods andservices and textbooks are directly provided by the 01. Furthermore,revenues generated by the school are in principle returned to theMinistry of Economy and Finance. In the experiment, schools wouldbe given a budgetary transfer in lieu of goods and services such asdesks and the direct payment of their utility bills (the latter equal to5% of salary outlays); increased authority to raise own-sourcerevenues; and the authority to budget and spend all revenues. Inaddition, the school will have the authority to reallocate monies fromnon-tenured teaching or administrative personnel to non-personnelexpenditures. However, the national pay scale would remain in effectand tenured teachers will not be able to be removed from theirpositions.

In essence, school will get a cash budget and will have discretion overhow it is spent with the following limitation: they will have to pay thesalaries of tenured and titled teachers first out of this cash budget.The rest of the budget is discretionary, to be spent on other teachers,salary benefits, or goods and services.

80 Annex 8Page 3 of 9

(b) Personnel Management. At present, the school director is unable toselect teachers, evaluate and reward them, authorize training, issuesanctions for failure to comply with rules, or to remove teachers fromthe school for poor performance. Under the experiment, schoolmanagers in all the experimental schools would have the authority torequest the re-assignment of tenured non-titled teachers and directlyreceive the funds equivalent to the re-assigned teacher's salary;performance and reward high performance with salary bonusesfinanced out of the school's discretionary budget; determine whichteachers should receive training; and issue sanctions.

(c) Pedagogy. Currently, the school curriculum is determined in detail bythe Ministry of Education, and the contents of the weekly 35 hours ofinstruction are almost completely specified. Similarly, the dates of theschool year and the hours of the school day are determined centrally.Textbooks are also specified by the Ministry. Under the experiment,the school manager would have the autonomy and authority todetermine the contents of the school curriculum beyond a minimumcore curriculum (of approximately 30 hours); choose an alternative setof school year dates when justified by special circumstances; and setthe hours of the school day.

(d) Internal Administration. Currently, internal administration is definedby national regulations, and the selection of administrative personnelis determined by the 01. Under the experiment, school managerscould determine their own internal administration, including definingadministrative posts and specifying information systems; and selecttheir own administrative personnel, including changing existingadministrative staff.

School Governance: Decisionmakers

School governance concerns who makes resource allocation and other decisions.Currently, almost no decisions reside at the level of the school; most commonly,the decisionmaker is at the 01 level. The only exceptions are decisions by theparents' association (the APAFA) concerning the expenditure of monies contributedby parents.

The experiment would assess the effects of changes in school governance. Themost important change is a transfer of authority from the 01 to the level of theschool. The experiment will apply two models of governance that will vary

81 Annex 3Page 4 of 9

according to the balance of authority between the director and a school council(Consejo), a new organization being created to assist in decision-making andprovide a measure of oversight, especially as regards budgetary decisions. TheConsejo will be comprised of, at a minimum, 2 representatives fromparents'groups, one representative from the intermediary organization and theschooldirector.

C. The Models and Implementation of the Experiment

The changes above will be grouped into models of school management that will beapplied to several hundred schools in about 8 districts in the Lima and Cuzcodepartments. There will be a control group studied to follow the status quo.

These models (M) are as follows:

MO: The existing system (i.e., the control group).

Ml: Assign the school director decision-making authority for internaladministration, pedagogy and budgetary authority as defined above.Consejo acts as an advisory board for these decisions. Consejo voteson the allocation of non-APAFA own-source funds and on all capitalinvestment decisions.

Applied in Lima and Cuzco.

M2: Assign the school director decision-making authority for internaladministration, pedagogy and budgetary authority as defined above.Consejo votes on the allocation of non-APAFA own-source funds, allcapital investment decisions, the annual plan including a budget andmedium term institutional development plans.

Applied in Lima and Cuzco.

M3: In addition to the authority granted to the school in M2, introduceincentives such as prizes to encourage improvements in efficiency oranother target as established by the school in their annual plan.

Applied only in Lima.

D. Evaluation and Methodology

82 Annex 8Page 5 of 9

The objective of the evaluation is to assess the impact of the decentralizationproposals on:

* the quality of basic education* the internal efficiency of the education system

The methodology for the evaluation includes defining the sample, the evaluationdesign, the focus of the evaluation as defined by issues and indicators of interestand the instruments to be applied.

1) Sample

The schools chosen for the sample should be representative with respect togeographic and cultural diversity, primary and secondary levels of schooling andschool size. The initial proposal is to construct a universe of eligible schoolsconsisting of rural and urban primary and secondary "polidocente" (with more thanone teacher) schools in the Lima and Cuzco regions. These two regions includesome of the largest urban areas and extensive rural areas representative of boththe sierra and the coastal areas of the country.

2) Evaluation Design

The evaluation will follow the experimental design model, whereby treatments arerandomly assigned to a subset of schools within the universe of eligible publicpolidocente schools. The random assignment assures both equity in the allocationprocess and equivalency in the treatment and control groups. The treatmentmodels described above will be applied to a randomly-selected group of about 300public schools. A preliminary sampling plan is presented below. The final numberwill depend on more information about the expected validity of school-levelindicators. Each treatment model will be applied to approximately an equal numberof schools within each region. To keep costs low and study the value-added ofincentives, the incentive model will be limited to schools within a few districts, allof which will be eligible to compete for the prizes. The control group ofapproximately 120 schools will be randomly drawn from the schools that were notselected for treatment. A group of private schools will be studied for the purposesof comparison.

83 Annex 8Page 6 of 9

Annex 8, Table 1: Distribution of Number of Schools by Model

MO Ml M2 M3 Total

Lima 30 30 30 30 120Urban/Periph

Lima Rural 30 30 30 30 120

Cuzco/Urban 30 30 30 90

Cuzco/Rural 30 30 30 90

Total 120 120 120 60 420

3) Issues and Indicators

It is useful to consider three levels of analysis: student, school and community.At the student level, one key issue is to what extent the decentralization modelsaffect the quality of education as measured by standardized mathematics andlanguage achievement tests. In order to make this attribution, it is important tocontrol for the students' socioeconomic characteristics. These will be obtainedthrough a short parents' questionnaire applied during the student matriculationprocess at the beginning of the school year. In addition, a short questionnaire willassess students' time allocation, motivation and self-perception. These exams Willbe applied to third grade students at the beginning and end of the 1995 academicyear. The cohort of third graders in both the treatment and control schools will befollowed in 1 996 and 1998 under the project's national assessment systemthereby allowing for a longitudinal study of the impact of decentralization (SeeAnnex 4)

At the school level, a key issue is to what extent the decentralization models affectthe internal efficiency of the schools. One set of indicators concerns students'attrition, repetition and matriculation rates. Another set concerns theadministrative and management practices of the school directors such as costs andfinancing, the use of textbooks and equipment and the personnel mix of theschool. A third set of indicators concerns teaching practices at the classroom level.

At the community level, the key issue is how the experiment affects therelationship between the school and outside institutions such as parents'associations and Ols. Indicators include parents' perception of the schools andtheir participation in parents' associations (APAFAs). The services provided to theschools by the Ols will be monitored. Table 1 summarizes the issues, indicatorsand instruments for the study.

84 Annex 8Page 7 of 9

4) Instruments

As noted in Table 1, several types of instruments will be developed and used toassess the relevant issues and collect the corresponding indicators. These include:i) standardized tests; ii) student, teacher, parent, APAFA, USE and directorquestionnaires; iii) observation guides to study pedagogical practices at theclassroom level and administrative practices at the school level; iv) administrativerecords from the school and the USE.

Standardized tests for the decentralization component will be developed andapplied to third grade students in treatment and control schools at the beginning ofschool year during which the experiment is being implemented (April 1 995) and atthe end of that year (November 1995). After that, efforts would be made toadminister comparable tests to these schools during the first two nationalapplications (1 996 and 1 998) of the national testing system, so that longer-termeffects of the experiment can be assessed.

For the baseline, the teacher, director, APAFA and USE questionnaire as well asthe collection of data from administrative records will be applied in October 1995prior to the staff training. The standardized tests and the student and parentquestionnaires will be applied in April 1995 at the beginning of the academic year.

Observation guides will be used for selective case studies on a smaller number ofschools and classrooms and for general monitoring during the course of 1 995.

E. Evaluation Products, Timetable and Budget

The evaluation will produce three types of products:

1) Reports

These will include descriptive reports based on the baseline information,intermediate monitoring reports during the implementation of the experiment, andmost importantly, a report after one year of the experiment based on thecomparison of ex-ante and ex-post data. These results will provide importantinformation to the Ministry as inputs in the decisionmaking process regardingeducational reform.

The baseline report will be written May-June 1995. The first evaluation report willbe prepared January-February 1 996. After that, two more evaluation reports willbe prepared upon completion of the 1 996 and 1 998 tests.

85 Annex 8Page 8 of 9

2) Data

The data will be documented and maintained in the Ministry of Education's PolicyPlanning Unit and the World Bank in order to serve as the basis of longer-termevaluations that may be conducted in the future. In addition, public use data tapeswill be made widely available for research in Peru and elsewhere.

3) Capacity Building

Through participation in the experiment and its evaluation, analytical capacity willbe built up in the Ministry of Education which will serve as a basis for improvingthe policy planning process.

F. Staffing and Institutional Arrangements

1) Ministry of Education

The Ministry of Education will be responsible for providing advice on the project,implementing the experiment, and analyzing the results in order to informpolicymaking.

An advisory committee will be formed to provide general guidance for theexperiment and ensure its effective implementation. This committee will consist ofsenior management from the Ministry of Education (MOE), the general contractorfor the evaluation and World Bank staff.

The overall coordinator for the experiment and evaluation will be a key advisor ofthe Minister of Education. The implementation of the experiment itself will be thetask of the Office of Technical Development (OTD) of the MOE, assisted byexternal consultants.

2) General Contractor

A general contractor will be responsible for preparing the evaluation design,collecting and analyzing the data. In carrying out their responsibilities they willengage a core full-time staff of 3-4 researchers trained in evaluation methodologyand educational analysis. In addition, they will hire short-term consultants forspecialized tasks as necessary.

86 Annex 8Page 9 of 9

3) World Bank

Operational staff will participate in the advisory committee, as outlined above. Inaddition, because this evaluation is a case study in the research project funded byRSB, "Impact Evaluation of Education Projects," staff associated with the researchproject will provide operational support and technical assistance to the evaluation.

Annex 8, Table 2: Indicators and InstrumentsLevel of Analysis Indicators Instruments

Student Academic Achievement Math and Language tests* Mathematics* Language

Non-Academic Achievement Student Questionnaire* Self-perception* Time Allocation

School Internal Efficiency Administrative Records* Dropout * USE* Repetition * Schools* Enrollment Rates Observation guide* Attendance (students, teachers, directors) Teacher questionnaire

Director questionnaire

Physical inputs* Texts* Equipment* Infrastructure

Cost and Financing* Costs* Resource Mobilization

Director behavior & Character* Management Process* Relation w/APAFAS* Relation with teachers* Qualifications

Teacher behavior & Character* Pedagogical practices* Administrative Responsibilities* Relation w/APAFAS & directors* Sociecon. Characters* Time Allocation* Self-perception

Community Parents Qualitative guides* Perception of school Parent's questionnaire* Relation w/student USE questionnaire* Socieconomic characs. APAFA questionnaireAPAFAS* Contribution/projects USEs

87 Annex 9Page 1 of 2

ANNEX 9: SCHOOL INFRASTRUCTURE COMPONENT

1. The identification of the targeted Departments for school rehabilitation was done usinga set of indicators which received a different weigh according to its contribution thedimensions of poverty, access to education and infrastructure deficit. The following were theindicators used to select the Departments with their respective weight: (i) unsalvageableclassrooms as a proportion of total enrollment (.35); (ii) proportion schools functioning on

Annex 9, Table 1: Index for Targeting Departments for School Rehabilitation

Unsalvageable Rented Primary Gross Poverty Map ClassroomClassrooms Space Enr. Ratio Rank Crowdedness TOTAL

Departments Index Index Index Index Index Score

Cajamarca 7.70 4.60 2.10 4.20 1.40 20.00

Huancavelica 5.60 4.20 3.60 4.80 1.10 19.30Cuzco 6.65 2.40 2.70 4.40 1.80 17.95Puno 8.05 2.20 2.40 4.00 0.90 17.55Junin 7.35 4.00 1.65 2.80 1.60 17.40

Loreto 8.40 2.80 2.85 2.00 1.30 17.35Ancash 7.00 4.40 1.95 3.40 0.40 17.15Lima 8.75 5.00 0.45 0.20 2.50 16.90

Apurimac 3.85 3.00 3.75 5.00 1.00 16.60

San Martin 5.25 3.20 3.00 3.60 1.50 16.55

La Libertad 6.30 3.60 1.20 2.40 1.90 15.40

Huanuco 5.95 0.80 3.15 3.00 2.40 15.30

Amazonas 3.50 3.40 2.55 3.20 0.50 13.15

Piura 4.90 1.40 1.35 2.60 2.10 12.35

Arequipa 4.20 4.80 0.75 1.00 1.20 11.95

Ica 2.80 3.80 1.80 1.60 1.70 11.70

Ayacucho 4.55 2.00 0.30 4.60 0.20 11.65

Ucayali 2.45 1.00 3.30 1.40 2.30 10.45Pasco 3.15 1.80 0.60 3.80 0.80 10.15

Lambayeque 1.40 2.60 0.90 1.80 2.00 8.70Madre de 1.05 0.60 3.45 2.20 0.30 7.60DiosTacna 1.75 0.20 1.05 1.20 2.20 6.40

Callao 2.10 1.20 1.50 0.40 0.70 5.90

Tumbes 0.35 0.40 2.25 0.80 0.60 4.40

Moquegua 0.70 1.60 0.15 0.60 0.10 3.15

88 Annex 9Page 2 of 2

rented buildings (.20); (iii) place of the Department on the poverty map (.20); (iv)primary gross enrollment ratio (.15); and (v) average classroom size (.10). EachDepartment was given a grade on a scale from one to twenty three on the aboveindicators, with the worse off Departments receiving the highest grade on each ofthe indicators. The score of each Department on a single indicator resulted frommultiplying the weigh of the indicator times the grade of the Department on thatindicator. The final score of a Department resulted from adding up theDepartment's score on each indicator. All the Department receiving a score abovethe national mean were selected to be beneficiaries of the project.

Annex 9, Table 2: Distribution of School Rehabilitation by Area and YearArea 1994 1995 1996 1997 1998 TotalUrban 497 542 587 452 181 2259Rural 150 479 618 514 180 1941Total 647 1021 1205 966 361 4200

Annex 9, Table 3: Distribution of Bokshelves by Area and YearArea 1994 1995 1996 1997 1998 Total

Urban 11051 14306 11429 11832 48617Rual 9760 15070 12991 11832 49653Total 0 20811 29376 24420 23663 98270

89 Annex 10Page 1 of 2

PERU: PRIMARY EDUCATION QUALITY PROJECTANNEX 10: DOCUMENTS IN PROJECT FILES

1. Plan Nacional de Capacitacion Docente. Proyecto Mejoramiento de laCalidad de la Educaci6n Primaria, prepared by the Ministry of Education,Lima, Peru, July 1994.

2. Componente: Fortalecimiento Institucional, Proyecto Mejoramiento de laCalidad de la Educaci6n Primaria, prepared by the Ministry of Education, July1994.

3. Subcomponent: Modernizaci6n del Sistema de Gestion, ProyectoMejoramiento de la Calidad de la Educaci6n Primaria, prepared by theMinistry of Education, Lima, Peru July 1994.

4. ComDonente: Sistemas de Informaci6n, Proyecto Mejoramiento de laCalidad de la Educaci6n Primaria, prepared by the Ministry of Education.

5. Ano de la Modernizaci6n Educativa del DeDorte: CRECER, Crecer con Calidadv Equidad en el Rendimiento, Proyecto de Mejoramiento de la Calidad de laEducaci6n Primaria (Decima Versi6n), Prepared by the Ministry of Education,Lima, Peru, July 1 994.

6. Ficha T6cnica 1 Modelo CEDEA: Centros Educativos Estatales Aut6nomos,Prepared by the Ministry of Education, Decentralizaci6n Administrativa de laEducaci6n.

7. Plan de Desarrollo de la Educaci6n a Largo Plazo 1 995-2010. Proyecto deMejoramiento de la Educaci6n Primaria, Lima, Peru, October 1994.

8. Lineas de Desarrollo Para un Plan de Largo Plazo de Educaci6n BilingueIntercultural, Proyecto de Mejoramiento de la Calidad de la Educaci6nPrimaria, Prepared by the Ministry of Education, Lima, Peru, October, 1995.

9. ComDonente l: Infraestructura Educativa, prepared by the Ministry ofEducation Direccion de Infraestructura Educativa-DINFE, September, 1994.

90 Annex 4Page 2 of 2

10. Subcomgonent II: Reforzamiento de la DINFE, Prepared by the Ministry ofEducation Direcci6n de Infraestructura Educativa - DINFE, Lima, Peru,September, 1 994.

11. Componente de Materiales Educativos, Proyecto Mejoramiento de la Calidadde la Educaci6n Primaria, Lima, Peru, October 1994.

12. Consolidaci6n Curricular, Proyecto Mejoramiento de la Calidad de laEducaci6n Primaria,

13. Censo Escolar, 1 993, Informe Ejecutivo, Prepared by INANDEP, Lima, Peru,September 1984