for official use only -...

Document of

The World Bank

FOR OFFICIAL USE ONLY

4.vA 3/// -

Report No. 7573-JM

STAFF APPRAISAL REPORT

JAMAICA

SOCIAL SECTORS DEVELOPMENT PROJECT

JUNE 1, 1989

Human Resources DivisionCountry Department IIILatin America and Caribbean Regional Office

This document has a resicted distibudon and may be used by reipients only In the perfonnmace oftheir offlci duties. Its contents may not otherwise be disdosed wihout Wodd Bank authodon.

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

Pub

lic D

iscl

osur

e A

utho

rized

CURRENCY EQUIVALENTS

Current Unit - Jamaican, Dollar (JS)

US$1.00 = J$5.50US$1 million J$5.5 millionUS$181,800 = J$l million

FISCAL YEAR

April 1 - March 31

ACADEMIC YEAR

September 1 - June 30

PRINCIPAL ABBREVIATIONS AND ACRONYMS USED

BMS = Bureau of Management SupportCAST - College of Applied Science and TechnologyCGCED - Consultative Group for Caribbean Economic DevelopmentGOJ - Government of JamaicaHEART 8 Human Employment and Resource Training TrustHRDP - Human Resources Development ProgramLSMS 3 Living Standards Measurement SurveyMOE = Ministry of EducationMOH = Ministry of HealthMTFP - Medium Term Economic Framework ProgramNAP - National Assessment ProgramNGO - Non Governmental OrganizationNWC = National Water CommissionPACE = Program for the Advancement of Early Childhood EducationPANCO = Project Administration and Management CompanyPIOJ = Planning Institute of JamaicaPSIP = Public Sector Investment ProgramRGD = Registrar General's DepartmentSLC = Survey of Living ConditionsSOE = Statement of ExpenditureSTATIN = Statistical Institute of Jamaica

FOR OMCIAL USE ONLYJAMAICA


Table of Contents Page No.

BASIC DATA SHEET ............................................ , v

LOAN AND PROJECT SUMMARY .................... vii

I. INTRODUCTION ................................................. 1

II. MACROECONOMIC SETTING AND SECTORAL STRATEGY . . 2

Recent Macroeconomic Developments ............................ 2Medium-Term Policy Framework and Financing Program ........... 3Bank Strategy ................................................ 3

III. f.ATUS OF SOCIAL SERVICES IN JAMAICA ......................... 5

Public Health Services ....................................... 5Nutrition Services ........................................... 7Education Services ........................................... 9Employment Aid ............................................... 13Housing, Water Supply and Sanitation Services ................ 13

IV. THE HUMAN RESOURCES DEVELOPMENT PROGRAM (HRDP) . .. .14

Goals ........................................................ 14Contents ..................................................... 15HRDP Costs and Financing ..................................... 18Management and Monitoring .................................... 19

V. THE PROJECT .................................................. 20

Objectives ................................................... 20Policy Actions ............................................... 21Annual HRDP Progress Reviews ................................. 23

This report is based on the findings of a pre-appraisal mission whichvisited Jamaica in July/August 1988 comprising R. Drysdale (missionleader), R. Moran (economist), H. Calika and K. Gibbons (consultants); andan appraisal mission which visited Jamaica in November/December 1988comprising R. Drysdale (mission leader), C. Valdivieso (economist),B. Carlson (population specialist), H. Calika and J. St. Germain(consultants). M. Grosh and P. Glewwe (economists) contributed to LSMSdesign and analysis.

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

- il -

Table of Contents (continued)

Page No.

Project Components ......................... 23Health Sector ...................................... 23Education Sector ................ ...................... . 26HRDP Administration and Monitoring . ........... 29

Project Implementation and Management ....................... . 30

VI. PROJECT COSTS, FINANCING, PROCUREMENT AND DISBURSEMENTS ... 31

Costs ........................................................ 31Financing .................................................... 33Procurement .................................................. 33Disbursements ................................................ 35Auditing and Reporting ......................... ....... ....... .38

VII. BENEFITS AND RISKS ........................................... 39

VIII. AGREEMENTS REACHED AND RECOMMENDATION ........................ 40

LIST OF TABLES IN MAIN REPORT

Table 3.1: Social Indicators: Jamaica and Comparator NormsTable 4.1: Human Resources Development Program: Projected Disbursements

on New ProgramsTable 6.1: Summary of Projects Costs by ComponentTable 6.2: SummAry of Projects Costs by Category of ExpenditureTable 6.3: Financing PlanTable 6.4s Procurement ArrangementsTable 6.5: Disbursement Forecast

ANNEXES:

1. Social Development IndicatorsTable 1: Comparative Education IndicatorsTable 2: Jamaica: Population ProjectionsTable 3: JamAica: Health Status -- Comparative Indices

2. Public Sector Outlays in Health and Education3. HRDP - Possible Projects for External Financing4. Statement of Sectoral Policies5. Policy Matrix6. Project Cost Estimates

Table 1: Project Components by Year, Base Costs and ContingenciesTable 2: Project Components by Year, Totals Including ContingenciesTable 3: Summmary Accounts by YearTable 4: Summary Accounts by Project Component

7. Implementation Schedule8. Selected Documents and Data in Project Files

- tit -

Table of Contents (continued)

CHARTS:

Chart It Organizational Structure of the HRDP Secretariat

Chart 2: Organizational Structure of the Ministry of Education

Chart 3: Organizational Structure of the Ministry of Health

Chart 4: Organizational Structure of the Project Implementation

Unit at the Ministry of Health

MAP: IBRD No. 20846

June 1, 1989

JA1AICA

Social Sector D-velopment Prolect

BASIC DATA SHEET

DATA YEARA. 2ENERAL CCUNTRY DATA:

1. Population Estimate (Million) 2.8 19872. Population Projection (Million) 2.7 20008. Assumed Year of Reaching Net Reproduction Rate of One -- 20054. Size of Stationary Population (Million) 4.4 2155S. GNP Per Capita (US$) 960 19876. Average Annual ONP Growth Rate (S) -1.8 1981-887. Urban Population as X ot Total 5t 19868. Literacy Rate (U) 90 19849. Are (C000 Sq. Kilometers) 11 198910. Pop. Density (Per KU2 of Agricultural Land) 487 19S7

B. POPULATION DATA:1. Crude Birth Rate (Per 1000) 28 19872. Crude Death Rate (Per 1000) 6 19878. Annual Rate of Population Growth (X) 1.6 1980-8B4. Total Fertility Rate 8.0 1986S. Age Specific Fertility Rate:

15-19 122 198820-24 190 198826-29 150 198880-34 110 1908a5-a9 78 198840-44 40 1088

6. Infant Mortality Rate (per 1000) 18 198?7. Life Expectancy at Birth (years) 78 198B8. Population Age Structure (X)

0-14 years 87 198614-84 yar. 56 198665. years 7 1986

9. Women o5 Child-bearing Age (16-49 as X oftotal population) 48 1985

10. Contraceptive Prevalence Rate (X) 62 1088

C. HEALTH DATA:1. Population Per Physician 2800 19862. Population per Nurse 550 19818. Population per Hospital Bed SOO 19864. Public Health Expenditures as X of Total Government Budget 7 1987

(Current ar Capital)

D. NUTRITION DATA:1. Daily Calorie Supply 2676 19662. Babies with Low Birth Weight. (X) 10 19848. Calorie Intake as X of Requirement. 116 19864. Per Capita Protein Intako (g/day) 69 1986

- vi -

DATA YEAR

E. EDUCATION DATA:

1. Preschool Enrollment Rate (1) 68 19872. Primary Education Enrollment Rate (X) 99 198?S. Secondary Education Enroll ment Rate (X) e1 19854. Higher Education Enrollment Rate (X) 8 19855. Public EdiucatIon Expenditures as X of Total Government

Budget (Current and Capital) 14 1987

SOURCE: World Bank, Social Indicetors of Developimnt, 1987World Bank, World Development Report, 1988Economic A Social Survey of Jamaica, 1982, 1986Mission Estimates

- vii -

JAMAICA

SOCIAL SECTORS DEVELOPMENT rROJECT

LOAN AND PROJECT SUMMARY

Borrower: Government of Jamaica

Beneficiaries: Ministry of Health (MOH), Ministry of Education (MOE),Statistical Institute of Jamaica (STATIN), and thePlanning Institute of Jamaica (PIOJ).

Amounts US$30.0 million equivalent

Termst Payable in 17 years, including a five-year graceperiod, at the Bank's standard variable interest rate.

Pro2ect Objectivesand Description: The objectives of the proposed project are to improve

the efficiency, delivery and management of socialservices in Jamaica, and in particular, of health andeducation. It would support the Government's HumanResources Development Program (HRDP), which representsa comprehensive initiative to improve severalimportant social services in Jamaica. The HRDP willprovide an increase in the flow of funds to the socialsectors, which had been deprived of sufficientresources in recent years due to economic austerity,while supporting institutional and policy reforms. TheBank's leading role in HRDP financing andimplementation will contribute to the adoption ofsound human resource development policies. Based onthe policy reforms and efficiency measures listed inthe Government's Statement of Sectoral Policies andPolicy Matrix, the proposed project will financeselected health and education activities included inthe HRDP. Outside these areas, other donors will takethe lead in their respective projectslprograms underthe HRDP, in the form of parallel financing. Theproposed project would finance: civil works,furniture, equipment (including vehicles),pharmaceuticals, books, training, consultants'services, and incremental HRDP staff for: healthsector development; education sector development; andHRDP administration and monitoring.

For health sector development, support would be givenfor: (a) construction, furniture and equipment for 12primary health care centers, including nurses'quarters in eight of them, and dental clinic equipment

- viii -

for eight centers; (b) acquisition and utilization ofmedical, surgical, dental and medical supportequipment for hospitals, including laboratory andpharmacy equipment; (c) replenishment of depletedstocks of pharmaceuticals for preventive. curative,and rehabilitative health care delivery; (d) healthsector institutional strengthening, including thestaffing of a project implementation unit at the NOH,as well as training for MOH staff; and te) upgradingthe Registrar General's Department at the MOH. Foreducaticn sector development, support would be givenfor: (a) upgrading the basic schools program forcommunity-sunDorted, pre-school centers in low-incomeneighborhoods by supporting the refurbishing of about390 pre-primary schools, training of pre-primaryschool teachers, and program supervision andmonitoring; (b) renovating about 20 primary and all-age schools, to alleviate overcrowding; (c) increasingthe availability of primary level textbooks bysupporting the development, production, anddistribution of English, mathematics, science andsocial studies textbooks for about 350,000 primaryschool children; and (d) education sectorinstitutional strengthening by supporting theconstruction of five and staffing of six RegionalEducation Offices, the operation of the NationalAssessment Program, teacher training, a pilot programof school awards, provision of educational materialsfor needy children, and support of the HRDP projectimplementation unit at the MOE. For HRDP adminis-tration and monitoring, support would be given for:Ca) staffing and operation of the HRDP Secretariatwithin PIOJ and (b) HkDP implementation and impactmonitoring, including semi-annual household surveys onliving standards, to be carried out by STATIN, incollaboration with PIOJ.

Benefits: The Bank's leading role in the HRDP formulation andexecution will help Jamaica to reap increased benefitsfrom the program, while keeping it within the agreedmacroeconomic framework and overall investmentpriorities. Through its policy reforms and othermeasures, the program would increase the overallefficiency of social services, improve targeting ofsubsidies and assistance, and promote formulation ofsuitable strategies to protect the vulnerable groupsof the population. The proposed project's main focuson primary health care and pre-primary and primaryeducation would help rehabilitate, improve and expandthese priority social services, and would give thepoor, especially women and children, better access tothem.

- {x -

Riskss The main tisk, both for the proposed project and forthe HREP as a whole, is possible administrative delaysin program implementation. An effective role by theHRDP Secretariat in monitoring, coordinating and expe-diting the HRDP execution by seve.dl Ministries andagencies would reduce stuch a risk. Special HRDPimplemenfting staff in major ministries and agencieswill help to expedite the program/projectimplementation. Another important risk is that theGovernment may find it politically expedient tooveremphasize certain segments of the HRDP (such asfood distribution and public works programs), to theneglect of other more economically sound HRDPcomponents. The periodic HRDP monitoring system andthe annual progress reviews with the Government wouldfocus on program priorities on a continuing basis. TheBank's involvement in the overall program and itsleading role in the donor aid coordination processwould provide an effective basis for discussion andclose monitoring of the !RDP expenditures.

Estimated Costs:a/ Local Foreign Total- USS million ------

Health SectorPrimary Health Care Development 3.1 2.3 5.4

Medical Equipment 0.1 1.0 1.1

Pharmaceutical Stocks 3.3 9.8 13.1

MOH Institutional Strengthening 3.8 1.0 4.8

Upgrading Registrar General's Department 0.6 0.7 1.3

Subtotal 10.9 14.8 25.7

Education SectorUpgrading Pre-Primary Schools 2.2 1.3 3.5

Upgrading Primary & All-Age Schools 5.5 3.6 9.1

Primary Textbook Program 6.9 0.8 7.7

MOE Institutional Strengthening 5.2 1.7 6.9

Subtotal 19.8 7.4 27.2

HRDP Administration and MonitoringHERDP Secretariat 1.2 0.2 1.4

Impact Monitoring 0.5 0.4 0.9

Subtotal 1.7 0.6 2.3

Total Base Costs 32.4 22.8 55.2

Physical Contingencies 1.6 1.2 2.8

Price Contingencies 5.8 3.2 9.0

Total Project josts 39.8 27.2 67.0

a/ Exclusive of taxes and duties, which are negligible.

Financing Plant

Local Foreign Total--- - US$ million ----

Government of Jamaica 37.0 0.0 37.0Proposed IBRD Loan 2.8 27.2 30.0

Total 39.8 27.2 67.0

Estimated IBRD Disbursement:

1990 1991 1992 1993 1994 1995-- US$ million --------------------

Annual 3.0 4.2 6.3 6.6 7.2 2.7Cumulative 3.0 7.2 13.5 20.1 27.3 30.0

Rate of Return: Not applicable

Maps IBRD No. 20846

JAMLICA


I. INTRODUCTION

1.01 The Government of Jamaica (GOJ) has asked the Bank to participateir. the financing of its Human Resources Development Program (HRDP) and totake the lead in securing further external finance at favorable terms. TheHRDP represents a comprehensive initiative on the part of the Government toimprove several important social services in Jamaica. It provides a socialdimension fer the major economic adjustment process which Jamaica wentthrough in recent years. The proposed project supports institutional andpolicy reforms, as well as an increase in the flow of funds to the socialsectors, which were deprived of sufficient resources in recent years, dueto economic austerity.

1.02 The GOJ envisages about US$390 million equivalent in new programsunder the HRDP, for health, education, and poverty alleviation (nutritionand employment aid) during the period 1989/90 - 1993/94. In addition,about US$400 million equivalent will be spent during the period on ongoinghuman resource /.evelopment programs.

1.03 The HRDP is a key component of the Government's medium-term PublicSector Invev,tment Program (PSIP). The Bank assisted the Government inpreparing the HRDF, and in presenting it to potential donors at aConsultative Group for Caribbean Economic Development (CGCED) specialSubgroup meeting on Jamaica in June 1988.1 Preliminary responses bypotential funding agencies indicate that additional financing requirementsof the HRDP will be secured from external sources, including the proposedBank loan. The Bank would assist the Government in coordinating externalaid flows in support of the HRDP.

1.04 The Bank approach to this lending operation differs fromconventional Bank projects, inasmuch as it is focused on a broad socialsector investment and policy reforms program, while disbursing on the basisof a fairly small part of the overall program. Under the proposedapproach, program and project implementation will be phased on the basis ofBank/Government agreerents at yearly HRDP progress reviews; phasing ofsocial sector policy reforms and efficiency measures will also beprogrammed at such review meetings. Annual Bank loan disbursements willreflect the borrower's satisfactory progress with project implementation.The Bank would continue to coordinate its actions with those by other donorand lender agencies.

1/ Jamaica - Summary Review of the Social Well-Being Program. World BankReport No. 7227-JH, May 20, 1988.

- 2 -

II. MACROECONOMIC SETTING AND SECTORAL STRATEGY

Recent Macroeconomic Developments

2.01 The GOJ has carried out major stabilization and adjustmentprograms to restore macroeconomic balance and economic growth. Variousagreements with the IMF and three structural adjustment and two sectoradjustment loans from the Bank have supported the Government's efforts.Economic adjustment, aggravated by an unfavorable internationalenvironment, led to deep cuts in social services and in public employment;many programs for the benefit of the poor were curtailed. These cutsaccelerated a deterioration in Jamaica's social infrastructure;unemployment increased, and poverty deepened in the lower income segmentsof the population. Corrective action in the social sectors--includingincreased transfer of resources--is required to reestablish the basis forlong-term human resource development and to assure that essential socialservices are available to all Jamaicans on an equitable basis. In view ofresource constraints, it is equally important that theso services beefficient in the use of resources and effective in attaining theirobjectives.

2.02 After a deep and sustained contraction, the economy of Jamaicamoved into a period of stagnation in the early 1980s, with mountingdifficulties in the servicing of external debt. In 1980, the GOJ started aprogram to stabilize public finances and gradually restructure the economytowards its goal of production of internationally competitive goods andservices. With the help of an exceptional infusion of foreign officialcredits and a strong recovery in tourism earnings, the contraction of theeconomy was arrested. This stabilization effort was seriously set back in1984/85, however, by the international recession and, in particular, by anunanticipated collapse of the world market demand for Jamaican bauxite andalumina. Under the drastic fiscal austerity which became necessary to copewith the situation, deep cuts were mrAde in public employment and in socialservices. Real current expenditures or. social servicts, as well asinvestments in public health and education, were greatly reduced. Higherrates for utilities were introduced, and some subsidies on consumer goodswere discontinued, both with adverse impact on the purchasing power of lowincome consumers. The safety net for protection of the poor was weakenedwith the decline in social services and subsidies, increased costs, andother actic s necessitated by the adjustment process.

2.03 In the two and a half years prior to Hurricane Gilbert, whichstruck the island on September 12, 1988, Jamaica was enjoying a sustainedperiod of economic growth. Real economic growth was 5.22 in 1987, comparedwith 1.92 in 1986, and this was being sustained at a 5.52 rate in 1988.All sectors of the economy were contributing to this growth, with particu-larly strong growth in tourism (the number of stopover visitors grew 16? in1986 and 112 in 1987) and stabilization and growtb in the bauxite/aluminasector. A notable achievement of the economy over the period 1986-87 hasbeen the improvement in domestic and national savings performance. Therewas a strong rebound in investment in 1987, and good progress has been madein restoring viability to the country's external accounts. Undoubtedly,the hurricane represents a setback to this improving economic performance.All of the economic sectors have been affected to some degree or another;

-3-

but the agricultural sector has suffered severely, as has the country'shousing stock. Furthermore, there has been considerable damage to thecountry's social and economic infrastructure. Overall damage to thecapital stock was estimated at between US$800 million to US$1.2 billion.In agriculture there were major losses in tree crops and disruptions todomestic food production. This caused an acceleration in domesticinflation to about 1OZ to 122 in the latter part of 1988. The hurricanedamaged more than SO of the housing stock, with a large impact on lowincome groups due to the less robust nature of the structures.Furthermore, there was damage to hospitals, clinics and schools, which hasdisrupted the provision of social services. The Government has launched anurgent reconstruction program, providing special grant assistance forrepairs to low income housing, to small farmers for replanting and a rapidrepair program for tne social sector infrastructure. The hurricane hascaused widespread dislocation in employment in all sectors, but this isexpected to be only temporary. Further pressure has been placed on thecountry's balance of payments as import demand increases to meet the needsof the country's reconstruction efforts.

2.04 Donor response to the relief effort has been very positive(including a Bank-financed Emergency Reconstruction Import Loan for US$30million), and external financing gaps appear to be closed for the next twoyears. The overall damage caused is a serious blow, particularly withinthe social sectors, which reinforces the pressing need for the correctiveaction and support that would be provided by the proposed project.

Medium-term Policy Framework and Financing Program

2.05 The GOJ, in early December 1987, presented to a special CGCEDdonor Subgroup meeting on Jamaica a Medium Term Economic Framework Program(MTFP) which included provision for the HRDP. In this submission, theGovernment set out the policy reform agenda for the next 3-4 years and itsfinancing needs, including further balance of payments support andrescheduling of debt.

Bank Strategy

2.06 Jamaica's economic growth performance during the last two yearshas been encouraging. During the next few years, leaving aside thereconstruction work due to hurricane damage (which is being financed bygenerous flows of external aid), the need remains for increased investmentin key economic sectors, supported by concessional resource flows andcofinancing from abroad, to sustain growth of incomes and progressiverehabilitation of economic and social infrastructure. There is need forrenewed focus on human resource development to sustain long-term economicgrowth with equity. Continued structural reforms and adjustment are alsorequired for growth over the medium term, with healthier balance ofpayments and debt management. Future Bank lending operations in Jamaicawill aim at aupporting the Government's investment and adjustment effortsin priority sectors. The Bank role in the social sectors, particularly inthose services reaching the majority of the population, is justified notonly to help the Government mitigate the social costs of adjustment, butalso to increase Jamaica's long-term economic viability. The Goverment'sMTFP (para. 2.05) supports such an approach.

-4-

2.07 The Bank's sector development strategy in population and healthhas been to support the Government's long term demographic and healthobjectives, including implementation of effective family planning programs.So far, the Bank has made three loans to Jamaica in support of populationand health programs. The first two loans, which focused on expanded post-partum family planning services and integrated family planning, andmnaternallchild health and nutrition education services in Cornwall County,have been completed with acceptable results. The third project, approvedin June 1987, has been designed to: strengthen the Government's populationand family planning programs, and build the Ministry of Health (MO-)capability to plan, finance and operate the health services deliverysystem, together with technical assistance to design a new patient referralsystem and to study cost recovery and financing measures. Projectimplementation has been elow due mainly to problems related to thepreparation of bidding documents for civil works. In addition, theproposed project would help to mitigate the costs of economic adjustmentfor the lower income groups through more efficient targeting of socialprograms and improved health services, without undue strain on theGovernment's budget.

2.08 In education, the Bank's sector development strategy emphasizescost-effective measures for qualitative development of basic (pre-school)and primary education, rationalization and consolidation of secondaryeducation, including job training for school leavers, and assistance forpost-secondary education that would be financed by a combination ofincreased cost-recovery, student loans, and targeted subsidies for capablestudents from poorer families. The Bank has so far supported foureducation projects in Jamaica, the first three focusing largely onsecondary and vocational education and teacher training. Despite delays inexecution, they have largely met their objectives. The fourth project,approved in January 1988, was designed to assist the Government to prepareand evaluate options for an education rehabiliration and developmentprogram aimed primarily at the first nine grades of schooling. It is alsostrengthening Jamaica's student loan program for higher education bysubstantially improving its collection performance and overalladministration. Project execution is satisfactory.

2.09 Lessons Learned from Project Implementation Experience. ThreeBank-financed education projects and two population and health projectshave been completed in Jamaica to date, and OED Project Performance AuditReports (PPARs) have been prepared for five of them. The following lessonslearned from past experience have been identified as relevant to theproposed project: (a) increase Bank involvement, especially during theinitial project implementation phase, for a more efficient utilization ofGovernment and loan resources;2 (b) pay greater attention to sociologicalfactors in project design;3 (c) ensure adequate provision of recurrent

2/ Project Performance Audit Report: Jamaica - First Education Project(Loan 468-JM), Report No. 649, March 4, 1975.

3/ Project Performance Audit Report: Jamaica - First Population Project(Loan 690-JM), Report No. 2580, June 29, 1979.

-5-

expenditures in schools, especially maintenance of the institutions andconsumable materials;4 (d) establish a clear hierarchy of projectobjectives, with room for change built in and monitored carefully duringimplementation; and (e) pay greater attention to institutional andbureaucratic arrangements. The proposed project will build upon pastexperience through annual reviews to increase Bank involvement; anintegrated HRDP that takes social factors into account; provision ofprimary textbooks and school materials for needy children; and carefuldesign of the institutional set-up for the HRDP Secretariat as well as theministerial project implementation units. Project preparation has alsotaken into account the need for competent management, effective planningand programning capability, and adequate and timely counterpart financing.

III. STATUS OF SOCIAL SERVICES IN JAMAICA

3.01 Social services in Jamaica have benefited from a long tradition ofpublic support. Among countries of comparable per capita income, Jamaica,over the decades, has consistently ranked close to the top on conventionalindicators of social development (See Table 3.1 and Annex 1). In recentyears, however, real public expenditures for education, health and othersocial services fell sharply and social well-being was adversely affected.The GOJ prepared the HRDP in response to these developments, and toalleviate the current financial and reform needs of various socialservices.

Public Health Services

3.02 Thanks to a distinguished history of accomplishments in publichealth care since early in the twentieth century, most Jamaicans enjoybetter health than their counterparts in countries of similar incomelevels. Life expectancy at birth is 74 years and infant mortality isestimated at about 27 deaths per thousand live births. Chronic disenses(stroke, heart disease, cancer, hypertensive disease and diabetes) areahead of the so-called diseases of underdevelopment (gastroentritis,respiratory infections, and communicable and infectious diseases) as causesof death. Non-respiratory infectious diseases (mostly gastrointestinal),perinatal conditions, and malnutrition account for slightly over a third ofthe years of potential life lost; injury and homicide account for about aquarter, and chronic diseases for the remainder.

3.03 In the 1980s, the growth in Jamaica's population (now at about 2.3million) has averaged close to 1.5Z per year, which is considerably lowerthan in countries of comparable per capita income. The GOJ intends to keeptotal population from growing beyond 3 million by the year 2000, andsponsors a variety of high quality family planning services to attain thisobjective.

4/ Project Performance Audit Report: Jamaica - Second Education Project(Loan 727-JM), Report No. 4161, November 1, 1982.

5/ Project Performance Audit Report: Jamaica - Second Population Project(Loan 1284-JM), Report, No. 5589, April 9, 1985.

-6

3.04 The MOH manages 24 public hospitals and 360 health clinics whichemploy about 12,000 people, two-thirds of whom work in hospitals, a tenthin administration and the remaining in primary health care centers. Theseinstitutions provide equitable access to basic health care for allJamaicans. Each parish has one or more public hospitals and 18 or morehealth centers; most Jamaicans live within a half hour's walk of a primaryhealth care center.

3.05 Not only did public health spending per capita decline by a thirdbetween 1982/83 and 1985/86, but another serious constraint to improvedquality of health services in Jamaica has been the MOH's limited capacityto manage the health system for maximum benefit to the community at large.The MOH is handicapped by a shortage of suitably-qualified personnel insuch areas as planning, evaluation and supervision. Over 90Z of the MOHbudget is used to cover recurrent costs (60Z for personnel, see Annex 2);but lower real salaries in recent years have led many trained MOHpersonnel, especially nurses, to seek better paying jobs abroad. Recentbudget cuts fell disproportionately on supplies and maintenance. With thedevaluation of the Jamaican dollar, the costs of imported drugs and medicalsupplies increased steeply. There is pressing need for increased budgetaryprovisions for health services, with particular emphasis on primary healthcare facilities, and adequate incentive measures to recruit/retain managersand other key personnel for public health care services.

3.06 The private health care market accounts for about 32Z of allhealth care expenditures, but for only 5Z of all facilities iu Jamaica.Between a third and a half of all outpatient health care is providedthrough private sources, while only 71 of all inpatients are cared for atprivate hospitals. In 1983, two-thirds of the island's 1,200 physiciansand interns worked exclusively in private practice, and about 602 of thedoctors employed by the MOH worked afternoons in their private practices.While no major changes are foreseen in the near future in this generalpattern, the GOJ recognizes the need to develop a partnership betweenpublic and private health care providers, and to enlarge the role of theprivate sector in meeting Jamaica's health care needs. In 1987, the GOJcontracted out hospital non-medical services such as catering, security,cleaning, housekeeping, janitorial, portering, laundry and pest control toprivate firms that can operate at lower cost. The GOJ is planning toincrease efficiency by giving Boards greater autonomy in the management ofhospitals. Private blocks are being operated in two hospitals, with fullcost recovery mechanisms within them. To reduce the financial burden onthe Government's budget, the MOH will also encourage communityparticipation in clinic construction and maintenance.

3.07 According to preliminary results of the 1988 Survey of LivingConditions (SLC) (para. 4.18), about a quarter of Jamaicans seeking medicalcare go to nospitals. Contacts with public health clinics have beenreduced since 1984, due to public perceptions of low quality medical care.Even the poorest groups make significant use of private health care. Thereis, therefore, considerable room for policies for increased cost recovery,provided the quality of public health services is raised to a satisfactorylevel. Since 1985, fees are being collected at public hospitals forpurposes of cost recovery and improved bed utilization. The GOJ intends toreview the fee structure, and increase fees as practicable, with a view to

- 7 -

increased revenues, efficiency in delivery of services, and optimum use ofhealth facilities. The Government will be introducing fees for someservices, such as blood banks and medical laboratory tests, where these arenot being collected at present. At present, hospitals and other healthfacilities are routinely reimbursed 50! of their fee collections forapproved expenditures and, in some cases, have received an additionalamount on request. The GOJ also intends to introduce new procedures underwhich public hospitals and other health facilities would be reimbursed 75!of their fee collections from patients for approved expenditures (para.5.05), and is considering measures to upgrade the fee collection system.

3.08 Budgetary constraints in recent years have caused growingshortages of medical equipment and supplies. Drug procurement anddistribution need stronger management within the MOH. Shortages of drugsand medical supplies at the level of health centers arise because oflogistical bottlenecks that cannot be eliminated with additional fundingalone. The GOJ has recently adopted measures to improve the distribution,storage and inventory control of drugs and medical supplies and toencourage the use of generic drugs. It also has plans to align hospitaldrug charges more closely with the real costs of individual drugs (para.5.05).

3.09 Since 1985, a program has been under way for rationalization andrestructuring of public health facilities in Jamaica, focusing on hospitalimprovements, strengthened referral systems, and improved conditions. Toimprove the financial management of public hospitals, the GOJ has recentlyintroduced performance-based budgeting and computerization of accounts.Veak information systems adversely affect the effectiveness of MOHoperations. At present, the Ministry of Health is responsible for themaintenance of a civil registry for, among other items, vital statistics.There have been serious shortcomings in these vital statistics, includingprobable underregistration of infant deaths. The GOJ is introducingmeasures to improve the civil registry and upgrade the Registrar General'sDepartment, under the HRDP.

Nutrition Services

3.10 With the drop in real incomes in Jamaica in recent years, thenutritional status of certain segments of the population has deteriorated.Malnutrition is mainly confined to a vulnerable group--young ch'.dren underfive and pregnant and lactating women who live in low income households,especially those headed by women. In 1985, about 152 of children underfive were classified as moderately to severely malnourished, using the WHOclassification of weight for age. Broadly similar results were found in anutrition survey in 1978. While the proportion of stunted children hadincreased from 5Z to 7! between the two surveys, the preliminary results ofthe 1988 SLC (para. 4.18), showed much lower indices of stunting and wastingthan expected. Statistics at two large metropolitan hospitals show that thenumber of children admitted for malnutrition increased slightly between 1980and 1985. Because malnutrition in Jamaica affects an identifiable group,nutrition program interventions should concentrate on this group.

3.11 The GOJ currently has three food and nutrition programs thatdiffer in the extent to which they are targeted:

-8-

(a) General Food Subsidies: In 1986, in an effort to cushion theeffect of the devaluation of the Jamaican dollar, the GOJ established gen-eral food subsidies covering eleven imported items and providing subsidiesof up to 29X. At present, these cover wheatflour, cornmeal, powderedskimmed milk and a few other items and are channelled through the JamaicaCommodity Trading Company. In 1987, about 802 of the US$25 millionequivalent budget for this program was spent on the purchase and resale ofimported wheatflour and cornmeal. Benefits of this program are regressive;it subsidizes rich and poor alike, but the poor spend less on food than therich and thus receive a small share of the subsidy. According to the 1968SLC (para. 4.18), the poorest quintile of the Jamaican population wasreceiving about J$20.00 in direct consumption benefits per person per year(compared with a national average of J$28.50), while the wealthiestquintile receives about J$36.80 per person per year. In addition, thisprogram may have been distorting food production and pricing. In April1989, the GOJ made substantial reductions in the amount of general foodsubsidies for staple foods such as flour, rice, cornmeal, chicken, driedsalted codfish and condensed milk. The subsidies for FY89-90 were reducedby about J$165 million (from an estimated J$293 million to about J$128million) thus maintaining the total amount at about US$23.5 million, closeto the 1987 level. In addition, the GOJ plans to completely phase outgeneral food subsidies during the next two years, subject to ':iscal andmacroeconomic conditions and objectives. A cabinet subcommittee, withtechnical support from PIOJ, is identifying those households which arehardest hit by food price increases and is designing measures to alleviatethe effects of these increases, primarily through better targeted programssuch as food stamps and school feeding programs. Since any expansion ofthese programs would be coupled with reductions in the general foodsubsidies, there will be no deleterious fiscal effect.

(b) Food Stamp Program: Between 1984 and July 1988, the GOJ wasproviding bi-monthly allotments of J$20 (US$3.60 equivalent) worth of foodstamps applicable to the purchase of cornmeal, rice, and dried skim milk.The effectiveness of this aid was considerably eroded in recent years dueto inflation. The amount was raised to J$30 every two months in July 1988,and will increase again, to J$40 every two months in July 1989. Eligiblebeneficiaries include: pregnant and lactating women and children under fivewho receive health care at public health clinics; families whose head ofhousehold has income of less than J$50/week equivalent; people on publicassistance; and people who obtain poor relief assistance. Food stamps are,thus, well targeted, and the distribution of their benefits is progressive.In practice, however, some who are eligible are left out, and some ineli-gible persons have benefited under the program. According to the 1988 SLC(para. 4.18), 23Z of Jamaican households were receiving food stamps. Halfof the households in the poorest quintile were recipients, while 6? ofthose in the wealthiest quintile were recipients. There is room forimprovement in program targeting. Improved monitoring should helpdetermine whether all eligible malnourished persons are reaching healthclinics (a condition for eligibility for food stamp aid) and receiving foodstamps. Because the most needy group receives insufficient health care,additional outreach efforts may be needed to accommodate them. The GOJ hasreviewed the food stamp eligibility criteria, in relation to nutritionalneeds and mortality/morbidity indicators of the target population, toensure that food stamps reach the most deserving beneficiaries, and has

- 9 -

adjusted the program by removing ineligible recipients from the rosters.In this way, the number of recipients has been reduced from 400,000 to320,000, so the estimated direct cost of food stamps will be close to US$14million for FY1989-90.

(c) School Feeding Program: A nutribun program" was introducedin 1986, with support from the World Food Program to improve childnutrition, school attendance, and performance in pre-primary and primaryschools. The program packages milk centrally and produces fortified bunsfor daily distribution. In 1987, about 170,000 lunches were distributedeach school day, consisting of a half pint of milk and one bun. (Thenutribun program complements a very small school lunch of hot meals cookedon the premises of schools too remote to easily receive daily distributionof products). Pre-primary schools receive a small cash subsidy fornutrition, totaling US$275,000 equivalent annually and targeted to 105,000children (an allowance of less than US$0.02 equivalent per child per schoolday). The school feeding program benefits are somewhat progressive, thoughless so than food stamps. According to the 1988 SLC (para. 4.18), about44? of children in the survey sample received school meals, ircluding 54?of children in the poorest quintile and 322 of children in the wealthiestquintile. The GOJ plans to progressively improve the targeting of itsschool feeding program towards poor children in the earlier years ofschooling and broaden its scope to cover more students at pre-primary andprimary schools (para. 5.05).

3.12 To sum up, the three nutrition programs described above arefunctioning without major problems. As nutrition aid is increased forcarefully targeted beneficiaries, while general food subsidies are beingphased out, the overall cost of the programs will be carefully kept undercontrol. This calls for clarification of policies and eligibility criteriaand for improved targeting of benefits. As in the health sector, the GOJneeds to maintain a reliable and timely monitoring and evaluation system toassess the impact of its nutrition interventions on the beneficiarypopulation (para. 4.18).

Education Services

3.13 Jamaica's reported literacy rate of 922 is one of the highestamong countries with a comparable per capita income (see Table 3.1 andAnnex 1). Achievement of high literacy and primary enrollment rates camewith the rapid expansion of public education, especially between 1940 and1970. Since then, the country's educational accomplishments have been few,and there has been an erosion of quality, particularly at the secondarylevel. The budgetary constraints of the 1980s aggravated this situation.

3.14 Jamaica possesses a broadly based public education system.Private institutions figure only marginally (3? at primary levels and 42 atsecondary levels). The education program serves students between the agesof 3 and 17, who currently number over 600,000 and who are taught by over18,000 teachers in 2,400 schools islandwide. Education is free andcompulsory up to age 11. Hale and female enrollments are about equal. Theeducation system consists of four main levels: pre-primary, primary,secondary, and tertiary. Pre-primazy education was not traditionally aformal part of the Government's education responsibilities, but, since the

- 10 -

mid-sixties, a network of 1,490 community-run *basic" (or pre-primary)schools was established by local demand throughout Jamaica. These areattended by about 105,000 children under six years old (about 632 of theage cohort). The Bernard Van Leer Founuation, a Dutch non-governmentalorganization, provided funds for the development and dissemination ofcurriculum materials to these schools. As of 1970, the Government joinedthis effort by recognizing many of the community schools, in effect certi-fying that they met minimal standards, and offering them small 'HelpGrants" to defray some of their operational costs. As of early 1988, allbut 390 of such schools had been recognized by the Ministry of Education(MOE). As these schools are recognized by the MOE, they will receive aninitial recognition grant of J$1,500. In 1972, the GOJ introduced atraining program to formally prepare teachers for the pre-primary level.The GOJ has also helped to establish 14 Resource Centers, one in eachparish, to serve as mini-training centers for basic school teachers.

3.15 The trend in pre-school education has been to bring "basic"schools progressively under the MOE jurisdiction and budget. In contrast,the primary education system is fully unified, with an enrollment rate ofabout 982 for children in the 6-12 age group. Recent reform efforts con-cerning the primary level include the passage of a compulsory attendancelaw in 1983, curriculum reform for grades 1-4 in 1981 and for grades 5-6 in1982, return to a-three-year intramural teacher-training program, thelaunching in 1984 of a textbook project to provide pupils with language,arts and mathematics texts, the expansion of school lunch programs, and theprovision of grants for school uniforms. Secondary education in Jamaica(with an enrollment rate of 81Z) is divided into two phases: first cycle(Grades 7 to 9) and second cycle (Grades 10 and 11). First cycle secondaryeducation is offered at All-Age, New Secondary, Comprehensive High andSecondary High Schools, as well as at Technical High Schools. Second cycleeducation is offered at all of these institutions except for the All-AgeSchools. 95Z of children who complete sixth grade progress to lower secon-dary school. Of those who go on to secondary school, 402 attend the sub-standard All-Age Schools; of this group, 402 drop out to become members ofthe unskilled labor force upon completion of the ninth grade. Highereducation (with an enrollment rate of 82) is offered by the University ofthe West Indies (which has a campus in Jamaica), the College of Arts,Science and Technology (CAST), and a variety of private training academiesfor part-time students.

3.16 Quality and efficiency are the key and long standing problems inJamaican education. Despite legal provisions to enforce attendance andhigh official primary school enrollment rates, about one-quarter to one-third of the students receive no more than two of the six years of primaryeducation. Substantial grade repetition and student attrition combine toincrease the duration of schooling, and result in low overall completionrates and high unit costs per actual graduate of the six year program.With respect to student achievement, partial but persuasive evidence from1982 sndicates that a large proportion of students who complete Grade 6,perhaps as high as 502, may be corsidered functionally illiterate.

3.17 These generally poor achievement levels appear to be a consequenceof: (i) inadequate physical facilities--generalized overcrowding, inade-quate water and sewerage, lack of maintenance and vandalism; (ii) shortages

- 11 -

Table 8 1: SOCIAL INDICATORS: JAMAICA AND COMPARATOR NORMS

Lower Middle Upper Iudustrialmiddle income middle warket

Jamaica Income countries ncome economlscountries countries

Total feortlilty rote (births)1976 5.4 - 6.1 - 2.81985 2.8 4.8 - 8.7 1.8

Lilfe expectency (years)1960 68 -- 48 -- 70

1965 86 48 -- 6o 71

1976 70 -- 58 -- 72

1996 78 58 -- 6 76

Population per physician (thousands)1960 2.8 -- 8.0 - 0.91965 2.0 -- -- 2.2 0.9

1981 2.7 8.2 - 1.8 0.6

Daily calorie supply(thousand calories per person)

1965 2.2 2.1 -- 2.8 8.11985 2.8 2.6 -- 8.0 8.4

Primary (number enrolled In schoolas percent of age group) /a

1960 82 -- 79 - 108

1965 109 75 - 96 1071975 111 - 97 -- 1041984 106 108 -- 105 102

Secondary (number enrolled Inschool as percent of age group)

1960 48 - 12 -- 581965 51 16 - 29 6s1976 64 - 85 -- ea

1984 58 40 -- 68 90

Higher Education (number enrolledin school as perceont of age group)

1960 2 -- 2 -- 81966 8 5 -- 7 211976 7 -- 7 -- 22

1984 8 12 - 15 as

a/ Enrollment of individuals below or above the age limits of the age group of referencemay couse this Ogross enrollment ratio* to exceed 100 percent.

Source: 'World Development Indiectore, In World Bank, World Develooment Report, vorious years.

- 12 -

of textbooks and instructional materials--until 1984 most primary-levelchildren lacked full-time use of a set of key texts; and (iii) low teachersalaries--real salaries have declined by 302 in four years; attr4 tion andabsenteeism are high, morale is low, and teacher training remainsdeficient; (iv) overly diversified curricula at the secondary level; and(v) inequity in student access to the higher quality programs.

3.18 These shortcomings have been further exacerbated by the reductioniu Government expenditure on education from about 72 of GDP in 1982/83 toabout 4? in 1985/86 (Annex 2). As in the health sector (para. 3.05), theMOE capital budget was drastically reduced in an effort to minimize cuts tothe operating budget. In the 1986/87 education budget, recurrent costsrepresented 95? of the total, mostly consisting of personnel costs, andvery little was available to finance the purchase of textbooks and othereducational materials. To overcome serious shortcomings in the sector, theGOJ needs to increase the MOE budget, especially to increase recurrentbudgetary expenditures on pre-primary and primary schools which servemainly lower income families (para. 5.05).

3.19 Textbook availability in Jamaica's sciool system is stillinadequate, although considerable progress has been made i1n that respectsince a primary-level textbook supply program was initiated in 1984 (para.3.15). The GOJ now plans to provide textbooks on core subjects to allprimary school students by September 1, 1992, and is studying options forcontaining the costs of primary level textbooks. At the secondary level,the GOJ intends to progressively increase the availability of textbooks forstudents, and to collect textbook rental fees from all except the very poor(para. 5.05). These fees currently amount to J$15 per textbook for grades7-9 and J$20 for grades 10-11.

3.20 Financial constraints in the education sector have accentuatedthe need for more efficient management. A study to decentralize schooladministration and to create local community committees in support ofcommunity involvement in school maintenance is nearly completed. The GOJhas recently eliminated boarding grants and introduced enrollment fees inhigher education, while expanding student loan "rograms.

3.21 A serious constraint to efforts to upgrade education services inJamaica has been the current limited capability of the MOE to administerthe system, to implement reform programs, and to systematically monitor andevaluate performance. The MOE suffers from a shortage of suitably-qualified personnel, particularly in such areas as planning, evaluation,and supervision. As in the health sector, qualified persons in the keyareas have been steadily leaving for more lucrative positions both at homeand abroad. The HRDP will provide assistance to improve in-serviceupgrading and post-graduate training for primary and secondary schoolteachers. In addition, the GOJ is designing programs to provide incentivesand training for key managers and teachers (para. 5.05). Monitoring andevaluation systems within the education sector are deficient. Since 1985,the GOJ has under implementation a National Assessment Program (NAP),consisting of a readiness test at grade 1, a diagnostic test at grade 3,and an achievement test at grade 6. The program, however, is poorlymanaged and, as a consequence, the data generated are incomplete orunreliable and, therefore, cannot be used effectively in assessing the

- 13 -

Impact of the education system or school children. The GOJ plans to

improve the quality of these tests, as well as their administration,

timeliness, and the dissemination of results.

Employment Aid

3.22 Unemuloyment has been a chronic problem in Jamaica, with the 'job

seekel rate' (a measure that is roughly comparable to the 'unemployment

rate' in most countries outside the Caribbean region) varying between liZ

and 182 since 1972. The job-seeker rate was 131 in 1980, peaked at 18? in

1982 and has fallen to around 8? in 1988. Thanks to the recent economic

recovery and the economic adjustment programs which have been shi.tirg

incentives towards labor intensive activities, overall employment grew by

156,000 jobs from 1980 to 1987. Over the 1980-87 period, employment in

manufacturing hae grown by 792, in construction by 722, in services by 492

and in commerce by 392, while mining, agriculture and public adminis-

tration's shares in employment declined. The share of self-employment,

which contains much of the low-income informal sector, rose from 1980 to

1985, but by April 1987 it had declined to the level of 1980. The portion

of employed people with less than full-time jobs also declined. Adjusting

total employee compensation statistics for inflation and employment growth

shows real wages rising from 1980 to 1982, then falling sharply between

1983 and 1985. They are increasing at present, and are probably again

close to their 1980 level. In sum, after substantial deterioration between

1983 and 1985, labor market trends are now generally favorable, suggesting

that the Government's macroeconomic program is having its intended positive

impact.

3.23 Two-thirds of those defined as 'unemployed' are women and one-half

are under 25 years. To address the special needs of unemployed women and

youth and of those working in the agriculture and the informal sectors, the

GOJ has sponsored several programs targeted to those groups. Notable among

these programs are the Human Employment and Resou..ce Training Trust

(HEART), an informal vocational training program for youth which emphasizes

on-the-job instruction; and SOLIDARITY, a small credit scheme assisting

unemployed youth in the informal sector to set up their own businesses. In

addition, the HRDP includes special programs, essentially public works, to

employ the poor (including women and youth) in areas with heavy

unemployment (para. 4.12).

Housing, Water Supply and Sanitation Services

3.24 The continued trend of rural-urban migrttion ever the last decade

has put considerable pressure on the infrastructure in Jamaica's towns and

cities. Government estimates indicate that at least 15,500 new dwellings

must be Luilt annually for the next twenty years and 9,700 existing

dwellings upgraded each year in order to accommodate the growing urban

population.° The formal sector produces only 3,500 niousing units per year

6/ This estimate was made before hurricane Gi-bert hit Jamaica. A large

number of dwellings were destroyed or received serious damage as a

result of the hurricane. The GOJ expects that foreign donors and

external aid agencies, together with insurance payments on insured

properties, will help cover the necessary repair and replacement costs.

- 14 -

and informal arrangements bridge the gap between supply and demand. TheGovernment's National Shelter Strategy devotes special attention to lowerincome households. The GOJ is also reviewing various programs and policyoptions to bring housing costs down and to stimulate private sectorparticipation. Plans for the provision of housing over the medium terminclude the construction of new low-cost dwellings, as well as theupgrading of existing shelter and related residential infrastructure.

3.25 Nationwide, Jamaica has made considerable progress in developing acomprehensive water distribution system. The Jamaican National WaterCommission (NWC) has an installed capacity adequate to meet nationaldemand. However, the reliable yield of the water system is only 76.6Z oftotal demand, due to faulty water pumps, leaks in the distribution system,and seasonal variations in rainfall. There is also a need for expandedsewerage treatment and infrastructure, which is adequate in the resortareas, but inadequate in the Kingston Metropolitan Region. The GOJ hasidentified the main gaps in the water supply and sewerage systems, andprograms are already in place to close these gaps and improve service. TheBank has an ongoing project in Jamaica to improve and expand the NWC'sfacilities and services.

3.26 Public investments in the housing, water supply and sanitationsectors, which are included in the Government's capital expenditureprogram, are not included in the HRDP, although they are complementary toit. Investments in these sectors were excluded from the GOJ programsubmitted to external aid agencies/governments in June 1988 for financialsupport, largely because additional external finance is not required.

IV. THE HUMAN RESOURCES DEVELOPMENT PROGRAM (HRDP)

Goals

4.01 The HRDP aims to restore the flow of funds to the social sectorsand to initiate necessary policy reforms. Its main goals are: to reversethe recent setbacks in human resource development through renewedinvestments in education and health; to alleviate the worst effects ofpoverty, particularly for the poorest groups of the population, throughbetter targeted nutrition and employment programs; and to implementinstitutional and policy reforms in the social sectors. To improve theeffectiveness and overall efficiency of social services, the HRDP providesfor: (i) redirecting investments in favor of those education and healthservices that are most likely to reach the poor; (ii) strengthening basiceducation, including rehabilitation and upgrading of pre-primary and primaryschools and providing a more effective and equitable system of secondaryeducation; (iii) rationalizing social services and increasing cost recovery;(iv) improving expenditure controls for better cost containment; (v)improving targeting and monitoring of nutrition and indigent reliefprograms; and (vi) establishing an effective information system to monitorprogram outputs and the impact on key social indicators. These elementswould be complemented by activities in other sectors (paras. 3.24-3.26).Table 4.1 summarizes projected HRDP disbursements on new programs.

- 15 -

Table 4.1: JAMAICA: HUMAN RESOURCES DEVELOPMENT PROGRAMPROJECTED DISBURSEMENTS ON NEW PROGRAMS

1989190-1993194(US$ million)

ProjectedDisbursements Percentage

Health 112.5 29

Nutrition/poor-relief 132.8 33

Education 74.8 19

Employment 68.9 19

Total 389.0 100.0

Source: Jamaica - Summary Review of the Social Well-being Program. WorldBank Report No. 7227-JM, May 20, 1988.

Contents

4.02 In health, HRDP policy objectives include 'ncreased emphasis onprimary health care, greater efficiency of certain public health services,increased cost recovery, and improved financial management and programmonitoring. Health care would be upgraded by: (i) rehabilitating orreplacing some 60 primary health care centers, including the replacement ofinadequate rented facilities deemed too small (in some cases, smallhospitals would be converted into local clinics with emergency rooms andtemporary in-patient care); (ii) refurbishing 12 hospitals; (iii) fosteringprivate interest in hospital management contracts; (iv) enlarging andconsolidating training facilities for nurses and medical technicians; (v)deploying cold chain refrigeration facilities to health centers; (vi)improving the pharmaceutical supply system; (vii) constructing a centraldrug supply depot; and (viii) rebuilding stocks and increasing the supply ofdrugs.

4.03 The HDP gives priority to primary health care centers and hospitalrehabilitation and modernization. Specific health service rationalizationprograms aim at strengthening the referral system and improving managementand efficiency. A national network of laboratory facilities for improvedmedical testing and upgraded training facilities for the nursing school isto be developed. The RDP also provides for enhanced provision ofpharmaceutical supplies. Recent efforts to improve drug management haveincluded computerization of monitnring and inventory control, upgrading ofstorage facilities, and increased use of generic drugs.

4.04 Given the decline in expenditures in the health sector in recentyears, selective increases in sectoral investment and recurrent expendituresin this sector are justified. The health care delivery system is sound and

- 16 -

can absorb additional financial resources, although administrative con-straints in the MOH could slow down program implementation (para. 3.05).Hospital rationalization deserves support, but this activity should notdistract attention from the priority on primary and preventive care for thepoor. Increased MOH expenditures for drug supplies has to be accompanied byenhanced cost recovery from all but the poor. The current fee of J$5 perprescription pays for only a small fraction of the cost. Cost recovery frombeneficiaries of other health services and privatization of servicedelivery, where feasible, need to be vigorously pursued. The current civilregistry system, handled by the Ministry of Health, has seriousshortcomings. Coordination of diverse HRDP activities and procurementchallenge the MOH's management capacity, which needs to strengthen itsproject administration and policy capabilities.

4.05 In nutrition, the HRDP emphasizes improved targeting and efficientprogramming. It proposes the use of three avenues to achieve itsobjectives. First, the GOJ has decided to double the value of food stampsfor recipients (with respect to June 1988) while improving targetingprocedures and continuing with the efforts to increase administrativeefficiency. The doubling in value will more than restore the purchasingpower of the food stamp to its original (1985) level. Secend, the HRDP willprogressively improve the targeting of school feeding programs towards poorchildren in the early years of schooling and broaden its coverage of primaryand All-Age schools; coverage of secondary schools will gradually beintroduced. (Pre-pr!mary schools will continue to be covered through theongoing cash subsidy) (para. 3.11). The southern part of the island, wheremalnutrition appears to be most prevalent, will receive first priority inthe expansion of both the food stamp and school feeding programs. Third,community-based health workers of the MOH will provide outreach services tohomes and childcare centers, to identify, assist, and monitor marginallymalnourished children, as well as to provide health and nuitrition educationto both mothers and others responsible for childcare.

4.06 The food stamp program, together with the outreach services bycommunity health workers, will strengthen the inter-sectoralcomplementarities between the health and nutrition sectors. Similarly, theschool feeding program will provide educational benefits as well as improvedchild nutrition. Geographic targeting to the poorest regions and to pre-primary and primary schools and gradual phasing out of general foodsubsidies would limit the fiscal cost of the programs.

4.07 Malnutrition's narrow concentration among young children andpregnant and lactating women in low-income households and among the verypoor calls for careful targeting of nutrition interventions. General foodsubsidies are not adequately targeted to needy groups, and may discouragelocal food production and create undue rents for distributors and retailersof subsidized foodstuffs (para. 3.11). After initial reductions of aboutJ$165 million for FY1989-90, the GOJ intends to phase out general foodsubsidies over the next two years, subject to fiscal and macroeconomicobjectives and conditions (para. 5.05).

4.08 The aggregate benefits of school feeding programs are greatest forpoor children in the early years of schooling. The GOJ is concentratingschool feeding on pre-primary and primary students in the poorest regions ofthe island, delaying, for the time being, its extension to the secondaryschool level.

- 17 -

4.09 In education, the HRDP policy objectives are to increase publicoutlays for pre-primary and primary education, to encourage communityparticipation in school activities and maintenance, to increase theavailability of instructional mAterials and school textbooks, to provideincentives for key managers/teachers, and to have better program monitoring.Under the HRDP, increased financial resources will be provided £or the MOE,to improve the quality of its services and to enable it to implementinstitutional reforms.

4.10 More specifically, the HRDP provides for the followingimprovements: (a) expanding and upgrading the current system of basic (pre-primary) schools to provide disadvantaged children with a sounder basebefore transition to primary level education (these improvements will bebased essentially on the community-supported Program for the Advancement ofEarly Childhood Education--PACE);' (b) improving the quality of primaryeducation through: refurbishing selected primary schools; increasingteacher training (both initial and in-service training); broadening thesupply of improved textbooks and availability of an increased range oflearning materials; improving the procedures for assessment of studentperformance at various grade levels; and encouraging community participationin school maintenance and other school activities; (c) increasing the accessof primary school leavers to lower secondary and, subsequently, uppersecondary education by upgrading existing secondary schools and providingfor new secondary schools; (d) progressively establishing a common corecurriculum for lower secondary school students, with associated schoolmaterials and adequate methods of student assessment; and (e) providingemployment incentives to improve the performance of school administratorsand teachers in primary and seconaary schools.

4.11 As a whole, the HRDP contains a sound mix of investments andeducational policy reforms that should have significant impact in addressingthe shortcomings arising from the institutional weaknesses of theeducational system and from the budgetary cuts of recent years. Measures toupgrade educational quality deserve high priority, particularly thosedesigned to improve educational management and evaluation. The Government'sefforts to upgrade the educational system have to focus on the pre-primaryand primary levels to enhance the prospects of children in the poorestsegments of the population for normal intellectual and social development.This emphasis, in turn, implies two major benefits. In the first place,many of the Jamaican children now entering school are unlikely to go beyondprimary education. By ensuring that primary school leavers achieve at leastthe minimum standards of literacy and numeracy, the productive capacity ofthe labor force would be greatly increased. Second, those students enteringthe secondary system would be better prepared for that level of education.

7/ As part of the HRDP, the Government would expand PACE, under which thecurrent "Help Grants' to the pre-primary schools will be replaced by anew subsidy system which would supplement (not replace) communitysupport for such schools, and provide incentives to increase privateinputs.

- 18 -

Improved community participation in education, which would be activelypursued under the HRDP, will enable the GOJ to reap considerable benefitsin improved education and in better preservation of school facilities. Costrecovery measures introduced for higher education in 1986/87 and later(para. 3.20) should be maintained and improved as needed. As in health, astronger professional team will be required in various sections of the MOEto handle the increased level of expenditures under the HRDP and to ensuresuccessful integration of the diverse but complementary program components.The HRDP also seeks to strengthen key institutions to support these efforts.

4.12 To increase employment in depressed areas and assist the ruralpoor, who are the most difficult to reach under the various indigent reliefprograms, the HRDP includes a targeted short-term public works program,composed of: (i) rural road maintenance; (ii) flood control; and (iii)reforestation and related soil conservation. These works would cost closeto US$70 million equivalent over the HRDP implementation period and mayprovide, mostly in rural areas, a total of about 12,000 full-time jobequivalents over the five years. Because work organization could includepart-time and temporary jobs, a much larger number of people could bereached in total. The program would, thus, provide income supplements forthose active in the informal sector and agriculture, particularly women andyouth, which are high priority target groups for poverty alleviation.

4.13 The fact remains that the long-run solution to Jamaica'sunemployment problem, which is both cyclical and structural in nature,requires sustained economic growth with expanding private sector investmentin labor-intensive activities. It also calls for ensuring that labormarkets are free from institutional rigidities, biasing technologicalchoices towards capital-intensity. Moreover, it is important to addresssources of structural unemployment through well-focused training programs(such as HEART--para. 3.23) and possibly through selective public worksprojects that would naturally employ urban youth, women, and idle manpowerin depressed areas. It is important that the civil works proposed in theHRDP to relieve unemployment in depressed areas and to assist the rural poorbe evaluated by the usual standards of economic suitability and be fullyintegrated into sectoral priorities. Further analysis of these proposedlabor-intensive civil works projects will include a review, to determinewhether institutional barriers are prejudicing choice of technique in favorof labor-intensive methods. Alternative approaches for increasingemployment opportunities for the poor, mainly of women and youth, are beingexamined.

4.14 Other Social Programs. In addition to the initiatives describedabove, there are a number of other related, on-going programs for which noincremental external financing is being sought by the GOJ. These includeprograms in the areas of vocational training, small business loans, supportfor small farmers, and direct income transfers.

HRDP Costs and Financing

4.15 Of the total estimated cost of the HRDP, around US$390 million isprojected as expenditures on new programs until 1993/94. Nutrition and poorrelief accounts for one third (33Z) of this total, followed by health (29?),education (19?) and employment (182) (Table 4.1).

- 19 -

4.16 Meetings which the GOJ and the Bank had with potential donors inJune, November, and March 1989, indicated continued donor interest inparticipating in HRDP financing. Eleven bilateral and multilateral agenciesare committed to contributing to HRDP financing. It is expected that alarge part of these contributions will be in the form of soft loans orgrants. These participations will be confirmed after the donors' agreementswith the Jamaican Government on the programs/projects selected. Annex 3contains a tentative list of HRDP projects for external financing.

Management and Monitoring

4.17 The HRDP presents a formidable management challenge for theGoverAment. Critical to the success of the program will be the existence ofeffective central management, to coordinate, oversee and monitor allactivities under the HRDP.8 Institutional strengthening is also needed inall line agencies/Ministries implementing components of the program.Incentives to attract and retain essential staff with high qualificationsmust be a key ingredient of any strategy for strengthening these agencies.The Government is preparing programs to provide incentive measures to retainand recruit MOH and MOE staff, through the provision of salary supplements,incentives and training. This is part of the on-going Administrative ReformProgram (Loan 2423-JM) which is expected to result in a rationalization andoverhaul of public sector salaries.

4.18 Program implementation will be carefully monitored. Equallyimportant. effective monitoring of the impact of the HRDP will be necessaryin order to assess whether the program is having the desired effect onhouseholds and to allow timely refinements and adjustments in programtargeting and phasing. Three elements of monitoring will be crucial duringthe HRDP implementationu period. First, financial flows have to be watchedto ensure coordination with the budget and macroeconomic framework. Second,institution-based statistics on service delivery will serve as preliminarymeasures of efficiency and implementation status. Third, household-basedsurvey data on well-being will serve for impact evaluation and form thebasis for periodic adjustment in the program's focus and design. Financialmonitoring will be carried out through the Ministry of Finance as part ofits overall economic management. The Statistical Institute of Jamaica(STATIN), with Bank assistance, has set up a living standards measurementsystem (LSMS), based on household surveys, designed to monitor key socialindicators and the impact of several HRDP components in collaboration withPIOJ. The Government is improving the institutional data base to improvethe quality of these evaluations. STATIN has recently issued a preliminaryreport concerning its 1988 SLC in Jamaica, based on household consumptiondata. The report indicates that the consumption of the poorest 10 of theJamaican population amounts to 22 of aggregate national consumption, whilethe wealthiest 1OZ consume about 332, which is a ratio of about 16 to 1.The survey also indicates that because income differences are large withineach geographic area and parish, targeting of aid merely to rural areas orpoorer parishes will not be a sufficient way of reaching the poor.

8/ Details regarding proposed HRDP management arrangements are given inparas. 5.31-5.35.

- 20 -

V. THE PROJECT

Obiectives

5.01 The objectives of the proposed project are to improve theefficiency, delivery snd management of social services in Jamaica, and inparticular of health and education . It would support the Government'sHuman Resources Development Program (HRDP), which represents a comprehensiveinitiative to improve several important social services in Jamaica, and toprovide an increase in the flow of funds to the social sectors (wiich hadbeen deprived of sufficient resources in recent years, due to economicausterity) while supporting institutional and policy reforms. The Bank'ssupport of the HRDP forms an integral part of its overall developmentstrategy in Jamaica (para. 2.06). It aims tot (i) ensure continuedconsistency of the HRDP with the agreed macroeconomic framework (HTFP) andpublic sector investment program (PSIP) targets; (ii) encourage donorfinancing of the HRDP, as an integral part of the overall financial strategyto support the MTFP; and (iii) support policies leading to priorityinvestments, increased efficiency and policy reforms in the social sectorsin an integrated way, in order to provide a framework for improving socialservices and long term human resource development in Jamaica. The proposedproject would finance selected HRDP segments.

5.02 The Bank would have a leading role in assisting the GOJ in planningand executing the HRDP, including implementation of the necessary policyreforms. While the bulk of HRDP financing would come from the GOJ's ownbudget 'including budgetary provisions for programs/projects alreadyapproved for implementation), additional external finance needs to be raisedat concessional terms (para. 4.16). The proposed project's contribution tototal HRDP financing would be relatively small (about 17t of total estimatedcost of new initiatives under the HRDP). However, as the CGCED JamsicaSubgroup chairman, the Bank has taken, and will continue to take, a leadingrole in support of the HRDP and in securing additional external finance forit at favorable terms. The HRDP is an integral part of the MTFP, which haslittle room over the next few years for additional investments not alreadyincluded. The recent hurricane has generated aaditional heavy financingrequirements, large portions of which are being met by generous externalaid. The Government is currently revising the Public Sector InvestmentProgram (PSIP) in light of these developments. Nevertheless, updatedinformation regarding the status of donors' financial support of the HRDP,and revised PSIP figures for the overall HRDP program for 1989/90 werereviewed during negotiations. The broad macroeconomic base for the HRDPremains fragile, and it is important that HRDP implementation be carefullyphased and monitored by the GOJ, to keep it within Jamaica's resourceconstraints, and to make adjustments as necessary in line with changes inJamaica's general macroeconomic situation and investment priorities. TheBank would also play an important role in this process (para. 5.06).

5.03 In addition to helping Jamaica secure financing for the HRDP, theBank would assist in coordination of the use of external finance, and ineffective program management and monitoring through annual HRDP reviews.These would ascertain the relative size, priority and contents of the annualHRDP subprograms (para. 5.06). More specifically, at negotiations,assurances were received that the GOJ will: (a) maintain institutionalstructures and procedures satisfactory to the Bank, for effective planning,program management, coordination of execution, monitoring and progress

- 21 -

reporting; and (b) supervise HERDP implementation to ensure its conformitywith sound program and project implementatien criteria satisfactory to theBank (para. 5.06). The Government would, after consultation with the Bankduring the annual HRDP progress reviews, make adjustments to the HRDPcontent and implementation pace if significant changes occurred in the broadmacroeconomic base and public sector investment priorities and wouldimplement institutional reform and efficiency measures on a timely basis.The Bank, through the CGCED or other arrangements, would inform otherexternal financing and donor agencies of the progress being achieved withthe HRDP, and take the lead role in any necessary joint action.

Policy Actions

5.04 The main policy actions and improvements in the efficiency ofsocial services supported under the HRDP includes (i) redirection ofcertain health and education expenditures for increased benefits to the poor(emphasis on primary healtCi care and pre-primary and primary education);(ii) better targeting of certain nutrition aid programs, to benefit the poorat a lower cost to the GOJ; (iii) cost savings in the delivery of certainhealth and education services, through measures such as cost recovery,divestiture of some hospital services, community participation in school andhealth clinic maintenance, and improved procurement, storage anddistribution of drugs; (iv) rationalization of program management for healthand education services, in particular, strengthening of program implementingcapacity of the MOH and the MOE; and (v) attention to economic viability ofspecial public works programs designed to alleviate unemployment in povertyareas and consideration of effective ways to deal with the unemploymentproblem. These policy actions are listed in a Statement of SectoralPolicies (Annex 4), and in a detailed Policy Matrix (Annex 5). Before BoardPresentation, the Government of Jamaica sent a letter to the Bank confirmingthe Statement of Sectoral Policies and Policy Matrix agreed at negotiations.

5.05 The Statement of Sectoral Policies includes, among other items, thefollowing policy and reform actions to be undertaken by the Governmentduring the HRDP implementation period (their timing and phasing may bemodified if agreed by the Government and the Bank at annual HRDP progressreviews -- para. 5.06).

(a) Between 1982183 and 1986/87, the relative share of primaryhealth care out of MOH recurrent expenditures increased from 16Z to 212 andthe functions of some hospitals were turned into primary health carefacilities. The Government will further increase the relative share ofprimary health care services in MOH recurrent expenditures (para. 3.05 andAnnex 2) to 23Z by April 1, 1990 and to 252 by April 1, 1991;

(b) the relative share of pre-primary and primary education out ofMOE recurrent expenditures increased from 322 to 35t from FY82/83 toFY86187. The Government will raise this ratio further to 36X by April 1,1990 and to 382 by April 1, 1992, with particular emphasis on improvedquality of education in these schools (para. 3.18 and Annex 2);

- 22 -

(c) the Government will: (i) phase out general food subsidiesover the next two Jamaican fiscal years (1990/91 and 1991/92); (ii) improvethe targeting of the current food stamp program; and (iii) progressivelyimprove the targeting of the current school feeding program towards poorerchildren in the early years of schooling and broaden its scope to includemore students at the pre-primary and primary levels (para. 3.11).Reductions in general food subsidies would be linked to improved and bettertargeted nutrition programs to cushion the effect of increased food pricesfor the poor. At negotiations, understandings were reached on an ActionPlan satisfactory to the Bank to implement necessary changes to the generalfood subsidy, food stamp, and school lunch programs. Before Boardpresentation, the Government confirmed its agreement to implement suchAction Plan.

(d) the Government will expand the c"rrent programs for dives-titure of public hospital non-medical services. It will increase efficiencyby granting Boards greater autonomy in the management of the hospitals, andis testing the operation of private blocks within hospitals, with full costrecovery mechanisms within them (para. 3.06);

(e) the Government will review its current fee structure at publichealth facilities, with due regard to prcgress being made in medicalinsurance coverage and fee exemptions based on poverty, and will increasecertain fees. In doing so, the Government will pay attention to the goalsof increased revenues, efficiency of the services and the optimum use ofvarious health facilities. The Government will also improve the efficiencyof the current MOH pharmaceutical program, and will align public hospitaldrug charges and prescription fees more closely with real costs (paras.3.07-3.08);

(f) the Government, by means of advanced budgeting and compu-terization programs and other rationalization measures, will progressivelyimprove the efficiency of the MOH. The MOH will allow public hospitals andother health facilities to retain 75? of their fee collections from theirpatients, and will overhaul the current inefficient Civil Registry andancillary vital statistics management systems (paras 3.07 and 3.09);

(g) the Government will progressively increase the availability oftextbooks for primary and secondary level students, including provision ofprimary school textbooks on core subjects. It will introduce measures tocontain the costs of primary level textbooks, taking into account the recom-mendations of an ongoing study, through measures such as bulk procurementand use of inexpensive materials such as newsprint. For the secondary leveltextbooks, the Government will collect a yearly textbook rental fee from allstudents except the very poor, currently amounting to JS15 per textbook forgrades 7-9 and JS20 for grades 10-11 (para. 3.19);

(h) in evaluating the public works components of the HRDP, theGovernment will use the usual standards of economic viability and sectoralpriority. In addition, it will prepare proposals on effective alternativemethods to increase employment opportunities for the poor (para. 4.13);

- 23 -

(i) the Government will make efforts to increase participaticn ofqualified NGOs in the HRDP (para. 5.36);

(j) the Government will use the LSMS and other appropriatemonitoring systems to evaluate changes in key social indicators, as a basisfor determining the need for policy changes related to the HRDP (para.5.30). The institutional data base will be strengthened with assistanceprovided by UNICEF; and

(k) the Government will prepare programs to provide salarysupplements, incentives and training for key MOH and MOE personnel (para.4.17).

Annual HRDP Progress Reviews

5.06 The Government's annual HRDP progress reviews with the Bank will bean essential instrument in the process of HRDP planning and implementation,including the execution of tha proposed Bank project, and will constitutethe key monitoring tool for the proposed project. In these reviews, theHRDP and project targets for each year would be set, in conformity withpriority investment needs of each social sector covered by the HRDP and withdue regard to the agreed policy reform agenda, taking into account currentmacroeconomic and budgetary conditions, and the functioning of HRDPimplementation arrangements (paras. 5.29 to 5.34). In subsequent reviews,the progress achieved with reference to previous subprograms would beevaluated. At negotiations, assurances were received that the Governmentwill conduct joint annual reviews with the Bank, covering overall HRDPpolicy, program and project implementation for the past year, and schedulesof program/project implementation for the following year, includingbudgetary allocations and external financing, following criteria acceptableto the Bank. The GOJ would prepare and furnish to the Bank, by not laterthan February 1 of each year, starting in 1990, annual HRDP subprograms.Thereafter, the first annual progress review with the Government would beheld by March 1, 1990 and subsequent reviews would be conducted annually.Annual donor coordination meetings would be conducted in conjunction withthe annual progress reviews, within the CGCED or some other framework (para.5.03). At negotiations, the Government and the Bank agreed on specificprogress review criteria which would govern such reviews during the projectimplementation period.

Project Components

5.07 The proposed project will finance selected priority activitiesincluded in the HRDP. Outside these areas, other donors will take the leadin their respective projects/programs in the form of parallel financing.Described below are the components of the proposed project:

Health Sector:

(i) Primary Health Care Development (US$6.7 million, including contingencies)

5.08 Poor maintenance and low capital butdgets have caused many existinghealth centers to fall into disrepair, and have prevented the GOJ from ex-panding primary health care facilities. This, in turn, has put more pressure

- 24 -

on the secondary and tertiary health care facilities, which provide servicesat a much higher cost. The MOB, as part of the HRDP, intends to rehabilitateits primary health care center system in an effort to reduce the demand forservice at the higher levels, thus increasing efficiency and lowering overallhealth care costs. The KIH plans to construct (or reconstruct) and equipabout sixty primary health care clinics. Those to be newly constructed arecurrently housed in rented facilities. Those to be reconstructed or expandedoccupy old dispensary-type structures which lack adequate waiting area,storage space, and casualty rooms.

5.09 The proposed project will finance the construction, furniture andequipment (including vehicles) for 12 primary health care centers, includingnurses' quarters in eight of them, and dental clinic equipment for eightcenters. The GOJ brought to negotiations, for Bank review and agreement,information on the detailed location, site status and updated cost estimatesfor health centers to be included under the proposed project, and sketchdrawings for staff quarters for health centers and related accommodations.The Government has agreed to employ an engineering firm or firms to supervisethe civil works by December 31, 1989.

5.10 Three of the health care centers to be financed under the project areType I Centers. which offer ante-natal, post-natal, family planning, childhealth and nutrition services to a population of roughly 4,000. Two of theclinics to be financed under the project are Type II clinics, which provideall of the services offered in Type I clinics as well as outpatient curativeand immunization services to a poprlation of about 12,000. Four Type III andtwo Type IV clinics are also inclucied in the proposed project. These clinicsserve a population of approximatel) 20,000 and provide services similar tothose provided in Type II clinics, but they also serve as District MOHHeadquarters. In addition, Type IV centers house the Parish Medical Offices.Finally, the project will finance the construction of one new Type V clinic,to provide comprehensive health services, including maternal and child health,family planning, nutrition, dental, curative, educational, and specialistservices. Type V centers serve as a key point of referral from the primaryhealth care centers to the tertiary level and provide follow-up care afterhospitalization. Type V clinics also coordinate the administrative andoutreach primary health care program.

(ii) Purchase of Medical Equipment (US$1.2 million, including contingencies)

5.11 Budgetary constraints during the last several years prevented theMOH from replacing old and obsolete equipment and instrvments. The pro-posed project will finance the purchase of medical, surgical, dental andmedical support equipment for hospitals, including laboratory and pharmacyequipment. The medical equipment list prepared by the MOH includes itemssuch as autoclaves, incinerators, incubators, trolleys, wheelchairs, anddiagnostic, laboratory and physiotherapy equipment. The sargical equipmentlist includes instruments for general, gynecological, orthopaedic, ear,nose, and throat, and neurological surgery. The Government brought tonegotiations, for Bank review and agreement, updated equipment lists anddraft bidding documents for equipment procurement.

- 25 -

(iii) Buildin8 Stocks of Pharmaceutical Supplies (US$15.7 million,including contingencies)

5.12 As a consequence of the recent economic austerity, the MOH hasbeen unable to provide adequate amounts of drugs and medical supplies toits hospitals and clinics, and stocks of these items have dwindledconsiderably. Even though the 1988/89 budget allocation of J$34 millionfor drugs and related supplies was twice the allocation given in 1980/81,with reduced purchasing power of the Jamaican dollar and the increase inmanufacturers' prices, this budget will satisfy only 40Z of current needs.These budgetary constraints, accompanied by cash flow problems, have causeda serious depletion of inventories held at the MOH Central Medical Stores.

5.13 The pharmaceuticals replenishment program financed under theproposed project aims at replenishing stocks of pharmaceuticals forpreventive, curative, and rehabilitative health care delivery. The CentralMedical Stores are in the process of computerizing their inventory system.This will enable them to maintain better control of their stocks and tomore accurately assess usage patterns, required lead-times, and minimum re-order levels. The GOJ brought to negotiations, for Bank review andagreement, draft bidding documents for drug procurement, and an updatedlist of drugs and pharmaceuticals to be procured under the project.

(iv) Health Sector Institutional Strengthening (US$5.9 million, includingcontingencies)

5.14 The proposed project will finance the staffing of a projectimplementation unit at the MOH to manage the execution of HRDP projectsunder the Ministry of Health. The Unit will comprise 18 new posts and 4upgraded posts and be eligible for compensation above regular governmentalsalary scales, partly financed with UNDP assistance, as an incentive formore effective HRDP management. The GOJ will absorb some of these posts,as necessary, after HRDP completion.

5.15 The proposed project will also finance incentives for MOH staff,including domestic training for pharmacists, pharmacy technicians, andmedical records clerks; foreign and local consultants (for bid preparationand evaluation, as well as preparing and delivering in-service training andseminars); construction of about 180 living quarters for health personnelat selected hospitals; and related equipment, furniture, and operatingcosts (utilities for refrigeration chain. office supplies, and maintenanceof buildings and vehicles). Draft terms of reference for proposedtechnical assistance to the MOH were reviewed and agreed duringnegotiations.

(v) Upgrading the Registrar General's Department (US$1.6 million includingcontingencies)

5.16 The Registrar General's Department (RGD) at the MOH is responsiblefor registering births, deaths, and marriages; issuing documents certifyingthese events; and producing and publishing statistics concerning theseevents. Annually, it receives approximately 60,000 birth registrationforms; 14,000 death registration forms; 600 still-birth registration forms;10,000 marriage records, and 250,000 requests for certified copies ofregistration. The RGD has been plagued with a multiplicity of problems.

- 26 -

Over the years, both its management and administrative systems, as well asite physical facilities, have become increasingly deficient. There isinsufficient space to store its current stock of 15 million records, whichare in most cases badly deteriorated, misplaced, or even lost. There arelong delays in the issuing of certificates, which may take as long as twoyears. As a result, there is a backlog of approximately 400,000applications.

5.17 The proposed project would upgrade the RGD in order to improve theefficiency of collection, use and distribution of vital statistics inJamaica. It will finance construction of office buildings and assist incomputerization of the RGD through the provision of computer hardware andsoftware and related training. The project will also support thedevelopment of a microfilmed system automatically driven by a computerizedindex for fast retrieval of information and copies of records.

Education Sector:

(i) UpRrading of Pre-Primary Schools (US$4.2 million, includingcontingencies)

5.18 The Government's Program for the Advancement of ChildhoodEducation (PACE) aims, by 1992, to enhance education and care for about 802of the children between 3 and 5 years old. It will encourage work atcommunity and neighborhood levels to establish new schools and upgradeexisting institutions, and provide opportunities for the development ofcommunity self-reliant activity. The PACE program will employ nearly 4,000people, while providing education to about 100,000 basic school children.

5.19 The proposed project will support the PACE program through theprovision of: (i) construction materials rad furniture needed by thecommunities to improve and refurbish about .90 existing pre-primary (basic)schools in their areas (the necessary skills and labor for suchrefurbishing work will be provided by the communities themselves); (ii)teaching materials, furniture and equipment and other software for trainingpre-primary school teachers; (iii) initial recognition grants for new pre-primary schools; (iv) awarding of 125 scholarships for pre-primary schoolteachers and teacher trainers to pursue courses in Early ChildhoodEducation at Teachers' College, the Cultural Training Center, or theUniversity of the West Indies; and (v) operational (travel andtransportation) costs for the supervision and monitoring of pre-primaryschools' programs. During negotiations, procedures for upgrading pre-primary schools included under the proposed project were reviewed, andassurances were obtained on the use of these procedures, including theservices of a supervisory agency, satisfactory to the Bank, to be appointedby December 31, 1989. Assurances were obtained during negotiations thatthe GOJ would make arrangements, satisfactory to the Bank, to seek thecooperation of the communities in the upgrading of pre-primary schools, byMarch 1 of each year for works to be undertaken in the following year.

- 27 -

(ii) Upgrading Primary and All-Age Schools (US$11.3 million, includingcontingencies)

5.20 There is considerable overcrowding in many primary and all-ageschools throughout Jamaica. This is evidenced by a sample of primaryschools in 13 parishes which had an enrollment of 32,000 students, for acapacity of 15,000. On average, classrooms in these schools are holdingmore than twice the number of children for which they were built, althoughthe number of teachers is largely adequate. Additional classrooms arenecessary. The proposed project would finance the addition of some 200classrooms in about 20 primary and all-age scho.ols, through the provisionof civil works, furniture and equipment. Average class size in theseschools will be reduced to about 40 students, as enrollments would remainrelatively stable. During negotiations, information on the detailedlocation, site status and updated cost estimates for primary and all-ageschools to be renovated under the proposed project was reviewed. TheGovernment agreed to employ an engineering firm or firms to supervise thecivil works by December 31, 1989.

(iii) Provision of Textbooks for Primarv Schools (US$9.4 million,including contingencies)

5.21 Lack of instructional material in primary schools has contributedsignificantly to the fact that many school leavers remain less thanadequately prepared (para. 3.17). Provision of textbooks both improves thelearning potential of the students and relieves some of the burden onteachers, who are often resporsible for teaching as many as 55 students atone time. The current textbook program is an extension of a 1984 programwhich supplied a set of six textbooks in language, arts and mathematics to350,000 primary school children, and teachers' guides to primary schoolteachers (para. 3.19). By 1986, 2.7 million books had been distributed tochildren islandwide. An evaluation of this program has confirmed thatstudents' performance in the areas served with new textbooks has improved.The new program would extend the areas of coverage to include science andsocial studies. Until now, textbooks have been provided by the Governmentfree of charge. The Government is endeavoring to contain the costs ofprimary school textbooks (para. 5.05).

5.22 The proposed project would finance the development, production,and distribution of English, mathematics, science, and social studiestextbooks for about 350,000 primary school children. Draft biddingdocuments for textbooks to be procured under the proposed project werereviewed during negotiations.

(iv) Education Sector Institutional Strengthening (US$8.5 million,including contingencies)

5.23 In recent years, the system of Regional Education Offices,originally set up to ensure that professional standards are maintained inschools islandwide, has deteriorated, leaving many rural schools withoutthe supervision and support required to deliver quality education. Theproposed project would provide for construction of five Regional EducationOffices, and for equipment, incremental staff, consumable materials, andoperating costs for six Regional Education Offices. For reliable linkages

- 28 _

betwecn them, the schools and the MOE headquarters, provision would be madefor vehicles and communications equipment. Personnel who will staff theRegional Offices would receive training in the areas of planning,evaluation, monitoring and student assessment. During negotiations,assurances were obtained that a plan for additional staffing of six MOERegional Offices, satisfactory to the Bank, will be finalized as soon asthe managerial study of the MOE, which is being financed under Loan.2899-JM, is completed; and that such plan will be effective by not laterthan March 31, 1990.

5.24 The National Assessment Program (NAP) is based on the new primarycurriculum, which has just completed its first full cycle for grades 1-6.The NAP provides for a readiness test at grade 1, a diagnostic test atgrade 3, and a national achievement test at grade 6. It is important thatthese tests be professionally and reliably administered, and school supportand participation are critical. An incentive payment will be provided toenlist the cooperation of schools. Each school is expected to nominate amember of its staff to serve as examinations" supervisor in a given year,for which services the individual will be paid a small honorarium.Additionally, the school would receive an allowance to cover other expensesassociated with administering the examinations. The proposed project willfinance administrative costs for NAP supervision by schools, and honorariafor NAP supervision.

5.25 Within the last five years, there has been a steady and rapiddecline of teachers in the system -aho are without teacher training.However, a substantial number of teachers in the primary and all-ageschools still lack academic qualifications. The proposed project willsupport short intensive upgrading courses to be given during vacations oron weekends, for about 2,000 primary and all-age school teachers. It willalso finance training for about 20 MOE staff, and teacher upgrading forabout 200 secondary school teachers, as well as foreign and local expertsto assist MOE in planning for the decentralization process. Beforenegotiations, the Government sent to the Bank draft terms of reference forproposed technical assistance to the MOE. These were agreed upon atnegotiations.

5.26 The proposed project will also provide support for a two-yearpilot program of school awards and its evaluation. Under this component,the schools would compete for awards to be made on the basis of definedperformance criteria. These criteria will be determined by the MOE inconsultation with the principals of schools and the Jamaican TeachersAssoeiation, based on the following aspects: (i) the average NAP score ofthe schaool compared with a fixed standard; (ii) the degree of improvementin average NAP scores compared with the previous year (applicable in thesecond year of the pilot program); (iii) maintenance of school buildings,equipment and supplies; and (iv) a school community project selected by theindividual school. These criteria will reward overall performance based onabsolute academic standard, improved academic performance, care of schoolfacilities, and school involvement in the community. The annual schoolawards will be earned competitively at the parish (20 awards per year),county (10 awards per year), and national levels (3 awards per year).Evaluation of the awards scheme will be undertaken during the second yearof its implementation, and after its completion. The Government sent tothe Bank, before negotiations, draft performance criteria for schoolawards, which are satisfactory to the Bank. These criteria will commenceto apply not later than June 30, 1992.

- 29 -

5.27 Because of low household incomes, probably as many as 302 ofprimary and all-age school children attend school without adequate suppliesof such basic items as exercise books, pencils, rulers, etc. The proposedproject attempts to redress the learning disadvantage of these children bymaking these basic items available without cost. Provision will be madefor 50,000 children in grades 1-6 (about 14Z of enrollments) to receivebasic school supplies currently worth about J$15 per year. The Governmentsent to the Bank, before negotiations, a draft implementation plan for thiscomponent. Criteria for the identification of the beneficiaries and forthe allocation of school supplies were agreed upon at negotiations.

5.28 The proposed project will also finance the creation of six newposts and the upgrading of 11 posts for HRDP implementation at the MOE.These staff would be assigned to a project implementation unit to beestablished under the Project Construction and Maintenance Division of theMOE. The new and upgraded staff will be eligible for compensation aboveregular government salary scales, partly financed with UNDP assistance, asan incentive for more effective HRDP management. The GOJ will absorb anyof these posts which are still required after HRDP completion.

HRDP Administration and Monitoring:

(i) HRDP Secretariat (US$1.6 million, including contingencies)

5.29 The project would provide funds to meet the costs of the HRDPSecretariat, which is located within the Social Planning Division of PIOJ,to assist in the implementation of the multi-sectoral ERDP. The proposedproject includes financing for incremental staff, equipment, travelexpenses and operational costs of the HRDP Secretariat. Duringnegotiations, the GOJ advised the Bank that the plans for the HRDPmanagement structure (in particular, additional HRDP staff and units inMOH, MOE and PIOJ, to be financed in part with UNDP assistance), satis-factory to the Bank, have been approved. Appointment of key staff to theHRDP Secretariat and MOM and MOE units would be a condition ofeffectiveness. During negotiations, understandings were reached that thekey staff to be appointed as a condition of effectiveness would be thefollowing: (a) for the HRDP Secretariat in PIOJ: a Program Manager and aFinancial Manager; (b) for the MOM: a Project Manager, a Technical Managerand a Financial Manager for the Project Implementation Unit; and (c) forthe MOE: a Project Manager and a Financial Manager for the ProjectImplementation Unit. Special provisions are being made within the Ministryof Finance and the Public Service to expedite the recruitment andappointment of these professionals. The Government would inform the Bankin writing when these staff have been appointed.

(ii) ImPact Monitoring (US$0.9 million, including contingencies)

5.30 The project would also cover the costs of HRDP implementation andimpact monitoring. Effective monitoring is critical to the overallmanagement of the program; it ranks among the most cost-effective elementsin the HRDP, and deserves high priority (para. 4.18). Existing mechanismsfor monitoring institution-based service delivery statistics will receivereinforcement in all major implementing agencles, with assistance fromUNICEF. For the HRDP, an enhanced system of monitoring social conditions,based on an approach developed in the World Bank under its Living Standards

-30 -

Measurement Study (LSMSj program, has been activated. This system is builton the Statistical Institute of Jamaica (STATIN) existing Labor ForceSurvey, for data collection, processing and analysis. The scope of thesurvey has been broadened to include health, education, employment. income,consumption, nutritional status, housing conditions and fertility. Toensure that the information is most relevant to policy makers, the systemcan achieve turn-around from interview to data analysis within two months.This will provide a major improvement in the Government's ability to assessand monitor social policy. The proposed project will retroactively financethe costs of the LSMS pilot run undertaken in Augus.. 1988, as well as thesecond survey, which will be fielded in June 1989. The project willsupport semi-annual surveys to be conducted and analyzed during the projectperiod.

Project Implementation and Management

5.31 Implementation Schedule. The proposed project would beimplemented over a period of approximately five years, covering Jamaicanfiscal years starting April 1, 1989, and is expected to be completed byMarch 31, 1994. The closing date will be December 31, 1994. The costschedules prepared for the various components (Annex 6) and detailedimplementation schedule (Annex 7) will serve as a basis for projectimplementation planning and will be updated annually by MOH, MOE, and theHRDP Secretariat, in preparation for the annual reviews. During the annualprogress reviews with the Government (para. 5.06), the Bank would giveparticular attention to the effectiveness and efficiency of HRDPimplementation, and changes will be agreed as needed.

5.32 The HRDP will require adequate management capacity in the agenciesconcerned, in order tot (i) formulate programs; (ii) carry outintersectoral planning and inter-agency liaison; (iii) coordinate donoractivities and financing; (iv) execute programs; and (v) undertake programmonitoring, evaluation and adjustments.

5.33 A key agency in this process is the PIOJ. Working withcorresponding staff in major HRDP implementing Ministries and agencies, thePIOJ is responsible for: ti) program formulation and expediting ofexecution, (ii) cootdination of donor financing, (iii) intersectoralplanning, policy analysis and coordination of the HRDP program andprojects; and (iv) analysis of statistical data and other information forHRDP monitoring, impact evaluation and adjustments. The HRDP Secretariat,located in the Social Projects Division of PIOJ, will monitor the physicaland financial progress of individual project/program components, and willmaintain liaison with the Bank and other donor agencies.

5.34 The HRDP activities to be carried out by the Ministries/agenciesinclude planning and implementation, at the field and headquarter levels,as well as monitoring and evaluation tasks for each sector. To accomplishthese tasks, the overall institutional capaci:.. of key Ministries will beimproved, including in particular the MOH and MOE. In the case of the MOE(Chart 2), a project implementation unit under the Project Construction andMaintenance Division, which is already handling implementation of WorldBank projects, is being created to implement HRDP projects in education.Several positions in other divisions will also be strengthened. Staff ofthe division are knosledgeable of World Bank procurement and projectimplementation procedures, but the ministry requires increased capabilities

- 31 -

in planning, policy formulation and statistical analysis, as well asprogram monitoring and evaluation. A central project implementation unitwill be newly established in the MO, to handle all foreign-assistedprojects (Charts 3 and 4), including the HRDP. In view of limitations inexisting staffing in these Ministries, additional personnel will be neededto ^arry out these functions.

5.35 Thus, the education and health components of the project will beimplemented by project implementation units to be set up in the MOE andMOH. Program impact monitoring will be undertaken by STATIN, inconsuAtation with PIOJ for interpretation of LSMS survey results. The HRDPSecretariat in PIOJ will have a coordinating role for all components, andwill act as a liaison between the Bank and the diverse ministries andagencies concerned with HRDP and project iLplementation, as well as withexternal financing agencies and donors.

5.36 There is considerable merit in the Government's delegatingsuitable HRDP components to Non-Governmental Organizations (NGOs) for theirsupport and/or participation in implementation. There are at presentapproximately 200 local, regional and international NGOs operating inJamaica, primarily in the social sectors. While NGOs have direct contactwith the Government, there have been few special efforts as yet tocoordinate NGO activities with HRDP-related operations. The HRDPSecretariat, working with the Ministries concerned, and on the basis ofupdated information, is in the process of identifying MRDP components thatmay be implemented by NGOs.

VI. PROJECT COSTS, FINANCING, PROCUREMENT AND DISBURSEMENTS

Costs

6.01 Total project costs are estimated at about J$368.6 million(US$67.0 million equivalent), excluding taxes and duties. Tables 6.1 and6.2 suumarize the estimated costs by project component and category ofexpenditure. Detailed costs are presented in tables in Annex 6.

6.02 Base Costs and Contingencies. Base costs are expressed inDecember 1988 prices, and exclude taxes and duties, which are negligible.Civil works costs were based on approved building proposals for the variouscomponents. Furniture costs were based on lists of standard locallyavailable items. Equipment and pharmaceutical costs were based on listspriced for similar imported or locally available items. Books were basedon current textbook production and distribution costs. Overseas anddomestic training and costs of foreign and local consultants were based oncurrent standards. Costs of incremental HRDP staff and operating costswere based on current estimates. Total contingencies of US$11.8 millionrepresent 21.5Z of base costs. Physical and price contingencies were basedon total project expenditures. Physical contingencies (US$2.8 million)represent 5.1Z of base costs. Price contingencies (US$9.0 million), about16.4Z of base costs, were estimated on the basis of the implementationschedule (Annex 7) and expected annual price increases as follows: local --82 for 1989, 6? for 1990, and 42 for subsequent years; foreign -- 5.32 for1989-90 and 4.1Z for subsequent years.

- 32 -

Table 6.1: SUMMARY OF PROJECT COSTS BY COPONNENT a/

$TotallForelgn Bass

Local Forelon Total Local ForeIsn Total Exchanae Cots(Js million) (USB *illion)

HEALTH SECTOR

PRIUARY HEALTH CARE DEVELOPMENT 17.2 12.7 29.9 8.1 2.8 5.4 42.8 9.9MEDICAL EQUIPMENT 0.6 5.8 s.9 0.1 1.0 1.1 90.0 2.0PHARMACEUTICAL STOCKS 18.0 54.0 72.0 8.3 0.8 18.1 75.0 28.6UOH INSTITUTIONAL STRENGTHENING 21.0 6.6 26.6 8.8 1.0 4.8 21.1 6.8UPGRADING REGISTRAR GENERAL'S 8.5 8.7 7.2 0.6 0.7 1.8 61.4 2.4

DEPARTMENT

SUB-TOTAL 60.8 81.8 141.6 10.9 14.8 25.7 57.4 46.7

EDUCATION SECTOR

UPGRADING PRE-PRIMARY SCHOOLS 11.9 6.9 18.8 2.2 1.8 8.5 86.7 6.2UPOR. PRIMARY A ALL AGE SCHOOLS 80.8 20.0 50.8 5.5 8.6 9.1 89.7 18.6PRIMARY TEXTBOOK PROGRAM 87.8 4.2 42.0 6.9 0.6 7.7 10.0 18.8MOE INSTITUTIONAL STRENGTHENING 28.4 9.8 89.2 6.2 1.7 6.9 25.7 12.6

SUB-TOTAL 108.4 40.9 149.8 19.8 7.4 27.2 27.4 49.2

HRDP ADMINISTRATION & MONITORING

HRDP SECRETARIAT 6.5 1.8 7.8 1.2 0.2 1.4 16.8 2.6IMPACT MONITORING 2.7 2.0 4.7 0.6 0.4 0.9 42.7 1.6

SUBTOTAL 9.2 8.8 12.5 1.7 0.6 2.8 26.6 4.1

TOTAL BASE COSTS 177.9 125.5 808.4 82.4 22.8 56.2 41.4 100.0

PHYSICAL CONTINGENCIES 9.1 6.4 15.5 1.6 1.2 2.8 41.4 5.1

PRICE CONTINGENCIES 82.1 17.6 49.7 5.6 8.2 9.0 85.4 16.4

TOTAL PROJECT COSTS 219.1 140.5 8s6.6 89.8 27.2 67.0 40.6 121.5

/ Net of taxes and duties, which are negligible.

- 33 -

Table 6.2 SUMMARY OF PROJECT COSTS BY CATEGORY OF EXPENDITURE(US Tillion)

UTotalXForeign Bse-

Local Forelan Total Local Foreian Total Exchanae Costs(JS tilion) (USS million)

Civil Works 65.7 87.4 108.1 11.9 6.8 18.7 86.2 38.9Equipment 8.8 18.2 21.5 0.6 8.8 8.9 84.8 7.1Books 87.9 4.2 42.1 6.8 0.8 7.6 10.0 18.8Furniture 5.5 8.7 9.2 1.1 0.7 1.8 40.0 8.0Foroign Experts 0.0 2.7 2.7 0.0 0.6 0.6 100.0 0.9Local Experte 0.9 0.0 0.9 0.2 0.0 0.2 0.0 0.8Overseas Training 0.1 0.9 1.0 0.0 0.2 0.2 96.0 0.8Domestic Training 9.2 1.0 10.2 8.8 0.2 1.9 10.0 8.4Bonus Incentives 1.2 0.1 1.8 0.2 0.0 0.2 10.0 0.6Pharmaceuticsls 18.0 64.0 72.0 8.8 9.7 18.0 75.0 23.7Incremental HRDP Staff 16.8 1.8 18.1 8.0 0.8 8.8 10.0 6.0Operation and Mainteannce 16.4 1.1 17.6 8.0 0.2 8.2 8.0 5.8Educational Materials 8.4 0.4 8.8 0.6 0.1 0.7 10.0 1.8

Total Base Cost 177.9 125.5 808.4 82.4 22.6 55.2 41.4 100.0

Physical Contingencies 9.1 6.4 15.5 1.6 1.2 2.8 41.4 6.1Price Contingencies 82.1 17.6 49.7 5.8 8.2 9.0 85.4 16.4

Total 219.1 149.5 868.6 89.8 27.2 67.0 40.6 121.5

6.03 Foreign Exchange Costs. Direct and indirect foreign exchangecosts are estimated at about J$149.5 million (US$27.2 million equivalent)including contingencies. Based on a detailed analysis of expenditures ofsimilar projects in Jamaica, the foreign exchange component for the majorcategories was estimated as follows: (a) civil works 402; (b) equipment90?; (c) pharmaceuticals 852; (d) furniture 402; (e) foreign consultants100?; (f) overseas training 952; (g) books, bonus incentives, domestictraining, and HRDP incremental staffing 102.

Financing

6.04 To meet a part of the total estimated project costs of aboutUS$67.0 million, the Bank would make a loan of US$30.0 million equivalent(45? of total estimated cost). The financing plan and loan allocations bycategory of expenditure are presented in Table 6.3. Jamaican counterpartfunding requirements would be met by the Government.

Procurement

6.05 For the proposed project, the Government will follow Bankprocurement guidelines and procedures. Cost of civil works under theproject (about US$23.0 million, with the biggest single contract notexceeding US$300,000 equivalent) will involve repairs and additions to

_ 34 -

Table 6.3: FINANCING PLAN(US$ million)

ProposedGovernment IBRD Loan Totala/ IBRD (Z)

Civil Works 13.3 5.4 18.7 30?Equipment 0.6 3.3 3.9 85ZBooks 6.1 1.5 7.6 20?Furniture 1.4 0.4 1.8 20?Foreign Experts 0.0 0.5 0.5 100?Local Experts 0.0 0.2 0.2 100?Overseas Training 0.0 0.2 0.2 100?Domestic Training 0.0 1.9 1.9 100ZBonus Incentives 0.2 0.0 0.2 0fPharmaceuticals 2.3 10.7 13.0 82?Incremental HRDP Staff 2.6 0.7 3.3 20?Operation and Maintenance 3.2 0.0 3.2 0?Educational Materials 0.7 0.0 0.7 0?

Total Base Costs 30.4 24.8 55.2 45Z

Unallocated 6.6 5.2 11.8 44?

TOTAL 37.0 30.0 67.0 452

a/ Totals represent base costs. Unallocated amount includes physical andprice contingencies.

primary and pre-primary schools as well as health centers, and limited newconstruction for nurses and technician housing and for five regional MOEoffices. Contracts for works would be awarded according to localcompetitive bidding (LCB) procedures acceptable to the Bank and which wouldallow foreign biddezx to participate. Because of competitiveness of thelocal construction industry, and the dispersed and remote location ofprimary schools and health facilities to be upgraded, it is very likelythat all civil works contracts would be awarded to local firms. The GO.Twill employ engineering firms to supervise civil works for primary and all-age schools and health facilities under the project. Constructionmaterials for improvement and reconstruction for about 390 pre-primaryschools will be procured under prudent shopping procedures, on the basis ofcompetitive price quotations from at least three suppliers eligible underBank guidelines for packages not exceeding US$20,000 equivalent andaggregating to no more than US$2 million. Procurement for larger packagesfor building materials for pre-primary schools will be administeredcentrally by the MOE, using LCB procedures acceptable to the Bank. Thenecessary skills and labor will be provided by the community, withtechnical expertise and supervision furnished by a Government-ownedconstruction supervisory company.

- 35 -

6.06 The total cost of equipment (including vehicles) is estimated atabout US$4.6 million, of which about two-thirds will be procured throughinternational competitive bidding (ICB) procedures, in accordance with Bankguidelines, and the remainder through LCB or local ehopping (by inviting atleast three quotations). Contracts in excess of US$100,000 would beawarded on the basis of ICB. Where 1CB procedures are used, goods manu-factured locally would be given a preference margin of 152. Contractsestimated to cost the equivalent of US$100,000 or less, but more than theequivalent of US$20,000, up to an aggregate amount equivalent to US$1.2million, may be awarded in accordance with competitive bidding procedureslocally advertised, satisfactory to the Bank. Goods estimated to cost theequivalent of US$20,000 or less, up to an aggregate amount equivalent toUS$200,000, may be procured by procedures of local shopping acceptable tothe Bank.

6.07 Pharmaceuticals (costing about US$15.6 million) would be procuredunder international competitive bidding procedires acceptable to the Bank.Procurement wil; be undertaken, as at present, through the JamaicaCommodity Trading Corporation (a Government company), and distributedthrough the Island Medical Stores. The Corporation imports all drugs forGovernment agencies, and requires that all its drug imports conform withinternational standards set out by the United States and the BritishPharmacopeia and meet the requirements of the Food and Drug Act of Jamaicaand be registered with the MOH. Packages not exceeding US$20,000 equiva-lent and aggregating to no more than US$600,000 equivalent may be procuredunder locaJ or international shopping procedures with at least threeeligible suppliers.

6.08 Primary school textbooks have been prepared by MOE staff.Printing of textbooks will be conducted in sev,ral phases; packages will besmall, and therefore t.heir printing and distribution will be awarded underLCB procedures acceptable to the Bank. Foreign bidders would participateif interested. Packages for furniture would be small, and the furniturewill be delivered in small quantities to scattered destinations, andtherefore, furniture will be procured using LCB procedures acceptable tothe Bank. Consultants required for the project would be hired followingthe Bank's Guidelines for the Use of Consultants.

6.09 Prior Bank review would be required only for contracts exceedingUS$100,000 equivalent. Other contracts and bid evaluations would besubject to random ex-post review by Bank staff. All ICB procurement wouldbe based upon Bank sample bidding documents for goods. These procurementarrangements are summarized in Table 6.4.

Disbursements

6.10 The proposed Bank loan would be disbursed over a period of aboutsix years (Table 6.5), consistent with the standard IBRD disbursementprofile for Jamaica (all sectors), modified to take into account repaymentof PPF and opening of special account during initial implementation stages.Disbursements are expected to be completed by December 31, 1994 (ClosingDate) and will be made against the following categories of expenditurecovering the HRDP activities to be financed under the proposed project:

- 36 -

Table 6.4. PROCUREMENT ARRANGEMENTS(US$ million)

Procurement Procedure TotalCategory of Expenditure ICB LCB Other N/A Costso/

Civil Works 21.0 2.0 23.0(6.3)b/ (0.6) (6.9)

Equipment 3.2 1.2 0.2 4.6(2.8) (1.0) (0.1) (3.9)

Books 9.3 9.3(1.9) (1.9)

Furniture 2.2 2.2(0.4) (0.4)

Pharmaceuticals 15.0 0.6 15.6(12.4) (0.4) (12.8)

Foreign and local 0.8 0.8consultants (0.8) (0.8)

Overseas and domestic 2.5 2.5training (2.5) (2.5)

Incremental HRDP Staff 4.0 4.0(0.8) (0.8)

Bonus incentives, opera- 5.0 5.0tion and maintenance and (0.0) (0.0)educational materials

TOTAL 18.2 33.7 6.1 9.0 67.0(15.2) (9.6) (4.4) (0.8) (30.0)

a/ Totals represent total estimated costs per category including price andphysical contingencies.

b/ Numbers between brackets reflect Bank financing.

- 37 -

(a) Health Sector: (i) civil works--30Z of total expenditures; (ii)equipment and pharmaceuticals--lOOZ of CIF cost of foreign expenditures;1002 of ex-factory costs of locally manufactured goods; and 652 of localexpenditures for other items procured locally; (iii) training andconsulting services--1OOZ of total expenditures; (iv) incremental HRDPstaff--20Z of total expenditures; and (v) furniture--20Z ef totalexpenditures; (b) Education Sector: (i) civil works--30Z of totalexpenditures; (ii) equipment--100Z of CIF cost of foreign expenditures;1002 of ex-factory costs of locally manufactured goods: and 652 of localexpenditures for other items procured locally; (iii) training andconsulting services--lOOZ of total expenditures; (iv) incremental HRDPstaff--202 of total expenditures; (v) furniture and textbooks--20Z of totalexpenditures; (c) HRDP Management and Monitoring: (i) equipment andfurniture--1002 of CIF cost of foreign expenditures; 1002 of ex-fActorycosts of locally manufactured goods; and 652 of local expenditures forother items procured locally: (ii) training and consulting services--100Xof total expenditures; and (iii) incremental HRDP staff--20Z of totalexpenditures.

6.11 Documentation of Expenditures. Withdrawal applications for goodsand services with a contract value of US$100,000 or more will be supportedby full documentation. Contracts below US$100,000 and other disbursementsagainst activities not undertaken by contract vill be made on the basis ofStatements of Expenditure (SOE). for which supporting documents would bemaintained by the MOH, MOE, and HRDP Secretariat, and would be made avail-able for Bank staff review. A Special Account in US dollars would beopened at the Bank of Jamaica, with an initial deposit of US$1.8 millionequivalent, corresponding to about four months of project expenditures.Retroactive financing will be permissible for approved expenditures forpayments made after August 1, 1988 (or twelve months prior to loansigning), up to an amount not exceeding US$2 million.

6.12 Disbursements will be subject to Bank satisfaction with theGovernment's progress with project implementation. For this purpose, theGovernment has agreed, as a condition of disbursement, that, if during theannual reviews (para. 5.06), the Bank is not satisfied with projectimplementation or with the proposed implementation schedule, expenditures,and financing thereof, for the following year, the Bank will be authorizedto reallocate, cancel, or both, by notice to the Borrower, any amount ofthe proceeds of the loan allocated under a Category or Subcategory. TheBank would notify the GOJ of its unsatisfaction in the carrying out of theprogram or project, based on the annual reviews. In the absence of suchnotification, the GOJ may continue to withdraw the amounts allocated toeach category. For an even flow of disbursements during the projectimplementation period, assurances were obtained during negotiations thatthe Government would prepare annual disbursement profiles that would notexceed 302 of the loan amount for any particular year.

- 38 -

Table 6.5: DISBURSEMENT FORECAST

IBRD fiscal year Disbursementsand semester Semester Cumulative Z Semester

CUSS million)

19901st (Jul 89-Dec 89) 1.8 1.8 62 12nd (Jan 90.Jun 90) 1.2 3.0 10 2

19911st (Jul 90-Dec 90) 1.2 4.2 14Z 32nd (Jan 91-Jun 91) 3.0 7.2 24Z 4

19921st (Jul 91-Dec 91) 3.0 10.2 34Z 52nd (Jan 92-Jun 92) 3.3 13.5 45Z 6

19931st (Jul 92-Dec 92) 3.3 16.8 56Z 72nd (Jan 93-Jun 93) 3.3 20.1 672 8

19941st (Jul 93-Dec 93) 4.2 24.3 81Z 92nd (Jan 94-Jun 94) 3.0 27.3 912 10

19951st (Jul 94-Dec 94) 2.7 30.0 1OOZ 11

Closing Date: December 31, 1994.

Auditing and Reporting

6.13 MOB, MOE and STATIN will keep separate accounts for projectexpenditures in accordance with internationally accepted accountingprocedures. The HRDP Secretariat, in collaboration with the ARDP units andother project implementation staff at various Ministries and implementationagencies, would maintain separate accounts for the HRDP as a whole andwould consolidate the accounts for the proposed project. The accountswould show expenditures for each program/project component, subdivided byexpenditures financed by the Bank, the Government and other donor agencies.All project accounts, the Special Account and all disbursements againstSOEs will be audited annually by an independent auditor acceptable to theBank in accordance with the Bank's auditing guidelines. The Governmentwill submit to the Bank the audit reports of expenditure within six monthsof the closure of each fiscal year. The audit reports will certify thatfunds were used for the purposes for which they were provided. Assuranceswere received at negotiations that the GOJ will comply with theserequirements.

- 39 -

6.14 The HRDP Secretariat in PIOJ will also submit to the Bank, forboth the HRDP program and for the proposed project, semi-annual reports onthe program/project implementation and expenditures, special reports priorto annual HRDP progress reviews, and a final report on implementationexperience and program/project outcome (Project Completion R port) withinsix months of the Closing Date of the proposed project. Assurances werereceived at negotiations that the GOJ will comply with these requirements.

VII. BENEFITS AND RISKS

Benefits

7.01 Unavoidable adjustment measures during the mid-1980s, followingseveral years of economic decline, resulted in significant economichardship to important segments of the Jamaican population. Real publicexpenditures for education, health, and other social services fell sharplyduring FY82-86, and remain severely depressed. Despite Government effortsto mitigate the effect of these cuts on the poor, the deterioration inbasic public services has been severe and human capital formation andsocial well-being have been adversely affected. The HRDP will addresssocial sectors' rehabilitation and development needs. The Bank's leadingrole in the HRDP formulation and execution, emphasizing economic factorsand policy reforms and efficiency measures, vould help Jamaica to reapmaximum benefits from the program. Through policy reforms, the Bank'sinvolvement would increase the overall efficiency of social services, antimprove targeting and formulation of efficient strategies to protect thevulnerable groups of the population. The focus on primary health centersand pre-primary and primary education would help rehabilitate and expandthese priority social services, and would improve access for the poor.Through its financing of HRDP implementation and monitoring costs, the Bankwould acquire an effective vantage point to influence overall programexecution, including continued consistency of the HRDP with macroeconomicobjectives.

Risks

7.02 The main risk--both for the HRDP as a whole and for the proposedproject--is possible administrative delay in program implementation. Aneffective role by the HRDP Secretariat within PIOJ in monitoring, coordi-nating and expediting HRDP execution by several Hinistries and lineagencies would reduce such a risk. Another important risk is that theGovernment may find it expedient to over-emphasize certain segments of theHRDP (such as food distribution and public works programs), to the neglectof other (and more economically sound) HRDP components. The annual HRDPprogress reviews with the Government and the monitoring system beingestablished would give the Bank an opportunity to review program prioritieson a continuing basis. The Bank involvement in the program and in donorcoordination would provide an effective basis for discussion and closemonitoring of HRDP expenditures.

- 40 -

VIII. AGREEMENTS REACHED AND RECOMMENDATION

Agreements Reached

8.01 The Government prepared and brought to negotiations the following,for Bank review and agreement:

Ca) updated information regarding the status of donors' financialsupport of the HRDP, and revised PSIP figures for the overall HRDP programfor 1989-90 (para. 5.02);

(b) updated equipment lists and draft bidding documents forequipment procurement (para. 5.11);

(c) draft bidding documents for textbooks (para. 5.22); and

(d) draft bidding documents for drug and pharmaceutical suppliesprocurement and an updated list of drugs and pharmaceutical supplies to beprocured (para. 5.13).

8.02 At negotiations, the Government:

(a) provided assurances that it will maintain institutionalstructures and procedures for effective planning, program management,coordination of execution, monitoring and progress reporting, and superviseHRDP implementation to ensure its conformity with sound program and projectimplementation criteria satisfactory to the Bank (para. 5.03);

(b) agreed to prepare and furnish to the Bank by not later thanFebruary 1 of each year, starting in 1990, annual HRDP subprograms; agreedto conduct, with Bank participation, annual reviews covering overall HRDPpolicy, program and project implementation for the past year, and schedulesof program/project implementation for the following year, includingbudgetary allocations and external financing, following criteria acceptableto the Bank, and to conduct annual donor coordination meetings inconjunction with the annual progress reviews. Thereafter, the first annualprogress review with the Government would be held by March 1, 1990, andsubsequent reviews would be conducted every year during MRDP execution.Specific progress review criteria satisfactory to the Bank were agreed uponat negotiations (para. 5.06);

(c) confirmed a plan and pzocedures for upgrading pre-primaryschools satisfactory to the Bank (para. 5.19), including the use of asupervisory agency; and agreed to make arrangements satisfactory to theBank, to seek the cooperation of the communities in the upgrading of pre-primary schools, by March 1 of each year for works to be undertaken thefollowing year;

(d) agreed to employ engineering firms to supervise civil worksunder the respective components of the project by December 31, 1989 (para.5.09 and 5.20);

- 41 -

(e) confirmed agreement on criteria for the identification of thebeneficiaries as well as for the allocation of primary school supplies forneedy children (para. 5.,7);

(f) provided assurances that the plan for additional staffing ofsix MOE Regional Offices will be finalized shortly after the administrativestudy being financed under Loan 2899-JM is completed; and that such planwill be effective not later than March 31, 1990 (para. 5.23), and confirmedthat it has approved the plans for HRDP management structure (inparticular, HRDP staff in MOH, MOE, and PIOJ, to be financed in part withUNDP assistance) (para. 5.29);

(g) agreed on loan disbursement, reallocation, and cancellationconditions (para. 6.12);

(h) agreed to maintain, audit and submit all project accounts(including the Special Account and all disbursements under SOEs) annuallyfor Bank review (para. 6.13); and

[i) agreed to prepare and submit to the Bank semi-annual progressreports on the program/project implementatioa' and to prepare and submit tothe Bank a Project Completion Report within six months after the closingdate of the loan (para. 6.14).

8.03 The Government of Jamaica has sent a letter to the Bank confirmingthe agreed Statement of Sectoral Pol4cies and Policy Matrix (Annexes 4 and5), including an action plan, satisfactory to the Bank, to achievenecessary changes to the general food subsidy, food stamp and school lunchprograms (para. 5.05).

8.04 As a condition of effectiveness, the Government will appoint keystaff to the HRDP Secretariat in PIOJ, and to the MOE and MOH units (para.5.29).

Recommendation

8.05 Subject to the above conditions, the proposed project wouldconstitute a suitable basis for a Bank loan of US$30 million equivalent tothe Government of Jamaica, repayable in 17 years, including a five-yeargrace period, at the Bank's standard variable interest rate.

43 -MANEX ITa-blIe 1Page 1 of z

- S. 830~~~M" MM . m0

4:110. 11 la 8o "l IM I M a1C a I 8 su *cas $a aUKUGmk OAU Ws ia t a* a a a~~~01 30" I aA 30fttft a ( S $ M ($) I TCIN io1 t S I (* tto I a

a= 16 1 a .0333'695w i tn U 91 U1 I3 ,um,916 69 U ;96m*6302ClIs4 2:a, 60CAM at2MaUiI. .aUsab .00098 asin:34 .933 W., 62 To (6 01104,8 "163 all Tsi ,u"ia, $a*t1 is~ *54)0 a

a UAM so .b6a S.% a I a 3 as a i a" la" al Ill a 1 a a ,

NM P A n I~8 .4k sub~ 440 86.6 -1 -4 -3 -0 803' 80 33 30*40t I .90011*66 68~a 13. n 9.90 .?' £6.0' )0' 34' 339 as4 I0" n3 3) (j30 930 l i It 33.40

621MO as 34.0 30490 1.0 IN 30 31 U. 494 10 499 86 39. 9 36 3) 3awurn 56M 9 3.94 490( .1 £1. 4 31 3 36 W . Il 00 so 40 .6, 300 63 39 :A.0'gum 19 6.1 32,1.0 3sI 9.2 1£ £0 80 399 931 3*0 3 89. 10 18 301 3.110'

1___NT 9343 to I4I43 40 3 17 so 30.0 40 is 3 .6LUOM A: 41so 5.5 I&A U~~4 36 a7 31 38 31 3 30.2 £2 3 is 13.00

UAU6B 94 0.44 341 1.6' 36.0 46 363 4s 16: 40 so -. 61 36 36 0.40bs£WA 94t0. 9Ia ,10 1. £8 1.9 1336.. I 0 43 4s as 61.0 40o 10 13 .00hmu"92 I 4.0 53b va . 1.49 9. la is8 jib 31 34 43 19.2 93 86 46 0.106514 A 62 87.40 434 1.0* 20.4- 43 0(8n to a 9 34 £6. I £6 3 --

.3611010 I 1 6.9b nab 6.' 6. 0 166 89 .. 03 St"* 33 ss4 I4 366 31 3...N6UL6 6£ Ws~ 334 3.96 £3. 363 3 Is 43 so U1 11.6 8 U4 t 33 .011113014, la t.0 S ,304 4 .1 3 a.0to 16 "lb0 91 a3 33 31.0 lob 1I 3oo 00s

coAm 061 Isl 10 1ab 27.0 to8It31 U1 41% a w4 84.0 31 is 3 0.40b63Win~~~, 19 0.to 1 . 3.' M300 lb 31b - -0t30

6Wi38 so .1k 940b 1693 30.4 983431 496 9is0 £. 9o 6 39 8 1.30$Ima ?63.lb 330 (.6 33. 36 8 6 3 3 46s 425 16 ,4 as (9s 32 0.401

2413 it 89.6k 3£0 65pa 23.0 -- 30U 344 416 3123.6 40 It 36 3.002304 90 .1.9 4406 450 88.8 401 a33 44 95 9 6 12.6 89 £4 33 8.30UNION3 46£ t 1.3k jgl . £99 23 6 l 90 99 is 300531 Zs 0.10

19 544$. 33 61' 11.0 413 1 2 33 is 35 464 14. - 88 43 8.400cam6 el 6.1 335 3.8' 8.1 1 69 St14 S 39 3 3 2l. 36 I 4 .0

C00066 0.0*is 1.34 "J 33 43 6 9 49 -- 31 3 31

64.4 06 344 3..04 5.41i 36.41', 6 6 2 9 4 4101 85 - (6 4?b 3.40'?ClIiU it 1.3 (1 3 .4W 4.9S 398 3?-lo 44b So9b 40 .16 11 1'u 41? .0CIA" 16 89.1 610 9.03 31.101 - - lf - 3449 - lf -bo 4.1 *36904.0S1 it6 0.4 9o 2. 3. 6 41 oo24.. 394 81 80 is 11.310 40 31 8' -. 0outs" sl0.ow43 lb1 - - 4a 64 -. - - (91 26'1011 1up 0.4% 330 3.3 494 S 461 93 £4 01 0 3314i1i 39.1' 40 WSk (1 I.1102434 16 £31 400 4.01 19.6 9k3 1-- -0 733 - 314 -0. -6 34t4 33 --

0A1311* 19 1.1b "a 3909n 4.n* - 3136363 14 3 la 30.0* 1 341 a) 1.800403666i 9 0.90 350 -. 91.0 4063 -3 91)4 U0 to 39 3.0 -1 - a4 -.

3101 61 93.14 Iab 4 130 79 4.0 13409 1 304 1s 19 31 39.0 46 as" 30 8.6

$so& 64 i.@4 in0 4.2 140 38.' 3 38 U8 (0 30 a 46 £1.7 to lb 83 0.9041stem8 10113 II i.14 4354 1.0b 1.6b 234031 8b I8 3) 35 3.0b 64 84m 3) 4.60b910 6M 1.3 0 3.6q 33.03 4031no6 .4 3o14 30 341 43.0 $3 42a 436 I0.10b

=0 'el6 AO 9344 ao 3. 164 .1 8.0A -1 -d 11 3 91 a1 II 89. 61 2t 3a 11.00

686A61 is1 1.6 2310 $.I 9. 36.0 Ss I jO St -3S3T04 9 is' t2 @.-1000 $ is 3. 40 ol50 8.1d, 34 33614 28' l6oop no 94 39.10 93 I"~ lot 3.0

CNIIJ 19 0.32.M1 9.1 96 16 4 3 93 4 9 34b - 9b 1 3

53. am 9 9.4 910 6*(0 30101 '* v 301 161 - o 301 3 St 1.410?

ami 09 .9 1.20 19.0k - - - 3j944 is 44 - - 114'? & 30 198.904665904 90~~ ~ 30 .4 1030 1.09 N3.e 0 3 9 0 2 3 . 0 (.0

team~ 90 .2 604 6.O 1. 402U12)90 1 M 1 31 12.9 U 40 3? 84.00

~~lA8IIUS 11 ~~~~ 41.6 a90 3.low13 66 621 42 ib1 33 29 - 48 344my 3141 1.80413039393 M6 O.6 8.080 for4 83. - - - - 694' - 1s41 - 9 3 i4t"9 1.10100631 e606l3 **49 132.4 -94-1--341 - 19' - .0oo4

slongo= 3.6 n S20 *4 84141 43' a 81 3' 0 30 431 8.6' 46W11 8 .0JoZ08 90 .3 8.880 6.1 81.1 P4)3 U 0 is U0 40 2.3 I5 as a3 6.00MEMO I 9 0659.6. 1, I1.0, 46 93 92 n091 9.) 41 14 it 30.309803304 16 2.4 &l@b ;,. 14* o _6.0k esas 24 1 - - 344A 39 93359 is ,.s241 :.900, 1.94' it.64 434 84 81 62b "If - now1 81.4 no soot 3141 3.40411*6304 M9 .0 (.4 .6'0 36.2 1463166 90 6) 33 U0 1.1 76 32 Is 0.10mm3 90 6. 48.9 . 86.1 118 £o990 a1 U 311 9.6 90 39 Is 34.401"Una23a 33.1 3.8I.940 6.641 Ms64a 46 060 9 1 30 10.991 49 64 2455364 U 16 6."D90 ;, 4k - - "'04' - 6 - - b649 - 31.604?

1UA 3616.41.960 ~~~~~.If gg4 --- 6 6 (304* - 0 364' 87 38.301

40 GPM m VW -ft MO 10 PFRM do so ommpmw-po"m '"no It all� fmowwsopm SU so El" qm stoma" snow onotown PR =sop= oupoobdop

MP GM p d� go go songo- a on"row ops am -PM at "Mus PM ""No I

so so "W .0 p ano-O GP - Fe sopt gope - ""a C" VW a 4

le",ooft stiqlA.Impo so oned do miammto "NW on ta"m we de gaim is PM t gosp) -P-0 so comomp MPL

411 GM on., L 0 low pw Salim do we 11% n PR a"am =$=mm am el � 4"� an# ponew INP � go 11106) a"" AWS"

'o fpmfmwmft Foome , I.E.*) gm p sprung" "OgR folp� so 0onisew per 40 *gnu I Ammunal. PM MR um up 0 mm

-tv"*&-cas p- inim 4- qwmm go tv MWM 0"0 4m IC PB"M a .0"00mvL ts)

�pro � S" It V~ $101110 VAPOS go ftm anso p angas in .4m vamose" as p almm MP 1110 dm"mwftm gm as gm so pip oneft" tose-

" "good" "to an Om 4m I I -gm so p de� so wow St In"" see" low a .. moRupproM el sM IM IM nnpn INNS% 11IWj WM St �SUD WW � ANPEP� 642 10$Ugft WANNNIMO WSJ

owtwp W" SR i[pen pnow "a W" " O"n 0"0 QP on Posecam OM 'EM� ~ "so PWPMBM In "NWgousam I so wb4ft" low wommo up P 0511101 so Is 'ambeas wwsww owpft "mm anon-0 I

"14"W PM =Dsom E"nnp mw$M p IW195"efio so Is sol� so MM 0 obvisomem

,*=PM& oftne so 8-nmss"mw .1 o I I angom we "am vio as I nosivio

""WM PIAVI am"= o"sM" 40 onw woo vtsm et PM 1 ano4o tesposes;

vin ="team M71rm aAlm &mmumahw INVIS OW NW A, Wu gm am 1110 sout�

a-m (NW) VDUV*M0 do MUSNIN I V"a W" a amisalawAaas Brogglij;

tr a to is St It to n 41Ia n Wei *lo sunpow0-1 I tr It gt 11 IC 49 s I el n all $11 plop""619 ti n of u a et n soa 0 wit irt now113 Vt $31! 919 ri fIa 0161 Wu 9-0 V& " lrs 911 go"s""o ""Am*S., $1 ot 0 a St 00 a tia u Illot re movsI't a a so go a to gm ts gi0 to 1191 wo twomwit a to n et 0 Os is to a 19 Is &,13 re nodde tmswm

twu to too toot (0140 cu 446 (oil to tU 4% CIO (61" (clottwo) -0) -t) .01) .411) -it) .11) -11) -9) -4) -9) -a) -ilt) .411) "ON

to 0 to Sd go a If n 111 to0 et IS n 'a

0511 or do et Wu a 09 to a 0 *1Ì on 116 Ws 4m 4" a `11-weWs at 6 a Wu IS a a 019 so a a slil ds-I qms 6 " WVare it It n wo It IS oil qu eta a 11,91 t-t I pit goart K 909 at rts Ot of SW 0 49 ft rot dri at I re a vommWto *11 Ît a 4st a aqn glot wt 69t I re of WM

Spool-ii; - &us jovei arts a,t wo'* ra ft am"Wal 40 at" so 4 wilm are &V 0"" I-SR 9A v�we el U a rot In as as 91 S as vto I qrot Is "S�

... 091 oil n - .9 U" Wu Sea - - - ces'et rt 0-1 a gmto., n Of t'st It 6 et$ a et to a rig wro go' n 0opwa - III, - of - on - -- _; rs awe a lot et or I ore aarts OÌ to so" 4: - 49-11 to

ANIS,11 a" S"fi mm - - - - "It, otell rot Gonool., 009 M" =201 a .-- - 401,91 at's Z., $49 et

so" wo �plll a 0 4 trol do's rg nw I 061 stfp a Su 0 so a" 1111 6-4 molf gm et," a

400119 St at AS go's it Vto M 9 on on S" gles airg Su's 6,61 diawl ^tt 9 go - tig 0 44tt el 0 So p .4 I., awdaw%mn� l

WC go is 99 re a 19 a a a a a re 4= 41'so aaft's a ti 99 61 I mm&M's ,,r C osun 4rog" nu TM

iris r 0409, 10,411 tg. gm, 11:& M

wt el gr alig of Ps ts 0 0 Vill re - wo is �waft0010 et so 141 st's M 4: el II as $la Vt 4m 4r" a fromort of Oa Olt Vol el a 0 or qrot awl M 0 awe a $9 re n a n el so a all rt an't, III 0arts u 91 I., 19 to drt *-ow aWI sit "to rgl fig Su V11 WC a we guma u Vol n a so 41141 a a r: 441-01 Tap"to &S" It 21 a de 4 a r 0. S-11 : onid n so a 0 99W a S., otla a

a Os a to 11 qu 0 " u r 1`11wfp of 19 0 Ws It ft a P& I's

(91)I ISO Its) 1160 40) (6) 41)mumme smap to) S M (wit) 8 a) I omalmlmwW# so wow emw 18) a a M up

smamtwnusnmtu�o u�o.�oAmmonalut AMMIAMMIMUMM��mme mm: 0 M ung gum AWANM$ dog� up

I0

;0I _oTgyt

- 45 -

ANNEX 1Tabl- 2

JAMAICA: Population Proj ettons

VARIANT A VARIANT B VARIANT CYEAR TFR a 8.4 TFR = 8.4 TFR 2

PARAMETERS

Crude Birth Rate 196S - low0 80.6 80.8 27.61990 - 1995 80.4 30.4 26.12000 - 2005 26.6 26.6 18.8

Crude Death Rate 1985 - 1990 5.4 5.6 5.6g990 - 1995 6.0 6.8 5.82000 - 2005 4.4 4.7 5.1

Infant Mortality Rate 195S - 1990 16.9 16.9 16.91990 - 1995 16.1 15.1 15.12000 - 2005 12.6 12.8 12.8

Now Reproduction Rate 1985 - 1990 1.62 1.02 1.471990 - 1996 1.68 1.68 1.82000 - 2005 1."8 1. 1.0

Growth Rate 1985 - 1990 2.52 1.78 1.451990 - 1995 2.54 1.93 1.482000 - 2005 2.21 1.94 1.06

Net Migration Rate 1986 - 1990 0.0 -7.4 -7.61990 - 1996 0.0 -5.2 -6.42000 - 2006 0.0 -2.6 -2.9

RESULTS

Total Population (Million) 1986 - 1990 2.6 2.5 2.51990 - 1995 8.1 2.6 2.72000 - 2005 8.9 8.4 8.0

Female Population [15-49] ($000) 1986 - 1990 710 660 6601990 - 1996 804 717 7172000 - 2005 1,025 698 975

Population (0-14] ('000) 1965 - 1990 981 918 8781990 - 1995 1,186 1,027 9142000 - 2005 1,863 1,221 e8e

Population E15-64] ('000) 1965 - 1990 1,816 1,472 1,4721990 - 1995 1,819 1,609 1,6092000 - 2006 2,854 2,018 1,978

Dependency Ration (X) 1985 - 1990 78.7 75.4 70.01990 - 1995 71.6 74.2 67.12000 - 2006 66.9 69.5 52.9

VARLANT A: Constant fertility with no migration. Mortality constant.VARIANT 8: Constant fertility with migration. Mortality Is constant.VARIANT Cs Net reproduction rate of 1.0 by Year 2005, with migration. Mortality Is constant.

Source: Policy Unit, PHND8, World BankTFR a Total Fertility Rate.

- 46 -

ANNEX 1Table 8

JAMAICA: Health Status--Comparativo Indices o/

CRUDE INFANT MATERNALLIFE DEATH MORTALITY MORTALITY

EXPECTANCY RATE RATE RATE(Years) (Years) (Por 1000) (Per 100.000)

Industrialized Economien 75 9 10 Different sourcesgiv- figuresvarying from 2-12

LAC Region 60 10 76 1oo cS

-Bahamas 9 6 so 20 c5

- Cuba 76 6 20 40 d/

-Cost Rica 74 4 20 20 c/

-Barbados 72 b/ 17 0 d/

- Guyana 69 N/A 48 b/ 100 b/

-Haiti 64 18 107 S20 c/

- Trinidad A Tobago 66 7 28 N/A

- Jamaica 70 7 28 s0

Source: World Bank, World Development Report, 1085; PIOJ; MON; and mission estimates.

a/ All figure are for 1983, except where stated otherwise._ 1979

19801981

- 47 -

ANNEX 2Page 1 of 6

JAMAICA


Public Sector Outlays on Health and Education

Health

4.01 Since FY79/80, annual real per capita outlays in health, (inconstant 1987 USS), reached a peak of US$44 in FY82/83, and then fell 422to a low of US$26 in FY86/87. In FY871 8, this indicator recovered toUS$32 (see Table 1). If the Jamaican economy continues to grow, restoringthe US$44 level reached in FY82/83 would be a plausible target for FY92/93.Based on GDP and population projections used in the MTEFP, this targetimplies raising the share of public sector outlays in health from 2.7t ofGDP in FY87/88 to 3.2Z of GDP by FY92193. This is not an unreasonablegoal, considering that in FY82/83 this share had reached 3.6X.1 Under theMTEFP assumptions, this target implies an average annual rate of growth inreal public sector outlays in health of 7.7Z per year over PY87188-92193 --a rate of increase which the SWP envisages for the growth in social sectoroutlays during that period.

4.02 Capital Outlays. Over the period FY79/80-86/87, capitalexpenditures for health ranged from a peak of 10.41 of total public sectoroutlays in health in FY81/82 to a low of 3.71 in FY85/86 (Table 2). It isestimated to have reached 15.11 in FY87/88, 252 in FY88/89 and to be 261 inFY89/90, largely for expenditures on long-delayed rehabilitation. Areasonable long-run ratio should be in the order of 152 of public sectoroutlays, which is the target set for FY92193.

4.03 Recurrent Outlays by Program Categories. The composition ofpublic sector recurrent outlays in health among program categories hasvaried significantly between FY80181 and FY86/87 (Table 3). Owing mainlyto changes in accounting categories between FY80/81 and FY84/85, ratherthan to substantive changes, the share of administration expenses plungedfrom 282 to 72 over this interval. After a significant drop betweenFY80/81 and FY82/83, the share of the key primary health care services rosegradually from 16S in FY82/83 to 212 in FY86/87. The GOJ has a long-termtarget of a 251 share for primary health care for April 1, 1991 and anintermediate proportion of 232 for April 1, 1990. Paramedical services,which gradually doubled their share from 32 in FY80/81 to 62 in FY86187,are targeted to reach 7Z by April 1, 1990 and to remain at that percentagethereafter. Training, whose share has ranged narrowly between 21 and 32 ofrecurrent costs, is targeted to reach a 42 share by April 1, 1990 andmaintain that level thereafter.

1/ Compared to other low- and middle-income countries, the 3.62 GDP-shareappears high. In an illustrative sample of such countries for whichthis index is reported in a recent Bank publication (Financing HealthServices in Developing Countries, 1987; p. 15), the data ranged from0.83Z in Ethiopia to 2.8S in Peru. However, in the sample of fourindustrialized countries shown in the same dncument, the correspondingvalues ranged from 4.3S in Japan to 7.72 in Sweden.

- 48 -

ANNEX 2Page 2 of 6

Table 1: JAMAICA - PU8LIC SECTOR OUTLAYS DN HEALTH AND EDUCATIONFY79/80-8s?/8 (Actual) and FY92/98 (Target)

Real total outlay Real per capita outlay Share of CDP(1987 JO miliIon) (1987 USS million) m

Fiscal Year H"lth Education Health Education Health Education

1979/80 489.8 934.0 42.1 60.8 8.8 6.8

1980/61 470.7 969.9 40.0 62.4 8.8 6.0

198182 504.2 1,011.5 42.2 84.? 8.4 6.9

1982/98 584.7 1,014.6 44.0 68. 8.6 6.8

198s/84 489.2 935.? 39.6 75.6 8.2 6.21984/8s 882.6 790.8 80.4 62.9 2.6 5.8

1965/86 85s.9 698.4 27.9 54.4 2.5 4.8

1986/67 880.6 744.9 25.6 67.8 2.2 5.0

1987/86 420.8 829.9 82.2 68.6 2.7 5.4

1992/93 (target) 608.8 1,171.9 44.0 84.7 8.2 6.2

Source: Ministry of Finance and msision estimatee.

- 49 -

ANNEX 2Page 3 of 6

Table 2: JAMAICA--CAPITAL AND RECURRENT EXPENDIURES IN HEAL.LN ANDEDUCATION AS SHARES OF TOTAL

SECTORAL OUTLAYS

(Perecntam)H"lth Educatilon

Fiscal Year Total Capital Recurrent Total Capital Recurrent

1979/S0 100 5.6 94.5 100 10.6 89.4

1980/81 100 6.9 91.1 100 8.6 91.4

1981/62 100 10.4 89.6 100 5.6 94.6

1982/83 100 9.2 90.6 100 6.9 98.1

1983/J4 100 4.0 98.0 l00 6.2 91.6

1984J85 100 6.0 95.0 100 7.4 92.6

198S/6 100 8.7 96.8 100 10.6 69.4

1966/87 100 6.9 93.1 100 6.6 9:.2

1967/68 100 16.1 84.9 100 21.8 76.7

1992/98 (target) 100 15.0 86.0 100 16.0 865.0

Sourc: Milaietry of Flnance and mission estimtes.

- 50 -

ANNEX 2Page 4 of 6

Table 8: JAMAICA-COMPOSITION OF RECURRENT EXPENDITURESON HEALTH AND EDUCATION, FYGO/81-88/87

(X shares)

80/81 82/83 84/8S 86/87

(A) Ministry of Health: Total 100 100 1G0 100Administration 28 15 7 5

Primary health care 20 16 18 21Sec. and tort. hoelth care 46 e8 69 68Paramedical services /I 8 4 4 6

Training a 2 2 2

(B) Ministry of Education: Total 100 100 100 100

Administration /b 6 8 6 7Primary education /c 88 32 a8 8S

Secondary education 35 86 86 34

Tertlary and higher oducation 19 22 21 24Student support services /I 2 8 2

/a Paramedical services: laboratory services, pharmaceutical supplies, andgeneral maintenance programs.

/b Administration: general administration, curriculum development, projectadministration, libraries.

Is Includes pre-primary and primry schools./I Student support services: school nutrition program and uniforas.

Source: Ministry of Finance

Education

4.04 Since FY79180, annual real per capita public sector outlays ineducation (in 1987 US$) have ranged from about US$85 in FY81/82 to aboutUS$54 in FY85/86 (see Table 1). By FY86/87, per capita outlays hadrecovered to about US$64. Corresponding amounts, stated in relation to thepopulation aged 5-14 years, were approximately four times greater: US$340in FY81/82 and US$216 in FY85/86 per school-age child.

4.05 If the Jamaican economy continues to grow, restoring the US$85 percapita annual public sector outlays in education reached in FY81182 wouldbe a plausible target for FY92193. Together with projections of populationand GDP in the MTEFP, this target implies raising the share of public

- 51 -

ANNEX 2Page 5 of 6

sector outlays in education from 5.42 of GDP in FY87/88 to 6.22 in FY92/93(Table 1). The corresponding GDP-share in FY81/82 was substantiallyhigher, 6.9Z.2 Under the GDP and population growth assumptions, this targetimplies an average annual rate of growth in real public sector outlays ineducation of 7.12 per year over FY87/88-FY92/93 -- a rate of increasewhich envisages for the growth of social outlays during the period.

4.06 Capital Outlays. Over the period FY79/80-86/87, the share oftotal public sector outlays on education devoted to capital expenditureranged from 10.62 in FY79/80 down to 5.52 in FY81/82 (Table 2). It reachedabout 21.3Z in FY87/88 which is well in excess of a reasonable long-runtarget of about 152 proposed for FY92/93.

4.07 Recurrent Outlays by Program Categories. The composition ofpublic sector recurrent outlays in education, among program categories, hasvaried over the period FY80181-FY86/87 (Table 3). From a high of 382 inFY80181, the share of primary education fell sharply to 322 in FY82/83,then recovered gradually to 352 in FY86/87. Considering that theoverwhelming majority of all beneficiaries of public education are enrolledin the pre-primary and primary level and that a deficient primary educationis typically a formidable impediment to effective higher-level instruction,a major Government objective will be to sustain the trend of a growingshare devoted to pre-primary and primary education until, at least, theFY80/81 share of 382 is restored by FY89/90 and sustained thereafter. Thecorresponding share for secondary education has fluctuated narrowly between342 and 362 over the same period, and is targeted to stabilize at 352 fromFY89/90 onwards. The corresponding share of tertiary and higher educationrose from a low of 192 in FY80/81 to a peak of 242 in FY86/87, and istargeted to fall moderately to an intermediate level of 212 by FY89/90 andcontinue at that level in subsequent years.

Conclusion

4.08 To sum up, public expenditure in Jamaica on health and educationwas drastically cut between 1980/81 and 1985/86 (See Table 4). Capitalexpenditures in both sectors were more affected than recurrentexpenditures. There was a limited recovery in 1986/87, which is planned tocontinue through 1992/93, with average annual increases in the publichealth and education outlays at rates of 7.72 and 7.142, respectively (theHRDP assumptions). Because of their key roles in the delivery of healthand education services (particularly to the poor), the focus of futuregrowth has to be on primary health centers and pre-primary and primaryeducation, respectively (paras. 3.05, 3.18 and 6.05).

2/ For a set of 28 countries in Latin America and the Caribbean for whichthis index is reported in a recent Bank publication (FinancingEducation in Developing Countries, 1986, pp. 47 and 48), the medianvalue is 4.22, the mean 4.82, and the standard deviation 2.72.

Tabl- 4: JAMAICA - COVERNLENT EXPENDITURES ON HEALTH, EDUCATION AND OTHER SOCIAL SERVICES 3/FY79/SO - PYs7/8s

79/8O 80/81 2/ 81/52 82/63 63/84 64/35 66/66 86/87 87/88 so 6/8s V

A. Heal th

Total 144.6 100.2 186.2 220.6 240.4 254.7 200.8 807.9 420.2 577.4Recurent 136.7 145.0 166.9 200.8 286.5 241.9 279.7 236.6 256.6 435.6Capital 7.9 14.8 19.4 20.8 9.9 12.8 10.6 21.1 68.6 141.8

8. Education )/

Total 276.2 880.1 878.7 418.5 471.8 625.8 S65.7 698.6 829.8 1040.2Recurrent 246.8 801.8 858.0 869.7 482.6 486.7 505.5 682.8 658.2 8s8.3Capital 29.4 23.3 20.7 23.9 88.5 8.1 60.1 61.1 176.5 201.9

C. Other Social el

Total 215.7 191.8 142.0 243.2 820.4 221.7 209.0 278.2 506.9 587.5Recur,rnt 121.0 114.4 115.0 99.8 281.9 140.2 181.9 175.0 243.4 264.7Capital 94.8 77.4 117.7 143.8 62.5 81.5 77.2 98.8 283.6 272.9

D. All Social S/

Total 686.5 692.1 791.9 882.8 )0as.1 1002.2 1066.0 1274.6 1756.9 2155.1

Recurrent 604.5 562.1 684.9 689.6 901.1 866.8 917.1 1094.1 1253.2 1538.8capital 182.1 120.0 157.8 192.5 180.9 183.4 147.9 1800. 608.7 616.6

A/ Atul expenditure' vanles noted; in millions of current JOI Includes training and cultural developmnt

S/ Includes: (1) ecial security and general welfare; (11) Iouing; (111) *ater supplies; (iv) other social and community servicoE Entries here are the a of correeponding entries for A, 5, and C

/ 'Approved stimates'V 'Estimates'

Source: Ministry of Finance, 'Functional Classification of the Sudget' sections In Financial Statement. and Revenue Estimates, v rious o

years

0'

- 53 - ANNEX 3Page 1 of 2

JAMAICA


HRDP - Possible Proiects for External Financing

Project Name Description

A. Health

Hospital Improvement II Restoration of 12 hospitals and the BellevuePsychiatric Hospital over a 5-year period.

Health Care Rehabilitation Construction and equioment for 55 health centers

Refurbishment/modification To integrate in one space several MOH

of a training complex inservice training programs.

Purchase of medical equipment Purchase of medical and surgical equipment toreplace obsolete component.

Refrigeration facilities Purchase of 60 refrigerators and 50 vaccinecarriers for immunization program.

Drug supply depot Construction of an intrasit depot for drugs forprimary use.

Pharmaceutical supplies Purchase of drugs for the Government medicalservices to dispense (5 years).

1s. Nutrition

School feeding program To provide a snack for 625,000 schoolchildren190 days per year (5 years).

Food stamp program To double the present value of the program(5-years).

Public assistance/poor relief To provide pension benefits to needy elderly ordisabled persons (5-year cost).

Supplementary feeding program To secure food supplies for feeding of certainpatients at MOH hospitals and malnourishedchildren in community (5 years).

C. Education

Strengthening of MOE support Evaluation/monitoring, technical assistance,

services for primary education training, equipment (4-years)

-54 ANNEX 3Page 2 of 2

Quality improvements in primary Supply of basic school materials to needy

education students; incentives for teachers; nationalassessment program (4-years).

Upgrading basic schools Salary supplements for teachers; buildingmaterials for school construction/ improvements(5 years).

Upgrading primary and All- Renovation and refurbishing of 39 schools

Age Schools (4 years)

Upgrading new secondary Improvements to physical facilities, support

Schools facilities, curriculum and teacher upgrading for79 schools (5 years).

Textbooks for primary schools To provide textbooks for all students andstudents and teachers' guides for primaryschools (5 years).

D. Employment

Rural Road Maintenance Labor-intensive maintenance of parish counciland settlement roads, including minor repairs ofbridges, culverts, etc. (5 years).

Drainage/River Control Digging of di-Lnage channels to prevent flooding(5 years).

Reforestation/Soil Conservation Plantation of 54,000 acres (5 years).

-55- ANNEX 4Page 1 of 10

OrFICE OF THU MINISTER OF FINANC4AND PUSLIC SERVICE

3`0 NrIONAL HEROES CIRCLE.P.O. Box 512.

JAMAICA

May 11, 1989

Mr. Barber ConablechaixuaWorld Bank1313 H. Street# N.W.Vashingtonf D.C., 20433

*~~~~-' 3. .A.

Dear Mc. Conables

As you may be &wage the Government of Jmaica has beauin negotiations with your organisation concerning a loan tofund a Social sector Deve1 opmaent Project. These negotiationshave been completed, and the goal of the project could bepresented to the World Bank Board before the end of June.This project is net within the wider context of a ,manResoUces Develovment Prc oet for which the sank is assistinqus wvth raising additional undinq.

Please find attac#sd the Goveranent of Jamaica PolicyStatement with regard to the Social Services# and an associatedmatrix indicating actions to be taken and the timing of theseactions.

I look forward tq a successful presentation of theproject to your Board.

Sincerely

- -eymour MuIlLnqg

nMiister of Finance andPublic service *

Mtt.

5 S6 -ANNEX 4Page 2 of 10

JAMAICA


Draft Statement of Sectoral Policies

by the Government of Jamaica

Introduction

1. Increasingly in recent years, the Government of Jamaica has beenaware of the need to initiate a comprehensive program in support of humanresource development, with particular focus on essential policy reforms inthe social sectors. The Government's objectives include mitigation ofadverse social impact of the economic adjustment measures on families withlimited means of livelihood. The Government has also sought to achievebetter targeting of poverty aid, and increased efficiency in the deliveryof social services. Until early in 1988, however, the Government'sattention to programs of economic recovery prevented it from addressingthese pressing needs in the social sectors.

2. While policies to consolidate the country's recent gains in econo-mic recovery still remain prominent in the Government's agenda, we nowconsider it feasible to implement a carefully phased 'Human ResourceDevelopment Program (HRDP)'. This 5-year program sets medium term targets,essentially in public health, education, nutrition and employment aid, toincrease the financial resources available in support of these services,and to initiate policy reforms and rationalization measures to improvetheir overall efficiency. The program also incorporates a new monitoringsystem to measure progress, including the impact on personal well-being ofhouseholds.

3. The Bank is well aware of the objectives and the contents of theHRDP, which was developed in collaboration with it. The Government isappreciative of the Bank's assistance and its prominent role, in June 1988,in presenting the program to the donor community for financial support. Asa basis for the Bank's and the donor community's financial support of theHERDP, listed below are the main policy reform actions and efficiencymeasures which the Government of Jamaica undertakes to implement during the5-year (1989/90-1993194) HRDP implementation period. The actual phasingof these actions will be discussed with the Bank and confirmed at annualHRDP progress review/planning sessions which will be held during the HRDPimplementation period. The target dates indicated below for certain pros-pective reform actions should, therefore, be taken as indicative at thisstage.

- 57 -ANNEX 4Page 3 of 10

Public Health Services

(a) Increases in public hospital user fees

4. In 1984, the Government of Jamaica revised fees for patients usingpublic hospitals. Exempt from fees under the present fee schedule arethose on visits for family planning, women with high-risk pregnancies, foodaid recipients, children in school uniform, members of the armed forces andpensioners. All visits to public health centers are free of charge. TheGovernment will now review the public hospital fee structure, with dueregard to progress being made in increased efficiency, medical insurancecoverage and fee exemptions based on poverty, and will increase collectionsfor increased revenue, as well as for optimal use of health facilities(i.e. to discourage excessive lengths of hospital stay, to encourage moreintensive use of primary and secondary facilities, and to improve thereferral system between different levels of care). The Government isstudying the possibility of introducin& fees in certain areas where theseare not being collected now, such as for blood banks and medicallaboratories. Government proposals will be prepared by March 31, 1990, andnecessary follow-up action will be implemented by July 1, 1990.

(b) Increased Efficiency of Public Hospitals

5. In 1987, a process of divestiture of major public hospital non-medical services was launched, extending over: (i) housekeeping, janitorialand portering; (ii) catering, and (iii) laundry services. In October 1987,housekeeping services were let to a private contractor in three Kingstonhospitals. The Government, following this practice, will divest, by June30, 1990, all catering and laundry services in the Kingston region, as wellas in Spanish Town, Cornwall and Bellevue Hospitals, following renovationand upgrading of their facilities.

6. In addition, the Government of Jam&ica intends to improve effi-ciency in hospital operations by improving the management system throughgranting greater autonomy to hospital Boards, and give more implementationresponsibilities to local management teams. There are plans to implementthis model in Spanish Town Hospital. Private blocks are now being operatedwithin two hospitals, introducing cost recovery mechanisms within them.The Government will pursue these and other initiatives to strengthen themanagement and organization of health delivery services and cost recoveryoptions. A report on which models are most appropriate and cost-effectiveto serve as a basis for an improved system of public health servicesdelivery in Jamaica will be prepared by June 30, 1992; the Government willimplement the findings by December 31, 1992.

(c) Increased emphasis on primary health care

7. The Government of Jamaica gives priority to the primary healthcare facilities as effective and economic instruments in the delivery ofpublic health services. Accordingly, the share of MOH recurrent expen-ditures on primary health care increased from 161 to 211 between 1982183and 1986187. in support of this policy, the Government will increase

58 ANNEX 4Page 4 of 10

further the primary health care share of total MOH recurrent expendituresto reach 23? by April 1, 1990 and 252 by April 1, 1991. To ease the burdenon the Government's budget, the Government will make efforts to promotecommunity involvement in the primary health care clinics' construction andmaintenance.

(d) Rationalization of public health services

8. Since 1985, the MOH has begun to rationalize its facilities byapplying performance-based budgeting and computerization for its accounts,and introducing incentives for hospitals to collect fees. Five hospitalswere converted to primary health care facilities, and five general hos-pitals were reduced in inpatient capacity. The referral system wasstrengthened with the development of criteria for referral and the provi-sion of improved facilities for transportation and communication; morespecialized and costly medical services were centralized. Under theAdministrative Reform Program (ARP), health information systems computer-ization and program budgeting were introduced. By April 1, 1990, the KOHwill complete the restructuring and rationalization of its facilities and,by April 1, 1991, complete computerization and reform of its budgetingsystems.

9. At present, all receipts from public hospital charges are passedon to the MOH, except that hospitals may claim 50? of their individualcollections for approved expenditures. The remaining 502 is retained atMOB headquarters and allocated to expenditures at the discretion of the MOHPermanent Secretary. (On that basis, individual hospitals could be reim-bursed for up to 10OZ of their fee collections if their proposals for reim-bursement qualify within certain acceptance criteria). By April 1, 1990(and on the basis of proposals given to the Bank by September 30, 1989),the Government of Jamaica will introduce a new system for reimbursement,allowing hospitals to retain 75? of revenues collected for expendituresunder budgets approved by the MOB (based on an increase in the feestructure).

(e) Increased employment incentives for key MOB staff

10. The Government has been concerned that key MOB personnel,including hospital administrative staff and nurses, are becoming difficultto recruit or retain due to low goverrment salaries. To ease thissituation, the Government will prepare (by December 31, 1989) a plan toprovide salary supplements/incentives for key public health personnel, toimprove the MOB staffing situation particularly in areas directly involvedin the implementation of the HRDP and other priority programs. The Govern-ment will begin to implement the agreed proposals by April 1, 1990.

(f) Improved system of civil registry

11. Since before independence, Jamaica has had a system of civilregistry (for recording of births and deaths in particular). Thisregistry is currently operated by the Ministry of Health. The Governmentis concerned that the present civil register's coverage is incomplete, and


its records collection and storage are outdated. The manpower planning andpopulation division of PIOJ is currently looking at this issue, in collab-oration with an inter-ministerial committee, and by December 31, 1989, willpropose a comprehensive plan to overhaul it, for implementation by theGovernment by April 1, 1990.

(g) Improved MOH pharmaceutical program

12. Although measures to improve storage, inventory control anddistribution of drugs and medical supplies and to encourage the use ofgeneric drugs wvre recently adopted, the MOH pharmaceutical program stillhas serious shortcomings. The supply of essential drugs and medical sup-plies is not adequate. The current fee for prescription drugs in publichospitals, at J$5, represents only a small fraction of the actual costs.By December 31, 1989, the Government will prepare proposals on revisedcharges. The MOH will introduce, by April 1, 1990, increased drug chargesmore aligned with real costs of individual drugs.

NUTRITION AID

Improved targeting and rationalization of food aid to the poor - TheGeneral Food Subsidy, Food Stamp, and School Lunch Programs

13. The General Food Subsidies on a wide range of items were removedin May 1984. However, in a period of hardship among the poor, controls andsubsidies on some 11 food items were reintroduced in May 1986 (basically onwheat, corn and powdered milk). The Government of Jamaica is aware of thisprogram's short-comings in respect to its targeting, as well as itsdisincentive effects on Jamaican agriculture. Accordingly, on April 271989, it took measures to reduce general food subsidies channeled throughthe Jamaica Commodity Trading Company (GFS) for 1989-90 by about J$165million, resulting in higher prices of up to 50Z for staple foods such asbread, flour, rice, cornmeal, chicken, dried salted codfish and condensedmilk. A cabinet subcommittee, with technical support from PIOJ, is (a)identifying those households which are hardest hit by food price increases,and (b) developing strategies and measures to alleviate the effects ofthese increases.

14. The Jamaica Food Stamp Program was introduced in 1984 with a valueof J$20 every other month, to provide partial protection to selected groupsof needy persons (such as poor, pregnant and nursing women, their infantsand young children; the elderly, and indigent poor). Food stamps coverrice, cornmeal and powdered milk. Measures have been adopted to strengthenmanagement, distribution and targeting of the program (via mail lists andclinic-based distribution). The Government of Jamaica believes that thereis need to improve further the targeting of the current stamp aid, throughan analysis of coverage, to reach the most vulnerable groups. Accordingly,steps are being taken to reduce coverage from about 400,000 toapproximately 320,000 recipients, by removing unqualified recipients fromthe list of beneficiaries. It also believes that the present nutritionalvalue of the program, which was seriously eroded by inflation in recent

- 60 - ANNEX 4

Page 6 of 10

ye.rs, should be restored to its original level. Accordingly, the stampallowance was ralsed to J$30 every other month, effective July 1988, andwill be increased to JS40 every other month, as of July 1, 1989. TheSchool Lunch Program, introduced in 1983, was designed to provide 302 ofprotein needs for about 170,000 children daily in pre-schools and primaryschools. Accumulating evidence, in Jamaica and elsewhere, points not onlyto enhanced daily dietary intake but also to improved school attendance andattentiveness as benefits of school lunches for children from poorerhouseholds. The Government aims, initially, at providing (as far a.possible) 350,000 lunches in 1989/90 and, thereafter. if an impactevaluation of the program establishes its feasibility, to reach a target of600,000 lunches by the end of the HRDP period. The Government willprogressively improve the targeting and broaden the school lunch program tocover more students at pre-primary and primary schools. Data from thecurrent Living Stand.rds Measurement System (LSMS) surveys will also assistthe Jamaican Government to monitor impact of its nutrition aid programs.

15. The Government of Jamaica has agreed with the Bank on an actionplan to implement necessary changes to the food stamp, general food subsidyand school lunch programs, and will implement such plan according to theagreed timetable. Accordingly, the GFS will become a line item in theGovernment's budget, beginning April 1, 1990. The Government has declaredits commitment to phasing out the GFS over the next two years. Using thestudies being conducted by the World Food Program and the Inter-AmericanDevelopment Bank as the base, the Ministry of Education will undertake astudy to determine the demand for school feeding, its appropriate nature,and efficient targeting mechanisms. The Government of Jamaica will send tothe Bank proposals to expand the coverage and to improve the targeting andefficiency of school feeding programs by March 31, 1990. An agreed programwould be implemented by September 1, 1990. A cabinet subcommittee, withtechnical support by the PIOJ, is reviewing the Food Stamp Program andother proposals to target food to the poor, and cushion the effects ofprice hikes as general food subsidies are removed. The Government ofJamaica will send to the Bank specific proposals for changes in the FoodStamp Program by September 30, 1989, and an agreed program will beimplemented by December 31, 1989. In accordance with the above, theGovernment of Jamaica will communicate annually to the Bank the estimatedannual amounts for the GFS program. The overall amount of all subsidizedfood programs would be reviewed annually within the context of the HRDPannual review, in light of macroeconomic development and fiscal objectives.

EDUCATION SERVICES

(a) Increased emphasis on pre-primary and primary education

16. In its support of the education system, the Government of Jamaicagives high priority to pre-primary and primary education. From 1982183 to1986/87, the share of the Ministry of Education's (MOE) recurrent budgetexpenditures devoted to pre-primary and primary education increased from32Z to 352 of the total. The Government intends to raise this ratiofurther. By April 1, 1990, the share of the MOE recurrent expendituresdevoted to pre-primary and primary education will reach 36Z, and 382 byApril 1, 1992.

- 61 - ANNEX 4

Page 7 of 10

(b) Improved Government capacity to monitor impact of educationprograms and to identify issues in learning achievement

17. As a result of past and planned investments, access to schoolingin Jamaica at lower levels is largely assured. However, quality (asmeasured by an incipient educational assessment program) has not yetreached an adequate level. In 1985, the Government of Jamaica establisheda National Assessment Program (NAP), based on a new primary levelcurriculum. The NAP provides for a readiness test at grade 1, a diagnostictest at grade 3 and an achievement test at grade 6. To develop the systemfurther, the Government will prepare, by December 31, 1989, proposals,satisfactory to the Bank, to improve the quality of the NAP tests, theiradministration and dissemination of their results. The Government willimplement the agreed action plan by September 1, 1990. The MOE, byDecember 31, 1991 (following two administrations of achievement tests),will evaluate the new primary level curriculum for any necessarymodifications. By September 1, 1992, the Government will provide pupilswith complete sets of textbooks for the core subjects being evaluated.

(c) Increased beneficiary participation in school affairs, includingrestoration and maintenance of buildings and equipment

18. The present low level of community support for maintenance andfrequent vandalism of school properties have been attributed in a largepart to the lack of community involvement and participation in schoolaffairs. With World Bank support (under Loan 2899-3M), the MOE isundertaking a study to decentralize school administration and to createlocal community committees for support of school activities, and hasestablished school maintenance committees in about 20 World Bank projectschools. Based on the results of the ongoing study to be completed byDecember 31, 1989, and experience with school maintenance committees, theGovernment will establish, progressively by parish, school maintenancecommittees which will cover all basic primary and all-age schools (interimtargetes 50 schools by December 31, 1990; 200 schools by December 31,1991).

(d) Increased supply of school textbooks and cost containment andrecovery.

19. In the past, the MOE has provided instructional materials inmathematics, reading and English directly to the schools, one set for everyfive pupils. Since.1984, in phased implementation across the island, allprimary school children received a set of six textbooks without charge.The MOE has a study under way regarding cost containment relatedto primary textbooks. Depending on its findings (due by September 30,1990) and if judged feasible, the MOE will introduce, bySeptember 30, 1991, measures for cost containment for primary leveltextbooks. Thereafter, it will evaluate the impact. The Government ofJamaica agrees that, to the extent practicable, secondary school pupils(excepting the poor) should contribute to the costs of the school textbooksthey use. Accordingly, the MOE has introduced a textbook rental scheme atthe secondary level. This scheme will, by September 1, 1989, be in effect

- 62 - - 62 - ~~~~ANNEX 4

Page 8 of 10

for four core Lubjects in grades 7-11. By September 1, 1991. it will covermore subjects. Annual rental fees will be approximately J$15 per textbookfor grades 7-9, and J$20 for grades 10-11.

te) Cost recovery in higher education

20. Beginning mid 1986/87, the Government eliminated boarding grantsfor students attending institutions of higher education. A cess was intro-duced more recently, and the student loan programs have been expanded. TheGovernment of Jamaica intends to maintain cost recovery/student aidmeasures and it will improve them as necessary.

(f) Increased employment incentives for key MOE staff

21. It is estimated that real incomes of the MOE personnel, adminis-trators and teachers have declined by 302 since 1984/85, despite aGovernment-approved increased salary subsidy in 1987 for teachers in basicschools and negotiated increases in salaries for other categories ofteachers and for administrative personnel. Additional incentiven are nownecessary to motivate staff and to reward good performance, so that the MOEwill be able to recruit/retain qualified personnel. The Government ofJamaica has allocated sufficient funds under the HRDP to enroll about 2,000primary teachers in in-service training over the 1989190-1992193 period.About 6,000 teachers will enroll over the same period in an upgradingprogram, leading to a diploma and, hence, to eligibility for significantsalary improvement. Approximately 600 secondary school teachers will eachreceive a scholarship for degree or post-graduate study. Additionalincentive schemes of a more innovative nature will be tried out and. ifsuccessful. introduced on a permanent basis. By December 31, 1989, theGovernment will prepare specific proposals on this matter for review withthe Bank, and will begin to implement an agreed action plan by June 30,1992.

EMPLOYMENT AID

(a) Provision of income support for the chronically unemployed

22. Unsatisfactory employment performance has been a chronic problemin Jamaica, as the "job-seeker' rate has varied from 8 to 18? from 1972 tothe present. It was 13? in 1980, peaked at 162 in 1982 and fell to 8.62 in1987, thanks to the Government economic recovery program. Following aperiod of decline, real wages have also been rising in 1986-1988. Becauseunemployment remains chronically high among youth and women--half theunemployed are under 25 and two-thirds are women--the Government hassponsored since 1982 several programs of training and technical assistancetargeted to these groups, including HEART, SOLIDARITY, and the small farmerincome programs.

23. To further relieve unemployment in depressed areas and assist therural poor, the HRDP includes a public works program, about 12,000 full-tine job equivalents over the next five years (touching a much largernumber in terms of part-time employees). Activities to be supported under

_ 63 -

ANNEX 4Page 9 of 10

the program involve drainage, road maintenance, and reforestation/soilconservation. Prior to full-scale launching of these activities, theGovernment will review with the Bank its criteria fo. economic assessmentof project proposals under the scheme. It will also consider alternativemethods (in addition to the public works approach) to be comr;nicated tothe Bank by December 31, 1989, to increase employment of the poor(including women and youth in particular) and agree with the Bank, by April1. 1990, on necessary follow-up action.

IMPLEMENTATION OF THE HUMAN RESOURCE DEVELOPMENT PROGRAM (HRDP)

(a) Participation of Non-governmental Organizations (NGOs) in HRDPimplementation

24. There are approximately 200 local, regional and internationalNGO's operating in Jamaica, primarily in the social sectors. While NGO'sdo have direct contacts with the GovernmeuL, so far there have been fewefforts to coordinate NGO activities with HRDP components- The Governmentof Jamaica agrees that the HRDP Secretariat, working with the Ministries,and on the basis of updated information, will seek to identify the HRDPcomponents that may be implemented with the assistance of NGO's.

(b) HRDP impact monitoring

25. The Government of Jamaica is fully cognizant of the need toevaluate the impact of its policies on key social indicators. This impactmonitoring role has been assigned by the Government to the Statisticalinstitute of Jamaica (STATIN) which will use the Living StandardsMeasurement System (LSMS). PIOJ is developing, with UNICEF financing,other institution-based monitoring systems of the key Ministries, whichwill complement this information. During the HRDP implementation period,the Government of Jamaica will conduct semi-annual surveys to assesschanges in key social indicators and will take these results into accountin determining the future course of HRDP policy and implementation.

CONCLUSION

26. The Government of Jamaica attaches high priority to the HRDP as anoverdue development and adjustment program in the social sectors, whichwill provide a social dimension for the major economic adjustment andrecovery process in Jamaica which has taken place in recent years. Thevarious policy reform actions and efficiency measures, listed above and inthe Policy Matrix attached, will constitute an integral part of the HRDP.The Government is fully aware that the HRDP implementation should be withinthe framework of Jamaica's broader macroeconomic policy objectives andpublic sector investment priorities. Accordingly, the Government willimplement the HRDP on the basis of yearly subprograms, to be agreed withthe Bank.

27. The Government of Jamaica declares its commitment to implementingthe HRDP-related reform actions and development policies described above.The Government appreciates the assistance given to Jamaica by the World


Bank in preparation of the HRDP and in seeking aid in support of it by thedonor community. The Government hopes that the World Bank will now be ableto make a loan to Jamaica to help finance the HRDP implementation through aSocial Sectors Development Project. The Government also hopes that theBank will continue to endorse the HRDP for financial support by otherexternal donors, and provide continued assistance over the medium termthrough follow-up operations as required.

28. We appreciate the continuous exchange of views with the World Bankon the HRDP and would be glad to discuss at regular intervals the progressachieved in its implementation.

ATTACHMENT: Policy Matrix

ANNEX 6~ 65 - Pag I ot 6

SOCIAL SECTORS DEVELOPMEENT PROJECT

POUCf MATRIX

POLICY OSJECTIVSJPRORAMS RECENT ACTIINS/STATUS ACTIONS TO BE TAKSG TIMING ./

A. Redirecting of SocialExpenditures

1. Increased budgetary Relative share of primary A further Increase to 26X In To reach 23X by April 1,provisions for primary health care out of the MOH primary health care 1990 and 253 by April 1,health care (health). recurrent expenditures services' relative share of 1991.

incresed from 16 to 21X the MON recurrentbetween 1982/83 and expenditures will be carried1986/87; functions of aom out.hospitals were turned Intoprimary care facilities.

2. Increased budgetary Relotive shares of pr- Further ineresoe will be To rech S0 by April 1,provisions for pre- primary and primry offected over time to raise 1990 and 38X by April 1,primary and primary education out of the MOE the total of the Pr-primary 1992.education (education). recurrent expenditurec and primary share of MOE

Increased from 82 to 3SX recurrent expenditure tobetween 1982/83 and 38X.1910/87.

B. Better Targeting ofSocial Services for thePoor.

1. General food subsldy, On April 27, 1989, the OGJ A cabinet subcommittee, with The overall amount offood stamp aid, end cut J918S mtillon In technical support from PIOJ, GS, nd all subsidizedschool lunch progrm general food subsidies Is Identifying households food program will be(nutrition). channelled through ths hardest hit by food price reviewed with the Bank by

Jamaica Commodity Training increases and developing March 1 of each year, InCompany (COFS), strategies and measures to light of macroeconomic

alleviate th- otffcte of development and fiscalthes Increases, objectives.

!/ Indicetive dates,subject to review andconfIrmation at annual HROPProgress Reviews andplann ng meetings betwenthe Governmnt of Jamaicaand the Bank.

ANNEX 6

- 66 - Page 2 of O

(t) Tho preosent food (') -The OFS will become a (I) - As of

subsWv progras, In ffset line- Item In the GOJ budget. April 1, 1990.

since 1988, covers Wheat, - The OFS wi I be phoasd out - By March a1, 1991,corn and powdered milk, over the next two years. subject to macroeconomic

and fiscal objectives.

(II) Food stamp program In (I1) - Allowance will be (II) - As ofoperation since 1984. incerased from J33O to J340 July 1, 1989.

Amount of aid eroded every two months.progressively due to - A cabinet subcommittee is - Proposals by

Inflation. Unqualified preparing proposals to September 80, 1999,

recipients were removed Improve targoting and widen Implement agreed program

from the rosters In April coverage of food stamp by December S1, 1989.1989, reducing the number program.of recipients from 400,000to 820,000.

(iiI) Introdueed In 1993, (III) The school lunch (III) COJ proposals by

the school lunch progrse is Drogram will be progres- March 81, 1990; Implementnow serving about 170,000 sively targeted towards the agreed program by

pro-primary and primary poorer children In the early September 1, 1990.

school students, while the years of schooling, and

traditional program * rves broadened to cover more

130,000 students. studente at pre-primary andprimary schools.

2. Employment aid Program has not yet been The Government will consider Government proposals by

(employment) launched. The Government alternative methods (in December 81, 1989; 'gree

has an ongoing program ddition to the public works with the Bank by April 1,

(SOL1DARITY) which provides approach) to Inereas 1990 on necessery follow-credit to unemployed youth employment of the poor up action, after review-

to set up businesse; also (including women and youth). Ing with the bank pro-there Is an expanding posed criteria for

training program economic assessment of

(H.EA.IR.T.). project proposals underthe scheme.

C. IncreasedEfficiency.Coit Savinasand Beneficiary Cost-Sharina In the Deliveryof Social Services

1. User foes/cost recovery Since 1995, fee are The Government will review Government proposals for

(health). collected at public the current tfo structur. incresing fees due March

hospitals for cost recovery with due regard to progr to S1, 1990; Increase fees

and Improved bed ode In increosed by July 1, 1990.

utilization, efficiency, medicalInsurance coverage, and feeexemptions based on poverty,and ralos fes as necessary,for Increased revenue andoptimal use of healthfacilitles (to discourage

A4NEX S- 67- Page a of 6

excoselve lengthe ofhospital stay, to encouragemore lntensivo use ofprimary and secondaryfacilities and to Improvethe referral system betweendifferent levolo of cars).

2. Increased Efficiency Some divestiture of The Government will pursuo By Jung a0, 1990, divest

(health) hospital non-edical initiatives to strengthen catering and laundry

services (housekeeping, management and organization services in all Kingston

janitorial, portering, of health delivery services Region Hospitals, Spanish

catering, laundry) took and cost recovery options, Town, Cornwall and

place In 198?. including granting greater Bollevue hospituls,

autonomy to hospital Boards,. follosing renovation and

Private blocks have been and giving more upgrading of their

Introduced in two implemntation facilities. Experiment

hospitals, with cost reponsibilties to local with various approaches

recovery mechanims within management team. for, end formulate

them. recommendations forchanges in publi- healthservices delivery by June30, 1992 and implmentfindings by December 31,1992.

S. Increased cost- Mesure, to Improve The Government will prepare Proposals on revised

effectiveness of the distribution, storage, and a plan to align the public charges by December 31,

MON pharmacutical inventory control of drugs hospital drug charges more 1989; revised cherges to

program (health). and mdical supplies end to closely with rel costs of be effective by April 1,

encourage the use of Individual drugs. 1990.

generic drugs were recentlyadopted.

4. Community Involvement A study to underway to Depending on the study Study completion by

In school activitios decntrallt school outcome and the experience December 31, 1989; set up

(education). administration and to with 20 pilot schools, the committees in no fewer

create locol comunity Government will progres- than 50 schools by

comittes In aupport of sively establish community December 31, 190 and in

school maintenance such as comittes for all primary at least 200 schools by

those sitablished under and all-ag schools. December 31, 1991.

World Bank loan No. Thereafter, extend to all

2899-JM. primary and all-ageschool.

- 68- ANNEX 6

S. Community Involvemnt The Governmnt wSill promoteIn primary health care comunity assistance Inclinics* construction construction and mintenanceand maintenance of primry health Caro(health), clinics.

6. Improved availability Textbook availability not (i) The Government will (1) By September 1,of textbooks and con- adequate, *lthough progressively increose 1992, provide to alltainment of primary considerable progress has availability of textbooks to primary studentslev-l textbook costs been made since a textbook all primary school students. textbooks on coreand rocovery of secon- program began In 1984. The subJects.d:ry level textbook govornmnt has a studycosts (education). underway to assess the

feasibility of costcontainmnt for primarytextbooks.

(ii) At the secondary (Ii) Introduce secondarylevel, It will collect a level textbook rentalrental fee from all students scheme for four coreexcept the poor. Annual subjects (grads 7-11) byrental fee: approximately September 1, 1989; coverJ316 per textbook for grades more subjects by7-9 and JS20 for grades September 1. 1991.10-11.

(iii) Depending on the (iII) Complete theongoing study rosults, it ongoing study bywill also Introduce measurs September a0, 1990 and,to contain costs of primary if judged feasible,textbooks. It sill introduce by Septemberthereafter analyzo the 30, 1991, measures forimpact, cost containment of

primary textbooks.

0. Rationalzation ofGovernment Operations/Program Management InHeath and Education

1. Improved MON financial (i) Performace-based (T) Tha Govornment will (i) By April 1, 1991,management (health) budgeting and implemnt advanced budgeting the W(IN will complote

computerization in and computerization program. computerization andeffect; reform of Its budgeting

system.

(tS) Hospitals and other (ii) Hosp!tale and other (ii) Prepar specifichealth facilittos are health facilities will be proposals by December 31,routinely reimbursed reimbursed 763 of their fee 1989 on achievement ofSOX r,f their fee collections from patients 76X fee reimbursement,collections for for approved expenditures. *nd implement newapproved expenditures, procedures by April 1,and, in selected 1990.cases, have receivedan additional amounton request.

- 69 - ANNEX 6Page 6 of 6

2. Improved Civil Registry At pm sent, tho Ministry of Th- HROP Secretorlat will be Now proposals, Includingand ancillary vital Health operates o civil responsible for exomining cost estimates, bystatistics mangement registry for, among other current shortcomings ef the December 31, 1989; the

systems (health). Items, vital statistics, vital statistics collection Government will IntroduceThie system has serious and analys e system new scheme by April 1,shortcomings %nd is not (Including death 1990.fully responsive to the registration) and willHRDP requirements. propose a plan to overhaul

It.

3. Rationalization and Under a MON rationa- Program implementation is By April 1, 1990, the MONrestructuring of public lization 2nd rostructuring quite advanced, tho MON will complete thehealth faclittes program underway since attention at preent ts restructuring and

(health). 1986, 6 small hospitals are focused on strengthening of rationalization of Itsbeing converted Into primary health centers facilitles.primary health care organization and management.e nters; the referral

system Is belng Improvedand edical services arebeing strngthend.

4. Incentive measures to Some key personnel ar* The Government will prepare Covernment proposals byretain/recrult MOH and leaving the MOH and the MOE programs to provide *sery December 31, 1989. BeginMOE key personnel services due to Inadequate supplementa/incentives and to Implement agreed pro-(health and eduetion). remuneration, training for key MON and MOE posels by April 1, 1990.

personnel.

5. Better monitoring of The Covernment'e new (1) The Government will (t) Prepare by Decemberimpact of educatlon National Assessment Program establish procedures for 81, 1989 proposals *attu-

program (education). (NAP) In being lmplemented; timely processing, reporting factory to the Bank, toIt Includes a rediness and dissemination of Improve the quality oftest at grade 1, a assessment results. It will the NAP tasts, their

diagnostic test at grade 3 Improve the quality of thes administration andand an achievement test at tests, their administration, dissemination of theirgrade S. and the timeliness and results. Implement

dissemination of results agreed action plan by

*valuated. September 1, 1990.

(it) The curricula on whieh (ii) Following twothe testa are based will be administration, of

evaluated. achievement tests,conduct curriculum*valuation review byDecember 31, 1991.

ANNEX 670 Page 6 of O

E. HROP ImDlementation/

Monitoring

1. Us. of Living Standards Th. impaet monitoring role The Government will conduct Semiannually. SecondMeasurement System has been assigned by the semiannual surveys to survey scheduled for

(LSMS) and oti~r Government to STATIN. evaluate changes In key June/July 1989.

institution-basod social sector indicatoro.

monitoring systems, asrelevant, to *valuate

changes in key social

Indicators.

2. Non-Governmental There are approximately 200 The HROP Secretariat, Continuing process.

OrganizatiTon (NGOs) to local, regional and working with the ministries,

participate in the NROP international NGO's and on the basts of updated

implementation, where operating in Jamaica, information, will seek to

appropriate, primarily in social identify the HRDP components

sectors. While NCO$s do that may be implemented withhave direct contacts with assistance of NCO'*.

the Government, there has

been no effort yet to

coordinate NGO activities

with HROP Implementation.

71 - ~~~~~ANNEX 6_-71 -Table 1

JAMAICASOCIAL SECTORS OEVELOPMENT PROJECT

Project Components by Year

Base Costs (JI milion)

Tot* I89/90 90/91 91/92 92/93 93/94 Total US$ millon

* HEALTH SECTOR

* PRIMARY HEALTH CARE DEVELOPMENT 1.2 7.4 7.9 7.6 5.9 29.9 6.4; MEDICAL EqUIPMENT 0.0 2.1 2.0 1.9 0.0 6.0 1.1* PHARMACEUTICAL STOCKS 14.4 14.4 14.4 14.4 14.4 72.0 18.1

MOH INSTITUTIONAL STRENCTHENING 8.4 6.2 6.2 5.6 5.2 26.6 4.8UPGRADING REGISTRAR GENERAL'S 0.0 2.3 2.8 1.8 1.8 7.2 1.8DEPARTMENT

Sub-total 19.0 82.4 82.8 80.7 26.0 141.7 25.s

EDUCATION SECTOR

UPGRADING PRE-PRIMARY SCHOOLS 0.6 5.7 5.7 5.6 1.0 18.8 a.4

UPGRADING PRIMARY & ALL AGE SCHOOLS 1.0 12.4 12.5 12.6 11.7 50.2 9.1PRIMARY TEXTBOOK PROGRAM 7.5 7.5 9.0 9.0 9.0 42.0 7.6MOE INSTITUTIONAL STRENGTHENINC 1.2 10.6 10.0 9.8 7.2 88.2 7.0

Sub-total 10.5 86.1 87.2 a8.5 28.9 149.2 27.1

HRDP ADMINISTRATION A MONITORING

HROP SECRXTARIAT 2.2 1.4 1.4 1.4 1.4 7.8 1.4IMPACT MONITORVNG 2.8 0.6 0.6 0.6 0.6 4.7 0.9

Sub-total 4.5 2.0 2.0 2.0 2.0 12.6 2.8

Total BASELINE COSTS 84.0 70.5 72.0 69.2 67.7 808.4 55.2

Physical Contingencies 1.7 8.6 8.7 8.5 2.9 15.4 2.6Price Contingncte- 1.2 7.4 11.6 14.5 15.1 49.8 9.1

Total PROJECT COSTS 38.9 81.6 87.8 87.2 76.7 388.6 67.0

Taxes 0.0 0.0 0.0 0.0 0.0 0.0 0.0Foreign Exchange 16.4 85.2 84.7 34.2 29.0 149.5 27.2

JAMAICA


Proj.ct Coepoonts by tI.r

Total. Including Contingmncles Total. Including Contingencies

(J atillIon) (US$ Sillion)

89/90 90191 91/92 92193 93194 Tot l 89180 90/91 91192 92193 93/94 Tot l

HEALTN SECTOR

PRIMARY HEALTH CARE DEVELOPMENT 1.S 8.7 9.6 9.6 7.7 30.6 0.2 1.6 1.7 1.7 1.6 6.7

MEDICAL EQUIPMENT 0.0 2.3 2.4 2.3 0.0 7.0 0.0 0.4 0.4 0.4 0.0 1.2

PHARMACEUTICAL STOCKS 16.6 16.5 17.2 17.9 18.7 85.9 2.8 3.0 3.2 3.3 3.4 16.7

MON DINSTITUTIONAL STRENBTHENING 8.8 7.2 7.6 7.1 6.8 32.6 0.7 1.3 1.4 1.3 1.2 6.9

UPGWADING RECISTRAR GENERAL"S 0.0 2.7 2.7 1.6 1.7 8.7 0.0 0.6 0.6 0.3 0.3 1.6

DEPARDIENT - n--

Sub-total 20.7 37.4 89.6 38.4 84.9 170.9 3.7 6.8 7.2 7.0 6.4 31.1

EDUCATION SECTOR

UPGRAOtNC PRE-PRIMARY SCHOOLS 0.9 6.6 7.0 7.0 1.3 22.8 0.2 1.2 1.3 1.8 0.2 4.2

UPORADING PRIMARY A ALL AGE SCHOOLS 1.1 14.3 15.8 15.9 15.3 61.9 0.2 2.6 2.8 2.9 2.8 11.3

PRIYMRY TEXTBOOK PROGRAM 8.1 6.7 11.0 11.6 11.9 61.2 1.6 1.6 2.0 2.1 2.2 9.4

MOE INSTITUTIONAL STREN¢THENING 1.4 12.2 12.1 11.6 9.6 47.0 0.2 2.2 2.2 2.2 1.7 8.5

Sub-total 11.5 41.8 46.4 46.2 38.0 182.9 2.1 7.6 8.8 8.6 6.9 83.4

HROP ADMINISTRATION A MONITORING

NW SECRETARIAT 2.8 1.6 1.7 1.8 1.9 9.3 0.4 0.3 0.3 0.3 0.3 1.6

IWACT MONITORINt 2.6 0.7 0.7 0.8 0.8 5.5 0.6 0.1 0.1 0.1 0.1 0.9

_~~ee _- - -!

Sub-total 4.8 2.3 2.4 2.6 2.7 14.8 0.9 0.4 0.4 0.4 0.4 2.6

Total PROJECT COSTS 37.0 81.5 87.8 87.2 75.6 368.6 6.7 14.8 16.9 16.9 13.7 67.0

73 - ANNEX 6Table 3

JAMAICASOCIAL SECTORS DEVELOPMENT PROJECT

(J8 million)

Summary Accounts by Year

ease Costs Foreign Exchange89/90 90/91 91/92 92/93 93/94 Total _ Amount

I. INVESTMENT COSTSCONSTRUCTION 0.0 21.8 24.5 24.2 18.4 86.7 40.0 38.5SITE WORK 0.0 1.0 1.0 1.0 1.0 4.0 20.0 0.8PROFESSIONAL FEES 2.4 2.6 2.6 2.6 0.2 10.3 10.0 1.0

Sub-total 2.4 26.1 28.1 27.8 17.6 103.0 36.2 37.8

EQUIPMENT 0.8 9.8 5.S 8.9 1.6 21.6 84.6 18.2BOOKS 7.6 7.6 9.0 9.0 9.0 42.0 10.0 4.2FURNITURE 0.4 1.9 2.8 2.3 2.8 9.2 40.0 8.7TECHNICAL ASSISTANCE

FOREIGN EXPERTS 1.8 0.8 0.8 0.8 0.0 2.7 100.0 2.7LOCAL EXPERTS 0.0 0.1 0.2 0.8 0.8 0.9 0.0 0.0

Sub-total 1.8 0.4 0.5 0.6 0.8 8.8 75.0 2.7

STAFF TRAININGOVERSEAS TRAININC 0.2 0.2 0.2 0.2 0.2 1.0 95.0 1.0DOMESTIC TRAINING 0.9 2.6 2.6 2.2 2.0 10.8 10.0 1.0

Sub-total 1.1 2.8 2.8 2.4 2.2 11.8 17.5 2.0

BONUS INCENTIVES 0.0 0.8 0.7 0.1 0.0 1.4 10.0 0.1PHARMACEUTICALS 14.4 14.4 14.4 14.4 14.4 72.0 75.0 C4.0

INCREMENTAL HRDP STAFF 3.7 8.6 8.6 8.6 8.6 18.1 10.0 1.8

Total INVESTMENT COSTS 82.1 68.1 68.9 64.1 52.9 SP2.1 44.0 124.0

II. RECURRENT COSTS

INCREMENTAL SALARIES 0.0 1.0 1.7 1.7 1.7 8.1 0.0 0.0OPERATION A MAINTENANCE 1.4 2.5 2.6 2.5 2.5 11.4 10.0 1.1EDUCATIONAL MATERIALS 0.6 0.9 0.9 0.9 0.6 8.8 10.0 0.4

Total RECURRENT COSTS 1.9 4.4 5.1 5.1 4.8 21.8 7.1 1.5

Total BASELINE COSTS 84.0 70.5 72.0 69.2 57.7 808.4 41.4 125.5

Physical Contingencies 1.8 8.6 8.7 8.5 2.9 15.5 41.4 6.4

Price Contingencies 1.1 7.4 11.6 14.6 15.1 49.7 86.4 17.6

Total PROJECT COSTS 86.9 81.5 87.8 87.2 75.7 868.6 40.6 149.6

Foreign Exchange 16.4 86.2 84.7 84.2 29.0 149.6 100.0 149.5

JAMAICA.

SOCIAL SECTORS TCLOP PROJECT

Su mary Accounts by Project Comonent

(4i million)

HEALTh UPFm. ESUCA.

PR!. SECTOR LFOR. UPR. PRI. PFRI. SECTORHEALH PHARA- INSTM. REO. PRE- A ALL TEXT- INSTIT. tIRP DIPACT

CARE EWICAL CSJTICAL STRENOlH DEPT PRIMW AO am STREH S.OTA- MONTTOR-DEw. EUIP, STOOC -BdNOM Oep. SOILS. S0ALS. PROC. -EMINO RIAT IOTTl

I. SNENT COSTS

CSVIL nF C

CaNSTRUCTION 20.1 0.0 0.0 6.6 5.2 1S.6 56.0 0.0 7.2 0.0 0.0 88.7

SITE Wm 0.0 0.0 0.0 1.5 0.0 0.0 2.5 0.0 0.0 0.0 o.o 4.0

PRSFiSIOAL fES 4.7 0.0 0.0 1.1 0.0 0.0 4.0 0.0 0.5 0.0 0.0 -O.S

___ __ __ __ __ __ ___ __ __ --- _ --- -- --- - - - --- ;------ -_-_ _-- _________________________- io ;-.

Sub-totul 24.6 0.0 0.0 9.2 5.2 1S.6 42.5 0.0 7.7 0.0 0.0 108.0

E4UIP"E4T 4.2 6.0 0.0 0.0 1.9 0.3 3.8 0.0 4.5 0.8 0.0 21.5

OmCKS 0.0 0.0 0.0 0.0 0.0 0.0 0.0 42.0 0.0 0.0 0.0 42.0

RRFLTURE 0.9 0.0 0.0 2.1 0.0 2.S 5.9 0.0 0.0 0.0 0.0 9.2

TECHICAL A3SISTANCE

FllSN EXPERTS 0.0 0.0 0.0 0.8 0.1 0.0 0.0 0.0 0.6 0.0 1.7 2.7

LOCAL EXPORTS 0.0 0.0 0.0 0.6 0.0 0.0 0.0 0.0 0.8 0.0 0.0 0.9

Sub-totsl 0.0 0.0 0.0 0.9 0.1 0.0 0.0 0.0 0.9 0.0 1.7 8.6

STAPr TRAINDV

OVERS TRAINII 0.0 0.0 0.0 0.0 0.0 0.0 c.G 0.0 1.0 0.0 0.0 1.0

DOMESTIC RIND42NO 0.0 0.0 0.0 1.9 0.0 1.4 4 0.0 7.0 0.0 0.0 10.8 _

_________________________________---------- ----------- -__-____-___________. J--

Sub-totAl 0.0 0.0 0.0 1.9 0.0 1.4 0.0 0.0 8.0 0.0 0.0 11.8

Dams cisves 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 1.4 0.0 0.0 1.4

PHTAICrICALS, 0.0 0.0 n.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 72.0

tWTAL IHDP STAFF 0.0 0.0 0.0 7.4 0.0 0.0 0.0 0.0 2.7 5.0 3.0 18.1

Tau~~ __________________________---- --- i;----_--_-- -__ - ___________202-

Tot.al DlSnaT coSTS 29.9 6.0 72.0 21.5 7.2 17.6 80.2 42.0 26.2 5.8 4.728.

II. FtMR 5FCS1

IN r OBTAL SALARIES 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 6.1 0.0 0.0 6.1

OPERATION & MAD1ETN*EE 0.0 0.0 0.0 5.1 0.0 0.8 0.0 0.0 3.9 2.0 0.0 11.4

eXJATIW4AL MATERIALS 0.0 0.0 0.0 0.0 0.0 0.9 0.0 0.0 S.0 0.0 0.0 3.6

Totnl R lG COSTS 0.0 0.0 0.0 8.1 0.0 1.2 0.0 0.0 13.0 2.0 0.0 21.8______________________-- __- ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ -- -------__---___________ __________-

Total BASELINE 29.9 6.0 72.0 26.6 7.2 1.8 60.2 42.0 88.2 7.8 4.7 808.4

Physical Continencies 1.6 0.3 3.6 1.8 0.4 1.0 2.5 2.1 2.1 0.4 0.2 IS.6

Price Contingencie 5.3 0.7 10.8 4.6 1.1 8.0 9.2 7.1 6.7 1.1 0.6 49.7

Totl PROJECT COSTS iS.8 7.0 6. 8 2.5 6.7 i.6 61.9 51.2 47.0 9.3 S5 S868.

Foruign Eahehnge 15.4 6.i 64.0 6.6 ;. 6.2 24.2 S.O 11.8 1.4 2.2 4. g

ANNEX 7-75 -

JAMAICA


Project Implementation Schedule(Cumulative Progress in Z)

----------------------------------------------------------------------- __--

Project Component 89/90 90/91 91/92 92/93 93/94----------------------------------------------------------------- __--------

HEALTH SECTOR

Civil Works 2 27 54 79 100Equipment 0 25 69 100Furniture 0 0 33 67 100Technical Assistance 0 33 67 100Staff Training 33 67 100Pharmaceuticals 20 40 60 80 100Incremental HRDP Staff 20 40 60 80 100Operation and Maintenance 20 40 60 80 100

EDUCATION SECTOR

Civil Works 2 24 52 79 100Equipment 0 50 100Books 20 40 60 80 100Furniture 13 34 57 78 100Technical Assistance 13 13 50 88 100Staff TraininRg 20 40 60 80 100Bonus Incantives 0 43 93 100Incremental HRDP Staff 20 40 60 80 100Incremental Salaries 0 0 33 67 100Operation and Maintenance 0 25 50 75 100Educational Materials 13 40 67 93 100

HRDP ADMINISTRATION & MONITORING

Equipment 100Incremental HRDP Staff 20 40 60 80 100Operation and Maintenance 20 40 60 80 100

-77-

ANNEX 8Page I of 2

JAMAICA


Selected Documents and Data in Proiect Files

A. Selected Reports and Studies Related to the Subsector

A.1 "Financing Health Care in Jamaica," Maureen A. Lewis, The URbanInstitute, June 1988.

A.2 "The Social Well-Being Programme - A Programme for SocialDevelopment,' Government of Jamaica, April 1988.

A.3 'The Programme of Social Adjustment," Government of Jamaica, May1988.

A.4 'Impact of Macroeconomic Adjustment on the Poor and on SocialSectors in Jamaica," Jere R. Behrman and Anil B. Deolalikar, July7, 1988.

A.5 'Preliminary Report - Living Conditions Survey - Jamaica,"Statistical Institute of Jamaica and The World Bank. October1988.

A.5 'Jamaica - Summary Review of the Social Well-Being Program,'World Bank, May 20, 1988.

B. Selected Reports and Studies Related to the Project

B.1 'Programme for the Advancement of Childhood Education - PACE -Rationale for Early Childhood Education", MOE, 1988.

B.2 'SWP Education Projects,' MOE, 1988.

B.3 'Project Summary, Background and History," MOH, November 1988.

B.4 'Health Centers for the Social Well-Being Programme,' MOH,December 1988.

B.5 'Report on Health Centers Redevelopment Project," EstateDevelopment Co. Ltd., December 1988.

B.6 'Essential Preparations for the Private Sector January 1988-June1989,' Jamaica Commodity Training Company Limited, 1988.

B.7 'SWP Financing Gap and Proposed Financing by Sector/Agency,"PIOJ, May 1989.

ANNEX 8-78- Page 2 of 2

c. Working Papers

C.A "Monitoring the Jamaica Social Well-Being Programme", SistemasIntegrales, July 1988.

C.2 "The Recruitment and Retention of Key Personnel/Teachers in theEducation Sector: A Preliminary Examination," MOE, Kingston,December 1988.

C.3 "Plan for Incorporating NGOs into Implementation of SWP," 1988.

C.3 Project Costs.

C.4 Importation of Pharmaceuticals by Jamaica Commodity TradingCompany Limited.

C.l "1989/90 and 1990191 Subprograms and Criteria for First YearlyProgress Review", December 1988.

C.2 "The Recruitment and Retention of Key Personnel/Teachers in theEducation Sector: A Preliminary Examination," MOE, Kingston,December 1988.

-79- CHART 1

CaIRT 1

ORGANIZATIONAL STRNCTURE OF THE HROP SECRETARIAT

DIRECTOR GENERAL| DIRECT--- -- Intormation Flow

Line of Command

DIVISIONAL DTRECTOR/[ PROGRAM DIRECTOR

PROGRAM AWMINISTRATOR STATISTICIAN/PRORAERALYSTS| (Now Pos (New Poet) - (Appro. 12 week_ p..)

Al~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~.

It~| N DIVISIONAL SUPPORT

!. " Staff . 1 New Post _ 4.

DESK DESK DESK STATTSlTCAL RECISTRAR SECTOtOFFICER OFFICERt OFFICERS INSTITUTE GENERAL VWNTSTRIES(HEAL"H (EDUCATION) (Other OF JAMAICA DEPARTMENT (Social

R4 Iwant (Survey of (Vital Indicators)

S eor ) Living Statistics)Conditttons)

I 4. *~~~~L-- - -- - 4........

v- ii_ [ 'U_ ..- -

[--iR @} a! *1

[]= _} --

F--|f-_5 - -}

-E. ::

' -B- -- {.II-{I1i[ K; 1 } -1 ill I -114

r=[ == -~ _ _I

[ ii0 }1 18I1R[ si'' } . . .I

[ - -} I -- I

-08-

QatRT 3

lROANI2ATIOtAL OF I' M4STRY OF

| 1S F EWWALTH

IC I

I I

INOMWVI RG$8011- IIR MWL I F I~~PMX I I SIX I I PDS. ARI MC I I FM ADOETM

I ~~~~~ AMM I I

IMWVCRI- I I MMMI I IWMTION Al IVOMUPW I JUBU OF I I LT H

I ~ ~ ~ ~ ~ ~~~PMM IIPA = I IMVMe- KXBCIIW M

I ~ Nm ITAA CNPIcMI I I I I OO T I I

FHO - Pr'oncipel hadioan Office

r !

L. L J ~ J L~ J I... *. . .

r , , , , , g I -- , _I I

I I I ~ ~ ~ ~ ~~~~I I I I

* ' *S~~M . '"' . I-' .. ' .

I ^E IIDR RI I NLT II u I II DDSII I I I lISTRTIWd | It;IID^6A PeOd

~~~~ . I

|~~~~~~~~~~~~~~~~~~TSI | I N~VIWQ- IN1r4NE D4TI4A j1IE @ FIIU

I I I I ITAJ CaNTRot | |I AflO

PHD - PrincipaI hdXcaI tOffXemr

PS- PIinmIpmI Dnt SIII9@a

CHART 482- I2

|~ ~L - -§ -- - -II - -I {J }-

g | ,i1-1 01- i{]~~~~~~~~~~~L

2 S' UA I A _

BAHAMPMGrow Fet Mtem JAMAICA a.,

wExico CeUBA Das uao - t8iain AJtla Road 0 Sectad Towns

/ 2964 B2OO Main Seooondry Rotads Parimh Capitals

ueauzE JAMAICA 14??77 ; . 460 Main Prts

- bC8mtenl ISO . bwnatonal Afports ....- Pariah_

IpmsBaaleo . 7 0; ° 0 -Raln Bwas- Coumty B_daleIs NARAQUA * 7 7R0m onwloCout ow-'

7fev

CORNWALL

: -~~--1

I'_Xe$ asrw I 001TG

i~~~~UE OO AM 00 l -

Z . . . . .Sg

"~~~~~~~~~~~~~~~~~~4 I II . _yS~~~~~~~~~~~~~~~~~~~~~

S~~WSH