staff appraisal report el salvador basic ......document of the world bank and the inter-american...

Document ofThe World Bank

andThe Inter-American Development Bank

IDB Report No. 0083-ES IBRD Report No. 14129-ES

STAFF APPRAISAL REPORT

EL SALVADOR

BASIC EDUCATION MODERNIZATION PROJECT

September 8, 1995

Country Department IIRegion II Human Resources Operations DivisionSocial Programs Division Latin America and the Caribbean Regional OfficeInter-American Development Bank World Bank

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CURRENCY EQUIVALENTSCurrency unit = Colon (C)

US$1.00 = C8.75 (July 1995)

FISCAL YEARJanuary I - December 31

ACADEMIC YEARJanuary 15 - October 31

PRINCIPAL ABBREVIATIONS AND ACRONYMS USED

ACE Community Education Association (Asociaci6n Comunalpara la Educaci6n)Becas CAPS Basic Education Leadership Training Program (Capacitacion de Lideres de

Educacion Bcasica)CEC Education Training Center (Centro Educativo de Capacitacion)CCM Teacher Training Centers (Centro de Capacitacion de Maestros)DNE National Directorate of Education (D)ircccion Nacional de Educaci6n)EDUCO Community-managed Schools Program (Educaci6n con Participacion de la

Comunidad)EMDE Model School for Education Development (ELscuela Modelo de Desarrollo Educativo)FIS Social Investment Fund (Fondo de Inversion Social)GOES Government of El SalvadorIBRD Intemational Bank for Reconstruction and DevelopmentICB International Competitive BiddingIDB Inter-American Development BankMICDES Ministry of Coordination of Economic and Social Development (Ministerio de

Coordinacion del Desarrollo Econ6mico y Social)MIS Management Information SystemMINED Ministry of Education (Ministerio de Educacion)MOH Ministry of Health (Ministerio de Salud Pu6blica y Asistencia Social)NCB National Competitive BiddingNGO Nongovernmental OrganizationODEPOR Planning and Organization Office - MINED (Oficina de Planificacion)OPCI Office of International Programs - MINED (Oficina de Proyectos de Cooperaci6n

Internacional)SABE Strengthening Achievement in Basic Education (Solidificaci6n del Alcance de la

Educacion Basica)SAL Structural Adjustment Loans (IBRD Loan 3293-ES and IBRD Loan 3646-ES)SETEFE External Financing Technical Secretariat (Secretaria Tecnica de Financiamiento

Ex.rterno)SNF National Secretariat of the Family (Secretaria Nacional de la Familia)SOE Statement of ExpenditureSSRP Social Sector Rehabilitation Project (IBRD Loan 3348-ES)TAL Technical Assistance Loan (IBRD Loani 3648-ES)UNDP United National Development ProgramUNICEF United Nations Children's FundUSAID United States Agency for International Development

EL SALVADOR


TABLE OF CONTENTS

IBRD Loan and Project Summary .................................... iiiIDB Loan and Project Summary ................................... . ivExecutive Summary .................................... vBasic Socioeconomic Data .................................... xiiEducation Glossary .................................... xiii1. ECONOMIC AND SOCIAL BACKGROUND .................................. 12. THE EDUCATION SECTOR .................................... 3

A. Sectoral Overview .................................... 3B. Sectoral Issues in Education .................................... 5C. The Government's Strategy for Education ................ 15D. World Bank and Inter-American Development Bank Roles and Assistance Strategy ... 18E. Lessons Learned from Past Experience ................................................................ 18

3. THE PROJECT ................................................................. 20A. Project Objectives and Scope ................................................................ 20B. Project Target Areas ................................................................ 21C. Project Components ................ 21D. Project Description ............... 22

(1) Component 1 - Expansion of Access to Preschool and Basic Education .. 22(2) Component 2 - Improvement in Education Quality ................................... 24(3) Component 3 - Institutional Modernization and Strengthening ..................................... 28

4. PROJECT COSTS, FINANCING, PROCUREMENT, DISBURSEMENTSAND AUDITING ......................................................... 33

A. Project Costs .......................................................... 33B. Project Financing ......................................................... 36C. Procurement .......................................................... 37D. Disbursements ......................................................... 42E. Accounting and Auditing ......................................................... 44

5. PROJECT IMPLEMENTATION AND MANAGEMENT .................................................... 44A. Borrower, Guarantor and Executor for the Project .......................................................... 44B. Project Organization ......................................................... 45C. Project Management ......................................................... 45

This report is based on the findings of the appraisal mission that visited El Salvador in February-March1995. The mission was composed of Mmes./Messrs. Madalena R dos Santos (LA2HR, IBRD missionleader), Ana-Maria Rodriguez-Ortiz (R2/S02, IDB mission leader), Diane Steele (LA2HR), CharlesRichter, Roberto Linares, and Emilio Cueto (IDB), Valeria Pena (LATEN), Maria Elena Anderson,Alfredo Sarmiento, (RUTA Social), Miriam Abramovay, Jose Pedro Alberti, Raimundo Arroio, EduardoAtalah, Alain Berthier, Antonio Cintra, Beatriz Fernandez, Henry Forero, Narayan Sastry, GabrielSchor, Alfred Wood, and Alberto Zuniga (Consultants). Daniel Artana and Thereza Lobo (Consultants)also contributed to the report. Carman Hamann, Rosita Estrada, Andrea Guedes, Patty Romero andEleanor Schreiber contributed to the report at IBRD headquarters. The IBRD peer reviewer is BarbaraBruns (ESP). The IDB Peer Reviewer is Steve Doherty. Messrs. Edilberto L. Segura and Kye Woo Leeare the IBRD Department Director and Division Chief, respectively, for this operation. Messr. MiguelMartinez is IDB Region II Manager and Mme. Eleanor H. Howard is Acting IDB Division Chieffor thisoperation.

D. Preparation and Review and Annual Work Programs and Budget ...................................... 47E. Annual and Mid-Term Reviews by the Banks ..................................................... 47F. Loan Supervision ..................................................... 49

6. PROJECT BENEFITS AND RISKS ..................................................... 49A. Project Benefits ...................................................... 49B. Impact on Women ..................................................... 50C. Environmental Impact ..................................................... 50D. Project Risks ..................................................... 51E. Program Objective Category ..................................................... 52

7. AGREEMENTS REACHED AND RECOMMNDATION ................................................. 528. ANNEXES ...................................................... 55

1. Basic Data ..................................................... 562. Basic Education Public Financing and Financial Impact of the Project ............................ 753. Economic Analysis ..................................................... 844. Social Assessment: Summary of Main Results ..................................................... 955. Proposals for the Modernization of the Education Sector within the

Modernization of the Public Sector ..................................................... 1006. Prioritization of Municipios ..................................................... 1027. Expansion of Access to Preschool and Basic Education Component ............................. 1078. Improvement in Education Quality Component ..................................................... 1. 1 9. Institutional Modernization Component ..................................................... 12110. Project Administration ..................................................... 12811. Project Costs ..................................................... 12912. Tentative Procurement Plans ..................................................... 13513. Disbursements ..................................................... 13714. Project Performance Indicators ..................................................... 13915. Terms of Reference for Project Review and Supervision Schedule ............................... 14416. Project Implementation Schedule ..................................................... 14817. Education Projects Funded by Inter-American Development Bank ............................... 15118. List of Documents in Project File ..................................................... 152

EL SALVADORBASIC EDUCATION MODERNIZATION PROJECT

IBRD LOAN AND PROJECT SUMMARY

Borrower: The Republic of El Salvador.

Implementing Agency: The Ministry of Education.

Beneficiary: The Ministry of Education.

Poverty: Program of Targeted Interventions. The project will be targeted tothe 135 municipios in the country most in need of social services asdefined by education indicators such as repetition rate, percentageof overage students and net enrollment rate, and nutrition indicatorssuch as percent of undersized children.

Amount: US$34.0 million.

Terms: Variable rate US dollar single currency loan for 17 years, includinga five year grace period.

Financial Benefitsand Risks: The Borrower has selected LIBOR-based variable rate US dollar

single currency loan terms in order to improve its overall liabilitymanagement and reduce its risks. It considers US dollars to be anappropriate currency for its debt management strategy, and prefersthe standard country repayment terms for LEBOR-based singlecurrency loans compared to the shorter final maturity for fixed ratesingle currency loans.

Commitment Fee: 0.75% on undisbursed loan balance, beginning 60 days aftersigning, less any waiver.

On-lending Terms: Not applicable.

Financing Plan: See para. 4.6.

Net Present Value: Not applicable.

Map: IBRD No. 27213.

Project ID: ES-7169

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EL SALVADORBASIC EDUCATION MODERNIZATION PROJECT

IDB LOAN AND PROJECT SUMMARY

Borrower The Republic of El Salvador.

Executing The Ministry of Education.Agency

Amount: US$37.3 million.

Terms: Repayment in 30 years including 5¼/2 years of grace with interest at theIDB's standard variable rate (ordinary capital).

The IDB's financing would be chargeable to the ordinary capital, under theIntermediate Financing Facility (IFF) subsidy, in the amount of US$37.3million, considering that: (a) El Salvador is eligible to use the IFF under theEighth General Increase in Resources (document AB-1683); (b) ElSalvador is conducting a peace process following a period of armedconflict that ravaged the country for over 10 years; (c) a significantmajority of the beneficiaries of the operation, according to conditionsprevailing in the country, are poor; and (d) the program supports preschooland basic education. It is proposed that the IFF resources be used todefray up to five percentage points of the interest rate on the total amountof the loan. It is also proposed that up to 90 percent of total program costsbe financed with IDB resources, since the direct beneficiaries are low-income earners. For the same reasons, it also proposed that the OC loanbe granted for 30 years.

Disbursementperiod: 5 years.

Commitment FeeOC: 0.75 percent annually on undisbursed balances.

Inspection andsupervision: 1 percent of the loan amount.

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EL SALVADOR BASIC EDUCATION MODERNIZATION PROJECT

EXECUTIVE SUMMARY

BORROWER AND The Republic of El SalvadorGUARANTOR:

EXECUTING AGENCY: Ministry of Education (MINED)

AMOUNT AND SOURCE: IBRD: US$34.0 millionIDB: US$37.3 million (OC under the IFF

subsidy)Local counterpart funding: US$8.9 millionTotal: US$80.2 million

IBRD Amortization period: 17 yearsFINANCIAL Grace period: 5 yearsTERMS AND Disbursement period: 5 yearsCONDMONS: Interest rate: IBRD standard variable rate

Commitment fee: 0.75 percent annually on undisbursedbalances, beginning 60 days aftersigning, less any waiver

IDB Amortization period: 30 yearsFINANCIAL Grace period: 51/2 yearsTERMS AND Disbursement period: 5 yearsCONDmONS: Interest rate: IDB standard variable rate (1FF

subsidy)Inspection and supervision: 1% of the loan amountCredit fee: 0.75 percent annually on undisbursed

balances

BACKGROUND: Following the peace accords, signed in 1992, the Government ofEl Salvador (GOES) committed itself to the reconstruction of thecountry. The achievement of peace was a prerequisite for theimplementation of a series of measures in support of social andeconomic development, including education. The educationsystem will play a key role in the reconstruction process becauseof its effects on social equity and economic growth at a time wheneconomic globalization imposes highly competitive standards forprogress.

Over the last five years, the political and economic policies putinto effect by GOES have put the country on a path of positivegrowth of GDP (6 percent in 1994) and have laid the basis forsustained growth. In that context, during the last administration

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(1989-May 1994), the Ministry of Education (MINED) began toaddress the problems of the education system through a number ofsectoral policies. The current Government is continuing,expanding and consolidating the education sector reform measuresinitiated by the previous administration. Central to this strategyare the processes of decentralization and modernization. Theoverall objective of the current education policy is to create aneducation system that can be an effective tool for promoting theeconomic and social development of the country.

OBJECTIVES: The proposed project will promote greater equity, quality andefficiency in the provision of education services by: (a) improvingaccess to education; (b) improving education quality in bothacademic achievement (output) and learning environment(education inputs); and (c) strengthening the managerial, financialand administrative capacity of MINED to set policies andguidelines for the sector and deliver public education servicesefficiently.

DESCRIPTION AND The project has been organized into three major components asCOST: follows:

(a) Expansion of Access to Preschool and Basic Education(US$12.5 million or 16 percent of total project costs) in 135target municipios to provide for: (i) supporting theexpansion of community-managed schools (EDUCO)including rehabilitating the school infrastructure in ruralschools; and (ii) technical assistance for strengthening theEDUCO model.

(b) Improvement in Education Quality (US$49.2 million or61 percent of total costs) would contain activities thatimpact the quality of preschool and basic education in thecountry as a whole, including: (i) technical assistance forsupporting curriculum development activities for preschooland basic education, designing a new student promotionsystem, and establishing multigrade classes in schools inrural areas; (ii) educational materials, such as textbooks,didactic materials, and classroom and school libraries; (iii)training and assistance to upgrade the skills of preschooland basic education teachers, principals and supervisors, andpreparing studies to improve pre-service teacher training;and (vi) developing an education assessment system. Thecomponent would also include activities to develop a schoolhealth and nutrition program giving priority to the poorest135 municipios in the country.

(c) Institutional Modernization and Strengthening

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(US$13.3 million or 17 percent of total costs) to providefor: (i) technical assistance for a review of MINED's legaland organizational framework to increase systemefficiency, to implement institutional reforms in the areas ofmanagement of human and financial resources, planning,information, evaluation, monitoring, supervision, andcommunication systems and to establish a staffdevelopment program to improve the capacity ofadministrators and technical personnel; and (ii) establishinga funding mechanism, the Pilot Basic Education Fund, totest alternative methods of providing basic education,through the municipios and non-profit private institutions,and to experiment with pedagogical and administrativeinnovations. This component will have an effect that willextend throughout the education sector and the country.

ENVIRONMENTAL The project is not expected to have direct environmental effects,CLASSIFICATION: and has been classified as Category C for IBRD and Category II

for IDB (December 12, 1994).BENEFITS: Faced with the urgent need to improve coverage and quality of

basic education, the project would support the efforts of theGovernment to undertake a balanced process of improving equity,quality and efficiency of the school system. The project wouldtarget some resources to poor and vulnerable groups, wouldimprove learning achievements, and promote the efficiency ofresource allocation. At the same time it would strengthen theinstitutional capacity of MINED to provide services and toevaluate and monitor educational policies and programs.

Decentralization and community participation will boostresponsiveness by teachers and administrators since all will besharing administrative responsibilities, and clarity will promoteaccountability at all levels. The proposed project will support thePublic Sector Modernization by establishing the conditions forMIED to be an active and responsive actor in the process whilebeing consistent with the general guidelines of the Public SectorReform. The program will also help to identify efficient methodsand procedures to deliver education services that will be a seed forfuture improvements within the sector.

RISKS: The fiscal requirements to support the modernization of basiceducation will depend on the assumptions made regarding growthand real recovery of teachers salaries. Under a conservativescenario the financial viability of the program will require thatpublic sector spending in education be increased by 0.7 percent ofGNP to a total of 2.7. As noted in Annex 2 the macroeconomicsand fiscal risks leading to inadequate funding are low. TheGovernment has been adamant in declaring its commitment to fund

viii

the program, even under a less favorable scenario that will requirean additional fiscal effort to the detriment of other sectors.

Due to the comprehensive scope of the operation, the success ofthe program will depend upon the capacity of MINED toimplement the program. MINED has proven to be one of themost dynamic ministries in El Salvador and has shown its capacityto respond to increasingly demanding tasks under the SABEProject (Strengthening Achievement in Basic Education) and theSSRP (Social Sector Rehabilitation Project).

The program relies on the EDUCO model for providing services inrural areas. The expansion of EDUCO will introduce newchallenges to maintain its efficiency, an adequate incentivesstructure, and timely responsiveness to the demands of thecommunity. The expansion of EDUCO will also have to bematched with the revision of the incentive structure for all teachers(EDUCO and traditional) to avoid the conflict that could arisefrom a dual labor regime for teachers. The program addressesboth issues to minimize those risks.

The introduction of a new teacher incentives system, theestablishment of a performance assessment system and therationalization of MINED's staff could create political tensionsbetween the GOES/MINED and the teachers, supervisors,principals and MINED's staff. The political support for themodernization program of MINED, the support of the Comisi6nNacional de Educaci6n, Ciencia y Desarrollo, and theintroduction of an active communication campaign will reduce therisk of a confrontation with MINED's employees.

The decentralization process bears the risks of an inadequatearticulation between different levels of operation. The design ofpilot programs and the consideration of lessons learned in otherLatin American experiences when designing the implementationprocess are the best ways to limit those risks.

THE BANKS' The IBRD's country assistance strategy (CAS) for El Salvador,STRATEGIES: discussed by the Board on September 14, 1993 with the Second

Structural Adjustment Loan, focuses on supporting theGovernment in meeting its critical development challenges andfacilitating the transition from a wartime economy to a peaceful,more participatory society. The Structural Adjustment Loans(SAL I, Loan 3293-ES, 1991; SAL II, Loan 3646-ES, 1993), theTechnical Assistance Loan (TAL, Loan 3648-ES, 1993), and theon-going SSRP (Loan 3348-ES, 1991) have been supportingGovernment economic reforms and the social sector strategy byemphasizing, in the long-term, the provision of targeted preschool

ix

and basic education which directly benefit the poor. The proposedproject would be a key instrument for supporting the efforts of theGovernment to implement public sector reforms and to continuethe strategies developed under the SSRP by increasing communityparticipation in the basic education system.

The proposed project is also in line with the IDB country strategywhich was discussed during a programming mission with theGovernment in August 1994. This strategy, which covers 1994-1996, was defined in the Country Programrning Paper of March1993. Its objectives include: (a) improving social and economicinfrastructure; (b) supporting economic reforms; (c) increasingIDB support to the social services; (d) protecting the environment;(e) supporting the modernization of the State; and (f)strengthening the participation of communities and women in thenational reconstruction process.

POVERTY TARGETING: The project would be an integral part of El Salvador's antipovertystrategy through its assistance to improve coverage and quality ofbasic education services for the poorest groups in the country.The Expansion of Access to Preschool and Basic EducationComponent and the Health and Nutrition Subcomponent, are bothtargeted to poor children in rural and urban marginal areas in the135 poorest municipios of the country.

The IDB's financing would be chargeable to the ordinary capital,under the Intermediate Financing Facility (IFF) subsidy. It isproposed that the IFF resources be used to defray up to fivepercentage points of the interest rate on the total amount of theloan. It is also proposed that up to 90 percent of IDB financedsubcomponent costs be financed with IDB resources, since thedirect beneficiaries are low-income earners. For the same reason,it also proposed that the OC loan be granted for 30 years.

RETROACTIVE The IBRD and the IDB have agreed to finance retroactively up toFINANCING: US$300,000 each to help cover eligible start-up expenditures. For

the IBRD this financing will cover expenditures made on or afterMarch 15 1995. For the IDB this financing will coverexpenditures six-months prior to Board approval.

ADVANCES: Given the degree of preparation and the proposed implementationplan, it is recommended that an advance equivalent to 10 percentof the proposed IDB loan be approved to assist the Government toimplement project activities during first 120 days. The fund wouldbe replenished upon presentation by MINED of the requireddocumentation.

PROCUREMENT: All procurement will be undertaken by a procurement agent. Thebenefits of using a procurement agent are consequence of (i)MINED's limited capacity to manage extensive procurement

x

procedures simultaneously; and (ii) the technical support providedto the MINED on a daily basis resulting from a procurementagent's experience in the implementation of projects financed byinternational donors.

The IDB would finance all construction and rehabilitation works.All civil works contracting would be managed by FIS which hasproven experience in this area and is also familiar with IDBprocurement norrns and procedures since it has been the recipientof four IDB loans.

SPECIAL At negotiations, agreement was reached: (a) on the schedule andCONTRACTUAL terms of reference for the modernization of MINED; (b) that theCONDITIONS: required funds for incremental teacher salaries as established in the

annual work plans review would be included in the MINEDbudget for the following year; (c) on the IBRD Special Accountand on retroactive financing; (d) on appointment of key projecttechnical and administrative staff and/or consultants and theirterms of reference; (e) that MINED would: (i) conduct, jointlywith MICDES, IBRD and IDB, annual project implementationreviews; and (ii) submit to the Banks annual progress reports onthe implementation of the project in accordance with targetsestablished in previous annual work and investment plans; (f) that:(i) the in-depth mid-term review would cover all aspects of projectimplementation and be conducted jointly by MINED, MICDESand the Banks, and (ii) on the basis of this review, action plans,satisfactory to the Banks, would be prepared and initiated byJanuary 1, 1999; and (g) on the Development Objectives for theproject.

During negotiations: (a) a signed agreement (convenio) with FISto guarantee the timely construction of new schools waspresented (para. 3.7); and (b) a letter signed by the Minister ofFinance, acceptable to the Banks, assuring the Borrower'scommitment to provide the required funds for the project includingan annual increase in the education ordinary budget was received(para. 6.6);

As a dated covenant, the borrower will: (a) select the localuniversity/research center to develop the education assessmentsystem no later than January 30, 1996 (para. 3.21).

As conditions for IBRD loan effectiveness: (a) the OPCI actionplan will be completed to the satisfaction of both Banks (para.4.8); (b)the Government will present evidence that the RevolvingFund had been created (para. 4.9); (c) the Operational Manual,satisfactory to both Banks, will be put in use (para. 4.10); and (d)a signed contract with a procurement agent would be presented

xi

(para. 4.11); and (e) final bidding documents, and consultantinvitation packages will be put in force (para.4. 11).

Conditions for IDB Board presentation: (a) MIED will presenta satisfactory draft of an agreement between MINED and UNDP(para. 4.23); and (b) key technical and administrative staff and/orconsultants and their terms of reference would be presented (para.5.6).

Conditions for IBRD disbursement: (a) for the InstitutionalModernization and Strengthening component, MINED willpresent the work plan for the staff development activities (para.3.28(f)).

Conditions for IDB disbursement: (a) for the Expansion ofPreschool and Basic Education in Rural Areas subcomponent,MINED will present assurances of the continuance of the schoolmaintenance program for rehabilitated schools (para. 3.9); (b) forthe Basic Education Program Fund subcomponent, theOperational Manual for the Fund, including the eligibility criteria,will be agreed with the Banks and put in place by MINED (para.3.33);(c) the OPCI action plan will be completed to thesatisfaction of both Banks (para. 4.8); (d) an agreement betweenthe borrower and the executing agency to transfer resources fromthe loan (para. 5.1); and (e) evidence of the establishment of theManagement Modernization Unit and the Quality ImprovementUnit in the Project Management Office (para. 5.6).

xii

EL SALVADORBASIC SOCIOECONOMIC DATA

.. -. .Ee EiEi ... i-EEE EE.:. . :. f . -E-:E- E :.. ... .. ............ ... ....... . ........ s....... . . .... ......iEEE iE

.So,i S, tas ti stcsi:l:0f ::0'0i.A:;i-Tj0TCE;A::f::00gt00.7f;--SS'0:'ltVtt00,0:Land Area (Km2) 1994 20,935Population (Thousands) 1994 5,641

Population (Average Annual Growth Rate (%)) 1985-1994 1.9Rural (Percent) 1994 52.7Density (Population per Km2) 1994 269.5

Vital StatisticsCrude Birth (Rate per 1,000 Population) 1992 33.4Infant Mortality (Rate per 1,000 Live Births) 1992 40.0Crude Death (Rate per 1,000 Population) 1992 6.9Life Expectancy at Birth (Years) 1992 66.3

Illiteracy (Percent) 1990 27.0Primary School Enrollment Rate 1993 83.1

.Exchange Rate (Colones/US$) March 1995 8.8

.GDP per Capita (Average Annual Growth Rate) 1985-1994 1.6!Labor Force (Thousands) 1992 2,306Unemployment Rate (Percent) 1994 7.2

lConsumer Prices (Twelve Month Variation) March 1995 8.8NF Public Sector Overall Balance (% of GDP) 1994 -0.6|Domestic Credit (% of GDP) 1994 30.6XBalance of Payments (Millions of US $)

| Current Account Balance 1994 -18Trade Balance 1994 -1,220

Capital Account Balance 1994 161Change in Reserves (- Increase) 1994 -143

Total External Debt (Millions of US$) 1994 2,245Total Debt Service (Millions of US$) 1994 345Debt to GDP Ratio (Percent) 1993 28.9

DebtiServiceuRation(Percent) 1994 25.95

Statistics and Quantitative AnalysisIntegration and Regional Programs DepartmentInter-American Development Bank15 May 1995

xiii

EDUCATION GLOSSARY

Completion Rate For nine-year basic education, the ratio between the number ofstudents exiting grade 9 in a given year T and the number ofstudents entering grade 1 in year T-9 as a close approximation ofthe percentage of students of a given cohort to complete nine yearbasic education.

Dropout Rate Percentage of students who abandon the system without completingthe education cycle.

Education Attainment Number of formal schools years achieved by a student.

Educational Achievement Magnitude achievement in any subject area, generally measured onthe basis of national curriculum learning objectives.

Enrollment Rate Percentage of children of any age group or a given age groupenrolled in their corresponding grade level.

Gross Enrollment Rate Percentage of children of any age group enrolled in a grade level.Percentages may be more than 100 because some pupils areyounger or older than the standard school age.

Incomplete School School with fewer than the official number of education grades.

Multigrade Classroom A classroom where children of several different grades are taughtby one teacher.

Net Enrollment Rate Percentage of children of a given age group enrolled in theircorresponding grade level.

Promotion Rate Percentage of students enrolled in a given grade who enroll in thenext higher grade the following year.

Repetition Rate Percentage of students enrolled in a certain grade who are notpromoted to the next grade and who enroll again in the same gradethe following year.

EL SALVADOR


STAFF APPRAISAL REPORT

INTRODUCTION

1. At the request of the Government of El Salvador (GOES), the World Bank (IBRD) andthe Inter-American Development Bank (IDB) have worked together to assist GOES in designinga project to continue their efforts in improving the quality of education and the delivery ofeducation services. The following document is one of the first efforts between the IBRD and theIDB to prepare a project using a single document. This document was written by members ofboth Banks and combines the elements of documents needed to comply with the requirements ofeach Bank.

2. The first chapter presents information on the economic and social context of El Salvadorand Chapter 2 provides an overview of the education sector. Chapter 3 is a detailed descriptionof the project components and subcomponents. Chapter 4 provides information on project costsand the mechanisms to be used for procurement, disbursement and auditing. Chapter 5 describesproject implementation and management. The final chapters summarize information on thebeneficiaries, the risks, and the agreements needed to proceed with the project. Annexes providespecific details on education statistics and the project components and subcomponents. Aneconomic analysis and social assessment were done to better assess the risks and benefits of theproject. These are presented in Annexes 2, 3 and 4.

1. ECONOMIC AND SOCIAL BACKGROUND

1.1 Following the peace accords, signed in 1992, GOES committed itself to the reconstructionof the country. The achievement of peace was a prerequisite for the implementation of a series ofmeasures in support of social and economic development, including education. The educationsystem will continue to play a key role in the reconstruction process because of its effects onsocial equity and economic growth at a time when economic globalization requires a highlycompetitive labor force.

1.2 Afder a twelve-year war and a 50 percent reduction in social expenditures as a proportionof GDP during the 1980s, more than two-thirds of the population was poor in 1991. Despitesubstantial improvements since the end of the war, poverty and inadequate social services are stillwidespread. Raising social sector expenditures and modernizing inefficient public sectorinstitutions are major challenges faced by the Government as it strives to achieve better socialindicators while maintaining sound fiscal policies.

1.3 Over the last five years, the political and economic policies put into effect by GOES haveput the country on a path of positive growth of gross domestic product (GDP) (6 percent in1994) and have laid the basis for sustained growth. Under stable economic conditions, the

2

Government's economic and social strategy sets the alleviation of poverty as the principal socialobjective. The plan calls for progress toward a long-term objective of establishing a nationalnetwork of basic social services that assures access to all the population, especially to the mostvulnerable groups. It places special attention on human capital formation (especially foreducation, health and nutrition), the well-being of the poorest groups, basic infrastructure,community development and the monitoring and evaluation of social programs. As part of thisstrategy, the Government implemented an IBRD-supported US$35.6 million Social SectorRehabilitation Project (SSRP, Loan No. 3348-ES, 1991) which was designed to enhance thepublic sector's capacity to manage and deliver health and education services efficiently bysupporting institutional reforms, increasing the flow of funds to the social sectors, and improvingbasic social services for the poor.

1.4 As another key element in the social plan, the Government instituted the Social InvestmentFund (Fondo de Inversi6n Social - FIS) in 1990. This agency is responsible for approximately5,000 small investment projects which have benefited 60 percent of the poor population in themajority of the country's municipios. The FIS has distinguished itself as an agency capable ofrapidly, efficiently and transparently channeling resources to the needy population through small-scale contracts, with the ample participation of community groups. By July 1994, the FIS hadbuilt or repaired 4,000 classrooms and supplied 200,000 desks. It implemented 250 waterprojects, in and near urban areas, benefiting about 160,000 persons (over 3 percent of thecountry's population). In its first three and one-half years of operation, the FIS has beensupported by UNDP, UNICEF, the Government of Japan, the German Credit Institute forReconstruction (Kreditanstalt fur Wiederaufbau - KfW) and the IDB. IDB's support in fourconsecutive loans sums to US$153 million (Loans 861/SF-ES, 905/SF-ES, 765/OS-ES, 829/OC-ES).

1.5 During the last administration (1989-May 1994), the Ministry of Education (MINED)began to address the problems of the education system through a number of sectoral policieswhich included: (a) re-allocating public education resources to favor preschool and basiceducation for the population living in the poorest areas of the country (especially in thecountryside and in urban squatter settlements); (b) the development of non-formal education foradults; (c) improvement in the basic education curriculum; (d) decentralization of educationservices as a means to improve the efficiency in the use of resources; and (e) the participation ofnongovernmental organizations (NGOs) and other private organizations in the execution ofcultural and educational programs and projects.

1.6 The new administration, which came to power in June 1994, will continue the reformsinitiated by the previous administration, and requested that the two Banks finance the proposedproject. The proposed project would support the reform program by: (a) expanding basiceducation services through alternative delivery means targeted to the most disadvantagedpopulation; (b) improving the quality of basic education services; and (c) further strengthening theinstitutional capabilities of MINED to plan and manage the delivery of social programs in adecentralized manner by incorporating new areas in the reform.

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2. THE EDUCATION SECTOR

A. Sectoral Overview

2.1 Since 1989, GOES has made great progress in rehabilitating the critical status of theeducation system which was severely affected by the war. The education sector has beendeveloping a set of programs to shape the education reforms considered essential to the buildingof a new society in the country. With the education strategies adopted by the 1989-1994administration, preschool education offered by the public sector for 4 to 6 year-old children hasincreased significantly from 15 percent in 1989 to 35 percent in 1993. The total enrollment ratefor grades I to 6 has increased from 76 percent in 1989 to 83 percent in 1993. The currentGovernment is continuing and consolidating the education sector reform measures initiated by theprevious administration (see paras. 1.5-1.6). In addition, it is expanding reforms in newdirections, emphasizing the provision of services to the poor.

Sector Organization and Administration

2.2 Organization. The formal education system consists of one year of preschool, nine years ofbasic education, three years of secondary education, and higher education with courses of two tosix years. Basic education starts at age seven and is organized in three cycles of three years each.The first cycle contains grades 1-3, the second contains grades 4-6 and the third contains grades7-9. Secondary education, grades 10-12, is diversified and prepares students for the Bachilleratodiploma in any of the following specialized programs: academic, business administration, homeeconomics, industrial, vocational arts, agriculture, hotel catering and tourism, navigation and

Table 1. El Salvador School System, 1993STUDENTS NET NUMBER NUMBER

TOTAL PUBLIC AGE ENROLLMENT OF OFLEVEL ENROLL (%) GROUP RATE (%) TEACHERSa SCHOOLS"Preschool 126,048 73 4-6 35 2,367 1,406Basic - Grades 1-6 863,478 88 7-12 83 18,967 3,349b

Grades 7-9 205,226 79 13-15 32 5,004Secondaryc 105,093 50 16-18 18 1,334 1801igherc - Tech/Voc. 4,341 25 19-21 667 30

University 81,773 32 19-23 598d 37a Public only.b Includes all basic education schools, grades 1-9.c Harvard Study. Data for 1992.d Full-time professors.Sources: Annex 1, Tables 1, 2, 3, 4, 7; "Diagnostico del Sistemna de Desarrollo de Recursos Humanos de El

Salvador" (Harvard Study).

fishery, health, and teacher training. Higher education is offered in two forms, technical/vocational and academic, through 30 technical institutions, a national university, and 36 privateuniversities.

2.3 Administration. The main institution in the education sector is NINED which isresponsible for administering all levels of education, except universities, and monitoring the

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private sector provision of services (see Annex 9 for organigram). Except for the nationaluniversity, which receives resources directly from the national budget, administration is highlycentralized with programming and administrative and financial management all concentrated in thecentral office. Adult education and vocational education are administered by the Directorate ofAdult Education in MINED through private institutions like the Fundaci6n Empresarial para elDesarrollo Educativo (FEPADE), Instituto Salvadoreno de Formacion Profesional(INSAFORP) and NGOs. The National Council for Culture and Art (Consejo Nacional para laCultura y el Arte - CONCULTURA), created in 1992 as a decentralized unit of MINED, was putin charge of watching over the preservation, development and dissemination of the culturalpatrimony of El Salvador.'

2.4 With the support of the SSRP, MINED developed and implemented a decentralized modelof services provision in rural areas, the Community-managed Schools Program (Educaci6n conParticipaci6n de la Comunidad - EDUCO), which transferred the management of schools tocommunities. This innovative program, based on the direct involvement of parents and membersof the community, and institutional strengthening activities at the central and regional levels,promotes the participation of rural communities in defining and administering education. TheCommunity Education Associations (Asociaciones Comunales para la Educaci6n - ACEs) havebeen instrumental in promoting community participation not only in educational matters, but alsoin matters concerning the community as a whole. Under the program, ACEs are organized bycommunities, and are the key management mechanism for program operation at the local level.MINED transfers funds to the ACEs who are responsible for: (a) managing the schools; (b)selecting (qualified) teachers, and hiring and dismissing them; (c) maintaining the infrastructureand furnishing the schools; and (d) negotiating with the different Government agencies and/orinternational agency programs to obtain funds for improving the school program. Additionally,they interact with supervisors to maintain adequate communication with MINED.

2.5 In 1993, there were approximately 27,700 teachers for preschool, basic, and secondaryeducation in El Salvador (see Annex 1, Table 7). These are divided into three categories: (a)Docente I teachers who are prepared to teach preschool and grades 1 to 6; (b) Docente IIteachers who are prepared to teach grades 7 to 9; and (c) Docente III teachers who are preparedto teach secondary education. Although teachers are categorized by Docente level, they may notbe teaching at the level in which they are categorized (see para. 2.26). MINED employs 5,520technical and administrative personnel, 38 percent assigned to posts outside San Salvador, toadminister traditional education services throughout the country. The existence of regionaloffices does not represent effective decentralization. Local staff activities are limited to a passivefollow-up of decisions taken at the central level. The only outstanding exception to centralizationis the EDUCO program where decentralization is effective through the administrative support ofthe ACEs.

2.6 The National Teacher Organization (ANDES) is strong in El Salvador. Althoughmembership is not obligatory, the majority of traditional teachers, and some EDUCO teachers,belong. ANDES has been participating with MINED in the definition of the education reform.2

MINED is also responsible for the preservation of the national patrimony, which includes parks and the zoo, andfor the so-called cultural extension executed by 100 "houses of culture" (casas culturales).

2 There is no formal trade union with legal support for collective labor negotiation, but the organization acts andperforms as a trade union.

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2.7 Teacher salaries, in real terms, have steadily declined since 1980. The purchasing powerof a teacher's wage in 1992 was 32 percent of its level in 1980. Per capita income rose 5.4percent between 1984-92, while teacher wages fell 50 percent in the same period. The apparentbenefits of the reduction of the economic burden of providing education is illusory. Qualitystandards drop and absenteeism increases. By reducing the number of teaching hours, teachersadjusted the real salary by quantity and quality to offset the drop in wages.

Gender in Education

2.8 El Salvador has advanced significantly towards gender balanced educational attainment.At the preschool level, female enrollment is 50.2 percent (see Annex 1, Table 17). In basiceducation and secondary education, female students slightly outnumber male students with 51percent and 54 percent, respectively. Female students also outnumber their male counterparts inpost-secondary technical education where 58 percent of the enrollment is female, but in post-secondary academic education, male students (52 percent) outnumber female students (48percent). A recent study jointly prepared by the IBRD and IDB3, shows that place of residenceand income level are more significant determinants of literacy than gender (see Table 2). Thereare, however, four women's issues in education that have not been resolved: teenage pregnancy;women's narrow preferences for careers and fields of study; lower rates of return on education forwomen; and gender stereotypes in textbooks. Gender stereotyping is closely related withpreschool and basic education. The Ministry has taken steps toward eliminating sex-rolemodeling in the textbooks for grade 1 through 4. The proposed project will continue these effortsby removing gender stereotyping from textbooks and other classroom materials (see also paras.2.24 and 3.14).

Table 2. Jllitera Rates by Income Decile and Gender ---Income Urban RuralDeciles Male % Female % Male % Female %First 26 33 48 50Tenth 3 8 25 28% Difference 8.67 4.13 1.92 1.79Source: Ministry of Planning, 199 1-1992 Household Survey.

B. Sectoral Issues in Education

2.9 The Salvadoran education indicators reveal an education system with interrelatedproblems causing poor system performance. The main education sector issues are: (a) lowinternal efficiency; (b) insufficient access to education; (c) unsatisfactory education quality in bothacademic achievement (output) and learning environment (education inputs); (d) weak managerialand administrative capacity; and (e) inadequate financing of the sector.

3 'El Salvador - Moving to a Gender Approach in El Salvador: Issues and Recomendations," joint study by theIBRD and IDB.

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2.10 To better understand education issues, a Social Assessment was undertaken (see Annex 4)to consider the perceptions of the stakeholders - MINED, teachers, parents, students, etc. Theprovision of well-organized information on the public perceptions of the education sector hasbeen an especially useful tool for MINED in the process of changing the provision of publiceducation services to rely more on community participation. The lack of regular communicationchannels transformed the Social Assessment into an unintended communication mechanism foreducation reform and helped the Banks in the fine tuning of the design of project components.

Low Internal Efficiency

2.11 Late entrance to school, the existence of a large number of 'incomplete" rural schools notoffering at least the full first two cycles of education, and high repetition and dropout rates inbasic education have the greatest impact on the education system's internal efficiency.

2.12 Late entrance to schooling. Fifty-three percent of urban students and 67 percent of ruralstudents enrolled in grades I to 9 are over the age expected for the grade in which they areenrolled (Annex 1, Tables 3 and 4). In 1993, the 1 st and 2nd cycle gross enrollment rate, in urbanschools, was 113.6 percent and the net enrollment rate was 89.6 percent. A similar situationoccurred in rural schools where the gross enrollment was also significantly higher than the netenrollment in the same grades, 101.9 percent and 77.3 percent, respectively (Annex 1, Table 2).In El Salvador, the main reasons for late entrance to school include: (a) absence of services duringthe war years; (b) ignorance on the part of parents about the benefits of schooling; and (c) lowlevels of family income which: (i) prevent parents from being able to afford the costs of sendingtheir children to school; and (ii) require children to work in order to augment the family income.Late entrance in school, particularly in the rural areas, has provoked the overage phenomenon andage heterogeneity in the classroom. Age heterogeneity in the classroom without the use ofappropriate methodologies can have an unfavorable impact on overall academic achievement.Available data show that late entrance, however small, increases repetition rates and decreases thecompletion rates of basic education. The introduction of preschool education is one of the mosteffective ways to promote prompt entrance of students. The proposed project will have a positiveeffect in increasing internal efficiency by expanding the coverage of preschool (para. 3.6).

2.13 Incomplete basic education schools. Too frequently public schools do not offer educationservices for the entire basic education cycle. According to a recent survey4 , almost all schoolscover the 1st cycle, but only 80 percent cover the 2nd cycle, and 50 percent cover the 3rd cycle.The deficiencies are more severe in rural areas. The existence of these incomplete schools keepmany student from completing their basic education. The expansion of coverage provided in theproposed project will cover preschool through grade 6 (para. 3.7).

2.14 Repetition and dropout rates in basic education. Repetition rates for basic educationrange from a high of 22 percent in 1 st grade in the Central Region to less than one percent in the9th grade in all regions (Annex 1, Table 6). Repetition rates in grades 1 to 3 are slightly higher inEDUCO schools where late entrance to school is a more frequent phenomenon than in traditional

4 Diagn6stico del Sistema de Desarrollo de Recursos Humanos de El Salvador. 1994. (Harvard Study) Reportfor the Harvard Institute for International Development in collaboration with Fundaci6n Empresarial para elDesarrollo Educativo, Universidad Centroamericana Jose Sime6n Cafias.

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schools (17 percent and 15 percent, respectively). At the national level, many students repeatmore than once and eventually drop out of school. Preschool education has proven to be aneffective method to reduce repetition rates in higher grades. Through the expansion of preschoolcoverage, the proposed project will help to reduce repetition rates (para. 3.6).

2.15 Because of repetition and dropout, completion and promotion rates are very low. Thecumulative effects of late entrance, repetition and dropout, and incomplete basic schools, meanthat only 47 percent of the initial student cohort finish the first two cycles of basic education, andonly 33 percent finish the 3rd cycle.5 On average, members of the urban population who are 15years of age or older have completed 7 years of schooling. In rural areas, on average, only 2.8years of school have been completed.

2.16 Repetition in grades 1 to 9 adds approximately 23 percent to the cost of producing agraduate.6 It is estimated that repetition adds to the system some US$37 million in additionalcosts each year. In addition to the financial costs, these inefficiencies are costly in terms of losthuman capital, and they compound the difficulty of addressing problems of low coverage andquality. The proposed project will address issues of efficiency in a comprehensive way through aseries of actions to improve the quality of education services provided by MINED. It is importantto emphasize six actions that will have a direct impact on repetition rates and are considered in theproposed project: (a) the revision of curriculum to meet the needs and interests of the rural schoolpopulation (para. 3.13); (b) the expansion of preschool coverage (para. 3.6); (c) the developmentof a multigrade program in rural areas that introduces the flexibility required in rural environments(para. 3.13); (d) the establishment of a new promotion system for students, allowing for automaticprogression within cycles (para. 3.21); (e) the development of a nutrition program targeted to thepoorest schools in rural areas (para. 3.23); and (f) the promotion of an active participation ofparents in school management (para. 3.1 1).

Insufficient Access to Education

2.17 Access to education varies depending on the part of the country in which the person lives,and is hindered by lack of sufficient infrastructure. It is also heavily dependent on the level ofincome of a student's family. Children from the poorest households not only have lessopportunity to enter school, but also enter at a later age, and stay less time in school, than dochildren from families with more economic resources. Education figures show that by 1993, only24 percent of children aged 4-6 attended preschool in rural areas, compared to 46 percent ofstudents the same age in the urban areas. At the same time, only 56 percent of children betweenthe ages of 7 and 15 were enrolled in basic education in rural areas, compared to 77 percent of thesame age group in urban areas (Annex 1, Table 2). Although low, the levels of rural enrollmenthave increased because of the EDUCO program. Despite its success in increasing enrollment,problems remain in regards to the ACE management capability. The proposed project will includemeasures to increase ACE efficiency with the support of NGOs and other private organizations.

2.18 Regional characteristics play an important role in explaining differences in access. Thesedifferences are a result of the priority given by the Government and other donors to regions

5 Ibid.6 Ibid.

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affected by the war, and to population increases caused by migration to the Central Region. TheCentral Region has the highest gross and net enrollment rates for both preschool and basiceducation (see Annex 1, Table 5).

2.19 Another factor affecting access to schools is inadequate infrastructure. Many existingschools need rehabilitation, and lack equipment and furniture. Based on the results of themicroplanning/microlocation exercise7 the proposed project will include measures to promote theconstruction of new sections in areas presenting infrastructure deficits and to rehabilitate ruralschools. Under the proposed project, MINED will work together with the FIS to increase andrehabilitate infrastructure following MINED's infrastructure (see para. 3.7).

Low Quality of Education

2.20 The low quality of education in El Salvador has been caused primarily by: (a) deficienciesin the provision and the quality of textbooks, and in the curriculum on which they are based; (b)lack of supplementary educational materials; (c) inadequate teacher training programs; (d)insufficient student achievement evaluation; (e) lack of systematic pedagogical supervision; and (f)the precarious nutritional status of the preschool/basic education age population.

2.21 Textbooks and curriculum deficiencies. Studies show that there are deficiencies in basiceducation textbooks and instructional materials in schools throughout the country in terms of thenumber of textbooks provided, the quality of the texts, and the curriculum on which they arebased. A recent evaluation study8 shows that only 44 percent of the teachers in traditional schoolsand 31 percent of the teachers in EDUCO schools surveyed indicated that each of their studentshad their own textbooks. Forty-three percent of traditional school teachers and 31 percent ofEDUCO teachers indicated that their students had no textbooks.9 Since 1991, with the support ofthe Strengthening Achievement in Basic Education Project (Solidificaci6n del Alcance de laEducaci6n Bdsica - SABE) (see para. 2.52), MINED has provided textbooks to urban and ruralstudents (grades I to 3) to use for the school year at no charge. With MINED funds, a limitednumber of textbooks produced under SABE has been printed and distributed to urban and ruralstudents in grades 4 to 6. However, because the SABE project is phasing out and the amount ofMINED funds for textbooks is limited, there are not enough books to cover all students in thosegrades. Textbook deficiencies can be particularly significant when teachers themselves lackmastery of the material, and when students lack supplemental learning opportunities in the homeor at the school, mainly when the environment is not conducive to formal learning as in ruralareas. Current textbooks lack complementary teaching materials relevant to the rural areas. Inthis environment, an improved curriculum and textbooks may be the most cost-effective means toimprove learning. No cost-recovery policies on textbooks and/or teaching materials has so farbeen implemented by the Salvadoran authorities, but the current administration has agreed tostudy and consider cost-recovery schemes. The proposed project wvill include measures to

Under the SSRP, an intensive survey of the existing education infrastructure has been undertaken to determinethe costs for providing infrastructure, the amount of rehabilitation required for existing infrastructure, and theareas where services are needed.

8 World Bank. 1994. 'El Salvador - Community Education Strategy: Decentralized School Management"(EDUCO Study). Report No. 13502-ES. Country Department II, Human Resources Operations Division, LatinAmerica and the Caribbean Regional Office, Washington, DC.

9 The rest of the teachers indicated that their students shared textbooks.

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establish universal provision of textbooks to students in basic education, and will support theestablishment of textbooks cost recovery policies ( paras 3.15 and 3.16).

2.22 Rural student absenteeism is related to inadequacies in curriculum plans and the schoolcalendar, and is also connected to low internal efficiency. MINED has devoted time and effort torethinking the curriculum for basic education in general and for rural students in particular. Inaddition, the school calendar in the rural schools needs to be organized taking into account thedemand for family labor. Such an adjustment is be expected to relieve parental pressure to pullchildren, particularly boys, out of school at times when their labor is in high demand. Theproposed project will include measures to increase the provision of textbooks and to adapt thecurriculum to rural areas (paras. 3.13, 3.15).

2.23 Multigrade methods in rural areas have been considered an important pedagogical methodto improve the provision of education.'0 However, teachers must learn how to deal with thissituation on the job. Building on the strong participation of the community in the school activitiesunder the EDUCO program, the proposed project will support, where necessary, the adoption ofmultigrade approaches in the rural schools to improve quality of learning and solve traditionalproblems of rural students (para. 3.13). Instructional materials, in-service teacher training, schooladministration, and community participation will be integral parts of the model to be adopted bythe rural schools, first on a pilot basis. UNICEF would support the pilot experience beforeexpansion to a large number of rural schools.

2.24 Textbooks and zender issues. As in many countries, textbooks used in El Salvador tendto foster and support gender stereotypes. Women are typically depicted in jobs consistent withtraditional nurturing roles. MINED has acted to counter negative gender-based stereotypingthrough efforts funded by UNICEF/UNIFEM and USAID, but results have been only partiallyachieved. An IBRD/IDB study on textbooks indicates that in the revised texts for grades I to 6,although illustrations were more gender balanced, texts continue to portray predominantly malecharacters, and women continue to be depicted in a traditional context."1 The proposed projectincludes measures to counteract gender stereotypes both in curriculum and textbooks (para.3.14).

2.25 Lack of supplementary educational materials. In addition to the lack of textbooks, schoolslack supplementary educational materials such as globes, maps, charts, educational toys,supplemental texts, and workbooks. Likewise, more costly but effective resources, such aslibraries, classroom reading resources, science kits, and computers, are rarely in evidence. Theabove situation is more acute in the rural and marginal urban schools. Under the SABE project(para. 2.52), MINED started to develop an educational package program (canasta bdsica) withbasic educational materials for grades I to 6. However, more needs to be done to make a moreextensive provision of these materials and supplementary teaching/learning materials to all basiceducation schools and students. The provision of instructional materials is also considered byteachers as a key incentive for teaching as noted in the Social Assessment (see Annex 4). The

1 For example, Escuela Nueva in Colombia.'El Salvador -Moving to a Gender Approach in El Salvador: Issues and Recommendations,"joint study by theIBRD and IDB.

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proposed project will include measures to increase the provision of instructional materials topreschool and basic education schools through the canasta blsica (para. 3.15).

2.26 Inadequate teacher training. Teacher pre-service training specifically for preschooleducation or the early years of basic education barely exists in El Salvador. Most Salvadoranbasic education school teachers are graduates of universities and have been prepared to teach theupper grades of the basic education cycle. As a result, most teachers lack the pedagogical skillsneeded to foster effective interaction with students in the lower grades, make the best use of thetextbooks and instructional materials, and identify and orient students with learning disabilities.Therefore, they are most in need of training because of: (a) their lack of previous teacher trainingpreparation; (b) the general lack of systematic supervision; and (c) the added difficulty of handlingmultigrade classes. The proposed project will include measures to establish a systematic in-service training system for all teachers in preschool and basic education and funds for assessingthe pre-service training system, currently administered by the private sector, which willrecommend policy options to improve the basic education pre-service training programsadministered by the private sector (para. 3.16).

2.27 Insufficient student achievement evaluation. MINED has only recently started to applyachievement tests to measure the learning status of students in the education system. Under theSABE project, MINED began using achievement tests to assess the impact of the new corecurriculum for grades 1-6. However, the results of this exercise showed that MINED's resourcesand capacity are too limited to monitor and evaluate academic achievement and standards ofteaching across the country and in the different modalities of education services provided. Thereis a need to create in MINED the '"ulture" of evaluation to support education policy optionsregarding teacher training, textbooks and instructional materials. The proposed project willinclude measures to improve the institutional and technical capacity in El Salvador for monitoringstudent achievement as a tool to increase education efficiency and accountability (para. 3.21).

2.28 Lack of systematic pedagogical supervision. The education supervision system, which haddisappeared during the armed conflict, was reorganized in 1990. Since the system was re-established, school supervisors have played an important administrative role in the implementationof the EDUCO program. However, they have not been able to provide pedagogical support andguidance to teachers in either system, traditional or EDUCO. Inadequate supervisionmechanisms, unclear assignment of activities, and low technical preparation, are factors impedingthe better performance of the supervisors and their contribution to improving school and teachingefficiency. The proposed project would support activities to re-orient the supervision system inthe direction of providing technical support to teachers and school principals, disseminatingresults of education program evaluation, and giving feedback to correct shortcomings in theeducation process. To increase the professional capacity of the supervisors, the proposed projectwill seek to achieve a qualitative change in the supervisors functions by increasing the timeemployed in monitoring teaching activities and by reducing their strictly administrativeresponsibilities (para. 3.28(d)).

2.29 Children's low nutritional status. Hunger and malnutrition diminish the physical andmental capacity of poor children. Protein-energy malnutrition and the lack of certainmicronutrients, especially iodine and iron, reduce learning capacity and academic achievement.Deficiencies of vitamin A and iron also reduce resistance to infections which can increase

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absenteeism. In addition, research shows that children who go to school without breakfast havedifficulty in concentrating, and perform less well than children who have had breakfast. Thiseffect is greatest in children who are also malnourished. School nutrition and health programs toalleviate hunger and malnutrition can complement other efforts to improve the quality of basiceducation, and contribute to improving the efficiency and effectiveness of the education system.

2.30 According to the first height-for-age census of first grade school children conducted in1988, one-third of Salvadoran children in first grade are malnourished. In the least developedmunicipios 2 , the prevalence of malnutrition rises to half the children. A Ministry of Health(MOH) study conducted in 1994 corroborates the results of the census. It showed that 61percent of preschool children in the least developed municipios are malnourished.

2.31 Goiter (an enlarged thyroid gland caused by a lack of iodine) affects 25 percent of childrenbetween the ages of seven and 14. The problem is especially severe in the Western region where,on average, 40 percent of the school age children are affected (Annex 8). Goiter is higher in girlsthan in boys (28 percent versus 21 percent) and also higher among children aged 10 to 14 yearsold. MOH has initiated a program to fortify salt with iodine, however, it will take several years,at least, before fortification can alleviate iodine deficiency in the country. The consequences ofiodine deficiency can be most severe and irreversible when experienced in utero, causing, forexample, mental retardation and deafness. School-aged children deficient in iodine perform worseon tests of intelligence and other tests of learning capacity compared to iodine-replete children.Iodine deficiency is also linked to impaired hearing in school-aged children.

2.32 The lack of vitamin A is a widespread problem in El Salvador. All of the studies over thelast 40 years have shown that more than 70 percent of infants consume inadequate amounts ofvitamin A, especially in rural areas. A study conducted in 1994 showed that 99 percent hadinsufficient consumption of vitamin A. Blood tests among preschool children show that 40percent are deficient. The MOH has embarked on a program to fortify sugar with vitamin A. Sofar the coverage of this program is low. It will take several more years before this program canalleviate vitamin A deficiency.

2.33 Anemia from a lack of iron affects a large proportion of the population in all developingcountries. A sample study with teenagers done in 1988 indicated that 51 percent suffered anemia.There is no updated and systematic information about iron deficiency, but the accepted estimate ishalf of the school population. It affects physical capacity, achievement and immunity. Childrendeficient in iron are less alert and attentive, less motivated, and perform less well on tests ofdevelopment and school achievement. Controlling this problem can be achieved through thefortification of foods (flour, cookies, drinks) and provision of iron supplements.

2.34 In regions with deficient sanitary conditions, half or more of children suffer from parasiticinfections. These infections reduce appetite, increase the risk of anemia, in some cases, and causeabsenteeism because of diarrhea. They also independently contribute to poor school performanceby diminishing a child's ability to pay attention and concentrate. Broad spectrum single dosedrugs, effective against several species of worms, are now available to treat helminth infections.

12 A municipio is the second administrative level of the govermmental system. The levels, in order, are:departamento, municipio, cant6n, caseria, comunidad.

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The proposed project will include the provision of basic nutrition supplements and healtheducation measures, and targeted treatment activities as a highly cost-effective approach toimproving children's readiness to learn via better nutrition and health (para. 3.23).

Weak Managerial and Administrative Capacity

2.35 Despite the major efforts of the Government to foster an effective administration and theexistence of a highly qualified group at the managerial level in MINED that is leading theeducation reforms, institutional weaknesses still remain. The education sector has insufficientinstitutional capability to strengthen and consolidate ongoing education reforms to assureefficiency, quality and equity improvements, especially among low-income areas. Overallinstitutional weaknesses and lack of adequate personnel policies in MINED underline much of thepoor performance in the sector. These weaknesses include: (a) an inappropriate institutionalorganization; (b) an inadequate incentive structure for teachers and MINED technical staff, and(c) the absence of an effective communication system (within MINED and between MINED andthe public) that weakens MINED's capacity to deliver its services timely and effectively.Moreover, the lack of a timely, trustworthy, and relevant management information system (MIS)has not allowed the Salvadoran education authorities to ascertain the impact of policies andactivities in the delivery of the education services. These weaknesses impede MINED ineffectively translating education policies and strategies into concrete programmatic actions, targetresources to most needed areas, and periodically monitor achievements.

2.36 Inappropriate institutional organization. MINED's rigid and centralized organizationalstructure, the wide range of responsibilities, the weakness of local institutions and the complexadministrative procedures are not conducive to the efficient management of education services.MINED devotes its limited management resources to a wide range of activities which lessens itsefficiency and exacerbates the problem of limited management capacity. Moreover, the basicmanagement tools - planning, information systems, and evaluation mechanisms - are almost non-existent. Under the shield of investment projects financed by external donors, MINED is able tobypass some of the rigidities of the current structure to implement more efficient practices.EDUCO is the most successful structural change in the way MINED provides education services.Based on this experience, MINED has been gradually shifting responsibilities to the regional andlocal levels. Other changes have happened in an unsystematic way, contributing to the lack oftransparency - an inadequacy of the current structure. The problems of organization areworsened by severe personnel constraints. The degree to which improvements could bedeveloped under the current structure are limited by the current legal framework of the educationsector and further actions need to be conceived in a consistent and systematic way.

2.37 The incentive to modernize MINED and increase its efficiency is part of a much broaderPublic Sector Reform that has been underway and will be supported by the Banks under a PublicSector Modernization Project under preparation (Annex 5). MINED was selected as the pilotinstitution for reforms in the budgetary planning process that is expected to facilitate allocationand flow of funds by level of education and to regions and departments. The proposed projectwill: (a) build on the successful decentralization experience of MINED to develop pilotmodernization programs that will subsequently be implemented at the national level; (b)strengthen the management tools available to MINED; and (c) revise the legal framework of theeducation sector to make it suitable for the new organization of MINED (para. 3.27).

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2.38 Inadequate incentive structure for teachers and MINED technical staff. Deficiencies in teacherperformance and low efficiency of technical staff are, in part, the result of an inadequate incentivestructure for both teachers and technical staff. During the last decade, performance of traditionalpublic school teachers decreased and absenteeism and turnover increased. This could be only partiallyexplained by the decline in real wages. Teachers are ruled by specific regulations (Escalaf6nMagisterial) that guarantee job stability, and reward time in service and pre-qualification, but fail tocompensate for work environment or to promote excellence. In addition, there are no specific criteria,based on qualifications, to select school principals. Moreover, the lack of adequate supervisionrestricts effective control of teacher performance. As a consequence, teacher salaries are linked moreto the strength of the negotiating capacity of the organizations representing them. On the other hand,teachers under the EDUCO program are not formal employees of MINED; they are selected, hired,supervised and dismissed by the parent associations and, unlike traditional teachers, are judged by theirperformance. Their salaries are higher, but they do not have the job stability of regular teachers. Thebetter attendance, performance and commitment of EDUCO teachers confirm the importance ofimproving the incentive structure for traditional teachers based on performance evaluation.

2.39 Despite the success of the EDUCO program in improving teacher performance, it isproving difficult in practice to hold teachers within the EDUCO system for appreciable lengths oftime because they prefer to be in the official career stream which is more stable and lessdemanding.'3 In addition, the regular teacher organizations could obstruct the expansion of theEDUCO system if it is perceived as threatening their interests. This calls for a comprehensiverevision of the incentive structure for both EDUCO and traditional teachers. A basic incentive,such as the improvement of teacher real wages, should be combined with the revision of thestructure of incentives, including regulations, supervision, training, performance evaluation, andbetter communication with MINED. The proposed project will finance a revision of the legalframework including the Escalaf6n Docente, a strengthening of supervision, the development of abroad in-service training program and the development of a communication strategy for MINED(para. 3.28).

2.40 Performance of the technical staff at MINED is limited by low motivation and lowsalaries, high turn over of management and technical personnel. In the absence of adequate anddefined policies for recruitment and career development, 50 percent of MINED's staff providesonly administrative support and the salary structure is very flat. Consequently, although MINEDoffers very good remuneration and stable labor conditions for low administrative positions, it hasenormous difficulties in hiring or retaining competent technical and professional personnel. Tofully achieve the objectives of the education reform, a highly trained work force should be in placeto carry out the decentralized processes"and systems. The proposed project will provide fortechnical assistance to MI4NED to revise the salary structure that will have to be consistent withthe revision of the Civil Service System under the Public Sector Modernization Project. Theproposed project will finance a revision of the education legal framework including the Escalaf6nDocente, a strengthening of supervision, the development of a broad in-service training programand the development of a communication strategy for MINED. It will also provide funds for thedefinition of new job descriptions and training programs, and for the implementation of therationalization plan for personnel under the new structure of MINED (para. 3.28(f)).

13 EDUCO Study, op. cit.

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2.41 Absence of an effective communication system. The Social Assessment (Annex 4),undertaken during project preparation, pointed out the severe problems resulting from MINED'slack of an effective communication policy. Within the Ministry, the general guidelines set at thehighest levels do not always reach lower levels, and fragmented infornation undermnined the rapidimplementation of reforms. Communication with teachers, supervisors and principals is constantbut not necessarily efficient, and communication with other stakeholders has been very limiteddespite its proven effectiveness in the EDUCO program. Although there is a consensus that theeducation system should be changed, the lack of communication led to public misconceptions ofGOES' plans to modernize the education sector, and prevented the stakeholders from developinga sense of ownership. The Social Assessment exercise contributed to promoting a better informeddiscussion of education reform between stakeholders. Based on its results, the project includesspecific actions to develop a communication system within MINED, and between MINED andother stakeholders (para. 3.28(e)).

2.42 To promote a national dialogue about education and to seek a national ownership foreducation reform, in October 1994 the Government set up a National Commission for Education,Science, and Development (Comisi6n Nacional de Educacz6n, Ciencia y Desarrollo). TheCommission was composed of 12 members who represent a wide range of political affiliations andare acknowledged for their professional capacity and strong technical skills. The Commissionpresented specific recommendations for the modernization of the education sector that are fullyconsistent with the proposed project. The Commission will continue to support MINED in thedefinition of further actions to improve education services in El Salvador.

Inadequate Financing of the Sector

2.43 Inadequate and deficient sector financing has been caused by: (a) sharp decreases ineducation spending as a percentage of GDP; (b) the relative reduction of fiscal resources allocatedto education; and (c) inadequate financial/management mechanisms. Education expenditure inrelation to Central Government expenditure and to GDP has steadily decreased since 1981 andhas only slightly increased in the last two years. Its share of GDP fell from 3.6 percent in 1981 to2.0 percent in 1994. This is partially due to the fact that total government expenditure fell fromnearly 20 percent of GDP in the early 1980s to 15 percent in 1994; however, the share ofeducation expenditure in the Central Government budget has also declined from nearly 28 percentat the beginning of the 1970s to 14 percent in 1994 (Annexes 2 and 3).

2.44 Fiscal austerity has also resulted in a severe curtailment of investments in education. Themost important investments in the last four years have been financed by international donors inprojects associated with considerable technical assistance programs. Investment expenditureshave been drastically reduced, and only partially executed. Since 1990, executed spending oneducation has fallen short of budgeted spending on education. In 1992 and 1993, the shortfallwas approximately 10 percent of total spending. In contrast, recurrent expenditures have beenalmost fully executed as budgeted, and their share has increased to nearly 90 percent of thebudget.

2.45 Cumbersome financial mechanisms impede better management of budgetary allocations.Apart from the ordinary budget, which finances most recurrent costs, El Salvador also has an

15

extraordinary budget, principally used to finance investment expenditures with external resources.The extraordinary budget, however, has expanded to cover some recurrent expenditures. As partof its macroeconomic reform program, the Government is taking measures to consolidate the twobudgets. This effort will provide a better management of education funding to supportdecentralization and local provision of education services and to make more cost-effectivedecisions in the sector. Moreover, the proposed project would allow GOES to implement a vastinvestment program for the expansion of education services and is part of a broader effort toexpand the fiscal support for the education section.

C. The Government's Strategy for Education

2.46 The severe economic crisis of the 1980s, followed by a drastic fall in real per capitaincome and in government expenditures in education, an earthquake, and a civil war have severelyimpacted the performance of the education sector in El Salvador. In 1989, only 14 percent of thepreschool age population and 65 percent of the basic education population were enrolled in theeducation system. Illiteracy among those 15 years old and over was 27 percent; in Latin Americaonly Guatemala and Haiti had higher illiteracy rates.'4 During the war period, most educationindicators held steady because of an increase in services by the private sector and foreign aid.Starting in 1989, GOES initiated policy reforms aimed at rehabilitating the public sector'scapacity to manage and deliver social services, including education.

2.47 The overall objective of the education policy currently being followed by GOES is tocreate an education system that can be an effective tool for promoting the economic and socialdevelopment of the country. This will be done by promoting the formation of human capitalwhich will allow the recipients to reach higher levels of productivity and capacity. By promotingpersonal development, the level of income and the quality of life of the population will beenhanced.15

2.48 The strategy of GOES for the education sector is based on three fundamental elements:(a) the focusing of human, financial and material resources on basic education; (b) thedecentralization of services and the participation of the communities; and (c) the provision ofservices through the private sector which are more efficiently provided by that sector.'6 The firstelement implies that the majority of human resources, as well as materials and financing, should befocused towards increasing coverage and improving the quality of preschool and basic educationuntil the sixth grade. Specifically, large amounts of resources need to be directed towards thoserural areas in which no education services. currently exist.

2.49 The goals for basic education in 1995-1999 include: (a) increasing preschool enrollmentrates from 24.5 percent in 1993 to 40 percent in 1999 in the rural areas; (b) raising enrollmentrates in the 1st and 2nd cycles from 83 percent in 1993 to 90 percent in 1999; and (c) reducingoverage students in basic education from 29.2 percent in 1993 to 15.3 percent in 1999. MINEDwould continue involving the community in the provision of basic education services,

14 Harvard Study, op. cit..

15 Ministry of Planning, "Plan de Desarrollo Econ6mico y Social, 1994-1999."16 Ibid.

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strengthening and increasing the ability of communities to organize and assume a protagonist rolein the administration of basic education services.

2.50 For secondary education (grades 10-12), the emphasis will be on improving the academicskills and capabilities of the graduates in order to respond to the dynamic changes of the labormarket. This will be accomplished, in part, by reforming the curriculum to respond to therequirements of the labor market and the possibility that graduates may continue their studies athigher levels. For technical education, the participation of the private sector in the administrationof technical institutes will be promoted by supporting a scholarship fund for students with limitedresources. Finally, as the result of curriculum reform and public/private interaction in theprovision of services, higher education should produce highly qualified professionals who will beable to respond to the conditions of the modern workplace in terms of scientific and technologicalinvestigation. 17

2.51 The strategy for education is part of a larger Public Sector Modernization Action Planwhich will be implemented with the technical and financial support of the IEBRD, IDB and otherdonors through a proposed Public Sector Modernization Project (see Annex 5). Central to theGovernment's strategy for education are the processes of decentralization and modernization,which include the provision of selected education services through the private sector. To supportthe education reform, both in academnic content and the provision of education services, theGovernment set up the National Commission for Education, Science, and Development composedof members of NGOs and other private organizations, universities and teacher unions (see para.2.42).

2.52 Since 1989, priority in the education sector has been given to both preschool and basiceducation with emphasis on expanding coverage to rural areas through an innovative programbased on direct involvement of parents and community groups, the Community-managed SchoolsProgram (Educaci6n con Participaci6n de la Comunidad - EDUCO) (see para. 2.4). In additionto sectoral policies to address problems of access in the education system, MINED also institutedseveral programs to enhance the quality of basic education. Several of these programs weresupported by the USAID-financed SABE Project. Under this project, curricula in basic educationwere redesigned up to the fourth grade. New curricular contents were established based on adiagnosis of needs, interests and problems, and were validated in more than 100 schoolsthroughout the country. To support the new basic education study programs, textbooks andworkbooks were prepared, and 1.5 million were distributed to students in grades I through 3.Training programs for teachers, school directors, and supervisors were intensified in the areas ofteaching methods as well as in education evaluation and administration.

2.53 The Government's EDUCO strategy to increase education opportunities in rural areas hasproven to be a good instrument for targeting education services to the poor and increasing accessand quality to preschool and grades I to 3. It helped expand preschool enrollment from 2 percentof the rural preschool population to 10 percent between 1989 and 1993. The enrollment ofchildren in the first three grades of basic education increased 6.4 percent between 1989 and 1993.Despite the lower average socio-economic status of EDUCO students compared with students in

" Ibid.

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traditional schools, EDUCO students performed on a level comparable with students in traditionalschools (rural and urban), and in some cases better.

Tabe 3 St~d~t Ahi~exnntScores .... _____.

A |bievemni Rural UrbanEDUCO Trad. Trad

Preschool 51 61 74Languagel 38 41 43Math 1 47 38 43Language 2 60 63 59Math 2 44 40 44Note: Average percent score (score/total possible).Source: EDUCO Study.

2.54 While the overall cost of the EDUCO program appears to be slightly higher than the cost ofthe traditional program overall, the benefits of the program seem to more than offset the highercost involved. These benefits include providing of basic education in areas which did notpreviously receive education, community involvement in providing basic education services, andbetter control over teacher attendance and performance. EDUCO has also contributed toimproved dialogue between communities and MINED, and between MINED and the internationalagencies and NGOs that support program implementation.

2.55 Nevertheless, despite the Government's recent efforts, the education system still facessevere problems of access in rural areas and low internal efficiency. Because of problems ofinternal efficiency related to repetition, on average, 10 years of instruction are required to producea 6th grade graduate.1 8 Without considering the high incidence of dropping out between the 2ndand 3rd cycles (on average for 5.4 years), four years of instruction are needed to complete the 3rdcycle.

2.56 The proposed project will play an important role in supporting the Government strategy toimprove equity, quality and efficiency of the school system. It will: (a) increase investments inbasic education, thus helping to accumulate human capital, the lack of which is a seriousconstraint to growth; (b) address the needs of the poor, and contribute to a more equitabledistribution of basic social services, thereby alleviating poverty; (c) improve the efficiency of usingthe scarce public resources through measures to strengthen MINED's institutional capacity.Additionally, the project will contribute to lowering the education flow wastage and repetition anddropout rates by improving the quality of the services through better qualified teachers, improvedavailability of instructional materials, -an updated curriculum, a more effective learningenvironment, and direct involvement of parents, teachers and the community in the managementof the schools. Decentralization and community participation will boost responsiveness byteachers and administrators since all will be sharing administrative responsibilities, andtransparency will promote accountability at all levels. Furthermore, the proposed project willsupport the Public Sector Modernization Program by establishing the conditions for MINED to bean active and responsive actor in the process, while being consistent with the general guidelines ofthe Government's strategy for the public sector.

"' Harvard Study, op. cit.

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D. World Bank and Inter-American Development Bank Roles and Assistance Strategy

2.57 The IBRD's country assistance strategy (CAS) for El Salvador, discussed by the Board onSeptember 14, 1993 with the Second Structural Adjustment Loan Project, focuses on supportingthe Government in meeting its critical development challenges and facilitating the transition froma wartime economy to a peaceful, more participatory society. The IBRD's strategy is to supportthe Government in meeting its four principal development challenges - modernizing the publicsector, enabling private sector-led growth, reducing poverty and investing in human capital, andstrengthening natural resource and environmental management - through a blend of adjustmentlending, investment lending in selected sectors, analytical work to address sectoral issues andguide the policy dialogue, technical assistance to deepen reforms and strengthen institutions, anddonor coordination.'9 The Structural Adjustment Loans (SAL I, IBRD Loan 3293-ES, 1991;SAL II, IBRD Loan 3646-ES, 1993), the Technical Assistance Loan (TAL, IBRD Loan 3648-ES,1993), and the on-going SSRP (IBRD Loan 3348-ES, 1991) have been supporting Governmenteconomic reforms and the social sector strategy by emphasizing the provision of targetedpreschool and basic education which directly benefit the poor. The proposed project would be akey instrument for supporting the efforts of the Government to implement public sector reformsand to continue government strategies for decentralization and community participation in thebasic education system which were supported by IBRD under the SSRP.

2.58 The proposed project is also in line with the IDB country strategy which was discussedduring a programming mission with the Government in August 1994. This strategy, which covers1994-1996, was defined in the Country Programming Paper of March 1993. Its objectivesinclude: (a) improving social and economic infrastructure; (b) supporting economic reforms; (c)increasing IDB support to the social services; (d) protecting the environment; (e) supporting themodernization of the State; and (f) strengthening the participation of communities and women inthe national reconstruction process.

E. Lessons Learned from Past Experience

2.59 The IBRD has financed four previous education projects in El Salvador. Three of theseprojects (First Education Project, Loan 609-ES, 1969; Second Education Project, Loan 1007-ES,1974; and Industrial and Agricultural Training Project, Loan 1571-ES, 1978) covered such areasas: (a) improving the secondary school system; (b) establishing rural basic education schools; (c)improving the teacher training college; (d) testing a national non-formal adult training program;and (e) creating a network of non-formal training centers for agricultural and industrial workers.The SSRP (see para. 1.3 ), funded in 1991, supported the development of EDUCO which includedimprovements in the delivery and the quality of basic education services in rural areas, and testeda decentralized education system based on community management of service delivery.

2.60 The IDB has financed nine education projects in El Salvador since 1962 (Annex 17).These loans have covered such areas as: (a) improvement of general education and basic sciences;

9 World Bank. 1993. Report and Recommendation of the International Bank for Reconstruction andDevelopment to the Executive Directors on a Proposed Second Structural Adjustment Loan of US$50 millionto the Republic of El Salvador. Report P-6108-ES, August 23.

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(b) expansion and improvement of academic and physical infrastructures; (c) studies of the supplyand demand of human resources in secondary and higher education; (d) programs to combatilliteracy and provide adult education; and (e) studies of non-university technical education. Priorto the proposed project, IDB's involvement in the finance of basic education in El Salvador hasbeen minor.

2.61 Implementation experience and the impact of the education component of the SSRP wasreviewed in 1994 and lessons learned from the project have been incorporated in a sector report,'El Salvador Community Education Strategy: Decentralized School Management" (Report No.13502-ES, December 8, 1994). Among other lessons, three should be highlighted. First, theEDUCO model, with its strong community participation, offers education services at a reasonablecost to some of the lowest income groups in rural areas, and provides efficient management ofthose services. Despite the lower socio-economic status of EDUCO students20 , their achievementresults are comparable to students in traditional (urban and rural) schools. Although overall costsof the EDUCO schools are similar to those of traditional schools, the benefits of the programappear to be much higher. These benefits include bringing education to areas which did notpreviously receive these services, community involvement in providing education services, andbetter control over teacher attendance and performance. EDUCO also established channels forbetter communication between communities and N4INED. The proposed project continuessupporting the participation of the community by expanding the EDUCO model in rural areaswhich are currently without services. Second, although the Ministry of Coordination of Economicand Social Development2 ' (Ministerio de Coordinaci6n del Desarrollo Economico y Social -MICDES) Project Coordinating Unit (PCU) had an important role in implementing the projectand acquired project implementation expertise, this expertise was not fully transferred to theexecuting agencies. To guarantee a high level of project implementation, the managerial capacitymust be reinforced, not only at the PCU level, but also within the executing agencies involved inproject operation. Thus, project management for the proposed project has been established as anintegral part of the MINED, with staff drawn from the operational units that prepared the project.In addition, a staff development program to improve, in a timely and coordinated way, the skillsof administrators, technical/administrative and pedagogical personnel required by the institutionaldevelopment process will be implemented. Third, the education loans in the 1970s experiencedsignificant implementation delays arising from shortage of counterpart funds. The SSRP took thisinto account in its design. Annual implementation targets were included in the Government'sbudget proposal presented to the Assembly to avoid shortages of counterpart funds, andconsequently funds were made available at the onset. Also building upon lessons from the SSRP,a revolving fund (see para. 4.9), operated by MINED's Office of International CooperationProjects (Oficina de Proyectos de Cooperaci6n Internacional - OPCI), would be opened in thename of the project.

2.62 The EDUCO program has also provided valuable experience that has been incorporatedinto the project including: (a) the effectiveness of incentives to improve teacher performance; (b)the positive impact of classroom libraries in complementing teacher strategies and in stimulating

20 EDUCO schools are in some of the lowest income areas of El Salvador, where factors such as health, nutrition,and the need for child labor weigh in heavily against school performance.

21 Formerly the Ministry of Planning and Coordination of Economic and Social Development (Ministerio dePlanificacion y Coordinaci6n del Desarrollo Econ6mico y Social - MIPLAN).

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student interests and reading habits; and (c) the importance of having learning materials thatcomplement textbooks to stimulate more active learning in school.

2.63 Feedback from other education projects in Latin America indicates that a proper policyframework and adequate institutional capacity are major factors in determining the success ofproject implementation. The proposed project focuses on improving the quality and efficiency ofbasic education on the basis of (a) a clearly stated government policy framework; and (b)improvement of the institutional capacity of MINED at the central and departmental levels. Otherspecific lessons learned from basic education projects in Latin America which have beenincorporated in the design of the proposed project include: (a) increasing education expenditures,especially those targeted to the poorest regions; (b) promoting adequate nutrition and healthpractices; (c) developing an integrated, inter-disciplinary curriculum that can be adapted to theneeds of the urban and rural sectors; and (d) the need to keep the public informed and involved inthe changes being contemplated by the Ministry.

2.64 Decentralization experiences in Latin America have pointed out some key elements thathave to be present to ensure that decentralized units of government, are capable of absorbing newresponsibilities and implementing them effectively. "Successful decentralization requires: (i) fullpolitical commitment from national, regional, provincial, municipal, and local leaders; (ii) a modeladdressing the issue of which educational functions and responsibilities could be more efficientlyand effectively delivered at the central level, smaller decentralized government units, and/or theprivate sector, and explicitly defining the degree of accountability of the different participants; (iii)an implementation strategy and a timetable; (iv) clear operational manuals and procedures; (v)continuous training for the skill levels to be performed at the central and decentralized units ofgovernment; (vi) relevant performance indicators to be continuously monitored; and (vii)adequate financial, human, and physical resources to sustain the process. 2

2.65 The decentralization process that is supported by the proposed project (para. 3.28(a)) hasbeen designed with the full support of the Government and through an active communicationcampaign that has already created a sense of ownership within the education community. Theprocess will be guided by a prototype that defines functions at all levels in a systematic way andits implementation will be sustained by the development of an MIS, and will be implementedgradually using pilot experiences that will allow for the introduction of corrective measures in atimely basis. The process will also be accompanied by a comprehensive training program at alllevels.

3. THE PROJECT

A. Project Objectives and Scope

3.1 The proposed project will promote greater equity, quality, and efficiency in the provisionof education services by: (a) improving access to education; (b) improving education quality in

22 Prawda, J. 1992. 'Educational Decentralization in Latin America, Lessons Learned." A View from LATHR,No. 27, Human Resources Division, Technical Department, Latin America and the Caribbean Region, WorldBank.

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both academic achievement (output) and learning environment (education inputs); and (c)strengthening the managerial, financial and administrative capacity of MINED to set policies andguidelines for the sector and deliver public education services.

3.2 Greater equity will be achieved by increasing coverage to include approximately 32,000preschool age children and 64,000 basic education students who do not currently attend school.Increasing the quality of education services, and thereby increasing the educational attainment formany who do attend school (approximately 800,000 children) will be made through provision oftraining and education materials. Training will be provided to approximately 26,300 teachers,13,000 community members and 23,000 parents (see para. 3.20). Textbooks will be producedand distributed to students in public schools to provide for a better learning environment.Improved efficiency will be reflected in a reduction of repetition rates, an increase in thecompletion rate, an improvement in the net enrollment rate and increased relevance of thecurriculum. These improvements in pupil and school performance will be achieved by improvingthe quantity, quality and management of learning resources and improving the planning,administration and management of the national education system.

B. Project Target Areas

3.3 The proposed project will continue the Government's efforts to increase education servicedelivery, especially in rural areas. Several interventions will be targeted to the 135 municipios(out of 262 total municipios) with the lowest levels of social services (see Annex 6). The targetedactivities are comprised of: (a) expansion of preschool and basic education; and (b) increasing thelearning capacity of children through improvements in health and nutrition. The remainder of theproject activities will be implemented nationwide.

C. Project Components

3.4 The project has been organized into three major components as follows:

(a) Expansion of Access to Preschool and Basic Education (US$12.5 million(including contingencies) or 16 percent of total project costs) in 135 targetmunicipios to provide for: (i) supporting the expansion of EDUCO to regionswhich currently do not have preschool or basic education services, includingrehabilitating the school infrastructure and providing school furniture in ruralschools not supported by the Social Investment Fund; and (ii) technical assistancefor strengthening the EDUCO model.

(b) Improvement in Education Quality (US$49.2 million (including contingencies)or 61 percent of total costs) would contain activities that impact the quality ofpreschool and basic education in the country as a whole, including: (i) technicalassistance for supporting curriculum development activities for preschool and basiceducation, designing a new student promotion system, and establishing multigradeclasses in schools in rural areas; (ii) educational materials, such as textbooks,didactic materials, and classroom and school libraries; (iii) training and assistance

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to upgrade the skills of preschool and basic education teachers, principals andsupervisors, and preparing studies to improve pre-service teacher training; and (iv)developing an education assessment system. The component would also includeactivities to develop a school health and nutrition program targeted to the 135poorest municipios as defined by having the lowest levels of social services.

(c) Institutional Modernization and Strengthening (US$13.3 million (includingcontingencies) or 17 percent of total costs) to provide for: (i) technical assistancefor a review of MINED's legal and organizational framework to increase systemefficiency, to increase the coverage and improve the quality of education services,to implement institutional reforms in the areas of management of human andfinancial resources, planning, information, evaluation, monitoring, supervision andcommunication systems, and to establish a staff development program to improvethe capacity of administrators and technical personnel; and (ii) establishing afunding mechanism, the Pilot Basic Education Fund Program, to test alternativemethods of providing preschool and basic education through, for example, suchorganizational entities as the municipios, NGOs or other non-profit privateorganizations, and to experiment with pedagogical and administrative innovations.This component will have an effect that will extend throughout the education sectorand the country.

D. Project Description

(1) Component 1 - Expansion of Access to Preschool and Basic Education (US$12.5 millionor 16 percent of total costs).

3.5 This component will increase access to preschool and basic education in rural areas by: (a)expanding the number of community-managed schools (Educaci6n con Participaci6n de laComunidad - EDUCO) in rural areas; and (b) strengthening EDUCO through the support ofNGOs or other private organizations.

3.6 Subcomponent (l.a) Expansion of preschool and basic education in the rural areas(US$6.0 million). The EDUCO program has contributed to improving access and raising thequality of education in rural areas.23 Based on its promising results, and following a gradualprocess, MINED intends to provide education coverage in rural areas under the EDUCO model.MINED will start the process by: (a) establishing approximately 3,000 new EDUCO sections inthe poorest municipios which currently have deficits in preschool and basic education services2 4;and (b) gradually replacing approximately 3,000 traditional school sections with the EDUCOmodel.

3.7 The creation of new sections, that will cover preschool through grade 625, will be financedwith funds from the ordinary budget26 of MINED and FIS funds. The teacher cost of increased

23 EDUCO Study, op. cit.24 The maximum distance that a child will have to travel to school has been set at 2.5 km.25 In an EDUCO school, all sections will be managed under the EDUCO system.

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coverage will be fully covered by the ordinary budget of MINED. The construction of classroomswith community participation will be undertaken as a regular operation of FIS and will befinanced by FIS. The microplanning/microlocation survey (see para. 2.19) will be used as thebasis for approving school infrastructure. The proposed project will also provide funds for thedevelopment and promotion of the ACEs that will manage the new preschool and basic educationsections. An agreement (convenio) with FIS to guarantee the timely construction of newclassrooms was presented at the negotiations (para. 7.2(a)). The estimated timetable for creatingnew sections is presented in Table 4.

Table 4. Timetable for Creating New EDUCO SectionsLevel Year 2 Year 3 Year 4 Year 5 TotalPreschool 250 250 250 250 1,000lst & 2nd Cycles 500 500 500 500 2,000Total 750 750 750 750 3,000Notes: There were 1,311 EDUCO sections and 14,602 traditional preschool, 1st and 2nd

cycle sections in 1993.All EDUCO sections are managed under the EDUCO system.

3.8 The gradual transformation of rural traditional schools to the EDUCO model will notrepresent additional recurrent costs because in these cases, traditional schools are alreadyoperating. Nevertheless, finance for rehabilitation of school is required and will be financed by theproposed project. To transform the rural school system into community-managed schools, threemethods will be used: (a) as traditional school teachers retire, transfer or resign, they will bereplaced by EDUCO teachers; (b) single-teacher schools will be transformed into EDUCOsections; and (c) any new school and/or section in rural areas will use the EDUCO model. Theproposed project will also support the rehabilitation of the schools. MINED will hire the servicesof FIS to manage the rehabilitation of infrastructure. The estimated timetable for transformingtraditional sections into EDUCO is presented in Table 5.

Table 5. Timetable to Transform Existing Traditional Sections to EDUCO SecdionsMethod Year 2 Year 3 Year 4 Year 5 TotalOne teacher schools 335 335 670Retirement 250 250 250 250 1,000Transfers 350 350 350 350 1,400Total 600 935 935 600 3,070

3.9 At the end of the project it is expected that the provision of education in rural areas will beprovided by approximately 9,400 EDUCO sections and approximately 11,500 traditional sections.This subcomponent will provide: (a) technical assistance to complete the microplanning exerciseinitiated under the SSRP undertaken in 50 percent of all schools in the country; and (b) funds torehabilitate schools and infrastructure, and purchase and distribute school furniture in EDUCOschools to complement current FIS funds for infrastructure in the rural areas (see Annex 7).Maintenance of the schools will be provided under the current MINED maintenance program

26 El Salvador's annual budget is divided into two broad categories: ordinary and extraordinary. The formercategory is comprised of funds from domestic sources; the latter is comprised of funds from bilateral andmultilateral agencies and other external donors (see also para. 2.45).

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which was developed under SSRP. The promotion of the ACEs will be financed under theStrengthening of EDUCO Program. As a condition for IDB for the disbursement of thissubcomponent, MINED will present assurances of the continuance of the school maintenanceprogram for rehabilitated schools (para. 7. 7(a)).

3.10 Subcomponent (l.b) Strengthening the EDUCO program (US$6.5 million). Thiscomponent will focus on strengthening the administrative capacity of the ACEs and parentparticipation in the EDUCO program with the support of NGOs or other private organizations.Pilot experiences with the participation of NGOs have demonstrated the sound contribution thatthose organizations can add to the communities, mainly in terms of improving ACE membermanagement skills and parent participation in the program. Based on these pilot examples, theproject will assist the Ministry in improving the participation of selected NGOs or other privateorganizations operating in the sector, building on their strengths to support communitydevelopment programs, facilitate local resource mobilization, and to promote local participation inthe socioeconomic development process.

3.11 The strategy to be developed by the component includes: (a) the selection, on anexperimental basis, of ACEs to participate in administering supplementary community services(e.g. school-based health and nutrition programs) in addition to administering education services;and (b) strengthening of training programs for parents. The subcomponent will provide: (a)technical assistance and consultant services to develop an inventory of NGOs or other privateorganizations to be selected for supporting the ACEs, and to establish a system to monitor NGOor private organization performance; (b) financial resources for NGOs or private organizations tohelp with the organization, training, and monitoring of ACE activities (see Annex 7); (c) trainingprograms for teachers and supervisors in community-related matters; (d) preparation and printingof training materials; (e) guidelines for the operation of the ACEs; and (f) resources for devisingways of launching, supporting, documenting, and disseminating information about the experiencegained (see Annex 7).

(2) Component 2 - Improvement in Education Quality (US$49.2 million or 61 percent oftotal cost)

3.12 This component would include measures to complement actions already initiated under theSABE Project and to develop new activities for improving the quality of education services. Thecomponent consists of the following interrelated parts: (a) curriculum design and development,including pilot multigrade classes; (@) design, production and distribution of textbooks,learning/teaching materials, school equipment, and school library books; (c) development of in-service training programs for preschool and basic education teachers, principals and supervisors,and a pre-service teacher training assessment study; (d) establishment of a permanent educationassessment system; and (e) development of a school-based health and nutrition program.

3.13 Subcomponent (2.a) Curriculum development (US$1.4 million). The curriculumdevelopment subcomponent is aimed at providing programs of study that are more relevant andflexible to meet the needs of the school population, especially in rural areas. The subcomponentwill complement curriculum activities initiated by the SABE Project (see Annex 8). Theseactivities would involve: (a) adapting learning objectives and content for core curriculum modules

25

at the preschool level in rural areas; (b) reviewing the curriculum for the 3rd cycle of basiceducation (grades 7 to 9) to complement the one designed for the 1st and 2nd cycles; (c)developing a multigrade pilot program in EDUCO schools; and (d) establishing a new studentpromotion system. Over the life of the project, the subcomponent will provide: (a) technicalassistance for studies of curriculum and student promotion; (b) production and distribution ofapproximately 26,000 curriculum guides for the 3rd cycle of basic education, and 31,000curricular guides for the rural schools; and (c) production of materials for multigrade classrooms.

3.14. Subcomponent (2.b) Textbooks and instructional materials (US$32.5 million).Recent evaluation in the country links the low level of student attainment at all levels andmodalities of education in the country to the lack of education materials.27 The proposed projectwould continue to support the current Government's effort in providing textbooks. This includesrevision of gender content, adaptation to the new curriculum, and adjustment to rural studentcharacteristics. This subcomponent is aimed at improving the quality of learning, increasingschool attendance, reducing student dropout and repetition rates, and raising the academicachievement level of students. This would be accomplished through the provision of: (a) technicalassistance for the development of student and teacher guides, and modular textbooks for grades 7to 9, the selection of school and classroom library books, and the design of cost recovery studies;(b) textbooks and instructional materials; (c) complementary classroom supplies for selectedpreschool and basic schools; (d) school libraries for preschool and basic schools, and smallclassroom libraries for EDUCO classes; (e) support for the development of a sustainable textbookand education materials production and distribution system; and (f) financing for office equipment,costs of transporting textbooks and instructional materials, and operating costs.

3.15 The MINED plan calls for the production and distribution of approximately 3,500,000books over the next five years.2 8 The textbooks will be provided following the strategy used bythe SABE Project by which textbooks are prepared by national or/and international specialists,and printed by the private sector. The project will provide: (a) two instructional bookletsdesigned to include multiple units for preschool students; (b) four textbooks (in the areas ofSpanish, mathematics, natural sciences and social studies) for grades 1 through 9; (c) modularstudent instructional guides, to foster auto-instructional use by students in grades I to 6 in urbanareas and in the multigrade classes in rural areas; (d) books for a total of about 3,400 schoollibraries to preschool and basic education schools in urban and rural areas; (e) 2,000 classroomlibraries to preschool and basic education EDUCO schools; and (f) 200 laboratory kits will beproduced for 3rd cycle schools. Each school library will have 2 copies of about 100 titles plusreference books, and each classroom library will be made up of 2 copies of about 20 titles plusreference books. A package of instructional materials (canasta basica) will also be distributedannually to all preschool and basic schools in urban and rural areas.29 Two strategies will be usedfor the provision of the basic instructional materials: (a) distribution of the canasta basica forurban schools; and (b) provision of funds (district and school fund) to schools to purchaseinstructional materials. The first strategy is designed to benefit from economy of scale in thepurchase of the instructional materials; the second, to test the cost-effectiveness of purchasing and

27 EDUCO Study, op. cit.28 The provision of books will be complementary to SABE's provision of textbooks. Approximately every student

will receive, on average, one new textbook per year.29 The canasta bMsica will include items such as pencils, non-durable materials such as exercise books, education

toys, paper, pens, markers, scissors, rulers, etc., and will also be used to distribute nutritional supplements.

26

distributing instructional materials through the ACEs for the rural schools or school committeesfor selected urban schools. For the distribution of textbooks and the canasta basica to urbanschools not included in the pilot district and school fund program, MINED will use thedistribution system established under SSRP which involved the contracting of privatetransportation firms to carry pre-packaged textbooks and instructional materials from the centralwarehouses to the departments, and from the departments to the districts. The distribution planensures that the instructional materials will arrive at schools before the beginning of each schoolyear and new textbooks will arrive before the usable life of existing textbooks expires.

3.16 Subcomponent (2.c) In-service teacher training system (US$10.8 million). Currently,with the support of the SABE Project, several in-service teacher training activities have beendeveloped to support curriculum implementation. MINED developed 90 schools as EducationTraining Centers (Centros Educativos de Capacitaci6n - CECs) to act as in-service training unitsor resource centers on an experimental basis. The impact of these activities has been limited dueto the lack of pre-service training programs for basic education teachers, and a lack of asystematic approach to improve the quality of the teacher training programs. The project willsupport an integrated/decentralized training system, to consist of gradually phasing in threeTeacher Training Centers (Centros de Capacitaci6n de Maestros - CCMs) into existingeducational facilities, and transforming the CECs into Model Schools for Education Development(Escuelas Modelos de Desarrollo Educativo - EMDEs) which will function as in-service trainingand pedagogical resource centers.

3.17 In addition, MINED will conduct assessment studies of the teacher pre-service trainingprogram developed by private/public institutions to address policy options to improve the qualityand efficiency of these programs.

3.18 The project will support technical assistance and training activities. Technical assistancewill be provided for: (a) the design of plans and programs for in-service teacher trainingprograms; (b) the design of a systematic assessment system to identify in-service training needsfor preschool, and basic education levels; (c) the production of training modules and evaluation ofoutcomes; and (d) the development of an assessment study of the pre-service training needs forbasic education and preschool teachers. Training will be developed as: (a) seminars for teachersworking in the EMDEs (80 hours); (b) programs offering specialized courses for: (i) preschoolteachers (80 hours), (ii) basic education teachers (grades I to 9) (80 hours), (iii) EDUCOmultigrade teachers (120 hours), (iv) school principals (80 hours), and (v) supervisors (120hours); and (c) follow-up teacher training at the EMDEs through 12 workshops per year,supported by the district supervisors. The training of supervisors will be linked with a morepedagogical role of supervision (see para. 3.28(d)).3 ° The project will also provide: (a) funds forcontracting out selected content/pedagogical training programs to universities or research centers;(b) furniture, equipment and rehabilitation of facilities to be used as the CCMs and the EMIDEs;and (c) specialized training libraries at the EMDEs.

3.19 The National Directorate of Education (Direcci6n Nacional de Educaci6n - DNE) will beresponsible for establishing national teacher training guidelines. Training activities will be carriedout by the CCMs which will be responsible for: (a) developing teacher training programs for

30 Hours of training are the numnber of training hours per teacher per year.

27

preschool and basic education teachers; (b) supporting the in-service teacher training programs tobe implemented by the EMDEs; (c) preparing teacher training instructional materials, and pilottraining prograns; (d) contracting out content/pedagogical training programs to universities andother private institutions; and (e) monitoring teacher training programs. The trainingprofessionals, currently working at the regional departments of education (about 12 in each ofthe regional training units), will form the basic staff of the CCMs. To allow full participation oftrainees and minimize travel time and costs, training will be decentralized primarily to the 238local schools (EMDEs) selected to function as in-service teacher training and resource centerswhich will be responsible for implementing the in-service training programs with the support ofteacher trainers prepared by the CCMs. Additionally, teachers trained under the USAID-supported Basic Education Leadership Training Program (Capacitaci6n de Lideres de Educaci6nBdsica - Becas CAPS) will be assigned to each of the schools in the network to function asanimators of the in-service teacher training activities.

3.20 Beneficiaries of the training program will be all the public preschools (approximately2,300 teachers), basic education schools (approximately 24,000 basic education teachers in grades1 to 9 and approximately 2,150 teachers working in the EMIDEs), approximately 6,500 schoolprincipals, and approximately 250 supervisors.31 Over the life of the project, each public schoolteacher, including EDUCO teachers, will receive an estimated 420 hours of additional trainingboth at the CCMs and in the EMDEs.

3.21 Subcomponent (2.d) Education assessment system (US$3.0 million). Under the SABEproject, MINED began using achievement tests to assess the impact of the new core curriculumfor grades 1 to 6. With the assistance of a local university/research center, MINED CurriculumDirectorate staff will continue developing this system on a nationwide basis. The localuniversity/research center will be selected no later than January 30, 1996 (para. 7.3(a)). Thesystem of external evaluation will test, each year, a nationally representative sample of thosestudents finishing each cycle of the basic education system (grades 3, 6 and 9) on Spanish andmathematics. Additionally, readiness tests will be administered at the beginning of first grade andat the end of third grade. To cover the whole learning evaluation process, a survey on the impactof associated factors that might impact the learning process will be applied to the sample ofschools selected. Three major criteria would be considered in the sample selection: (a) type andsize of school according to official typification; (b) source of funding (public, private andpublic/private); and (c) geographic area (department, rural, urban and urban-marginal areas).

3.22 Considering the lack of experience in the country in carrying out achievement tests on apermanent basis, this subcomponent would provide: (a) technical assistance for: (i) furtherdeveloping the existing system, including the preparation of tests, and implementing it in a sampleof schools on a nationwide level, and (ii) designing of training programs for the development oftechnical skills for both the local university/research center staff and MINED staff membersresponsible for the coordination of the evaluation assessment system; (b) funding for equipment,office furniture and operating costs for an external evaluation unit (university/research center); (c)the production and implementation of a sample of language and mathematics achievement tests,and a survey to determine the impact of selected associated factors to the learning process forgrades not covered by the SABE Project; and (d) supplies, materials and computer services. The

31 Some teachers will receive training in more than one modality.

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pedagogical evaluation will be complemented with management evaluation and pilot exercises(see para. 3.28(c)).

3.23 Subcomponent (2.e) School health and nutrition program (US$1.5 million). Theobjective of this sub-component is to improve the quality of education by increasing the learningcapacity of children via improvements in health and nutrition. The component will supportinterventions and activities to: (a) increase knowledge and change practices related to nutritionand health in the school community; (b) prevent and treat significant nutrition and health problemsof school-aged children; and (c) evaluate the on-going school feeding program while identifyingand testing alternative school feeding models for the municipios with the most poverty.

3.24 The school nutrition and health measures will be built on the activities developed by MOHand MINED in the 78 targeted municipios under the SSRP. The proposed component willcontinue and improve upon these activities and expand them to 135 targeted municipios (seeAnnex 6). The specific measures include: (a) incorporating nutrition and health education into theformal curriculum, as well as developing and implementing non-formal approaches to health andnutrition education; (b) providing vitamin A and iodine supplements, and anthelminthic treatmentthrough the schools to 400,000 children in the first two years of the project; (c) identifyingvisually and hearing impaired children and taking remedial action; (d) implementing a pilot test ofproviding school-based iron supplementation; and (e) developing alternative school feedingprogram mechanisms to overcome logistical and other difficulties in on-going programs.

3.25 The subcomponent will be implemented in close coordination with MOH and the NationalSecretariat of the Family (Secretaria Nacional de la Familia - SNF) which is in charge of foodprograms.32 A coordinating mechanism will also be established between MINED, MOH, andNGOs or other private organizations for supporting sub-component implementation, mainly in therural areas through the canasta basica. Prior to the negotiations, MINED provided the drafttechnical agreement model and coordinating mechanisms between MINED, SNF, and MOH toimplement this subcomponent.

(3) Component 3 - Institutional Modernization and Strengthening (US$13.3 million or 17percent of total costs)

3.26 The main objective of the institutional modernization component is to carry out institutionalmodernization and strengthening of the education sector. The policies and activities of thiscomponent will be consistent with the reforms in other sectors as part of the Government's PublicSector Modernization Action Plan which will be implemented with the technical and financialsupport of the IBRD, IDB and other donors through a proposed Public Sector Modernizationproject (see Annex 5). As presented in the Social Assessment (Annex 4), the participation ofstakeholders will be critical to develop a sense of ownership that will be the base on which thereform would be successfully built. Seminars with representatives of the different stakeholdershave been one of MlNED's strategies to build up consensus for the reform. Advancement of theoverall public sector reform and results of the report of the High Level Commission forEducation, Science and Development (para. 2.42) may cause changes that will have to beincorporated during project implementation.

32 The SNF wiUl pay for the school food program.

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3.27 Subcomponent (3.a) Modernization of MINED (US$11.4 million). This subcomponentwill address the changes needed in MINED by: (a) designing a new organizational structure forMINED and revising the legal framework of the education sector to support education activitiesat the school and community levels; (b) implementing the new MINED organization structure,including improving MINED management mechanisms in the areas of planning, information,communication, evaluation and monitoring systems and the introduction of a more soundincentive system; (c) revising the performance incentive system for teachers, principals,supervisors, and technical staff, (d) improving the supervision system; and (e) establishing a staffdevelopment program to improve the technical capabilities of managers, technical/pedagogical,and administrative staff to support improvements in the provision of education services. Underthis subcomponent, the project will provide: (a) technical assistance and consultant services for:(i) reviewing MINED's legal and organization structure; and (ii) completing the design andimplementing the planning, information, communication, evaluation, and monitoring systems; (b)funds to carry out staff development activities; (c) a review of the incentive structure for teachersand technical staff, (d) public campaigns and communication activities, including annually updatedcommunication strategies and their use by the media; and (e) operating costs for developing thedecentralized activities, and equipment, materials and supplies.

3.28 The implementation of actions to foster policy development and changes on a long-termbasis will be based on the review of MINED's organizational structure and legal framework. Theinstitutional reforms to be carried out by a national technical group would be supported bytechnical assistance and training provided under the project. The main activities planned include(see Annex 9 for more detail):

(a) Reorganization of MINED structure, and decentralization of educationactivities. Education services will be decentralized to the department/district andschool levels with the elimination of the current regional organization. MINED'srole under the new organization will consist of providing general direction, settinggoals and priorities, establishing quality standards and pedagogicaVadministrativelegal norms and regulations, and evaluating the public and private educationsystem. Its major activities will be: (i) the definition of policies, education goalsand program objectives; (ii) the definition of targets, budget and staff posts foreach department/district and school; (iii) establishing basic curriculum content, andquality standards for teacher training programs, textbooks, instructional materialsand assessment of learning achievements; (iv) undertaking systematic evaluation ofstudent learning achievement and impact evaluation of education programs; (v)determining physical investments; (vi) defining standards for recruitment of bothteachers and administrative staff, and establishing career planning services andincentive systems for both teachers and administrative staff, (vii) the control ofcash flows, and accounting and budgeting at the national level; (viii) procurementactivities, when justified by economies of scale, distribution costs, and timeliness ofdelivery; and (ix) monitoring of departmental activities. The Departments,organized as small and responsive offices, will be responsible for administering thehuman, physical and financial resources at their level and for coordinating districtsupervision activities. The Supervision districts will be responsible forcoordinating activities and processes between the schools and the department in

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terms of teachers, textbooks, school materials, school meal programs, collectinginformation on public and private schools within their jurisdiction, and providingtechnical assistance to schools and teachers for solving administrative andpedagogical problems, the latter with the support of the EMDEs. The schoolswould be able to: (i) provide quality education services; (ii) prepare their schooleducation plans (Plan Educativo Escolar - PEE); (iii) administer their financial andmaterial resources; (iv) select qualified teachers; (v) generate data and indicatorsregarding the results of their operation (e.g. data on promotion, repetition,desertion and coverage33 ); and (vi) administer funds for small purchases.

(b) Teacher and technical staff performance incentive system. To increase theeffectiveness of the MINED reorganization, it is necessary to combine it with astructure of incentives promoting excellence. In order to foster the establishmentof an adequate structure of incentives for all MINED personnel, the proposedproject will provide technical assistance and consultant services to: (a) revise theEscalaf6n Docente for teachers in the traditional system; (b) develop an improvedemployment policy for teachers in the EDUCO system; (c) revise the salarystructure for technical staff within the new organization of the Civil ServiceSystem to be defined under the Public Sector Modernization project; and (d)define new job descriptions. The program will also provide funds to foster theimplementation of the rationalization of personnel under the structure of MINED.

(c) Planning, management information, and evaluation systems will be improvedthrough provision of technical assistance, equipment and software to: (i) expandthe education statistics database to all levels of education; (ii) support planning,budgeting, accounting and evaluation activities; (iii) track the distribution ofeducational materials through an inventory of facilities and equipment; (iv) supporthuman resource activities through an inventory of teachers and administrative staff(number, professional characteristics, location, vacancies) and student enrollmentinformation; and (v) conduct joint evaluations with external agencies to measurethe impact of education interventions, including an assessment of secondaryeducation. Training activities to carry out the planning, evaluation/monitoring andmanagement information systems will be provided under the staff developmentprogram (see para. 3.28(f)). To be consistent with the GOES program for PublicSector Modernization, priority will be given to the development of the HumanResources System (Sistema de Informaci6n de Recursos Humanos - SU" andIntegrated Financial Management System (Sistema de Administracion FinancieraIntegrada - SAFI).

(d) Supervision. Supervision activities will be re-oriented in the direction of: (i)providing technical support to teachers and school principals; (ii) disseminatingresults of education program evaluation; and (iii) giving feedback to correctshortcomings in the education process. Additionally, to increase the professionalcapacity of the supervisors, the program seeks to achieve a qualitative change intheir functions by increasing the time employed in monitoring teaching activities

33 For analysis and comparison at the central level.

31

and by reducing their strictly administrative responsibilities. The supervisionsystem will be improved through the provision of: (i) technical assistance to reviewthe supervision system and the incentive system for supervisors working in remoterural schools; (ii) training programs especially designed for the supervisors; (iii)per-diem, vehicles, office supplies and equipment for department and districtsupervisors; and (iv) assessment of the revised system.

(e) Communication Program. International experiences with education reformprojects in developing countries show that where insufficient attention was givento identifying real needs or to mobilizing demand for changes, innovations weredifficult to implement. Using these experiences, MINED has developed a series ofstrategies to guarantee education agents' participation in the education reformprocess. The social assessment (Annex 4), undertaken during project preparationto identify major education reform benefits and risks, suggests an action plan ofactivities to be developed by MINED to enhance public support for the educationreforms envisioned by the Government. The plan calls for the establishment of aneffective communication strategy as a key tool: (i) to guarantee public support forthe education innovations; and (ii) for the establishment of a communicationsystem to provide a permanent information channel within MINED, betweenMINED and the public and to receive feedback from the sector's stakeholders.The communication activities, which started during project preparation, willcontinue through project implementation to inform and mobilize the participationof parents, teachers, students, and other stakeholders. The communicationprogram will use social research techniques, particularly the 'focus groups"technique, and mass media publicity, in the design, execution and monitoring of theprogram. MI4NED's communication structures will be strengthened to facilitatethe fulfillment of their coordinating and monitoring roles. The project will provide:(a) technical assistance for: (i) organizing focus groups with different stakeholders;(ii) monitoring and evaluation; and (iii) design of public campaigns; (b) equipmentand operation costs; and (c) school and public campaigns.

(f) Staff development program. A review of the international literature shows thatsuccessful education reforms, involving decentralization of tasks, should includetraining for both central administrators and local implementors. Technical andmanagerial training must be provided not only for those to whom responsibility isbeing transferred, but also to central officials who will have to learn how tosupport local implementors more effectively. The design and implementation ofthe staff development program will follow MINED's reorganization to improve, ina timely and coordinated way, the skills of administrators andtechnical/administrative and pedagogical personnel required by the institutionaldevelopment process. The staff development program will be provided through 15courses, 10 seminars, and 15 scholarships for short courses specializing ineducation policy analyses, information, planning, budgeting, educationmethodology and human resources management. As a condition for IBRDdisbursements for the modernization component MINED will present the workplan for the staff development activities (para 7.6(a)).

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3.29 Implementation Strategy. The implementation of the new MINED organizationalstructure, including new planning, information, supervision and evaluation procedures, will betested initially in three departments, which will serve as prototypes of the new structure. Theredistribution of functions and roles between levels, across all systems, and the strengthening ofmanagerial capacity at all levels, will be implemented in their entirety in the pilot departments.Only after testing and evaluating the pilot experiences will implementation be extended to theremaining departments. This strategy will allow for the control and simultaneous testing ofproject components, particularly the new modalities of delivering education services and the newfunctions envisioned by the education reform. The departments of Ahuachapan, Cabanas, and LaUni6n were selected to participate in the pilot experiment based on the following criteria: (a) theirphysical and institutional infrastructures; (b) the existence of a sub-regional structure; (c) thedepartment's geographical extension; (d) the existence of human resources; and (e) demand foreducation services. The preparation, development and evaluation of the pilot decentralizationactivities are expected to be carried out in ten months, and the expansion for the new departmentsin 15 months (see Annex 9). MINED will establish, under the Modernization Manager'ssupervision, a Management Modernization Unit (MMvIU), in charge of managing thesubcomponent. The MMU will be responsible for: (a) implementing the pilots in the selecteddepartments; (b) promoting and coordinating changes at the central level; (c) selecting staffresponsible for implementing the reform in the departments; (d) coordinating studies to supportthe organizational development activities and modernization of the legal framework; and (e)coordinating MINED's activities with the groups involved in the public sector modernizationproject. During negotiations, terms of reference and a schedule for the modernization ofMINED, including key staff at the department level, were agreed (para. 7. I(a)).

3.30 Subcomponent (3.b) Pilot Basic Education Fund Program (US$1.9 million). As partof the principles of the Education Reform, MINED needs to explore various methods ofdelivering education services, in order to improve the quality and efficiency of the public andprivate sectors. Innovative methods of combining the public and private sectors in the provisionof education services can eventually be adopted on a broader scale within the modernization ofthe education sector but they need to be identified and tested. A pilot fund to develop educationinnovations will be set up to support new initiatives in the education reform process. The mainobjectives of this fund are to: (a) test alternative methods of providing basic education throughthe municipios, NGOs or other non-profit private institutions; (b) establish a more substantial andincentive-driven financing mechanism for piloting school-oriented interventions to solve particularadministrative and/or learning/teaching problems; (c) make provision for future public educationinitiatives in the areas of pedagogical innovations and institutional modernization which cannot beanticipated or launched immediately; and (d) disseminate the pilot results. Four principlesunderlie the design and organization of the Pilot Basic Education Fund Program: (a) ensuring thateducation innovation in pedagogical and administrative areas to provide education programs aredesigned according to the priority needs of implementing the education reform; (b) ensuring thatfunds to increase access and quality of education are used effectively; (c) pursuing efficiency inthe use of human/financial resources in the sector, thus avoiding duplication of effort; and (d)providing support for the implementation of the reform program and the decentralization process.

3.31 During project implementation, the subcomponent will finance at least four innovativesubprojects that contribute to improving the quality, efficiency, and coverage of preschool andbasic education in the country. The subcomponent will provide: (a) financial resources for

33

identifying and implementing the approved subprojects; (b) support to establish a monitoringsystem to follow-up the education interventions financed by the program; (c) support to fullyevaluate all subprojects funded; and (d) assistance to disseminate the results of the evaluations.By the end of the project, MINED will have developed a funding mechanism to continuesupporting the education innovations piloted during the proposed project that have been evaluatedas being relevant and successful.

3.32 Organization and Administration. The subprojects submitted for financing would bepresented twice a year to a Review Committee which would analyze, rank and recommendapproval of the subprojects according to established criteria.

3.33 Based on the Education Reform Project principles and guidelines, the Minister and ViceMinister of Education will supervise the Fund. They will be responsible for: (a) establishing thegoals and policies of the Fund; and (b) defining the Fund's classification system based onconsiderations such as coverage, quality, efficiency, focus, and cost. The factors for considerationwill reflect the priorities of MINED policies and will be established annually during the ProjectAnnual Review. The Review Committee will evaluate each one of the proposed pilot subprojects.This Committee will be formed by five voting members: the Project Coordinator, who will presideover the Committee, the Manager of OPCI, and the three Project Component Directors. Expertsin subjects related to the specific subproject proposals could be invited when deemed necessary.Each proposal will be classified and evaluated according to the classification system for that year,and points will be assigned to each one of the five areas (coverage, quality, efficiency, focus ofobjectives, and cost). The subproject with the largest number of total points will be selected. The'ho objection" of the Banks is a pre-requisite for the final approval of the proposed subproject.Once a proposal is approved, a technical agreement (convenio) between MINED and therequestor will be signed whereby the former agrees to disburse the resources approved under theproposal, and the latter agrees to implement the proposed project. As a disbursement conditionfor IDB for this subcomponent, the Operational Manual for the Fund, including the eligibilitycriteria, will be agreed with the Banks and put in place by MINED (para. 7.7(b)).

4. PROJECT COSTS, FINANCING, PROCUREMENT, DISBURSEMENTS ANDAUDITING

A. Project Costs

4.1 The total project cost, including physical and price contingencies and taxes, is estimated atabout US$80.2 million, of which about US$37.3 million will be foreign exchange. Taxes amountto about US$4.4 million. Investment costs amount to 91 percent of base costs and incrementalrecurrent costs amount to 9 percent of base costs (Annex 11). Project costs were estimated atJuly 1995 price levels and include physical contingencies of 10 percent for civil works and 5percent for equipment, furniture, and didactic materials. Price contingencies were calculated at1.8 percent for 1995 and 1996, 2.4 percent for 1997, and 2.5 percent annually thereafter. Theserates have been applied to local and foreign costs as well, as periodic currency rate adjustmentswould compensate for the difference between projected US dollar inflation and local inflationrates.

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4.2 Estimated costs of equipment, furniture, textbooks and didactic materials are based on unitprices of goods procured recently by MINED. Estimates for technical assistance and studies arebased on current rates for local and foreign experts. Cost estimates for training, salaries andoperating costs are based on current costs or costing standards used by MINED. Estimatedconstruction and rehabilitation costs of schools and administrative buildings throughout thecountry are based on current FIS unit prices that derive from periodic cost analyses for similarstandards of construction in corresponding facilities.

Table 6.f Components Project Cost Summaiy (US$ million) _ _:_______

Component Local Foreign TotalExpansion of Access to Preschool and Basic Education

Expansion in the Rural Areas 3.2 2.1 5.3Strengthening the EDUCO Program 5.9 0.1 6.0

Subtotal 9.1 2.2 11.3Improvement in Education Quality

Curriculum Improvement 0.6 0.6 1.2Textbooks and istrutional Materials 7.5 21.3 28.8In-Service Teacher Trainig System 8.5 1.0 9.5Education Assessment System 1.5 1.4 2.9School Health and Nutriton Program 1.0 0.6 1.6

Subtotal 19.1 24.9 44.0Institutional Modernization

Modernization of MINED 5.6 3.6 9.2Communications 0.9 0.4 1.3Basic Education Fund Program _1.9 0.0 1.9

Subtotal 8.4 4.0 12.4Project Coordination and Management 2.6 1.9 4.5Total Baseline Costs 39.0 33.2 72.2

Physical Contingencies 1.3 1.4 2.7Price Conigencies 2.6 2.3 4.9

IDB Loan Inspection and Supwvision (FIV) l 0.4 0.4

Total Project Costs r43.1 _37.1 80.2

Note: Interest and financial costs will be paid directly by the El Salvadoran Government.

Incremental Recurrent Costs

4.3 During the implementation period, the project will add an average of about US$1.5 millionper year to the recurrent expenditures budget of MINED. These incremental operating costs wouldbe generated mainly by salaries for staff at the departmental levels, incremental personnel at the centrallevel, travel expenditures, and operation and maintenance of infrastructure, equipment, vehicles,furniture, and office supplies. Over the life of the project incremental recurrent costs generated bythe project are estimated to grow from US$1.1 million in the first project year, to US$1.6 millionin the last year. The recurrent costs would be financed by GOES increasingly during the life ofthe project. Recurrent costs under the project, in July 1995 US dollars, are estimated as follows:

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US Million 1995/96 1996/97 1997/98 1998/99 1999i00GOES 0.11 0.15 0.62 0.62 1.06IBRD 0.85 1.07 0.84 0.82 0.45IDB 0 18 026 0.12 0.11 0.04

TOTAL 1.14 1.48 1.58 1.55 | 1.55

The effect of the recurrent costs on MINED's budget is small and could be easily absorbed byMINED. Based on MINED's ordinary budget for 1995 (excluding investments) of aboutUS$184 million, and the projected budget increments equivalent, at least, to the projected annualgrowth of GNP (7 percent real for next five years), the impact of those costs on the MINEDordinary budget would be 0.06 percent, 0.07 percent, 0.27 percent, 0.25 percent, 0.41 percent,for the successive years of implementation of the project. Savings accruing to MINED fromincreased efficiency and reduced repetition waste should amply compensate for higher incrementalrecurrent costs.

4.4 The recurrent costs associated with the GOES program to introduce a better incentivesystem for teachers including improvements in teacher salaries are not part of the projectrecurrent costs. To accomplish the objective of the education reform, the public sector has togenerate revenues and provide them to MINED in order to: (a) cover the incremental recurrentcosts associated with the proposed project investment plans; (b) pay for the enrollment incrementprogram; (c) improve teacher real salaries; and (d) pay for the expected growth of actualexpenditures that would occur without additional expansion programs. In order to fulfill thesegoals, it has been estimated that the education budget will need to reach 2.7 percent of GDP bythe end of the century.34 The Government expects that total revenues will reach 19 percent ofGDP in 1999. If this target is reached, it will not be necessary to raise the share of educationexpenditure in the total central Government expenditure. But any figure lower than 19 percent intotal revenues would imply that the efforts on education should be pursued at the cost of othersectors. The Government has made a clear and public commitment to devote the required fundsto develop an extensive and efficient education sector (Annex 18).

4.5 In addition, teacher salaries associated with the expansion of services to rural areas are notincluded in the project costs. The Government's decision to continue to fund all new EDUCOteachers with funds allocated to MINED reflects its commitment to increase basic educationexpenditures. It is estimated that the total MINED contribution for teacher salaries during theproject period for the new EDUCO sections will amount to about US$3.7 million annually.During negotiations, the Government provided assurances that the required funds forincremental teacher salaries as established in the annual work plans (para. 5. 10) would beincluded in the MINED budgetfor the following year (para. 7.1(b)).

34 If economnic growth is lower than expected (3 percent), increases in the education budget could be as high as 3.3percent. Nevertheless, under these adverse circumstances it would be expected that growth in all publicexpenditure and investment will also slow down.

36

B. Project Financing

4.6 The World Bank, the Inter-American Development Bank and the Government of ElSalvador will finance the project. To allow flexibility and clarity in the choice of cost items to befinanced by each of the external cofinanciers, the proposed financing plan is articulated accordingto the project's sub-components. Also, to allow flexibility in the percentages of financing, eachsub-component is divided in investment costs (including civil works, vehicles, equipment,furniture, didactic materials, technical assistance and training), financed by both Banks at equalpercentages for the same items, and recurrent costs (including incremental salaries, long-termconsultants, travel allowances, operation and maintenance of infrastructure, equipment andfurniture, and operating costs), these items being financed, on a declining basis, by the externalcofinanciers. Table 7 lists the proposed financial arrangements.

Table 7. Components byFinanciers (US$ miillion) a~

GOES IBRD IDB TotalExpansion of Access to Preschool and Basic Education

Expansion in the Rual Areas 0.8 5.2 6.0Strengthening the EDUCO Program 0.0 6.5 6.5

Subtotal 0.8 6.5 5.2 12.5Improvement in Education Quality

Curriculum Improvement 0.1 1.3 1.4Textbooks and Instructional Materials

Textbooks 1.9 17.9 19.8Instructional Materials 1.3 11.4 12.7

In-Service Teacher Training System 1.3 9.5 10.8Education Assessment System 0.0 3.0 3.0School Health and Nutrition Program 0.2 1.3 1.5

Subtotal 4.8 17.0 27.4 49.2Institutional Modernization

Modernization of MINED 1.8 8.1 9.9Communications 0.2 1.3 1.5Basic Education Fund Program 0.2 1.7 1.9

Subtotal 2.2 8.1 3.0 13.3Project Coordination and Management 1.1 2.4 1.3 4.8IDB Loan Inspection and Supervision (FIV) _ 0.4 0.4Total Disbursement 8.9 34.0 37.3 80.2a Costs include contingencies. Interest and financial costs are not included.

4.7 Given the project's major emphasis on serving the education needs of the poorestsegments of the population, the Government's contribution to the financing would be reduced toabout 11 percent of total costs, while the share of each of the external cofinanciers would be 42percent for the IBRD and 47 percent for the IDB. Taxes and duties (approximately US$4.4million), and a portion of the local costs of recurrent costs would be financed by the Government.The IBRD Loan of US$34.0 million would finance 38 percent of foreign exchange expenditures,and 51 percent of local expenditures. The IDB Loan of US$37.3 million would finance 61percent of foreign expenditures and 37 percent of local expenditures. To ensure timely andefficient project implementation, some start-up activities, particularly those related to contractingof technical assistance for the institutional modernization component, are now being undertaken.

37

Retroactive financing of up to US$300,000 would be requested from each Bank to help covereligible start-up expenditures.35

4.8 GOES is eligible to receive single currency loans and anticipates borrowing US$115million from IBRD on a single currency loan basis during FY96, including US$34.0 million forthis project. The loan would be a US dollar single currency loan for 17 years, including 5 years ofgrace, at the IBRD's standard LIBOR-based rate for such loans.

4.9 Project Financial Monitoring. MINED's Office of International Cooperation Programs(Oficina de Programas de Cooperaci6n Internacional - OPCI) would be responsible formanaging and monitoring the project's flow of funds. Though OPCI has had wide experience inexternally-financed projects, a recent survey identified some bottlenecks in the area of accounting,and a still extensive flow of funds cycle. To remedy this situation, and to enable OPCI to be fullyoperational at the project start, the following action plan has been adopted: (a) a joint analysis ofthe flow of funds cycle with every entity intervening in this process (mainly the External FinancingTechnical Secretariat (SETEFE) and the Corte de Cuentas), to identify steps to be eliminated; (b)internal reorganization and streamlining of OPCI's present structure, eliminating inefficiencies andreinforcing identified weak points; (c) preparation of a computerized financial data processingsystem, which will allow integration with the future 14 departmental offices (who wouldeventually maintain their own accounts) and with SETEFE (to accelerate the disbursementprocess); and (d) adoption of cost accounting, ensuring a better monitoring of the accounts andthe flow of funds. This action plan has already been initiated, and all actions to be taken andinvestments to be made would be financed through the SSRP. This action plan is expected to beachieved by the end of December 1995, when it will be assessed by a joint IBRD-IDB mission.The completion of the OPCI action plan satisfactory to both Banks will be a condition ofeffectiveness for IBRD and a condition of disbursement for IDB (paras. 7.4(a), 7.7(c)).

4.10 Revolving Fund in Local Currency. Improvements in the procurement process shouldimprove the quality of the accounting procedure, but also improve the project's cash flow, byreducing the flow of funds cycle from the present level of six to seven months to an expectedcycle of three to four months. It is thus necessary to give to the project the necessary liquidity tooperate during the four first months of project activities, before the IBRD Special Account (heldat and managed by the Central Bank) can operate (see para. 4.27). As was accepted at the startof the SSRP, a Revolving Fund, operated by OPCI, would be opened in the name of the project,with an initial deposit of about US$2.5 million, from the Government as its up-front participationto the project financing. The effective creation of this Revolving Fund would be a condition ofIBRD loan effectiveness (see para. 7.4(b)).

C. Procurement3 6

4.11 The project would include procurement of construction and rehabilitation of schoolinfrastructure, textbooks and other school library and reference books, manuals and guides for

35 IBRD retroactive financing will cover expenditures made on or after March 15, 1995. IDB retroactive financingwill cover expenditures six months prior to Board Approval.

36 A detailed explanation of the ad hoc procurement procedures will be included in the Loan Agreement between the IDBand the Government

38

teachers and students, educational materials, school furniture and other furniture, vehicles, andconsulting services for studies. Procurement of civil works, goods and services would follow theprocurement procedures agreed with each Bank. The procedures of both Banks are similar, butnot identical. An effort was made to establish similar limits to facilitate MINED's management ofprocurement processes. Procurement for IBRD-financed contracts would be carried out inaccordance with guidelines for procurement of January 1995. Procurement procedures for IDBwould be carried out in accordance with guidelines for procurement of September 1994 and adetailed explanation of ad-hoc procurement procedures will be attached to the loan agreement forthis project to be signed by GOES. MINED staff acquired substantial experience in handlingnational and international shopping procedures and preparation of technical specifications duringimplementation of Loan 3348-ES. MINED would continue to be supported by a procurementagent, and by qualified staff trained under the SSRP project and experienced in IBRD'sprocurement procedures. In addition, OPCI would be further strengthened to ensure acceptableprocedures under the distinct guidelines of the two Banks by contracting one specialist to handleprocurement in IBRD-financed contracts and one for IDB-financed contracts. Detailed projectprocurement and disbursement procedures to manage procurement and ensure acceptableprocedures of IBRD and IDB would be included in the Operational Manual to be used by allrelevant project executing units. A draft of the Manual would be presented to the Banks forreview in December 1995, and the Manual must be put in use as a condition of IBRD loaneffectiveness (paras. 7.4(c)).

4.12 All procurement under international competitive bidding (ICB), national competitivebidding (NCB), and contracting of international consultants and consulting firms will be initiallyundertaken by a procurement agent. MINED would continue to undertake procurement done bynational and international shopping and direct contracting. A signed contract with a procurementagent would be a condition for IBRD effectiveness (para. 7.4(d)). Fees for procurement agents'services would be financed under the project. For ICB and NCB, the procurement agent woulduse the standard bidding documents (SBDs) to be issued by the Banks, with such modifications asagreed by the Banks to be necessary for the purpose of the project. For the purpose of comparingforeign and national bids for goods during ICB evaluation for IBRD financed contracts, nationalmanufacturers would be allowed a margin of preference in accordance with IBRD guidelines. Inall procurement carried out by NCB, foreign bidders would be allowed to participate. Prior tothe negotiations, MINED prepared draft standard bidding documents, including modified ICB-2stage documents for library books to be financed by IBRD. Final documents would be put inforce by loan effectiveness.

4.13 Procurement arrangements under both Banks are summarized in Table 8 below.

Civil Works

4.14 IDB would finance all civil works. Civil works are comprised of construction andrehabilitation of classrooms, rehabilitation of up to three teacher training centers and of a fewsmall administrative buildings throughout the country, mainly in small cities, which would amountto about US$6.6 million. All civil works would be carried out under a management agreementwith FIS following IDB standard procedures. As an executing agency for IDB's financed loans,FIS has acquired substantial experience in the procurement of these contracts and in itsprocurement norms and procedures. Packaging of works contracts would be encouraged, but is

39

not mandated to ensure competition and interest by local contractors. ICB procedures would beused only when packages of works exceed US$1.0 million, although no contract of this size isexpected. Contracts costing US$250,000 or more would be done by NCB. Works expected tocost less than US$250,000 would be done by private bidding procedures requiring invitations toat least five contractors/suppliers. Direct contracting in scattered distant rural areas would becarried out for works below US$100,000. Foreign bidders' participation is not expected due tothe small amounts and scattered locations of the construction or rehabilitation works. A signedagreement between FIS and MINED for the management of infrastructure and rehabilitation waspresented prior to negotiations.

Textbooks, Teachers' Manuals, and School Furniture

4.15 IDB would finance procurement of textbooks for grades 1-6, teachers' manuals, schoolfurniture and printing of textbooks for grades 7-9, and distribution services for these materials.Procurement of goods and services costing US$150,000 or less would be done using privatebidding procedures37 , with invitations to at least five suppliers. In the case of specializedpublications, direct purchase would be allowed. NCB procedures, acceptable to the IDB, wouldbe used for procurement of goods costing between US$150,000 and US$250,000. ICBprocedures would be used for goods costing more than US$250,000. Procurement throughprivate tender and NCB procedures would be open to international suppliers.

Educational Materials, Library Books, Office Furniture and Office Equipment

4.16 IBRD would finance the procurement of library and reference books, laboratory kits andeducation packages (canasta bdsica) for preschool and basic education students, printing servicesfor instructional booklets for students in preschool and multigrade classes, and distributionservices to transport these materials to the local level offices. In addition, some office equipmentand furniture would be procured. Library books would be procured following ICB-2 stageprocedures, using modified ICB standard bidding documents. NCB would be used to procurepackages of goods equal to or less than US$250,000, up to an aggregate limit of US$600,000.National or international shopping, from at least three qualified suppliers, would be used forpurchases equal or below US$50,000, up to an aggregate of US$1.4 million.

Vehicles

4.17 The project would also finance the procurement of vehicles. IBRD procurement ofvehicles, up to an aggregate amount of US$1.2 million, would be purchased using limitedinternational bidding (LIB) procedures acceptable to IBRD.

4.18 For the IDB, for purchases of vehicles costing more than US$250,000, MINED would useICB. NCB would be used for procurement of vehicles costing between US$150,000 andUS$250,000. Private bidding procedures with invitations to at least five suppliers would be usedfor vehicles costing less than US$150,000. Procurement through private bidder and NCBprocedures would be open to international suppliers.

37 One firm could not have individual contracts exceeding an aggregate amount of US$2.0 million.

Table & Proew~eme i Arran~ements Mn i C~INCRA ~ated ii Other (08$ millioA)''____________ _____..r_....

Category ICB NCB Other Consulting Services TotalIBRD . l)B IBRD IDB IBRD IDB IBRD IDB IBRD IDB

Civil Works 6.6' 0.0.' 6.6.- _____ . ______ .'_____ (5.9) . (0.0). (5.9)

Equipment, Vehicles, 0.6 0.8 0.4' 1.3 052 2.3. 1.3Furniture (0.6)- (0.8) (0.3). (1.2) (0.3) (2.1). (I. 1)Textbooks and 17.8 0.2 2 0 b3 0 0.0 20.0Manuals , (16.0) (0.2) . (1-7) . (0°0). (17.9)Other Educational I 1.9a. 0.2, 4 b1d' 13.5 0.0Materials (10.7).: (0.2), (1.3). . (12.2) (0.0).Micronutrients 1.2 1.2 0.0.

.__ _ _ _ _ _ .__ _ _ _ _ _ (1 .0 ). .__ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ (1 .0 ) (0.0 ).Training, Tech. Asst. 15.7' 10.0 15.71 10.0& Studies . . . (14.7) (9.6) (14.7). (9.6)Education Fund 194. 0,0. 1.9

.,_____ .______ '._____ (1.7) ,. (0.0). (1.7)Salaries and 6.2 f. 1.1 6.2, 1.1Operating Costs i i (4.0) (0.7) i (4.0), (0.7)IDB Inspection and 0.4 0.0. 0.4Supervision . . (0.4) . (0 0)- (0.4)Total 12.5, 18.6 0.6 0.2 10.1. 12.5 15.7. 10.0 38.9. 41.3

(11.3)'. (16.8) (0.5) (0.2) (7.5). (107) (14.7): (9.6) (340) (37.3Note: Figures in parentheses are the respective amounts financed by each Bank.ICB - International Competitive Bidding; NCB - National Competitive Biddinga Includes US$3.1 million for library books to be procured under ICB-2 stage procedures.b Includes US$0.2 million for internal distribution costs.c Includes US$1.2 million for vehicles to be procured under limited international bidding.d Includes US$1.2 million procurement of materials to be purchased directly by parent associations (ACEs) with funds transferred by the centralgovernment to the schools.

e Procurement will be done through limited international bidding. Includes US$0.1 million for distribution costs.f Includes about US$600,000 for consumable office supplies that would be purchased using national shopping procedures.' Procurement procedures will be those used by the Social Investment Fund under the current IDB loan.2Procurcment will be done through private bidding (invitation to at least five suppliers).3 Includes printing of manuals for multigrade classes.4 Does not involve procurement.

tktwo4.xd

41

Micronutrients

4.18 IBRD would finance procurement, inspection and distribution services of micronutrientsto be under the nutrition pilot program.38 Procurement of these goods would be done followingLIB procedures. Procurement agents would ensure the selection of a list of internationallaboratories which meet World Health Organization (WHO) quality control requirements andoperate under ISO regulations. Micronutrients would be procured in two packages, amounting toapproximately US$1.2 million.

Technical Assistance and Studies

4.19 The project would finance technical assistance and consulting services to prepare studies,design and provide training, design instructional materials and communication campaigns, andother project support activities. The studies to be performed under the project include, but arenot limited to: (a) an assessment of pre-service teacher training needs; (b) an assessment ofsecondary education; (c) an evaluation of curriculum development; (d) an evaluation of themodernization/decentralization process; (e) an evaluation of the supervision system; and (f) anevaluation of the school feeding program and an assessment of alternative school feeding modelmethods. For the subcomponents financed by IBRD, individual consultants and consultant firmscarrying out technical assistance, including auditing services, would be hired following the IBRDGuidelines for the Use of Consultants by World Bank Borrowers and by the World Bank asExecuting Agency (August 1981). During appraisal technical assistance required to support thecomponents financed by the project were reviewed and agreed with each executing agency. Forcontracting studies and technical assistance services financed by the IBRD, all executing agencieswould use a standard invitation package and contracts as agreed with the IBRD, amended asrequired for the purposes of the project. Drafts of a standard invitation package and contractswere presented prior to negotiations. Final documents woul be put in place prior toeffectiveness. For the subcomponents financed by IDB, IDB's Standard Procedures forConsulting Services would be followed. ICB procedures would be used for consulting servicescontracts costing US$200,000 or more. NCB procedures, acceptable to the IDB, would be usedfor consulting services contracts costing between US$100,000 and US$199,999. Consultingservices contracting less than US$100,000 would be done through private bidding involvinginvitations to at least five contractors. Direct invitations and NCB procedures would be open tointernational consultants.

Costs not Involving Procurement

4.20 Approximately 11 percent of project costs, or about US$8.1 million would not involveprocurement. These costs include the education fund and operational expenses.

Review by IBRD

4.21 Prior review by the IBRD would be required for: (a) all annual procurement plans done byeach executing agency, including procurement agents; (b) procurement procedures and

38 Micronutrients are organic compounds essential in minute amounts to the growth and welfare of people, andinclude such things as vitamin A, iron, and iodine.

42

documentation for all tender packages and contracts for ICB and LIB, and tender packages forthe first contract during each year of project implementation for miscellaneous goods done underNCB, regardless of value. It is expected that these procurement arrangements would result inabout 52 percent of IBRD-financed contracts by value. All terms of reference for technicalassistance and studies would be subject to prior review by the IBRD. Documentation forcontracts with consultant firms, valued at US$75,000 and for individual consultants, valued aboveUS$3 5,000, would also be subject to prior review by the IBRD. These thresholds of prior revieware justified, based on a careful review of estimated costs and nature of consultant services whichare required by the project. All other documentation would be subject to ex-post review duringauditing and by IBRD supervision missions on a random basis.

Prior Review by the IDB

4.22 The IDB's Country Office would review the first contract for civil works, regardless ofvalue, and all supporting documentation for civil works and goods contracts valued atUS$250,000 or more. All other contracts would be subject to ex-post review by country officestaff, on the basis of random sampling.

Procurement Agents

4.23 NIvNED would enter into a one-year agreement with a procurement agent for theacquisition of goods and services financed by the project. The benefits of using a procurementagent, such as UNDP were evident in the implementation of the SSRP. The reasons to use aprocurement agent to assist MINED include: (a) MINED's limited capacity to manage extensiveprocurement procedures simultaneously; (b) the technical support available to MINED on a dailybasis resulting from a procurement agent chosen for its vast experience in the implementation ofprojects financed by international donors; and (c) the GOES/UNDP general agreement that grantsUNDP an exemption from value added tax and exempts UNDP from the jurisdiction of the Cortede Cuentas, allowing for an expedited procurement and contracting process. As a condition topresentation of the program to the IDB Board, MINED will present a satisfactory draft of anagreement between MINED and UNDP (para. 7.5(a)).

4.24 No recent Country Procurement Assessment on El Salvador is available. However, ElSalvador's procurement regulations clearly authorize, as a special provision, application ofprocurement procedures of international financial institutions in the procurement of works, goodsand services, where financing of such procurement comes from an international financialinstitution.

D. Disbursements

Disbursements of IBRD Funds

4.25 The proposed project will be implemented over a period of five years and is expected tobe completed by December 31, 2000 and closed by June 30, 2001. The proceeds of the IBRDloan would be disbursed during a five and a half year period as follows: (a) equipment furnitureand vehicles, 100 percent of foreign expenditures, and 90 percent of local expenditures for otheritems procured locally, excluding taxes; (b) didactic materials and library books, 100 percent of

43

foreign and 90 percent of local expenditures, excluding taxes; (c) staff training, technicalassistance, consultancy services, and studies, 100 percent of total expenditures, excluding taxes;(d) micronutrients and food supplements, 90 percent of total expenditures, excluding taxes; and(e) incremental salaries and local long-term consultant costs, travel and per diem costs,maintenance costs, and office supplies costs, at a rate of 90 percent until an aggregate amount ofUS$1.6 million has been reached, thereafter, disbursements for this category would be made at arate of 60 percent until the aggregate amount of US$2.5 million has been reached; and theremaining funds would be disbursed at a rate of 30 percent.

4.26 Proceeds of the proposed loan would be disbursed according to the schedule shown inAnnex 13 against expenditures that would be submitted to the IBRD and fully documented forcontracts valued at more than: (a) US$250,000 for goods; (b) US$75,000 for consulting firms'services; (c) US$35,000 for individual consultants' services; and (d) expenditures under category5 of the project. Claims for expenditures of lesser amounts would be disbursed againstpresentation of statements of expenditure (SOEs), for which the supporting documentation wouldbe retained by the MINED for inspection by the Banks and by external auditors. The Governmentwould set up a special account for the IBRD loan in US dollars with an initial deposit of US$2.5million. Withdrawals from the special account would be supported by the required documentationat the exchange rate prevailing on the date of expenditure. Separate project accounts may beestablished in MINED for each project executing agency and these would be monitored by OPCI.During negotiations, agreement was reached on the IBRD Special Account and on retroactivefinancing of up to US$300,000 to cover eligible expenditures for preparation and launching ofthe proposedproject incurred after March 15, 1995 (para 7.1(c)).

Disbursements of IDB Funds

4.27 The proceeds of the IDB loan would be disbursed during a five year period as follows: (a)civil works, 90 percent of expenditures for construction of classrooms and/or rehabilitation, repairand maintenance of existing classrooms, training centers and administrative buildings; (b)equipment furniture and vehicles, 100 percent of foreign expenditures, and 90 percent of localexpenditures for other items procured locally, excluding taxes; (c) textbooks, and manuals, 100percent of foreign and local expenditures, excluding taxes; (d) teacher training, technicalassistance, consultancy services, and studies, 100 percent of total expenditures, excluding taxes;and (e) incremental salaries and local long-term consultant costs, travel and per diem costs,maintenance costs, and office supplies costs, at a rate of 90 percent until an aggregate amount ofUS$0.4 million has been reached, thereafter, disbursements for this category would be made at arate of 60 percent until the aggregate amount of US$0.5 million has been reached; and theremaining funds would be disbursed at a rate of 30 percent. During negotiations, agreement wasreached on the IDB Special Account and on retroactive financing of up to US$300, 000 to covereligible expenditures for preparation and launching of the proposed project incurred afterMarch 15, 1995 (para. 7.1(d)).

4.28 Proceeds of the proposed loans would be disbursed according to the schedule shown inAnnex 13. Given the degree of preparation and the proposed implementation plan, it isrecommended that an advance equivalent to 10 percent of the proposed loan be approved to assistthe Government to implement project activities during first 120 days. The fund would bereplenished upon presentation by MINED of the required documentation. These funds would be

44

deposited in a Special Account that will be held at the Central Bank. Retroactive financing of upto US$300,000 to cover expenditures for the preparation and launching of the proposed projectincurred six months prior to Board Approval will be provided.

4.29 The procedures for the management of the Special Accounts and the revolving funds areincludes in a manual (Instructivo Unico) that would be reviewed and agreed among all theGovernment institutions involved. The draft manual was included in MvINED's proposal (seeAnnex 18).

4.30 OPCI, with the support of the relevant offices of both Banks, will prepare formats fordisbursements that will be adequate to comply with the requirements of both Banks.

E. Accounting and Auditing

4.31 MTINED would establish and maintain separate accounts and records for each loanadequate to reflect, in accordance with sound accounting practices, the resources andexpenditures related to the project. OPCI, at the central level, would maintain a consolidatedaccount of all resources and expenditures under the project. Other sets of records, one for eachoperating unit, OPCI at the regional level and parents' associations at the local level, would bemaintained by each unit, under supervision from the central level, and would reflect the resourcesand expenditures related to project implementation for their respective programs. Data from thethree OPCI regional operating units would be sent to the central level for consolidation purposes.These accounts would be audited annually by private independent auditors satisfactory to theBanks. The audit reports, which would include a separate opinion on the adequacy of statementsof expenditures as a basis of loan disbursements, and on the special account and the revolvingfunds, would be forwarded to the Banks no later than six months after the end of each fiscal year.To support the timely provision of audit reports, MINED will contract the auditing firm at thebeginning of each project year to be considered for the auditing exercise. To support the timelyprovision of audit reports, the private independent auditors would be requested to present mid-year progress reports. The annual audits would also cover a random sample of the records andaccounts maintained by parents' associations. During negotiations the Government providedassurances that MINED would: (a) have the records and accounts for each fiscal year auditedby independent and qualified auditors, in accordance with generally accepted auditing standardsand procedures; (b) furnish to the Banks as soon as available, but in any case not later than sixmonths after the end of each year, a certified copy of the agreed audit reports; and (c) furnish tothe Banks such other information concerning the records and accounts as well as the audit as theBanks wouldfrom time to time reasonably request (para. 7. I (e)).

5. PROJECT IMPLEMENTATION AND MANAGEMENT

A. Borrower, Guarantor and Executor for the Project

5.1 The borrower and guarantor of the loan will be the Government of El Salvador. MINEDwill be responsible for the execution of the project. An agreement between the borrower and theexecuting agency to transfer resources from the loan will be a condition for IDB disbursement

45

(para. 7.7(d)). MINED has experience in implementing programs financed by internationaldonors and its institutional capacity has been evident in the implementation of the SSRP, financedby the IBRD, and the SABE Project, financed by USAID, that are close to completion (early1996). The size of this loan will demand expanded management capacity within MINED for itsefficient implementation. The project provides adequate financing to guarantee that MINED willreceive timely, adequate technical support for project implementation. In addition, beforedisbursements begin, OPCI will complete an action plan to strengthen its capacity to manage andmonitor the project's flow of funds (see para. 4.8).

B. Project Organization

5.2 The project organization would have two levels: the central level, which would haveoverall responsibility for project coordination and implementation, and the decentralized levelwhich, throughout the project implementation period, would receive progressively moreresponsibility for the implementation and delivery of education services.

C. Project Management

5.3 Project implementation would be carried out within the existing organizational structure ofMINED through the Project Management Office which would be drawn from existing unitswhose operational and administrative responsibilities are directly linked to project components.Overall responsibility for implementation of the proposed project would be vested in the Ministerof Education who would be supported in general policy setting and institutional coordination by acommittee composed of the Vice Minister of Education (General Project Director) and ProjectComponent Directors.3 9 To facilitate project implementation, a Project Manager would beappointed. The Project Manager would report directly to the Vice Minister of Education on theday to day operations of the project, and would be responsible for calling the directors tocommittee meetings.

5.4 The Ministry of Education, through the Project Manager, would assist, coordinate,monitor and evaluate the activities through the following participating units, each under thedirection of a Project Component Director:

(a) The Quality Improvement Unit which would be responsible for the implementation ofthe quality improvement comrponent through its various administrative units. The mainresponsibilities of the unit would include: improvement of the basic educationcuniculum, production and provision of teaching materials and textbooks, in-servicetraining for teachers and supervisors, evaluation of student achievement, revision of thesupervision system and provision of nutritional and health programs through schools;

(b) The EDUCO Unit which would be responsible for the expansion of the model in ruralareas, and reorganization and strengthening of service delivery;

39 MINED directors involved in implementing project activities.

46

(c) A Management Modernization Unit (MM[) would be created which would beresponsible for the implementation of the Institutional Modernization Component. Themain responsibilities of the MMU would cover: changes and improvements in sectorplanning, administration, decentralized provision of services, evaluation, supervisionand monitoring, a review of the organizational structure and the legal framework, themanagement information system, and public awareness campaigns. The MMU wouldinclude a small Decentralization Unit whose main functions would be to carry out thedecentralization process, to provide support to the staff working in the decentralizedunits in all aspects of the operations; and

(d) OPCI which would be responsible for management of the procurement and financialaspects of the project. OPCI's main responsibilities would include: contractingprocurement agents, procurement of goods and services under shopping and directcontracting, maintaining the project's financial records and accounts, developing annualplans to be presented to the Ministry of Finance regarding national finance of theproject, including maintenance funds and teacher salaries, making transfers to theACEs, and making payments for goods and services required by the project.

5.5 The Project Management Office would manage the Pilot Basic Education Fund and deviseadequate mechanisms to ensure that the Fund reaches its intended beneficiaries quickly andefficiently.

5.6 The proposed structure is deemed appropriate to ensure efficiency in projectimplementation because implementation authority is retained by the respective line and staffdepartments of MINED. MINED will require technical support during project implementationand the proposed project provides sufficient funds to guarantee adequate and timely support. Theproposed project would include financing for contracting specialized staff and/or long-termconsultants, and travel and per diem costs for project monitoring and supervision. Evidence ofthe establishment of the Management Modernization Unit and the Quality Improvement Unit inthe Project Management Office will be a condition for IDB disbursement (para. 7.7(e)). Duringnegotiations, agreement was reached on the appointment of key technical and administrativestaff and/or consultants (para. 7.1Wf)). This condition was also required for IDB boardpresentation (para 7.5(b)).

Other Agencies Involved in Project Implementation

5.7 MINED will sign an agreement with the FIS to ensure timely and efficient implementationof all civil works financed under the project. FIS has extensive experience in the construction andrehabilitation of small education infrastructure in isolated and scattered locations. FIS has beenfinanced extensively by international donors (including four IDB loans) and is very familiar withIDB's procurement norms and procedures (para. 4.13). In addition, FIS has put in placeprocedures to deal with land tenure issues and for insuring technical construction specificationsare met.

5.8 MINED will contract with a procurement agent to handle the procurement of goods andservices that require ICB, NCB, ICB-2 stage, LIB, and contracting of international consultantsand consulting firms (para. 4.23).

47

D. Preparation and Review and Annual Work Programs and Budget

5.9 The project implementation units, with the Project Manager's support and with OPCI'sassistance, would prepare an annual work program for the project that would include theproposed activities for the year, their timing, and budget. Under SSRP, MINED has acquiredconsiderable experience in the preparation of annual work programs that are monitoredperiodically to ensure that performance targets are being met. As responsibilities are delegated tolower levels of MINED administration, the relevant units would be required to prepare annualwork programs and budgets that would be monitored by the central level. These work programswould cover the period January through December of each year and their preparation would takeplace early enough to enable MINED to incorporate the total budgetary requirements of theproject in its budget proposal for the following year.

E. Annual and Mid-Term Reviews by the Banks

5.10 Throughout the project implementation period, annual reviews would be undertakenjointly by MINED, MICDES, IBRD, and IDB no later than September 30 of each year to have anopportunity to assess project impact and performance, and to reach agreement on necessaryadjustments. The cost estimates prepared for the various components (Annex 11) and the keymonitoring indicators and implementation targets (Annex 13) would serve as a basis for projectimplementation planning, and would be updated annually by MINED in preparation for the annualreviews. The annual project implementation review would: (a) analyze progress made during theprevious year in project execution and in attaining its objectives, based on the key monitoringindicators for the project; (b) analyze and agree on the proposed annual work plans, specificproject progress reports, and budgetary requirements for the following year of projectimplementation to ensure the adequacy of counterpart funding; (c) assess the effectiveness ofproject management and coordination and discuss adjustments to be made in the project'simplementation schedule or targets; and (d) review progress in implementation of the ministry'sdecentralization and its coordination with the Government's overall program. Duringnegotiations, the Government provided assurances that MINED would. (a) conduct, jointly withMICDES, IBRD, and IDB, annual project implementation reviews in September of each year,beginning in 1996; and (b) by the same date each year, beginning in 1996, submit to the Banksannual progress reports on the implementation of the project in accordance with targetsestablished in previous annual work and investment plans, including the proposed budgetaryrequirements for project implementation during the subsequent year (para 7.1(g)).

5.11 The third annual review would be the mid-term review and would be undertaken no laterthan September 30, 1998. It would assess overall project performance and initial impact in thelight of project objectives and MINED policies. The key areas to be covered, in addition to allaspects of project implementation covered during the annual reviews include:

(a) Expansion, reorganization and strengthening of the EDUCO model:

Number of new sections created and converted from the traditional system would bereviewed. NGO and other private organization performance in the delivery of servicesto ACEs, and results of the school maintenance program would be analyzed to

48

determine the efficacy of the programs. Careful review of the improved mechanisms totransfer resources to the ACEs would be made, as well as of the impact of teacherincentives included in the new teacher salary structure and a thorough assessment ofEDUCO's costs vis-a-vis the traditional system. In addition, close attention will begiven to the existing procedures that guarantee adequate financing for maintenance ofeducation infrastructure.

(b) Quality improvement:

Progress in development of improved curricula for basic education, especially in the3rd cycle as well as in the textbook development program for all grades of basiceducation would be analyzed. The implementation of the pilot multigrade programwould also be evaluated. Efficiency in the acquisition and distribution of didacticmaterials for teachers and students would be reviewed. An evaluation of theachievements and effectiveness of the training program will be undertaken. Preliminaryresults of the student assessment program would be analyzed to take measures toaddress any deficiencies that may be found. The pilot nutrition program would bereviewed to ensure that coordination mechanisms between MINED and MOH areadequate for the program.

(c) Institutional modernization:

The functioning of the human resources, statistics, budgeting, infrastructure andprocurement subsystems at the departmental level, in the pilot departments would bereviewed, including the actual costs associated with the decentralized provision ofeducation services. The reports produced by the information system for the abovesubsystems would be analyzed. The implementation of local planning andprogramming in some urban and rural schools as well as in the pilot departments wouldbe evaluated. The operating and administrative manuals would be reviewed. Inaddition, the implementation of the human resources data base would be reviewed.The implementation of the supervisor training program, as well as the equipping oftheir offices would be reviewed. Particular attention will be given to the consistencybetween the modernization of MINED and the Public Sector Reform, including civilservice conditions, decentralization, and accounting procedures. The communicationstrategy and its efficiency will be assessed. Finally, the procedures used to allocatefunds for projects financed by the Pilot Basic Education Fund would be evaluated withrespect to their efficiency and effectiveness.

(d) Public education financing:

Particular attention will be given to education expenditure as a share of both GDP andcentral Government expenditure. The composition of expenditures by academic leveland expenditure category would be reviewed. An analysis of the evolution of teachersalaries and an implicit incentive structure would be undertaken. Finally, the sources offunding of other investments would be analyzed.

49

5.12 On the basis of the above in-depth review, the MINED and the Banks would agree onadjustments to project design and implementation, as necessary. During negotiations, theGovernment provided assurances that: (a) the in-depth mid-term review would cover all aspectsof project implementation; (b) it would be conducted jointly by MINED, MICDES and theBanks, and (c) on the basis of this review, action plans, satisfactory to the Banks, would beprepared and initiated by January 1, 1999 (para. 7. 1 (h)).

F. Loan Supervision

5.13 Project supervision will be coordinated by the IBRD task manager and the IDB teamleader and is expected to take place at least twice a year, jointly, by the two Banks.40 The mainpurpose is to monitor progress of the different project components. This supervision will requirean estimated 20 staff-weeks per year. Although MINED has project implementation experience,this project would require significant supervision because of its wide scope. The supervisionteams would be a combination of the Banks' staff4' and consultants with the required technicalexpertise and experience in the operation of similar projects in Latin America and other regions.The participation of team members of the proposed joint IBRD/IDB Public Sector ModernizationProject will be requested when necessary. It is expected that the main areas of expertise requiredwould be education and education planning, student achievement testing, institutionaldevelopment, management information systems and communications. Annex 15 includes aproject supervision strategy.

5.14 The IDB Country Office will perform the continuous task of monitoring and supervisingthe proposed project for the IDB. The IDB Country Office will be responsible for all supervisiontasks, coordinating with the Project Team.

5.15 Since annual evaluations of the proposed project will be undertaken (including an in-depthmnid-term review) and a loan completion report is expected, it was decided that an additional ex-post evaluation would not be required.

6. PROJECT BENEFITS AND RISKS

A. Project Benefits

6.1 Faced with the urgent need to improve coverage and quality of basic education in ElSalvador, the project would support the efforts of the Government to undertake a balancedprocess of improving equity, quality and efficiency of the school system. The project wouldtarget resources to poor and vulnerable groups, would improve learning achievements, andpromote the efficiency of resource allocation. At the same time it would strengthen theinstitutional capacity of N4INED to provide services and to evaluate and monitor educationpolicies and programs. The education flow wastage could be dramatically cut by improving thequality of services and by the existence of minimal nutrition conditions for the students. The

40 For IDB, the annual review mission will take place in the second semester of each year. Additionally, duringexecution, supervisionlmonitoring missions will take place in the first semester of each year.

41 Staff from headquarters and the country office in the case of IDB.

50

project is designed to produce significant reductions in repetition and dropout rates through theexpansion of preschool education, better qualified teachers, improved availability of instructionalmaterials, an updated curriculum, a more effective learning environment and direct involvement ofparents, teachers and the community in the management of schools. Decentralization andcommunity participation will boost responsiveness by teachers and administrators since all will besharing administrative responsibilities and transparency will promote accountability at all levels.The proposed project will support the Public Sector Reform by establishing the conditions for theMINED to be an active and responsive actor in the process while being consistent with thegeneral guidelines of the Public Sector Reform. The program will also help to identify efficientmethods and procedures to deliver education services that will be a seed for future improvementswithin the sector.

6.2 The socio-economic viability and efficiency of the project is supported on the basis of thehigh average return of basic education in El Salvador, and the solid results obtained in apreliminary exercise to estimate the marginal returns of the Government program to expandcoverage in rural preschool and basic education (20 percent, see Annex 3). These results arebased on the expected economic rate of returns of students that achieve one more year ofeducation and also the fiscal savings resulting from higher internal efficiency. The result is veryconservative because it overlooks the externalities of the project and the positive effect of a moreefficient and responsive Ministry of Education.

6.3 The financial benefits of the project are represented in GOES' selection of a variable rateUS dollar single currency loan from the IBRD to improve its overall liability management andreduce its risks. The Government considers US dollars to be an appropriate currency for its debtmanagement strategy, and prefers the standard country repayment terms for LIBOR-based singlecurrency loans compared to the shorter final maturity for fixed rate single currency loans.

B. Impact on Women

6.4 Female students slightly outnumber male students at both the preschool and basiceducation levels (para. 2.8). Curriculum reform under the SABE project has sharpened the focuson the specific needs of women and the key role of educated women in reducing fertility,promoting family values, and guiding and encouraging the education of young children. Theproject will support these reform efforts by eliminating the remaining gender stereotypes in schooltexts, improving teacher quality, and introducing career guidance. The EDUCO model directlyinvolves a significant number of mothers in school boards and decision making processes. Byexpanding the EDUCO model, women will be increasingly active in community activities and willbenefit from the training programs that will improve their skills in education.

C. Environmental Impact

6.5 The project is not expected to have direct environmental effects, and has been classified asC for IBRD and Category II for IDB.42 Civil works will be restricted to recovering existingschools. Education materials produced by the project will include appropriate environmental

42 IDB classification was approved by CMA Short Procedure on December 12, 1994.

51

topics. Therefore, an improved basic education will contribute to make children and their parentsmore aware of the environmental concerns and more receptive to public campaigns forconservation and protection of the environment.

D. Project Risks

6.6 Although the project has been designed with a systemic and balanced approach, thetechnical viability is highly contingent on the participation of qualified technical support during theproject. The end result, however, will be increased equity through improvements in quality andthe transformation of the structure of incentives leading to more efficiency.

6.7 The fiscal requirements to support the modernization of basic education will depend onthe assumptions made regarding growth and real recovery of teachers salaries (Annex 2). Under aconservative scenario the financial viability of the program will require that public sector spendingin education be increased by 0.6 percent of GNP to a total of 2.5 percent.43 As noted in Annex 2the macroeconomic and fiscal risks leading to inadequate funding are low. The Government hasbeen adamant in declaring its commitment to fund the program, even under a less favorablescenario that will require an additional fiscal effort to the detriment of other sectors. Duringnegotiations, a letter signed by the Minister of Finance assuring the Borrower's commitment toprovide the requiredfunds, including an annual increase in the education ordinary budget, wasreceived (para. 7.2(b)). During Annual Reviews, the provisions for adequate counterpart fundsfor the project and the fulfillment of agreed budgetary increase will be condition for the approvalof the Annual Work Program.

6.8 Due to the comprehensive scope of the operation, the main risk will be the limited capacityof MINED to implement the program. However, MINED has proven to be one of the mostdynamic ministries in El Salvador and has shown its capacity to respond to increasinglydemanding tasks under the SABE Project and the SSRP. This risk will be reduced, and theinstitutional viability secured, through continuous technical assistance that will strengthen theinstitutional capacity of MINED.

6.9 The project relies on the EDUCO model for providing services in rural areas. Theexpansion of EDUCO will introduce new challenges to maintain its efficiency, an adequateincentives structure, and timely responsiveness to the demands of the community. The expansionof EDUCO will also have to be matched with the revision of the incentive structure for allteachers (EDUCO and traditional) to avoid the conflict that could arise from a dual labor regimefor teachers. The program addresses bothissues to minimize those risks.

6.10 The introduction of a new teacher incentives system, the establishment of a performanceassessment system, and the rationalization of MINED staff could create political tensions betweenthe GOES/MINED and the teachers, supervisors, principals and MINED staff. The politicalsupport for the modernization program of MINED, the support of the Comisi6n Nacional deEducacion, Cienciay Desarrollo, and the introduction of an active communication campaign willreduce the risk of a confrontation with teachers.

4 Five percent if economic growth is half of what is predicted in MIPLAN's long term plans.

52

6.11 The decentralization process bears the risks of an inadequate articulation between differentlevels of operation. The design of pilot programs and the consideration of lessons learned in otherLatin American experiences when designing the implementation process are the best ways to limitthose risks.

E. Program Objective Category

6.12 The proposed project, in the human resources development category, is a program ofnational and targeted interventions. The project would be an integral part of El Salvador'santipoverty strategy through its assistance to improve coverage and quality of basic educationservices for the poorest groups in the country. It will target poor children in rural and urbanmarginal areas through a ranking system based on prevalence of malnutrition, repetition rates forfirst grade, net enrollment rates for first grade, and percentage of overage students. The non-targeted actions of quality and efficiency will be circumscribed to improve the public educationservices at preschool and basic education levels. Following the guidelines of the IDB's EighthReplenishment Poverty Targeting Mandate, this project is a poverty targeted loan.

-7. AGREEMENTS REACHED AND RECOMMENDATION

7.1 During negotiations, agreement was reached:

(a) on the terms of reference and schedule for the modernization of MINED, includingkey staff at the department level (para. 3.29);

(b) that the required funds for incremental teacher salaries as established in the annualwork plans would be included in the MINED budget for the following year (para.4.5);

(c) on the IBRD Special Account and on retroactive financing of up to US$300,000to cover eligible expenditures for preparation and launching of the proposedproject incurred after March 15, 1995 (para. 4.27);

(d) on the IDB Special Account and on retroactive financing of up to US$300,000 tocover eligible expenditures for preparation and launching of the proposed projectincurred after March 15, 1995 (para. 4.28);

(e) that MINED would: (i) have the records and accounts for each fiscal year auditedby independent and qualified auditors, in accordance with generally acceptedauditing standards and procedures; (ii) furnish to the Banks as soon as available,but in any case not later than six months after the end of each year, a certified copyof the agreed audit reports; and (iii) furnish to the Banks such other informationconcerning the records and accounts as well as the audit as the Banks would fromtime to time reasonably request (para. 4.32);

(f) on appointment of key technical and administrative staff and/or consultants andtheir terms of reference (para. 5.6);

53

(g) that MIvNED would: (a) conduct, jointly with MICDES, IBRD, and IDB, annualproject implementation reviews in September of each year, beginning in 1996; and(b) by the same date each year, beginning in 1996, submit to the Banks annualprogress reports on the implementation of the project in accordance with targetsestablished in previous annual work and investment plans, including the proposedbudgetary requirements for project implementation during the subsequent year(para. 5.10);

(h) that: (i) the in-depth mid-term review in September 1998 would cover all aspectsof project implementation; (ii) it would be conducted jointly by MINED, MICDESand the Banks, and (iii) on the basis of this review, action plans, satisfactory to theBanks, would be prepared and initiated by January 1, 1999 (para. 5.12); and

(i) on the Development Objectives for the project (Annex 14).

7.2 During negotiations:

(a) a -signed agreement (convenio) with FIS to guarantee the timely construction ofnew schools was presented (para. 3.7); and

(b) a letter signed by the Minister of Finance, acceptable to the Banks, assuring theBorrower's commitment to provide the required funds for the project including anannual increase in the education ordinary budget was received (para. 6.7).

7.3 As a dated covenant, the borrower will:

(a) select the local university/research center to develop the education assessmentsystem no later than January 30, 1996 (para. 3.21).

7.4 As conditions for IBRD loan effectiveness:

(a) the OPCI action plan will be completed to the satisfaction of both Banks (para.4.9);

(b) the Government will present evidence that the Revolving Fund had been created(para. 4.10); I

(c) the Operational Manual, satisfactory to both Banks, will be submitted to the Bank(para. 4.11); and

(d) a signed contract with a procurement agent would be presented (para. 4.12);

54

7.5 Conditions for IDB Board presentation:

(a) MINED will present a satisfactory draft of an agreement between MINED andUNDP (para. 4.24); and

(b) key technical and administrative staff and/or consultants and their terms ofreference would be presented (para. 5.6).

7.6 Conditions for IBRD disbursement:

(a) for IBRD disbursement for the Institutional Modernization and Strengtheningcomponent, MINED will present the work plan for the staff development activities(para. 3.28(f)).

7.7 Conditions for IDB disbursement:

(a) for the Expansion of Preschool and Basic Education in Rural Areas subcomponent,MINED will present assurances of the continuance of the school maintenanceprogram for rehabilitated schools (para. 3.9);

(b) for the Basic Education Program Fund subcomponent, the Operational Manual forthe Fund, including the eligibility criteria, will be agreed with the Banks and put inplace by MINED (para. 3.33);

(c) the OPCI action plan will be completed to the satisfaction of both Banks (para.4.9);

(d) an agreement between the borrower and the executing agency to transfer resourcesfrom the loan (para. 5.1); and

(e) evidence of the establishment of the Management Modernization Unit and theQuality Improvement Unit in the Project Management Office (para. 5.6).

7.8 Recommendation. Subject to the above assurances and conditions, the proposed projectwould constitute a suitable basis for an IBRD loan of US$34.0 million and an IDB loan ofUS$37.3 million for El Salvador.

55

8. ANNEXES

1. Basic Data2. Basic Education Public Funding and Financial Impact of the Project3. Economic Analysis4. Social Assessment: Summary of Main Results5. Proposals for the Modernization of the Education Sector Within the Modernization of the

Public Sector6. Prioritization of Municipios7. Expansion of Access to Preschool and Basic Education Component8. Improvement in Education Quality Component9. Institutional Modernization and Strengthening Component10. Project Administration11. Project Costs12. Tentative Procurement Plans13. Disbursements14. Performance Indicators15. Terms of Reference for Project Review and Supervision Schedule16. Project Implementation Schedule17. Education Projects Funded by Inter-American Development Bank18. List of Documents in the Project File

56 Annex 1Basic Data

EL SALVADOR BASIC EDUCATION MODERNAZATION PROJECTBASIC DATA

Table 1. Preschool Enrollment Data 1993

Public 47,615 44,410 92,0254-5 29,826 24,607 54,4336 17,7891 19,8031 37,592

Private 30,880] 3,143 34,0234-5 19,912 1,961 21,8736 10,968 1,182 12,150

Total 78,495 47,553 126,0484-5 49,738 26,568 76,3066 28,757 20,985 49,742

Population 170,703 193,960 364,6634-5 113,388 128,974 242,3626 57,315 64,986 122,301

Deficit 92,208 146,407 238,6154-5 63,6501 102,406 166,0566 28,558 44,001 72,559

Net Enrollment Rate 45.98% 24.52% 34.57%4-5 43.87% 20.60% 31.48%6 50.17% 32.29% 40.67%

Note: Includes EDUCO Enrollment

Source: Ministry ofEducation, Information Unit

Table 2: Basic Education Enrollment 1993

Urban Rural Total Urban Rural Total Urban Rural TotalPublic 334,119 421,962 756,081 117,368 45,492 162,860 451,487 467,454 918,941

Correct age 257,035 319,124 576,159 74,412 26,954 101,366 331,447 346,078 677,525Over/underage 77,084 102,838 179,922 42,956 18,538 61,494 120,040 121,376 241,416

Private 93,565 13,832 107,397 39,014 3,352 42,366 132,579 17,184 149,763Correct age 80,579 11,550 92,129 29,365 2,466 31,831 109,944 14,016 123,960Over/underage 12,986 2,282 15,268 9,649 886 10,535 22,635 3,168 25,803

Total 427,684 435,794 863,478 156,382 48,844 205,226 584.066 484,638 1,068,704Correct age 337,614 330,674 668,288 103,777 29,420 133,197 441,391 360,094 801,485Over/underage 90,070 105,120 195,190 52,605 19,424 72,029 142,675 124,544 267,219

Population 3q6,500 427,872 804,372 194,126 212,413 406,539 570,626 640,285 1,210,911

Deficit 38,886 97,198 136,084 90,349 182,993 273,342 129,235 280,191 409,426

Net Enrollment Rate 89.67% 77.28% 83.08% 53.46% 13.85% 32.76% 77.35% 56.24% 66.19%Gross Enrollment Rate 113.590/o 101.85% 107.35% 80.56% 22.99% 50.48% 102.36% 75.69% 88.26%

Notes: Correct age for Istl2nd Cycles (grades 1-6) is 7-12 years.Correct age for 3rd Cycle (grades 7-9) is 13-15 pars.Over/underage are children over or under the correct age for the cycle.Deficit is calculated as pqoulation for the correct age group minus the enrollment for the correct age group.Enrollment counts for IstV2nd Cycles includes EDUtCO enrollment

Source: Ministry of Education, Information UnitCa

Z

m X1._1sup2%-9I

Table 4: Basic Education Enrollment 1993Public Sector, Rural Zone

Age 1 2 3 4 5 6 7 8 9 Total5 839 8396 11,755 760 12,5157 28,853 8,892 959 38,7048 16,274 16,833 8,881 1,016 43,004

9 8,041 10,842 14,372 7,814 953 42,02210 4,776 7,228 11,356 13,748 7,289 915 45,31211 2,679 4,312 7,472 11,083 12,708 6,313 865 45,43212 1,749 3,003 5,492 8,761 11,734 12,692 6,776 869 51,07613 819 1,559 3,265 5,743 8,550 11,513 12,654 6,049 751 50,90314 308 601 1,477 2,871 4,875 7,462 10,768 11,686 5,647 45,695] 5 97 225 553 1,278 2,413 4,298 7,018 9,563 10,280 35,72516 47 83 186 416 922 2,021 3,867 6,180 8,352 22,07417 23 23 48 152 302 720 1,585 2,956 4,787 10,596

18+ 84 61 82 106 175 367 939 1,901 3,875 7,590 in

~~~~~~~..' . ' .. - .'' ".- ..."'''-' ''''-.,-Xi .---.'. ..-...

Underage 12,594 9,652 9,840 8,830 8,242 7,228 7,641 6,918 6,398 77,343Overage 34,897 27,937 29,931 30,410 28,971 26,381 24,177 20,600 17,014 240,318Correct age 28,853 16,833 14,372 13,748 12,708 12,692 12,654 11,686 10,280 133,826

Underage 16.50% 17.74% 18.17% 16.66% 16.51% 15.61% 17.18% 17.65% 18.990/0 17.13%Overage 45.71% 51.33% 55.28% 57.39% 58.03% 56.98% 54.36% 52.55% 50.50%/o 53.23%Correct age 37.79%/ 30.93% 26.54% 25.95% 25.46% 27.41% 28.45% 29.81% 30.51% 29.64%

Source: Ministerio de Educacion, Oficina de Planificaci6n Educativa, 1994.

Z

uz

Table 4: Basic Education Enrollment 1993Public Sector, Rural Zone

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

Age 1 2 3 4 5 6 7 8 9 Total5 1,624 1,624

6 14,279 569 14,8487 43,604 6,221 377 50,202

8 31,892 17,797 4,574 401 54,6649 19,411 18,433 12,131 3,600 395 53,97010 12,983 15,494 14,341 9,626 3,124 315 55,88311 7,611 11,426 12,065 11,244 7,608 2,640 197 52,79112 5,316 8,581 10,037 10,923 9,995 6,971 1,913 180 53,91613 2,893 5,475 6,958 7,958 8,518 8,347 4,540 1,636 154 46,47914 1,169 2,492 3,602 4,694 5,512 6,384 4,945 3,793 1,359 33,95015 504 1,160 1,614 2,277 3,011 3,999 3,579 3,862 3,089 23,095

16 237 488 630 1,022 1,376 2,079 2,259 2,747 2,972 13,81017 91 203 270 346 577 850 1,043 1,505 2,123 7,00818+ 90 206 200 257 315 550 713 1,012 1,871 5,214

. ....... ...... .... . ..1 ..

Underage 15,903 6,790 4,951 4,001 3,519 2,955 2,110 1,816 1,513 43,558Over age 82,197 63,958 49,717 38,721 29,304 22,209 12,539 9,126 6,966 314,737Correctage 43,604 17,797 12,131 9,626 7,608 6,971 4,540 3,793 3,089 109,159

Underage 11.22% 7.67% 7.41% 7.64% 8.70% 9.20% 11.00% 12.32% 13.08% 9.32%Over age 58.01% 72.23% 74.43% 73.97% 72.48% 69.11% 65.34% 61.93% 60.22% 67.33%Correct age 30.77% 20.10% 18.16% 18.39% 18.82% 21.69% 23.66% 25.74% 26.70% 23.35%

Source: Ministerio de Educaci6n, Oficina de Planificaci6n Educativa, 1994.

a,a)Co. >

nzOz

60 ANNEX 1Basic Data

Table S. ENROLLMENT RATES BY DEPARTMENT, 1993 (percent)

Ahuachapan 9.9 62.3 21.1 50.2 125.1 66.7 56.2 139.2 74.5Santa Ana 20.1 55.0 35.8 70.3 92.7 79.8 76.4 101.9 87.2Sonsonate 16.0 50.8 29.6 59.6 116.5 81.3 66.0 129.8 90.3Chalantenango 44.1 70.5 52.8 68.4 90.3 76.1 77.4 104.4 86.9La Libertad 25.0 60.5 38.9 70.1 97.8 81.2 82.9 109.5 93.5San Salvador 38.3 56.4 52.0 95.8 73.3 78.3 106.1 81.7 87.2Cuscatlan 29.8 63.0 42.7 63.4 145.4 93.4 72.8 164.8 106.5LaPaz 21.8 60.7 34.5 65.5 116.9 83.2 72.6 137.8 95.1Cabanas 19.4 41.8 26.0 65.2 92.5 73.6 72.5 105.4 82.6San Vicente 42.1 69.5 52.8 71.0 107.4 86.0 83.0 126.8 101.1Usulutan 29.6 69.2 42.9 59.6 109.7 78.7 68.6 126.2 90.6San Miguel 33.3 51.3 41.1 72.9 94.1 82.3 85.6 108.2 95.5Morazan 20.0 41.4 26.2 39.6 112.4 58.3 44.6 130.0 66.5LaUnion 27.3 81.2 38.4 65.1 109.4 75.3 71.6 124.0 83.7

5 A .~~~~~~ 4~~~4*~~~ 5~~w .. . ... .

Gross enrollnmnt for Buic Education.

.,-rateXs

Table 6. TRANMSITION RATES BY DEPARTMENT, 1993 (percent)

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

Ahuadupan 16.7 6.1 3.8 5.0 3.7 1.6 1.2 0.7 0.2 14.1 - 7.7 0.7 3.3 2.6 11.4 0.4 2.8SantaAna 16.4 6.0 5.0 4.1 3.3 4.3 3.6 1.9 0.6 12.7 1.4 0.4 - 2.8 - 7.6 2.4 3.2Sconate 20.5 9.2 6.6 4.6 3.6 3.2 2.6 1.9 0.6 11.4 0.5 4.3 3.6 7.1 8.9 11.0 1.8 2.6Chalantenan 23.0 11.1 8.6 7.1 5.3 6.3 4.9 2.7 0.9 14.2 0.1 6.5 2.0 7.3 - 10.0 5.9 7.3LaLibertad 19.1 8.1 6.1 5.1 3.5 2.8 2.6 1.7 0.6 10.3 0.7 0.2 1.3 4.0 3.7 11.3 9.8 10.4SonSalvador 19.5 9.9 6.8 5.7 4.1 3.7 2.3 1.5 0.7 11.3 .- - - 2.7 4.5 6.7 11.6 11.9Cuscatlan 24.1 9.1 6.9 4.4 4.1 2.6 2.0 2.0 0.4 9.2 - - 10.3 3.8 10.2 7.0 11.0 12.2LA Paz 24.6 10.9 9.2 6.6 3.7 3.9 3.9 2.2 0.5 9.9 3.1 - 7.4 -- - 7.9 14.7 15.9Cabanm 27.9 11.8 8.6 5.9 3.4 3.3 4.3 1.5 0.5 13.9 - 2.6 1.7 7.7 7.9 13.6 9.5 10.0San Vicente 25.0 95 7.9 52 3.4 4.7 3.5 1.8 1.6 14.0 0.7 5.1 1.5 2.8 -- 1.3 7.4 7.0Usulutan 18.4 6.6 3.2 3.8 1.8 1.4 1.2 0.4 0.2 19.9 - 9.5 4.4 3.2 -- 6.0 9.0 8.8SanMiguel 21.9 7.0 5.2 3.8 1.7 1.7 1.1 0.7 0.3 14.2 3.5 3.4 2.4 5.9 1.8 92 3.1 3.0Morazn 23.4 7.6 6.1 4.5 2.1 1.3 0.7 0.9 0.1 13.6 6.0 - 10.9 20.3 - 8.2 13.1 13 4LaUniwn 23.5 10.2 5.7 4.9 3.0 1.5 1.0 0.5 0.2 16.5 0.2 5.9 - 31 1.1 9.4 5.2 5.0

~.__K. ... K 1. : . t. >.. ... . *2: $ : I:*.::. ............M: *t: : >

. ~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~ ..... *.'*: ........

Ahuachapan 69.2 96.9 88.5 94.3 93.0 95.8 87.4 98.9 97.0Santa Ana 70.9 92.6 94.6 96.3 93.9 98.3 88.8 95.7 96.2Scnsonate 68.1 903 89.1 91.8 89.3 87.9 86.4 96.3 96.8Chalantenango 62.8 88.9 84.9 91.0 87.4 102.4 85.1 91.3 91.8LaLibertad 70.6 91.2 93.6 936 92.6 93.5 86.1 88.5 89.0San Salvador 69.2 90.9 93.5 94.9 93.2 91.8 91.0 87.0 87.5Cuscatlan 66.8 93 8 93.2 85.3 92.1 87.2 91.0 86.9 87.4La Paz 65.4 86.0 94.4 86.0 97.5 108.6 88.2 83.1 83.6Cabaas 58.2 91.5 88.8 92.3 88.8 88.8 82.0 89.0 89.5Son Vicente 61.0 89.8 87.0 93.3 93.8 95.9 95.3 90.9 91.4Usulutan 61.7 94.1 87.2 91.8 95.0 99.3 92.8 90.6 91.1Son Mguel 63.9 89.6 91.4 93.8 92.4 96.5 89.8 96.2 96.7Mcz n 63.0 86.4 96.6 84.6 77.6 107.1 91.1 86.0 86.5La Unin 60.0 89.6 88.5 96.6 93.8 97.4 89.6 94.3 94.8

q4 w01

lb

I-.


RURAL URBANTraditional EDUCO Traditional TOTAL

Preschool 813 593 1,406

Basic Educations 2,471 878 3,349Secondary Education 14 128 142

_ m X W ' m '.,..2~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~.........~~~~~~~~~~......... .. .........j ...... .................. .......Preschool 1,060 394 1,472 2,926lst/2nd Cycles,,d 13,542 917 9,674 24,133

3rd Cyclee 1,573 3,497 5,070Secondary Education 71 1,518 1,589

Preschool 1,066 394 907 2,3671st/2nd Cyclesod 7,228 917 10,822 18,967

3rd Cyclee 1,408 3,596 5,004Secondary Education 50 1,284 1,334

_ _ __............District 210Department 14

B Basic Education covers grades 1 through 9.b A section is the unit (students and classroom) administered by a teacher.

Ist/2nd Cycles of Basic Education cover grades 1 through 6.d EDUCO sections, teachers and students are in the 1st cycle only (grades 1 through 3).

3rd Cycle of Basic Education covers grades 7 through 9.f Estimations derived from the specifications of hours/class established in the 1993 Salary Law.

Source: Ministerio de Educaci6n, Oficina de Planiflcacifn Educative, 1994.

63 ANNEX IBasic Data

Table 8. Public Sector: Preschool and Primary Education

PUBLIC PRESCHOOL 47,615 44,410 12,608 28.4%Deficit (to be covered by Public Sector) 92,208 146,353 146,353 100.0%Total to be covered by Public Sector 139,823 190,763 158,961 83.3%Public Sector Deficit % 65.9% 76.7%

Private Preschool 30880 3,143 _ _

Total 170,703 170,703 _ _ ___

Net Enrollment Rate (including private) 46.0% 27.9% = =

PUBLIC BASIC (lstl2nd CYCLES)b 257,035 319,124 29,304 9.2%Deficit (to be covered by Public Sector) 38,886 97,198 97,198 100.0%Total to be covered by Public Sector 295,921 416,322 126,502 30.4%Public Sector Deficit % 13.1% 23.3%°/

Private Basic (lst/2nd Cycles)b 80,579 11,550Total 376,500 427,872Net Enrollment Rate (including private) 89.7% 77.3% ==

PUBLIC BASIC (3rd CYCLE)b 74,412 26,954Deficit (to be covered by Public Sector) 90,349 182,993Total to be covered by Public Sector 164,761 209,947Public Sector Deficit % 54.8% 87.2% _=

Private Basic (3rd Cycle)b 29,365 2,466Total 194,126 212,413Net Enrollment Rate (including private) 53.5% 13.9%

a EDUCO counts included in rural totals.b Correct age students only.Sources: Ministry of Education, Infornation Unit

World Bank. 1994. "El Salvador, Community Education Strategy: DecentralizedSchool Management."


Table 9. Public Sector Teachers and Sectionsin Preschool and Basic Education

Students 47,6157 44,410| 12,608|Teachers 907 1,460| 394Sections 1,472 1,454. 394Teachers/Students 0.02 0.03 0.03Students/Section 32.35 30.54 32.00Sections/Teacher 1.62 1.00 1.00

Students 334,119 421,962 29,304Teachers 10,822 8,145 917Sections 9,674 14,369 394Teachers/Students 0.03 0.02 0.03Students/Section 34.54 29.37 74.38Sections/Teacher 0.89 1.76 0.43

Students 117,368 45,492____Teachers 3,596 1,408 ____

Sections 3,497 1,573Teachers/Students 0.03 0.03 ____

Students/Section 33.56 28.92Sections/Teacher 0.97 1 .12

Note: Calculations of Teachers/Students, Students/Section and Sections/TeacheThey do not take into account teachers who teach more than one section.

' EDUCO counts included in rural totals

Sources: Annex 1, Tables 1,2, 7, and 8.


Table 10. Teacher Population by Level, 1994

._.PIPeW~# __~t~S<{X~t%1f..Ahuachapan 841 167 40 1,048Santa Ana 1,830 436 96 2,362Sonsonate 1,070 287 72 1,429WESTERN REGION 3,741 890 208 4,839

Chalatenango 1,037 150 66 1,253La Libertad 1,816 468 99 2,383

San Salvador 4,557 1,616 396 6,569Cuscatlan 755 157 30 942

La Paz 1,229 194 68 1,491CabaiSas 665 63 25 753

San Vicentes 930 183 63 1,176CENTRAL REGION 10,989 2,831 747 14,567

Usulutan 1,558 374 110 2,042

San Miguel 2,209 585 179 2,973Morazan 741 105 39 885

La Union 984 219 51 1,254EASTERN REGION 5,492 1,283 379 7,154

Docente 1: Teachers with pre-service training to teach preschool and primary education.Docente I: Teachers with pre-service training to teach the last grades of basic education (6-9).Docente III: Teachers prepared to teach the last grades of primary education and secondary education.

Source: Ministry of Education, General Directorate of Human Resources.

1:0\ssrp2\docentc.x1s


Years of Schooling (percent)

Male 24 19 22 16 12 7 100Female 30 19 20 13 12 6 100Total 27 19 21 15 12 6 100

Note: Population 15 years or older

Source: Encuesta de Hogares de Prop6sitos Muiltiples, 1992-1993

Ministerio de Planificaci6n y Coordinaci6n del Desarrollo Econ6mico y Social

............. ...... .............................................. ..,----------i-

Total 75

Male 78

Female 72Note: Population 13 years or older

Source: Encuesta de Hogares de Prop6sitos Multiples, 1992-1993

Ministerio de Planificaci6n y Coordinaci6n del Desarrollo Econ6mico y Social1 - ---.--- -; ~~~Mle 78.n sp gX

Note:Popul tuon13 ear o3r Npoldery geGr

|Age 1980 1985 1990 19953 2000'0-4 790373 788195 839679 952399 10503665 - 9 687934 747805 763324 821867 935623

10- 14 603282 658898 730931 752815 812767

15 - 19 498259 545953 621584 707598 732881

20 - 24 392004 393763 483496 582536 673382

Total" 4525400 4767569 5251678 5943260 6739295

a Projections.

b Population of country as a whole.

Source: CELADE, 1991.

....-.... :.............. 3n...... .

Age 80 - 85 85 - 90 90 - 95' 95 - 00'

0 - 4 -0.06 1.27 2.52 1.95

5 - 9 1.67 0.41 1.48 2.59

10 - 14 1.76 2.08 0.59 1.53

15 - 19 1.83 2.59 2.59 0.7020 - 24 0.09 4.11 3.73 2.90

Total 1.04 1.93 2.47 2.51

a Projections.

Note: Expected average annual population growth could be overestimated.

According to MIPLAN, aggregate population growth could be smaller for all groups ( something close to 35 percent)

Source: CELADE, 1991


Table 15. Female Population by Age Group

198 1985 ". 190 195 O00 - 4 388,642 386,614 408,134 460,440 508,5105 - 9 339,122 367,059 373,599 398,200 451,10310- 14 298,244 324,229 359,751 369,111 394,31315- 19 250,654 269,336 311,724 352,162 362,63720 - 24 202,432 204,501 248,541 299,294 341,418

Female Population as Percentage of Total Population by Age Group

R:': :::~~~~~~~.:....- -.'.'R'-: 'R.:.R.R.-. - ....-. ':' -:'' .:.-.-. -.-.-.'.'- -RR'.-'...-.-.

0 - 4 49 49 49 48 485-9 49 49 49 48 4810- 14 49 49 49 49 4915- 19 50 49 50 50 4920 - 24 52 52 51 51 51

a Projections.

b Total female population in the country.Source: CELADE, 1991.


Table 16. SALARIES AND MONTHLY INCOMEBY GENDER AND NUMBER OF YEARS OF STUDY

0 628.94 531.67 583.54 786.86 643.42 732.261-3 776.90 583.11 694.45 1,002.53 708.78 893.404 - 6 956.14 655.09 834.55 1,066.64 795.55 963.257 - 9 1,133.29 787.78 1,009.85 1,190.36 954.00 1,108.5110 - 12 1,627.03 1,208.55 1,435.38 1,816.99 1,330.27 1,596.6713+ 2,863.97 1,825.26 2,412.92 3,721.06 2,070.27 3,009.88Other 962.15 744.14 861.18 842.63 1,178.98 972.87

~~~~~~~~~~~~~~~F. .i.. t. .- i ..

Note: Colones.a Includes only employed people.Source: Encuesta de Hogares de Prop6sitos Multiples, 1992-1993

Ministerio de Planificaci6n y Coordinaci6n del Desarrollo Econ6mico y Social.

Table 17. EL SALVADOR ENROLLMENT BY GRADE, SECTOR, ZONE AND GENDER 1993

.,~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~_. ... .....

Age Male Female Total Male Female Total Male Female Total Male Female Total4 6,594 7,094 13,688 4,318 4,643 8,961 4,083 4,379 8,462 323 327 6505 7,817 8,321 16,138 7,556 8,090 15,646 5,656 5,794 11,450 645 666 1,3116 8,707 9,082 17,789 9,856 9,947 19,803 5,619 5,349 10,968 620 562 1,182

,,~~~~~~~~~~~.,,.,,,,,,...,,,....,,,,. .....,,,X. ... ,h .... ..... ...,

'~~~~~~~~~~. . . . .. .'.'.. . . ' ...... . . . .. . . ' ' ' : ' " : ..'..''.......'

~~~~~~~~~~~~~~~~~~~~~~~~~~~..: vop fl, X: ...... -- . n..:.--

Grade Male Female Total Male Female Total Male Female Total Male Female Total1 39,279 37,066 76,345 63,584 78,119 141,703 10,123 9,274 19,397 1,729 1,435 3,1642 27,467 26,955 54,422 41,455 47,091 88,546 8,385 7,715 16,100 1,387 1,149 2,5363 27,169 26,974 54,143 33,493 33,306 66,799 7,911 7,382 15,293 1,233 1,052 2,2854 26,272 26,715 52,987 26,681 25,668 52,349 7,534 7,395 14,929 1,218 969 2,1875 24,523 25,399 49,922 20,761 19,670 40,431 7,107 6,945 14,052 1,048 881 1,9296 22,335 23,965 46,300 16,592 15,542 32,134 6,932 6,862 13,794 924 807 1,7317 22,214 22,258 44,472 9,942 9,247 19,189 6,812 6,855 13,667 754 578 1,3328 18,783 20,421 39,204 7,688 7,047 14,735 6,555 6,414 12,969 660 449 1,1099 15,999 17,693 33,692 5,823 5,745 11,568 5,958 6,420 12,378 548 363 911

Tota 2444 21 227,446 4544 ....22601 24,3 4.67,454 6..317 65221259 41 77,184

* Includes EDUCO enrollment.Source: Unidad de Infonnatica, Ministerio de Educaci6n.

>

X

Table 18. HIGHEST LEVEL OF SCHOOLING ATTAINED (%)

Belize 1991 25+ 12.8 63.3 14.7 9.2Bolivia 1976 25+ 48.6 28.5 10.8 7.1 5.0

Brazil, 1989 10+ 18.7 57.0 6.9 11.9 5.5Chile 1982 25+ 9.4 55.6 26.9 7.2Cuba 1981 25 - 49 3.7 22.6 27.6 40.2 5.9Ecuador 1990 25+ 2.2 54.3 28.0 15.5

El Salvadorb 1993 25+ 34.5 21.0 19.7 9.0 9.2 6.5Guatemala 1981 25+ 54.7 27.1 8.6 4.8 2.5 2.2Haiti 1986 25+ 59.5 30.5 9.3 0.7

Honduras' 1983 25+ 33.5 51.3 4.3 7.6 3.3Mexico 1990 25+ 18.8 28.6 19.9 12.7 10.7 9.2Panama 1990 25+ 12.9 20.0 21.6 17.2 11.5 16.8 o

Paraguayd 1982 25+ 14.2 51.0 15.4 16.0 3.4Perud 1981 25+ 24.0 27.3 17.2 10.7 10.7 10.1Uruguay 1985 25+ 62.4 28.6 9.0

Venezuelad 1990 25+ 21.2 55.0 12.0 11.8

a Does not include rural population of the region in the north of Brazil.b Category "completed primary" includes individuals who entered the 2nd cycle of Basic Education, but did not complete it.c Based on a sample survey referring to 51,372 persons.d Persons who dod not state their level of educatoin have been included in the category "no schooling."

Sources: El Salvador: Encuesta de Hogares de Prop6sitos Muiltiples, 1992-1993. All others: UNESCO, Statistical Yearbook, 1994.

Iiiy


Table 19. RETURNS TO INVESTMENT IN EDUCATION BY LEVEL

Bolivia 1989 9.3 7.3 13.1 9.8 8.1 16.4Brazil 1989 35.6 5.1 21.4 36.6 5.1 28.2Chile 1989 8.1 11.1 14.0 9.7 12.9 20.7Colombia 1989 20.0 11.4 14.0 27.7 14.7 21.7Costa Rica 1989 11.2 14.4 9.0 12.2 17.6 12.9Dominican Republic 1989 -- -- -- 85.1 15.1 19.4Ecuador 1987 14.7 12.7 9.9 17.1 17.2 12.7El Salvador 1990 16.4 13.3 8.0 18.9 14.5 9.5Guatemala 1989 -- -- -- 33.8 17.9 22.2Honduras 1989 18.2 19.7 18.9 20.8 23.3 25.9Mexico 1984 19.0 9.6 12.9 21.6 15.1 21.7Panama 1989 -- -- -- 5.7 21.0 21.0Paraguay 1990 20.3 12.7 10.8 23.7 14.6 13.7Peru 1990 -- -- -- 13.2 6.6 40.0Uruguay 1989 21.6 8.1 10.3 27.8 10.3 12.8Venezuela 1989 23.4 10.2 6.2 36.3 14.6 11.0Latin America 17.9 12.8 12.3 26.2 16.8 19.7

Table 20. RETURNS TO EDUCATION BY GENDER

.:m ....... a ,al .,: ,--;Bolivia 1989 7.3 7.7Brazil 1989 15.4 14.2Chile 1989 12.1 13.2Colombia 1989 14.5 12.9Costa Rica 1989 10.5 13.5Dominican Republic 1989 7.8 12.0Ecuador 1987 9.8 11.5El Salvador 1990 9.6 9.8Guatemala 1989 14.2 16.3Honduras 1989 17.2 19.8Mexico 1984 14.1 15.0Nicaragua 1978 8.5 11.5Panama 1989 12.6 17.1Paraguay 1990 10.3 12.1Peru 1990 8.5 6.5Uruguay 1989 9.0 10.6Venezuela 1989 8.4 8.0

-- Not available.Source: Psacharopoulos, G. 1993. "Returns to Investment in Education: A Global Update."1:\ssp2cetrns.xis

Table 21. PERCENTAGE OF 1989 COHORT REACHING

Total Male Female Total Male Female Total Male FemaleBolivia 84 85 83 69 71 67 44 47 41 0.64lBrazilb 77 50 20 0.38Chileb 98 98 98 95 95 95 77 73 80 0.83

Colombia 80 78 81 63 60 65 56 53 59 0.66

Costa Rica 95 89 79 0.78Cuba 98 92 89 0.92Dominican Republic 64 50 14 0.24Ecuador 81 81 81 71 70 72 63 63 65 0.78El Salvador 74 73 75 52 52 53 24 24 23 0.43Guatemala 68 46 36 0.59Haiti 80 80 80 55 55 55 39 40 38 0.53Hondurasb 68 63 72 47 42 52 34 30 23 0.59_Mexico 90 82 72 0.77Nicaragua 76 57 41 0.54Panama 92 92 93 85 83 88 79 76 82 0.81

Paraguay 90 90 90 76 75 76 59 57 60 0.68Uruguay 100 100 100 98 97 99 93 91 94 0.86Venezuela 100 __ _ _ _94 _ ____ _____ 48 __ _ _ _ ____0.53

a Ratio between the theoretical number of pupil-years that it would have taken to graduate the cycle of education,

had there been no repetition or drop-out, and the numnber of pupil-years actually spent by the cohort.b Data on repeaters not included.

Source: UNESCO. World Education Report 1993.

O. m

I:'ssrp2s:obattx1s


Table 22. PUPIL-TEACHER RATIO

: 4¢ .-: A...- . . . .--- . F ir s t - - e e . S... . . . . . . . .

Belize 8 25 25 4 16 14Bolivia 8 20 25 4 -- 18Brazil 8 26 23 3 14 14Chile 8 33 29 4 -- 17Colombia 5 31 30 6 20 20Costa Rica 6 33 32 5 19 19Cuba 6 17 13 6 13 10Dominican Republic 8 50 41 4 -- --

Ecuador 6 36 29 6 17 --

El Salvador 9 48 40 3 24 28Guatemala 6 37 34 6 14 15Haiti 6 44 29 6 23 20Honduras 6 37 38 5 28 --

Mexico 6 39 31 6 18 17Nicaragua 6 35 33 5 33 24Panama 6 27 20 6 21 19Paraguay 6 27 25 6 -- --

Peru 6 37 38 5 25 21Uruguay 6 22 22 6 -- --

Venezuela 9 26 23 2 -- 9

Source: UNESCO. World Education Report 1993.

1:\ssrp2\puptc1Lx1s

Table 23. PERCENTAGE OF AGE GROUP ENROLLED IN EDUCATION

Total Female Total Female TERTIARY

1970 1991a 1970 1991a 1970 1991a 1970 1991a 1970 1991aBolivia 76 85 62 81 24 34 20 31 13 23Brazil 82 106 82 -- 26 39 26 - 12 12Chile 107 98 107 97 39 72 42 75 13 23Colombia 108 111 110 112 25 55 24 60 10 14Costa Rica 110 103 109 102 28 43 29 45 23 28Dominican Republic 100 - 100 - 21 -- -- -- -- --

Ecuador 97 -- 95 -- 22 -- 23 -- 37 20El Salvador 85 76 83 77 22 25 21 27 4 16Guatemala 57 79 51 73 S 28 8 -- 8 --

Honduras 87 105 87 107 14 19 13 34 8 9Mexico 104 114 101 112 22 55 17 55 14 15Nicaragua 80 101 81 104 18 44 17 46 14 10Panama 99 106 97 105 38 60 40 62 22 24Paraguay 109 109 103 108 17 30 17 31 9 8Peru 107 126 99 -- 31 70 27 -- 19 36Uruguay 112 108 109 107 59 84 64 - 18 32Venezuela 94 99 94 100 33 34 34 40 21 30Latin America 95 106 94 105 28 47 26 54 15 18

- Not available.

a Or most recent year.

b Weighted by population.Source: World Bank. 1994. World Development Report.

I:\ssrp2\ageenro.xls

w :>-.

75 ANNEX 2Basic Education Public Financing and

Financial Impact of the Project


BASIC EDUCATION PUBLIC FINANCING AND FINANCIALIMPACT OF THE PROJECT 1

1. Basic education enrollment in El Salvador increased 24 percent between 1991 and 1993,reaching 1.19 million children at the end of this period. El Salvador's net enrollment deficit inbasic education remains high (34 percent) and disparities between rural and urban enrollmentpersist. While net enrollment in preschool and the 3rd cycle have reached 46 percent and 53.4percent, respectively, in urban areas, it is about half as much as that in rural areas - 24.5 percentand 13.8 percent, respectively.

2. Education expenditure as a share of both gross domestic product (GDP) and centralGovernment expenditure has steadily declined since 1981. Its share of GDP decreased from 3.6percent in 1981 to 2.0 percent in 1994. This reflects the fact that total government expenditurefell from nearly 20 percent of GDP in the early 1980s to 13 percent in 1993 while, at the sametime, the education share of the budget declined by more than half during the same time period(see Figure 1).

3. There are several issues of concern in El Salvador's education budget:

(a) Investment expenditures have been drastically reduced, and only partially executed.In contrast, recurrent expenditures have been almost fully executed as budgeted,

and their share has increased to nearly 90 percent of the budget.

(b) In El Salvador, the percentage of the Government's education expenditure is lessthan its Central American neighbors.

(c) El Salvador allocates proportionately more resources than its neighbors to basiceducation, however, its expenditure on secondary education is low compared toother Central American nations. There is a high private sector share in secondaryeducation (55 percent in 1993).

(d) There is a high private sector share in secondary education (55 percent in 1993)and transfers to the University of El Salvador are very low for regional standards(an average of 0.19 percent of GDP in the last five years).

(e) Teacher salaries in real terms have steadily declined since 1980. Between 1984and 1992 per capita income rose by 5.4 percent while teacher wages fell by 50percent. The purchasing power of teacher wages in 1992 was 32 percent of its

This annex refers only to public expenditures because there is no available information about private educationsector finances.



level in 1980. Hence, in the last decade education became a less attractive sectorfor young people in the job market.2

(f) The key education investments in the last four years have been financed byinternational donors in projects associated with considerable technical assistanceprograms

4. In summary, in El Salvador the amount of resources being allocated to education havebeen reduced in the past 20 years, and concentrated in basic education. Most of those resourcesare being used to cover recurrent expenditures. Additionally, there has been a sharp deteriorationin teacher remuneration, and El Salvador has shown a limited managerial capacity to undertakeinvestment projects.

5. Repetition and dropouts are costly for El Salvador. In 1994, the average per studentannual cost was around US$149. However, due to repetition, a child spends an average of 5years longer than necessary to complete the primary level costing as much as US$37 million peryear, that is, almost one-fourth of the total government expenditure in basic education. Betweenrepeating grades and temporarily dropping out of school, a child needs, on average, 19 years tocomplete a 9 year cycle.

GOVERNMENT GOALS FOR ENROLLMENT IN BASIC EDUCATION, 1995 - 1999:

6. El Salvador's basic education goals for 1995-1999 include: (a) increasing preschool ruralenrollment from 24.5 percent in 1993 to 40 percent in 1999; (b) raising enrollment in the 1st and2nd cycles from 83 percent in 1993 to 90 percent in 1999; and (c) reducing overage students inbasic education from 29.2 percent in 1993 to 15.3 percent in 1999. No specific target has beenset for increasing enrollment in the 3rd cycle which is currently 32.8 percent (net enrollment).

7. Calculations of the cost of meeting the goals are based on the following assumptions:

(a) GOES' Economic Plan for the next five years assumes an annual economic growthof 7 percent per year. To avoid distortions implicit in this assumption, estimationsof recurrent costs (cost per student involving all inputs) were made as a percentageof GDP. The estimation of capital costs (investment) was made under twoscenarios, 7 percent and 3 percent GDP growth.

(b) The school-age population is assumed to grow by 2 percent annually. Thisprojected growth is larger than the Ministry of Education's (MINED's) projectionsof 1.95 percent growth rate for 4-6 year olds and 1 percent for 7-12 year olds.

(c) Sections3 are assumed to have 32 students, the average number of students inEDUCO schools.

2 There is some evidence that suggests that teachers in the traditional system have high absenteeism. But evenadjusting teacher salaries by the net hours worked, real wages declined by about 50 percent between 1980 and1992.3 A section is a group of students under the charge of a teacher.



(d) Since increased coverage will focus on schools in rural areas and in small towns, itis assumed that EDUCO will play a fundamental role. Some of the plannedexpansion will be based on adding a second session to the already existinginfrastructure. Because teachers receive a premium of 43 percent of their basesalary for teaching a second session, the expansion of the EDUCO system throughadding a second session can be achieved with a 43 percent increase in base salaries,far below from the cost of opening a new EDUCO session.4

(e) The simulation allowed for increases in expenditures in the 3rd cycle of the basiclevel and on the secondary level due to the natural increase in the population andfor the preservation in real terms of other education programs.

8. Based on the above, the projected cost of meeting the government's medium-term goals isprojected in Table 1:

Ta. .. P ted Public Expenditures on Education, 1995-1999 (% of GDP)Scenario 1 Scenario 2GDP gro h) 7% GDP groth)

Recurrent Capital Recurrent CapitalYear costs costs Total costs costs Total1995 2.0% 0.9% 2.9% 2.0% 0.4% 2.4%1996 2.0% 1.2% 3.2% 2.0% 0.5% 2.5%1997 2.1% 1.2% 3.3% 2.1% 0.5% 2.6%1998 2.2% 1.2% 3.4% 2.2% 0.5% 2.7%1999 2.2% 1.2% 3.4% 2.2% 0.5% 2.7%

Note: For a detailed presentation of the methodology used, see Artana 'Education Program forEl Salvador," 1995.

9. These public expenditures will provide for the implementation of the Governmentexpansion of the education system as described in paragraph 6. This includes additional actions tothose financed by this proposed IBRD/IDB project including an average of 0.15 percent of GNPinvestment financed by other donors. For a specific assessment of counterpart funds for theproject see Annex 11.

EDUCATION BUDGET 1995-99:

10. MINED's total expenditure plan aims at annual education investments of 0.5 percent ofGDP during the next 5 years. Approximately 80 percent of the investments will be used forinfrastructure, equipment and training. The remaining 20 percent will be used for recurrentexpenditures associated with the investments, in particular with didactic materials.

4 The recurrent cost of a new EDUCO section is assumed to be $32,800 colones (of 1994) per year. Teachersalaries are, by far, the important recurrent cost of the EDUCO program.



11. It is expected that the public sector will generate revenues and assist MINED in: (a)covering the incremental recurrent costs associated with these investment plans; (b) paying for theenrollment increment program; (c) improving teacher salaries (real) at least in the EDUCOprogram; and (d) paying for the passive growth of actual expenditures. In order to fulfill thesegoals it will be necessary that the education budget reach between 2.7and 3.4 percent at thebeginning of the next century depending on the rate of GDP growth and the wage policy adoptedfor teachers in the traditional system (see Table 8).

12. The emphasis of government programs will change the composition of expenditure amonglevels of education, favoring preschool and basic at the cost of secondary and higher education.In the above scenarios, the share of education expenditures channeled to preschool and basiceducation would climb from 76 percent of the total in 1992 to 79 percent in 1999. The remainderof education expenditures goes to secondary education (9 percent), vocational training (2percent), adult education (1 percent), and the university (9 percent). The program will reduce theshare of private education in preschool from 27 percent in 1993 to 22 percent in 1999, willslightly reduce its share in basic education, and will increase its share in secondary school from 55percent in 1993 to 56 percent in 1999.

13. The ability of the Government to increase education expenditures hinges on: (a)implementation of sound macroeconomic policies that increase tax revenues; and (b) a substantialincrease in the surplus of public enterprises. The government expects that total revenues willreach 18 percent of GDP in 1999; if this target is reached it will not be necessary to raise the shareof education expenditure on central government expenditure. But any figure lower than 18percent in total revenues would imply that the education goals should be pursued at the cost ofother sectors.

14. It is important to mention that the expected reduction in repetition rates can yield savingsup to 38 percent of the education costs per graduate in grades 1 through 6 and 21 percent ingrades 7 through 9. Under a very conservative assumption, the process will reduce repetitionrates by 25 percent (one year for 1st and 2nd cycles). The reduction in repetition would beequivalent to savings of US$5 million per year. Those savings will be an additional source forfunding the expansion of education services.

1:Assrp2\ann_edsc.doc



Education Expenditure as % of GDP

4

0.

1973 1975 1977 1979 1981 1983 1985 1987 1989 1991 1993

Year

Edcicaion Bqpendttre as % of Govemn(nt Bperdture

21)~~ - --

Teacher Wage I ndex ( 1978=1 00)

120100

~ 0

x 40-20 -20

1973 1975 1977 1979 1981 1983 1985 1987 1989 1991

Year



oMbles2. -.SW4k: Nlic Ex enditurs onE ion 1973-1994(in:mill of5cu ..tre.utco1onEsExpenditures Expenditures Unbudgeted Education

(ordinary (extraordinary USAID-financed expenditures (%Year budget) a budget) expenditures Total GDP of GDP)1973 124 124 3,332 3.71974 157 157 3,944 4.01975 176 176 4,478 3.91976 223 223 5,706 3.91977 266 266 7,167 3.71978 292 292 7,692 3.81979 308 308 8,607 3.61980 355 355 8,917 4.01981 347 347 8,647 4.01982 338 338 8,966 3.81983 328 4 4 336 10,152 3.31984 374 4 0 378 11,657 3.21985 427 17 12 456 14,331 3.21986 472 7 29 508 19,763 2.61987 536 40 51 627 23,141 2.71988 566 47 60 673 27,366 2.51989 647 62 31 740 32,230 2.31990 754 33 15 802 41,057 2.01991 825 31 20 876 47,792 1.81992 912 131 15 1,058 54,583 1.91993 b 1,063 257 N/A 1,320 66,239 2.01994 b 1 1,296 210 N/A 1,506 76,840 2.0* Includes expenditures by the Ministry of Education and transfers to the University of El Salvador. Excludescurrent expenditures on education, of 0.1-0.2% of GDP, by other public sector entities.b Estimated.Sources: Jorge Quintana, "Economria de la Educacion," May 1993.

Secretaria Tecnica de Financiamiento Externo (SETEFE)Daniel Artana, "El Programa Educativo del Gobierno de El Salvador," February 1995.

::Tbl3.; El :Salvador - Evolution of GDP and Fiscal Varnables.

Real GDP Central Govt. as % of GDPGrowth

Year Rate (%) Revenues Spending Educ. Spending1984 13.3 19.8 3.21985 1.6 13.9 17.8 3.21986 0.7 14.5 19.4 2.61987 2.4 11.4 15.2 2.71988 1.5 10.2 14.6 2.51989 1.6 8.3 13.1 2.319901991 3.0 8.4 11.9 2.01992 3.9 9.2 13.8 1.81993 4.9 10.0 14.7 1.9

5.7 10.1 13.1 2.0Source: Inter-American Development Bank.



-T.e *4. .Ah&G% C Per. Stident iitio ion Preschl 1 Cycie Bas, 19.4

Operating Expenses SourcePersonnel Servicesb $102.54 Official Expenses, Education Branch, IBRD ReportClassroom Supplies $2.06 Directorate for Educational MaterialsBooks/Student Materialsc $1.66 Directroate for Educational MaterialsTeacher Training $4.95 Annual Progranuning Costs for EDUCO Sections

Subtotal $111.21Administrative Expenses

Central $7.24 IBRD ReportRegional $2.75 IBRD ReportLocal (ACE) $0.00Teacher Supervision $0.83 Annual Programming Costs for EDUCO Sections

Subtotal $10.82Annualized Capital Expenses Costs of Typical, Social Investment Fund

Construction $9.10 Straight Line Depreciation, 75 Year LifeFurniture and Equipment $12.67 Straight Line Depreciation, 20 Year LifeMaintenance $4.52 Alberto Zuniga, Evaluation Unit, IBRDSchool Library $0.48 Straight Line Depreciation, 10 Year Life

Subtotal $26. 77Total Per Student $148.80Total Section of 31 Students $4,612.75a Assumes 31 students per section. (Source: Ministry of Education, Directorate for Planning and Statistics)b Weighted average across teachers in the three pay scales (Docente I, II, and III).c Assumes five year replacement cycle for books and student materials.Source: 'An Analysis of the Unit Costs of Preschool and Primary School Education in El Salvador,"Melamid, Sastry and Ross, RAND Corporation, April 1995.

Table 5. ExpeXditure on Education in Various Counr ies% of Central Distribution of Government Expenditure (/)

Year Govt. Budget Preschool Primary Secondary HigherEl Salvador 1993 14 5 71 9 15Costa Rica 1991 19 - 43 23 34Guatemala 1990 20 - 54 18 28Honduras 1992 15 - 61 22 17Nicaragua 1992 18 - 57 8 35Mexico 1991 14 - 39 35 26Panama 1992 17 - 45 22 33

Notes: Higher education includes 10 percent for the University of El Salvador, 3 percent for training and 2percent for adult education.

Source: Dewees et al. 1995, and World Bank.



Tale 6. ExpCnditue -per Student as reer eaf Pe Capita GDP, 1988Preschool Basic

El Salvador 6 9Honduras 12 2Ecuador 6 11Nicaragua 13 22Latin America 9 12Africa 14 60Asia 11 18World 14 30Source: Costos Beneficios y Financiamiento de la Educaci6nDewees, A., S. Kless, and J. Quintana in Educaci6n en El Salvador, deCara al Siglo AXX.

Table 7. Number of Years-to Produce-A Grad.uael__________________ Years Per Level Actual Years RequiredPreschoolBasic (grades 1-9) 9 19.4Ist/2nd Cycles 6 10.13rd Cycle 3 3.9Sources: Costos Beneficios y Financiamiento de la Educaci6n.Melamid, E. et al. 'An Analysis of the Unit Costs of Preschool and PrimarySchool in El Salvador,"World Bank.

Table 8, Etitd.Cost of pAnn Preschool gan Basic Educ tion_Services' - ______

Teacher Salary Growth Scenarios 1995 1996 1997 1998 1999Teacher salarygrowth= 0 2.3% 2.3% 2.3% 2.2% 2.1%EDUCO Teacher salary growth = GDP growth 2.3% 2.4% 2.3% 2.3% 2.2%All teachers salary growth = GDP growth 2.4% 2.6% 2.6% 2.7% 2.7%

Percentage of Investmentb 0.4% 0.5% 0.5% 0.5% 0.5%Project Cost Absorbtionb 0.04% 0.08% 0.12% 0.16% 0.16%

Enrollment GoalscPreschool 29.7% 32.3% 34.6% 37.4% 40.0%Basic 85.3% 86.5% 87.7% 88.8% 90.0%

* Other levels of education would be expanded to maintain current levels of coverage.b For all scenarios.

Percentage of coverage.



Table 9. Non-fmancial Pubic Sectr (*/a of -D-Mone Program Medium Term Outlook

1994 1995 1995 1999Current Revenues 15.2 15.8 16.3 17.6

Operating Surpus 1.4 1.9 1.8 3.1Capital Revenues 0.3 0.2 0.2 0.0Donations 1.4 1.1 1.7 0.1TOTAL INCOME 16.8 17.1 18.2 17.7

Current Expenditures 13.2 13.3 13.3 13.1Capital Expenditures 4.1 5.0 7.3 5.5TOTAL EXPENDITURES 17.3 18.3 20.6 18.6

Net FinancingExternal 2.1 1.5 2.7 1.8Internal (1.6) (0.4) (1.0) (2.2)

External Gap 0.0 0.0 0.8 1.3Source: "Plan Desarrollo Econ6rnico y Social 1994," and "Programa Monetario"

Table 10. Public Sector Revenue (% of ODP . .MonetaryProgram Medium Termn Outlook

1994 1995 1999Tax Revenues 10.87 11.39 11.85

Income Tax 2.57 3.24 3.80VAT 4.63 4.96 4.99Imports 2.11 2.05 2.02Other 1.56 1.14 1.05

Non Tax Revenues 2.90 3.03 2.69

Public Enterprise Operating Surplus 1.43 1.83 3.09Transfers to Central Government 0.20 1.20

Source: "Plan Desarrollo Econ6mico y Social 1994,"and "Programa Monetario."

84 ANNEX 3Economic Analysis

EL SALVADOR BASIC EDUCATION MODERNIZATION PROJECTECONOMIC ANALYSIS

1. Empirical evidence suggests that the overall rate of return to primary education is high inEl Salvador. Using 1990 data, Psacharopoulos and Ng estimated the average private rate ofreturn for primary education at 18.9 percent.' The same study estimated the average private ratesof return for secondary education at 14.5 percent and for university education at 9.5 percent.Social rates of return of 16.3 percent for primary school, 13.3 percent for secondary school and8.0 percent for university education show a similar pattern of the highest rates of return forprimary education and the lowest for university education.

2. Although one cannot assume that the above-cited average rates of return are the same asthe marginal rates of return from investments by project activities, high average rates of returnaugur well for the overall returns to investments in primary education. Moreover, the availableevidence suggests a positive assessment of the project's returns when compared with alternativeinvestments available in the country. Under the assumption that the private marginal return willbe half of the average return (9.5 percent), returns are still considerably higher than the currentaverage real lending rate (7.4 percent).

3. A brief analysis of the components of the project will give additional evidence of theeconomic soundness of the proposed project.

Component 1. Expansion of Access to Preschool and Basic Education

4. The expansion of EDUCO schools, supported by the first component of the project, seeksto follow cost-effectiveness criteria in offering education services at a reasonable cost to some ofthe lowest income groups in rural areas, and provides efficient management of those services.Despite the lower socio-economic status of EDUCO students2, their achievement results arecomparable to students in traditional (urban and rural) schools. Although overall costs of theEDUCO schools are similar to those of traditional schools, the benefits of the program appear tobe much higher. These benefits include bringing education to areas which did not previouslyreceive these services, community involvement in providing education services, and better controlover teacher attendance and performance. EDUCO also established channels for bettercommunication between communities and the Ministry of Education (MINED).

5. The EDUCO model accomplishes a balance between the benefits of an active participationof parents in the education of their children, and the economic benefits of public sectorintervention. The proposed project will support the strengthening of the partnership betweencommunities and MINED.

' Psacharopoulos, G. and Y.C. Ng, "Earnings and Education in Latin America: Assessing Priorities for SocialInvestments," World Bank Policy Research Working Paper, WPS 1058, December 1992. The results reported usethe full discounting method.2 EDUCO schools are in some of the lowest income areas of El Salvador, where factors such as health, nutrition,and the need for child labor weigh in heavily against school performance.


6. By delegating the administrative functions to the local communities, the EDUCO modelbuilds in an adequate structure of incentives because the parents are empowered to make the bestout of the resources provided by the government and by themselves to educate their children.

7. The financial support of the government circumvents two phenomena which hinder privatedemand for education. Parents do not perceive the full economic return of education becausethey only take into account private costs and returns, and, even when they do, they may be unableto pay its price, or to borrow against the future returns of this investment. Facilitating the accessto education services, based on the expansion of the EDUCO model, allows the capitalization ofeconomic returns that could otherwise be lost in a poverty trap.

8. Through the use of double sessions and, whenever possible, the rehabilitation of existingschools rather than construction of new schools, the expansion of EDUCO that is supported bythe current project uses cost-efficient criteria to achieve better school coverage. Double sessionsin existing infrastructure and in new schools reduce expensive infrastructure investments.Additionally, experience shows that teachers are willing to assume responsibility for a secondsession at a premium of about 43 percent of their regular salaries, this means that the marginalcosts of adding double sessions are substantially below those of adding new sections with newteachers. In reference to classrooms, the project calls for rehabilitating 9,152 classrooms at a costof approximately $2,600 each. A much smaller number of new classrooms (1,140 at a cost ofabout $23,000 each) will be built where rehabilitation of existing infrastructure cannot meet thedemand for increased coverage, and will be financed by the communities and the SocialInvestment Fund (Fondo de Inversi6n Social - FIS).

9. It is important to mention that the expansion of EDUCO could face increasing marginalcosts. The program introduces a more active participation of the private sector to providepromotion and organization services for the community which are currently provided directly byNMINED. The project will compare the cost effectiveness of contracting services with thepotential negative economies of scale of extensive MINED micromanagement of the project.

Component 2. Improvement in Educational Quality

10. The education flow wastage could be dramatically cut by improving the quality of servicesand by the existence of minimal nutrition conditions for the children. The five subcomponentssupporting education quality - curriculum improvements, teaching materials, teacher qualificationand training, student achievement evaluation, and health and nutrition - respond to the weakestelements of the Salvadoran education system.

11. There is substantial room for improvement in dropout and repetition rates. The averageperiod required by a student to finish 9 academic years is 19 years. The dropout rate isparticularly high between the 2nd and 3rd cycles.

12. The transition to 3rd cycle increases by 51 percent the required surplus time needed tocomplete the basic education cycle. Dropout rates within cycles are known to be considerablyless. Under the assumption that repetition explains 90 percent of education waste within cycles,repetition is responsible for 4.5 of the extra years needed to finish basic education.


L Expeniture er Stuent an Numbe of Yv to~ Prdue a. .......e__.....Years per Graduate Education Wastage (years) Annual Cost

Effective Acadeniic Total Repetitionb Per Student'Basic (1-9) 19.4 9 10.4 4.5 US$149lst/2nd Cycles 10.1 6 4.1 3.69 US$149

3rd Cycle 3.9 3 0.9 0.81 US$149(7-) .Transference to 3rd Cycle 5.4' Annual costs per student include capital costs.b Number of years out of the total that are due to repetition.Source: Rand. 1995. "An Analysis of the Unit Costs of Preschool and Primary School in El Salvador.

13. Reduction of repetition rates can yield savings up to 23 percent of the education costs pergraduate in grades 1-9. Annual expenditures for students in basic education are US$149 dollars. Witha basic enrollment of 1.06 million in 1994, the cost of repetition may be as high as US$37 million peryear. This cost will increase with expansion of education services if it is not combined with actions toimprove quality to reduce repetition and dropout rates.

14. The proposed project will address issues of efficiency in a comprehensive way through aseries of actions to improve the quality of education services provided by MINED. It is importantto emphasize six actions that will have a direct impact on repetition rates and are considered in theproposed project: (a) the revision of curriculum to meet the needs and interests of the rural schoolpopulation; (b) the expansion of preschool coverage; (c) the development of a multigradeprogram in rural areas that introduces the flexibility required in rural environments; (d) theestablishment of a new promotion system for students allowing for automatic progression withincycles; (e) the development of a nutrition program targeted to the poorest school in rural areas;and (f) the promotion of an active participation of parents in school management. Under theassumption that repetition is responsible for 4.5 of the years needed to finish basic education, areduction of repetition rates in one year will reduce the annual average repetition waste in theamount of US$9 million. If that goal is accomplished, an amount similar to that estimated for thequality component could be 'internally" financed by the savings.

15. Dropout costs are difficult to measure because of the complex interconnections with laborand production. Nevertheless, the costly pedagogical difficulties of having overage students, theincreased cost of generating human capital, and the potential loss of economic returns sustain theimportance of reducing dropout rates.

16. The importance of the subcomponents included under the quality component have furthersupport in international experiences. A recent study of Chile, Colombia, Argentina and Mexicostated that "the study flow inefficiency, specially among the urban and rural low-income students,is primarily prompted by lack of: (a) early stimulation programs; (b) appropriate educationalinputs such a as textbooks, learning and teaching materials, in-service teacher training,


pedagogical supervision, feeding programs, health screening, and school construction andmaintenance; (c) relevant curricula; and (d) suitable learning environments."3

17. One aspect that deserves special attention is the introduction of evaluation schemes tomonitor the effectiveness of the education policy, including this project. The evaluationcomponent and the development of a MINED information system, introduce powerful tools tovalue the effectiveness of the education policies. The establishment of accountability throughachievement tests has proven its capacity to improve teacher performance and studentachievement, the case of Thailand is one remarkable example.4

Component 3. Institutional Modernization and Strengthening

18. The government has set realistic targets for improving enrollment, and the project emphasizesquality enhancing investments. The increase in resources has to be paired with an effort to enhanceefficiency in the provision of education, and in the performance of government agencies.

19. Moreover, the Government is developing a full Program of Modernization of the PublicSector that aims to improve the overall efficiency of the public sector. The project will contributeto this process from within MINED by supporting improvements in MINED's incentive structure,strengthening the information system, improving communications, strengthening the supervisionof personnel, and developing an effective monitor system.

20. One important underlying decision in the modernization process that the Governmentwants to implement is the decentralization of services (particularly education and health). Theexamples of education decentralization in Latin America indicate the paramount importance of thecoexistence of a strong management capacity that will allow policy makers and governmentofficials to monitor the decentralization process and the development of managerial capacity atlocal levels to absorb new responsibilities. The timely provision of technical support and theestablishment of an efficient information system to implement the monitoring process are alsocritical. The project will closely support the decentralization process and is expected to providethe necessary technical assistance to empower the MINED to finish that process.

21. The major bottleneck of the education sector is the limited managerial capacity ofMINED. In spite of the willingness of the Government and international agencies to providefunds to expand and improve the education sector, the implementation capacity is limited. Bycontributing to the development of MINED's managerial capacity, the education sector couldreap the benefits of a vast set of social investment opportunities.

22. Finally, the availability of funds and technical support for pilot projects is a cost efficientway to introduce efficient methods and procedures to deliver education services. The pilotprojects will encourage innovations on an experimental basis. The pilot projects will identify, test,improve, and evaluate different pedagogical methods and administrative procedures to improve

3 Prawda, J. 1992. "Educational Decentralization in Latin America: Lessons Learned." A View from LATHR,No. 27. World Bank, Human Resources Division, Technical Department, Latin America and the CaribbeanRegion, Washington, DC.4 Lockheed, M., A.M. Verspoor, et al. 1991. Improving Primary Education in Developing Countries. New York:Oxford University Press.


coverage, quality and increase efficiency. The evaluation of such experiments will give extremelyuseful inputs for policy makers to make cost effective decisions in the allocation of capital andhuman resources.

Marginal rate of return of the medium term education plan of GOES for expanding coverage andreducing repetition and dropout rates

23. The medium term plan of the government of El Salvador aims at increasing the coveragein rural preschool and in primary education, and to reduce the presence of overage students.

24. Even without detailed econometric work based on the Household Surveys,5 it isworthwhile to estimate a rudimentary internal rate of return for the project. In order to do so, thefollowing assumptions were made:

(a) A higher coverage demands additional resources. A yearly average cost perstudent of US$149 (including capital costs) was multiplied by the increase in thenumber of preschool and primary students in public schools.6 The yearly cost wasassumed to increase at an annual rate of 7 percent until 1999 and 5 percentthereafter.7

(b) A more rudimentary method was used to estimate the benefits of the plan. It wasassumed that an improvement in coverage will have the following positive effects:

(i) Dropout decisions will be postponed by a year. This means that theaverage wage of those students who dropout from school will increase.Using data about the relationship of wages and years of schooling fromDewees et al.8, it was estimated that the average income of primary schooldropouts will increase by about 10 percent. This income differential wasmultiplied by the projected number of dropouts from 1995 to 2024.

(ii) A higher coverage allows new students to receive higher wages. The extraannual income was assumed to be the same obtained by postponingdropout decisions (i.e. about 10 percent of actual wages). It was appliedto the difference between the enrollment in the three cycles of public basiceducation with and without the project. This is a very conservativeassumption.

5 National Survey of Household Income and Expenditures (Encuesta Nacional de Ingresos y Gastos de Hogares)and the Multiple Purpose Household Survey (Encuesta de Hogares de Prop6sitos Multiples).6 Stulents in the 3rd cyvle of basic education w~ere also mcluded7 Based on the mid-term projections implicit in the current Economic Plan.5 Dewees, A., S. Klees, and J. Quintana. 1994. "Costos, Beneficios y Financiamiento de la Educaci6n en ElSalvador." In Diagnostico del Sistema de Desarrollo de Recursos Humanos de El Salvador. Report for theHarvard Institute for International Development in collaboration with Fundaci6n Empresarial para el DesarrolloEducativo, Universidad Jose Sime6n Caffas. The differential in income was adjusted so as to allow for a 5 percentanmual teal gmwth in salaries of the economy.


(iii) A better coverage of preschool in rural areas will reduce the repetition rateof 1st. grade. This reduction was estimated as 20 percent (i.e. repetitionrate in the 1st grade in rural areas declines from 20 percent to 16 percent).This allows the saving of fiscal resources.

(iv) Benefits accrue after 1999. This assumes that the benefits of the programrequire time to mature before becoming effective.

25. With these assumptions the annual real marginal rate of return of the medium term plan foreducation was estimated as 19.7 percent. This underestimates the true rate because: (a) privateand social returns for education are increasing as a consequence of an increasingly competitiveeconomy; (b) returns gaps between levels of education are widening as a consequence of thedemand for a better educated labor force by the productive sector; (c) the assumptions aboutexpanded years of education are very conservative; and (d) no external positive effects wereincluded.

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TOTALRURAL PRESCHOOL COVERAGE 47,553 53,651 59,975 66,530 72,692 80,146 87,432 89,181 90,965 92,784 94,640 96,533 98,463 100,432 102,441 104,490

Public RuPl Preschool Coverage 44,410 50,446 56,705 63,194 69,290 76,676 83,893 85,571 87,282 89,028 90,808 92,625 94,477 96,367 98,294 100,260

-Private Rural Prescho-ol Coverage 3.143 3,206 3,270 3,335 3,402 3,470 3,540 3,610 3,683 3,756 3,831 3,908 3,986 4,066 4,147 4,230

EXPECTEDRURALCOVERAGE 24.5% 27.1% 29.7% 32.3% 34.6% 37.4% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0%

|Preschooi Populaion 194,094 197,976 201,935 205.974 210,093 214,295 218,581 222,953 227,412 231.960 236,599 241,331 246,158 251,081 256,103 261,225

PUBLIC PRESCHOOL WITH PROGRAM 44,410 50,446 56,705 63,194 69,290 76,676 83,893 85,571 87,282 89,028 90,808 92,625 94,477 96,367 98,294 100,260

PUBLIC PRESCHOOL WITHOUT PROGRAM 44,410 45,298 46,204 47,128 48,071 49,032 50,013 51,013 52,033 53,074 54,136 55,218 56,323 57,449 58,598 59,770

INCREASED COVERAGE WhIt PROGRAM 0 5,147 10,501 16,066 21,219 27.644 33,880 34,558 35,249 35,954 36,673 37,406 38,154 38,918 39.696 40,490

BASIC EDUCATION: TOTAL CYCLES L& I 863,498 889,922 914,935 929.401 935,513 934,764 932,180 948,486 965,117 982,081 999,385 1.017,034 1,035,037 1,053,399 1,D72,129 1,091,233

-Urban 427,704 440,303 452,098 459,650 463,329 4637997 463,873 472,118 480,527 489,104 497,853 506,777 515,879 525,163 534,633 544,292

-Rujral 435,794 449,619 462,637 469,751 472,183 470,767 468,30Y7 476,368 494,590 492,977 501,532 510,258 519,158 528,236 537,496 n 5 146,4

PUBLICA BASIC EDUCATION 756,081 780,356 803,178 815,409 819,241 816,167 811,211 85,097 839,261 853,708 868,444 883,475 898,806 914,444 930,394 946,664

PoUrbain 334,119 344,447 354,932 360,337 362,030 360,672 358,482 364,618 370,877 377,261 383,753 390,415 397,190 404,101 411,150 418,339

P Rural 421,962 435,510 448,247 455,073 457,211 455,496 452,730 460,479 468,384 476,447 484,671 493,059 501,615 510,343 519,245 528,325

... of wvbicb

-~Overage :195,529 1.99,09 4 201,085 191.03.1 171,927 146.138 116,911 H6,911 1t6,911 116,911 116,911 : 116,911 1t6,9tl: 116,91.1 11.6,911 116,911

EnlroDnma. 7412 : 560.552 581,~262 602.09 624,3787 647,314 670i029 694.300 708,186 722,350 736,797 751,533 .766,5.64 781,895 :797,533 813,483 829,7L53

PRIVAT'EBASIC EDUCAnON 107,417 109,565 111,757 113,9912 116,272 118.597 120,969 123,388 125,856 128,373 130,941 133,560 136,231 138,955 141,734 144,569

-Urbanl 93,585 95,457 97,366 99,313 101,299 103,32.5 105.392 107,500 109,650 111.843 114,080 116,361 118,688 121,062 123,483 125,953

-Rural 13,832 14,109 14,391 14,679 14,9172 15,272 15,577 15,889 16,206 16,531 16,861 17,Z98 17,542 17,893 18,251 18,616

ESTIMAllE OF BASIC EDUCATION COVERAGE 83.0% 84.2% 85.3% 86.5% 87.7% 88.8% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0%1

lPopulatimn7-12 804,373 820,460 836,870 853,607 870,679 888,093 905,855 923,972 942,451 961,300 980,526 1,000,137 1,020,139 1,040,542 1,061,353 1,082,580

|PUBLIC RURAL CYCLES I & 421,962 435,510 448,247 455,073 457,211 455,496 452,730 460,479 468,384 476,447 484,671 493,059 501,615 510,343 519,245 528,325

PUBUC RURAL FIRST GRADE 143,889 148,509 152,852 155,180 155,9D9 155,324 154,381 157,023 159,719 162,468 165,273 168.133 171,051 174,027 177,062 IS0,159

STUDENTS REPEATING GRADE 28,669 29,590 30,455 30,919 31,064 30,947 30,760 31,286 31,823 32,371 32,930 33.500 34,081 34,674 35,279 35,896

COSTS USS/rodN dollars $146 S156 $167 $179 $191 $191 $191 $191 $191 $191 $191 $191 $191 $191

COST OF EXPANDING PRESCHOOL COVERAGE (in hosansal) $1,533 $2,510 $3.547 S4.944 $6,484 $6,601 $6,733 $6,867 $7,005 $7,145 $7,288 17,433 17,582 $7,734

COSTSOFPERSISTENTREPETMITON (io thousand[s) $889 $966 $1,039 $1,107 $1,177 $1,195 $1,216 $1.237 $1,258 $1,280 $1,302 $1,325 $1,348 $1,371

C,0

t ..... .... ... . : : E ..............E . ;. S sM............;

TOTAL RURAL PRESCHOOL COVERAGE 106,58D 104711 110,886 113,103 115,365 117,673 120,026 122,427 124,875 127,373 129,920 132,518 135,169 137,872 140,630 143,442

Pubc Rural Prewcool Coverge 102,265 104,310 106,397 108,524 110,695 112,909 115,167 117,470 119,820 122,216 124,661 127,154 129,697 132,291 134,937 137,635

Private Rural PreschDol Coveage 4,315 4,401 4,489 4,579 4,670 4,764 4,859 4,956 5,055 5,156 5,260 5,365 5,472 5,581 5,693 5,807

rEXPECIrED RURAL COVERAGE 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0% 40.0%1

|Preschool Populati 266,449 271.778 277,214 282,758 288,413 294,182 3C0,065 306,066 312,188 318,432 324,806 331,296 337,922 344,681 351,574 358,606

PUBLIC PRESCHOOL WITH PROGRAM 102,265 104,310 106,397 108.524 110,695 112,909 115,167 117,470 119,820 122,216 124,661 127,154 129.697 132,291 134,937 137,635PUBLIC PRESCHOOL WITHOUT PROGRAM 60,965 62,185 63.428 64,697 65,991 67,311 68,657 70,030 71,431 72,859 74,316 75,803 77,319 78,865 80.443 82,051

IINCREASED COVERAGE W1I7 PROGRAM 41,300 42,126 42,968 43,828 44,704 45,598 46,510 47,440 48,389 49,357 50,344 51,351 52,378 53,425 54,494 55,584

BASIC EDUCATION: TOTALCYCLES I &m 1,110,720 1,130.596 1,150.869 1,171,549 1,192,641 1,214,156 1,236,101 1,258,485 1,281,316 1,304.604 1,328.358 1,352,587 1,377,301 1,402,508 1,428,220 1,454,447- Urban 554,145 564,195 574.445 584,901 595,566 606,444 617,539 628,657 640,401 652,175 664,186 676,436 688,931 701,677 714,677 727,937

- Rural 556,575 566,401 576.424 586,648 597,076 607,712 618.562 629,628 640,916 652,429 664,173 676,151 688,369 700,832 713,543 726,509

PUBLIC BASIC EDUCATION 963,259 960,186 997,452 1,015,062 1,033,025 1,051,348 1,070,036 1,089,099 1,10S,543 1,128,375 1,148,605 1,169,238 1,190,285 1,211,752 1,233,649 1.255,9S4

- Urban 425,673 433,153 440,783 448,565 456,503 464,600 472.859 481,283 489,875 498,639 507,579 516,697 525,998 535,484 545,161 555,031

- Rurnl 537,536 547.033 556,669 566,497 576,522 586,748 597,178 607.816 618,668 629.736 641,026 652.541 664,287 676,268 688.489 700,953

... of which

-Overage 116,911 116,911 116,911 116,911 116,911 116,911 116,911 116,911 116,911 116,911 116,911 116,911 116,911 116,911 t16,911 116,911

- Enroliwme. 7-12 146,.4U 863,275 880,541 898,151 916,114 934,437 953.125 972,188 991,632 1,011,464 1,031,694 1,052,327 1,073,374 1,094,841 1,116,738 1,139,073

PRIVATE BASIC EDUCATION 147,461 150,410 153,418 156,486 159,616 162,808 166,064 169,386 172,774 176.229 179,754 183,349 187,016 190,756 194,571 198.462

- Urban 128,472 131,042 133,662 136,336 139,062 141,844 144,681 147,574 150,526 153,536 156,607 159,739 162,934 166,192 169,516 172,907

- Rural 18,968 19,368 19,756 20,151 20,554 20,965 21,384 21.812 22,248 22,693 23,147 23,610 24,082 24,563 25,055 25,556

ESTMATE OF BASIC EDUCATION COVERAGE 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0%

|Populatior 7-12 1,104,232 1,126,316 1,148.S43 1,171,820 1,195,256 1,219,161 1,243,544 1,268,415 1,293,783 1,319,659 1,346,052 1,372,973 1,400,433 1,428,442 1,457,010 1,486,151

PUBLIC RURAL CYCLESIAIIH 537,586 547,033 556,669 566,497 576,522 586,748 597,178 607,816 618,668 629,736 641,026 652,541 664,287 676,268 688,489 700,953

PUBLIC RURAL FnRST GRADE 183,317 1S6,538 189,824 193,176 196,5914 200,081 203,638 207,265 210,966 214,740 218,590 222,517 226,522 230,607 234,775 239,025

ISTUDENTS REPFATTNG GRADE 3,6,525 37,167 37,821 38,489 39,170 39,865 40,574 41,296 42,034 42,786 43,553 4.4.335 45,133 45,947 46,778 47,624

COmST USS/W,&M Sl91 Sl91 Sl91 S191 Sl91 Sl91 Sl91 Sl91 Sl91 Stl9 Sl91 Sl91 5191 Sl91 Sl91 Sl91

COST OF EXPANDING PRESCHOOL COVERAGE S7,S8S SS,046 SS,207 SS,371 SS,538 SS,709 SS,8S3 S9,061 S9,242 S9,427 S9,616 9Sq0Sm 510,0C4 S10,204 S10,408 $10,617

COSSOF PERSISTENT REPETITION S1,395 Sl,420 Sl,445 Sl,470 S1,496 Sl,52 S,5 S178 16C Sl34 S1,664 S1,694 Sl,724 Sl,755 S1,787 S1,819

0Shn

PUBLICBASICEDUCATIONSTUDENTS 920,394 947,945 974,119 989,769 997,088 997,571 996,243 1,016,168 1,036,491 1,057,221 1,078,366 1,099,933 1,121,931 1.144,370 1,167,258 1,190,603

-URBAN 452,196 465,285 477,779 485,641 4899840 491,038 491,455 501,285 511,310 521,536 531,967 542,606 553,459 564,528 575,818 587,335

-RURAL 468,188 4S2,660 496,340 504,128 507,248 506,533 504,788 514,883 525,181 535,685 546,398 557,326 568,473 579,842 591,439 603,268

PUBLIC BASIC EDUCATION SUDENTS (IhvuMWI) 920 948 974 990 997 998 996 1,016 1,036 1,057 1,078 1.100 1,122 1,144 1,167 1,191PUBLIC THIRD CYCLE EDUCATION STUDENTS 164,303 167,589 170,941 174,360 177,847 181,404 185,032 222,038 266,446 319,735 383,682 460,418 552,502 663,003 795,603 954,724

-URBAN 118,077 120,439 122,847 125.304 227,810 130,367 132,974 159,569 191,4S2 229.779 275,735 330,882 397,058 476,469 571,763 686,116

-RURAL 46,226 47,151 48,094 49,055 50,037 51,037 52,058 62,470 74,963 89,956 107,947 129,537 155.444 286,533 223,840 268,608

OVERAGE 196 299 201 191 272 146 117 119 122 124 127 129 132 134 137 140

PUBLIC EDUCATION STUDENTS EXCLUD. OVERA 725 749 773 799 825 851 S79 897 915 933 952 971 990 1,010 1,030 1,051DROPOUTS 95 98 101 102 103 103 103 105 107 109 III 114 116 218 121 123PUBLIC EDUCATION STUDENTS WITHOUT THE PROGRAM 754 769 784 800 816 832 849 866 883 901 919 937 956 975INCOME DIFFERENTIAL (In millia) (1) 12 12 13 13 13 13 13 13 14 14 14 14 15 15 15 16GROWTH IN REAL INCOME (2) 1 1.050 1.103 1.158 1.216 1.276 1.340 1.407 1.477 1.551 1.629 1.710 1.796 1.886 2.980INCOME DIFTERENTIAL FOR LATER DROPOUT 13 14 IS 16 17 18 19 20 22 23 25 27 29 31INCOME DIFFERENTIAL FOR INCREASED COVERAGE (3) 3 4 6 8 10 I1 12 12 13 14 15 16 17 19TOTAL INCOME DIFERENTIAL FOR BASIC EDUCATION 16 18 21 24 27 29 31 32 35 37 40 43 46 50

REDUCTION IN REPETITION I I I I I I 1 I I I I I I I

COSTS

COST PER STUDENT (2) 149 159 171 183 195 205 215 226 237 249 262 275 289 303BASIC EDUCATION COSTS WITH PROGRAM Millions 115 227 141 155 172 184 197 211 226 242 259 278 297 318 8OBASICEDUCATIONCOSTSWITHOUTPROGRAM 112 123 134 146 159 171 183 196 210 225 240 258 276 295 S)DlFERENTIAL IN COSTS WrOUT OVERAGE 3 5 7 9 12 13 14 15 16 17 19 20 21 23COST OF INCREASED COVERAGE OF PRESCHOOL 2 3 4 5 7 7 8 8 9 9 10 II I1 12SOCIAL GAINS (wiKcA munity) 13 12 11 10 9 9 10 10 I1 12 12 13 14 15SOC1AL GAINS AFTER 5 YEARS (4) -4 -6 -0 -13 -18 9 10 10 21 12 12 13 14 15

INTERNAL RATE OF RETURN 20% S

slF _ i7 --e -iSit? -. . -............ .. ,,:',:: .: .. ::::: ....... ..:::.: .... ::.::. ........ . -:::E::-:::E:::::::::::: : :: :7 7 I; o;i:i"itl,i,vm ,p ,,;;}j,

f.0igailll:jll,rZSis .-|s lll-:i .. llL--jl'_ 'i|||FE : " Ei

~~Mhfl2' 4 ~~~~~A ........ ... '56 _, - 46ix4- W *4 46 't f

PUBUC BASIC EDUCAllON STUDENTS 1,214.415 1,238,703 1,263,477 1,288.747 1,314.522 1,340.812 1,367,628 1,394,981 1,422.880 1.451,338 1,480,365 1,559,972 1,540,172 1.570,975 1,602,394 1,634,442

-URBAN 599,081 611,065 623,284 635,750 648,465 661,434 674,653 658,156 701.919 715,958 730,277 744,882 759780 774,976 790.475 806.285

-RURAL 615.333 627,640 640,193 652,997 666,057 679,378 692,965 706,825 720,961 735,380 750,088 765,090 780,391 795.999 211.919 t28,258

PUBUC BASIC EDUCATION STUDENTS (Tbhm s 1,214 1.239 1,263 ,289 1,315 1,341 1,368 1,395 1,423 1,451 1,480 1,510 1,540 1,571 1,602 1,634

PUBUC n'[RD CYCLE EDUCAIION 51UDEJS 2,145,669 2.374.802 1,649,763 1,979,715 2,375,658 2,850,790 3,420,948 4,102,137 4,926,165 5,911,398 7,093,678 8,512,413 10,214,896 12.257,875 14,709,450 17,652,340

-URBAN 823,339 968.007 1.185,60 1,422,730 1,707,276 2,048,731 2,458.478 2,950.173 3,540.208 4,248,250 5,097,899 6,117,479 7,340,975 8,809,170 10,571,C04 12,685.205

-RURAL 322,329 386,795 464,154 556,985 668,382 802,058 962,470 1.254.964 1,385,957 1.653,148 1,995,778 2,394,934 2,873.921 3,448,705 4,138.446 4.966,135

OVERAGE 143 145 148 151 154 157 160 164 167 170 174 177 181 184 128 192

PUBUCEDUCAllONSTUDENTSEXCLUDINGOV 1,072 1,093 1,115 1,138 1.160 1,183 1,207 1,231 1,256 1,281 1,307 1,333 1.359 1,387 1,414 2,443

DROPOUTS 125 228 130 133 136 138 141 144 147 ISO 153 156 159 162 165 169

PUBIC EDUCATION STI ENTS W1rHOUT THE P 995 1014 1035 1055 2077 1098 1120 1142 1165 1189 1212 2237 1261 1287 1312 1339

INCOME DlFERNflAL (In mlin) (1) 16 16 16 17 17 17 28 28 19 19 19 20 20 20 21 21

GROWTH IN REAL INCOME (2) 2.079 2.183 2.292 2.407 2.527 2.653 2.786 2.925 3.072 3.225 3.386 3.556 3.733 3.920 4.116 4.322

INCOME DIFERENI'lAL FOR LATER DROPOUT 33 35 38 40 43 46 50 53 57 61 65 70 75 so 86 92

INCOME DIFERENTIAL FOR INCREASED COVER 20 21 23 25 26 2a 30 32 35 37 40 42 45 49 52 56

TOTALINCOMEDIFERENTIALFORBASICEDUC 53 56 61 65 69 74 85 85 92 98 105 222 120 129 138 142

REDUCTION IN REPETMON I I I I 1 2 2 2 2 2 2 2 2 2 2 2

COSTS

COST PER STUDENT (2) 318 334 351 368 387 406 426 448 470 494 518 544 571 6C0 630 661

BASIC EDUCATION COSTS WITH PROGRAM 341 365 391 419 449 481 515 551 590 632 677 725 777 832 891 954 8O

BASIC EDUCATION COSTS WlHOUT PROGRAM 316 339 363 389 416 446 478 511 548 587 628 673 722 772 827 885 w

DIFERENTlAL IN COSTS WllHOUT OVERAGE 25 26 28 30 32 35 37 40 43 46 49 52 56 60 64 69

COSTOFINCREASEDCOVERAGEOFPRESCHOO 13 14 15 16 17 19 20 21 23 24 26 28 30 32 34 37

SOCIAL GAINS (wiltint mnrity) 16 27 l8 28 21 22 24 25 27 29 31 33 35 38 40 43

SOCIAL GAiNS AFTER 5 YEARS (4) 26 27 28 20 21 22 24 25 27 29 31 33 35 38 40 43

0o'a>* 3

flc:w iiiSL:kim$ witkrDEl TTAL YCoESf t 34i.111E'EFYON lRAEIN FlRS DE: : ::: l3%

Total Emnployment EnMPtym lncm, by Eeployme~ Diffeou by G.&tYears of Schooling (K.e) A.u1 1992 prevedie0 436 6324 Ge : :e1-3 377 7980 1.26 1.26

4-6 411 9708 1.22 1.547-9 233 10909 1.12 1.7210-12 197 15672 1.44 2.4813+ 126 23668 1.64 4.06

TOTAL (in thouad) 1780 1 ______

Swm S Dppo. Reet o N- o Dnrpra I.: US$ : P."oGRADES 92 93 7. lEm h Q Deopons boorc Q2O 424815 66,324 S.944

I n~~~~~~~~~~~~~27.99 220.353 19.4% 18.97. 61.67. 12.391 17.980 $11,309 42.815 $390D472 354.375 153.732 0.1% 8.6% 83.4% 10,512 17,980 19.404 12.391 $11,3093 1357656 137.304 7.5% 6.3% 86.2% 9.992 17,980 19,113 10,312 19,404

4 118,293 122.452 8.2% 4.7% 87.2% 8.028 19,706 99,807 9,992 SI11,0864 102,449 106.334 7.6% 3.2% 19.3% 10.251 $9,706 111.373 8,92 59.7

6 80,490 93.959 10.9% 2.8% 86.3% 7.975 $9,708 $89,84 10.251 $111.3737 T7.459 79,7419 10.0% 2.1% 87.9% 6.171 $10,988 57.693 7.975 $9,9427 63989 69233 1 9.0% 1.3. 79.7% 0 $10,906 s0 6.171 $7,693

9 16,297 59.422 0.3%TOTAL 10291 12042 1 06 $97,53 106,753

AVERAGE INCOME PER YEARS (Colones) 904

GADES0TIIW PWOGRAMACINV THE PO9 b ONEMENT 'QFDROPOUT 1 R:\ssrp2\'irtabl2. xQs

0

0 42,815 S6,324 S30.944 >~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~r

95 ANNEX4Social Assessment: Summary

of Main Results

EL SALVADOR BASIC EDUCATION MODERNIZATION PROJECrSOCLL ASSESSMENT: SUMMARY OF MAIN RESULTS

Background and Objectives

1. As part of the preparation of the project, a Social Assessment (SA) was undertaken betweenNovember 1994 and February 1995. The SA supports the operation by identifying major benefits andrisks, and proposing an action plan on how to maximize the former and minimize the latter. Given thatbackground and statistical information were already available, the SA focused on both the enforcementcapability of the government and on the involvement of school communities in canying out theeducation reforms. The SA had two components. The first component, institutional, analyzed theorganization and legal framework of the education system as well as its constraints. The secondcomponent, community participation, identified the main stakeholders, their values and interests, theirevaluation of the education system, their level of information about it, and their willingness toparticipate. The SA sources consisted of desk review, focus groups, in-depth interviews, and a casestudy. Focus groups, rather than individual interviews, were chosen for both practical andmethodological reasons: the practical reason was the limited time frame in which the SA had to work;the methodological reason was that the reform would rely upon the capacity of groups (school boards),rather than individuals (principals) taking over responsibilities in school management.

Findings

* The access and quality of basic education are considered a priority by the government. Thepriority placed on basic education is reflected in the 1994-99 National Plan for Development and inthe government's budget. The first draft of the Plan identifies as main objectives, for 1995-1999,to: (a) increase the coverage of pre-primary education from 24.5 percent in 1993 to 40 percent in1999 and increase coverage in the first six grades of basic education from 83 percent in 1993 to 90percent by 1999; (b) expand the EDUCO program; (c) improve the quality of education in firstthrough sixth grades by financing curricula, training and supplies; and (d) provide parents withincentives to discourage school drop-outs and encourage teachers to spend more time in theclassroom. MINED's 1995 National Budget reflects this priority placed on basic education.

* Education is valued and parents' attitude towards teachers is positive. Parents speak well ofthe school and teachers: "Teachers do miracles" according to one mother. There are fewercriticisms than expressions of support for teachers, and criticisms are attenuated by generalizationssuch as "80 percent of the teachers are very dedicated, very responsible, but 20 percent no longerwant to teach." Because parents value education, they are critical of the government, which,according to many, "is neglecting health and education and building more roads. "

* The new education goals are not yet known to their beneficiaries. Although there is aconsensus that the education system should be changed, there is fear that the Government intendsto privatize and "municipalize" education, thus undermining children's sole access to socialmobility: "The reform is announced as if it were a privatization. If it [school] is to privatize weparents would have to pay more, and would not be able to support our families."Municipalization raises the fear that personnel decisions will be politicized even firther, and that

96 ANNEX 4Social Assessment: Summary

of Main Results

they will be more arbitrary. A parent stated, "the municipal mayor's office is a political post.Mayors do not have the training or the time to take care of education issues."

* The main constraints to reforming the education system are not economic but rathersocial, cultural and institutional. The SA provides evidence of satisfaction with the systemamong parents whose children are enrolled in EDUCO, although they must contribute to schoolbuilding and maintenance. EDUCO's system is the best way for parents to be taken seriously. Onthe other hand, parents of children enrolled in traditional schools resent being called to meetingsonly to be asked for money. Another bottleneck in the system is the lack of teacher incentives.Thus, teachers seem to be more willing to move to the private sector because they feel it offers abetter incentive system. Teacher incentives are strongly tied to self-esteem. Low self-esteem iscorrelated to lost prestige, poor benefits, arbitrary promotions, poor infrastructure and lack ofaccess to good training. When teachers are asked what would make them feel more satisfied, theyanswer that they would like to receive more support from the Ministry as well as more incentives,more training, and more teaching material. Finally, the Government's inability to disburse all of itsavailable financial resources is an indicator of its weak institutional capacity.

- Self-esteem and respect in the community are linked to participation for both parents andteachers. In general, participation is considered important because it gives a role for people toplay in society, bringing social recognition and creating a sense of self-worth. For parents, this isachieved through helping to define the interactive system their children belong to; for teachers it isfound as they achieve the professional status they lost.

* There is frustration with authority at every level. Results from focus groups indicate thatteachers don't trust either the government, which they think is disdainful, or principals, who theythink are erratic and unaccountable. One of the interviewed teachers said, "l was in a schoolwhere the director didn 't even have a promotion list. One day he took off his belt and hit one ofmy colleagues." Parents also distrust principals, often complaining that they only want theirmoney, never telling them how the money is spent. On the other hand, principals claim to that it isdifficult to reach parents because few of them attend meetings. They are also apprehensive aboutparents supervising their activities claiming that parents are not prepared to be active in theirchildren's education.

* Gender bias: women exercise their influence through husbands or companions. Women arenot completely marginalized from making decisions, but men are the ones who vote in the ACEs.In 1992, 60 percent of the total ACEs' membership and 78 percent of their presidents were men.

* Repetition and dropout rates are high, particularly in the fist grade. There are severalreasons for high repetition in the first grade: teachers' inexperience, higher enrollment in first gradethan in any other grade, lack of teaching materials, low family income, nutritional deficiencies, andabsenteeism because of distance from school. Similarly, explanations for the dropout rate arerooted both within and outside the system. Common justifications for dropping- out of schoolinclude questioning the relevance and usefulness of what the student learns, claiming that earning aliving takes precedence over education, and believing that the costs of sending children to schoolseem to outweigh benefits. Parents who live in communities far from education centers often wait

97 ANNEX4Social Assessment: Summary

of Main Results

until their children are older to send them to school. Another common problem amongst poorerfamilies is how to afford to have more than one child in school at the same time.

* The institutional capacity of the education system is fragile. This fragility is shown in manyways:

- Since 1989, MINED has been supported by a multiplicity of bilateral and multilateralorganizations. However, an analysis of its financial cooperation projects during 1989-1993confirms that the Ministry was able to execute only 42.3 percent of programmed financialresources.

- MlNED's goals and strategies have been complemented by "compensatory" strategiespromoted by the Social Investment Fund (FIS) and the Secretariat for National Reconstruction(SRN). Nonetheless, there is no effective coordination among the three offices to complementand maximize institutional resources. NflNED has not kept accurate records of thecontributions that the FIS and SRN have made to education, particularly in the area ofinfrastructure.

- Besides the Constitution, there are approximately 300 laws in the education system. Theexcessive number of laws results in confusion and ineffective regulation of the sector

- Approximately 110 NGOs with education programs are registered in El Salvador; about halfof them with technical training programs and the other half with management trainingprograms. NGOs are capable of expanding coverage with subsidies from the public sector, butthe SA reveals a distrust from both NGOs regarding the government and from the governmentregarding NGOs.

- Current teacher training is problematic in three aspects. First, there is a concentration onsecondary education training and in three subjects. About 81 percent of the teachers are beingtrained for the secondary level, 14 percent for the pre-primary level and 5 percent are certifiedas special education teachers. About 21 percent of the training is in social sciences, 18 percentin philosophy/humanities/esthetics and 14 percent in English. Training for the elementaryeducation level has been suspended since 1990 and training for physical education teacherscorresponds to less than 1 percent of total enrollment. Second, the Ministry is not fulfilling itsrole as quality control enforcer for training. Third, teachers are not receiving sufficient trainingfor the posts they are to occupy. If this trend continues, supply and demand will be completelyincongruous by the year 2000 resulting in 83 percent of teachers certified to teach secondaryeducation while the demand would represent only 19 percent of total student enrollment. Onthe other hand, the demand for elementary education teachers would be 72 percent by the year2000 while the current supply is zero percent. The structure of the current promotion systemsends an implicit message that secondary education is more important than elementaryeducation, thus steering teacher training demand towards the former.

- The supervising function, which should be pedagogical, is also administrative. This createsdouble expectations and inefficiencies.


of Main Results

Recommendations

As a result of the SA, the following strategies are suggested:

* Recognize that MINED's most critical problem is not the lack of resources but rather inappropriatemanagement. It is suggested that the project include an institutional component to: (a) improve theinformation systems for monitoring, evaluating and making decisions; (b) develop mechanisms toincrease coordination between the central units and units at the regional and community/locallevels; (c) improve the quality of the supervisory system and the participation of the private sector,NGOs and groups from communities and universities; (d) perform a follow-up assessment of theproject's impact, including promoting an evaluation system for learning performance that should bean integral part of curricular development; (e) structure and organize teacher training to: takeplace during vacation periods, be recognized academically by the University of El Salvador, beginas early as university training, and provide health care training to children and other communitymembers.

* Communicate to society that the main goal of education reform is not to privatize education, butrather to extend coverage and improve quality.

* Suspend traditional hiring practices for teachers in order to reorganize the current system ofteacher administration and education coverage. To take advantage of EDUCO's innovations, thetraditional system has to be dismantled. Personnel hiring and replacement should be specificallyassigned to each departmental education center and managed by community or civil institutions.

* Simplify the legal framework which oversees the functions of MINED to serve as the basis foradministrative and financial restructuring.

k Ensure that teacher promotion is not based solely on seniority, but rather includes merit. Salariesshould also correspond to the level of academic preparation and training required for each level.Categories should be flexible enough to recognize and to give incentives for further professionaltraining. The Teaching Profession Law should: (a) apply exclusively to teachers (not supervisors,directors and technical staff); (b) abolish position assignments traditionally based on seniority; and(c) establish that teachers will compete for assigned posts and eliminate transfers of posts.

Action Plan

* Support MINED's Communication Unit in implementing mechanisms for consulting schoolcommunities (teachers, parents, supervisors, administrators and principals), NGOs, unions andother governnental institutions, in order to keep them informed about the project as well as to getfeedback and suggestions from them.

* Disseminate community and teacher innovations on administrative, financial and teaching/learningprocedures through radio, videos and community meetings to help communities learn from eachother.


of Main Results

* Support MINED's initiative of following-up the project's implementation with focus groups ofparents and teachers, adding new groups with different stakeholders, including school boards,school administrators, and administrative personnel from MIN4ED.

* Promote public discussion of the goals and achievements of the new policy through workshopswith conmmunity representatives and NGOs. Listen to suggestions on adaptations and changesneeded.

* Create mechanisms to inform MINED's employees of their new role and of the role expectedfrom communities.

* Study and compare the Salvadoran reform and the experience of community participation withother efforts carried out in Latin America to upgrade their experience in this material.

* Create mechanisms to enlighten commnunities about the importance of having women participate inschool boards and in decision making processes.

1:\ssrp2\ann_scas.doc

100 ANNEX5Proposals for the modernization of the Education

Sector within the Modermization of the Public Sector


PROPOSALS FOR THE MODERNIZATIONOF THE EDUCATION SECTOR

WITHIN THE MODERNIZATION OF THE PUBLIC SECTOR

1. This Annex summarizes the main aspects of three recent proposals for the modernizationof the public sector in El Salvador. The first Public Sector Modernization Program wasdeveloped by the previous administration which was in power between 1989 and 1994. The othertwo have been developed by the current administration which took power in June 1994. Thecommon theme that runs through each proposal is the decentralization of the delivery of servicesas a means of achieving increased coverage and improved quality in performance.

Background

2. During the previous administration (1989-1994), the process of modernizing theSalvadoran public sector was launched with the support of the World Bank (IBRD) (StructuralAdjustment Loans Ln. 3293-ES, 1991, Ln. 3646-ES, 1993, and Technical Assistance Loan, Ln.3648-ES, 1993) and other external donors. Reform proposals were directed towards economicand social policies, and the promotion of a strong market economy. The strategy focused on sixareas: institutional reorganization; administrative simplification; decentralization; privatization;strengthening of human resources; and fiscal and financial management.

3. The following three proposals are reviewed: (a) the IBRD supported Public SectorModernization Program; (b) the 1994-1999 Plan de Desarrollo Econ6mico y Social; and (c) theMinistry of Education's (MINED's) general proposals for the modernization of the educationsector.

Public Sector Modernization Program (Programa de Modernizaci6n del Sector Pfiblico,PMSP)

4. Decentralization is one of the most important mechanisms developed in this strategy. Thecommission for Decentralization and Municipal Development was created in 1992 and developedconcrete proposals within the scope of the general strategy. The document, "Socio-EconomicDevelopment Policy and Operational Strategy" (Sept 1994), explains the main guidelines. Themodel proposed for the strategy defines three areas to be tackled: local socio-economicdevelopment; municipal strengthening; and decentralization.

Modernization of the Education Sector - Plan de Desarrollo Economicoy Social 1994-1999

5. In the education sector, the main guidelines mirror the overall social sector strategy. Themain elements of the education strategy, according to the Plan, for the next five years will be:stronger focus on human, financial and material resources; decentralization and communityparticipation; and privatization of some MINED actions, especially those related to technicaleducation.

101 ANNEX 5Proposals for the modernization of the Education

Sector within the Modernization of the Public Sector

6. Policies designed to meet basic needs pursued objectives consistent with the prioritiesrepresented in the strategy, such as: to focus on poorer groups and areas; decentralization ofservices; and the reduced role of the state, with stronger roles assigned to the private sector andto the organized community. Emphasis was given to activities that could be completed in theshort- and medium-term. Medium-term activities included the modernization of those entitiesresponsible for planning and executing priority policies and services - the Ministries of Finance,Planning, Health, Education, Agriculture, Civil Works, Economy and the administrative entitiesworking at the local level.

MINED's Proposal for Education Reform

7. MINED's proposal for education reform intends to achieve two basic objectives: (a)increased coverage of the system; and (b) improved quality of the delivery of education services.While acknowledging the important advances that have been made since 1990, the proposalemphasizes the need for institutional modernization of the education sector, focusing on theadministrative and planning systems.

8. The proposal considers two innovations as the axes of the reform: (a) schools andcommunities will jointly manage transferred resources for the operation and maintenance of thesystem; and (b) the central office (MINNED's central units) will be limited to the financing andregulation of activities, to technically support the system, and to evaluate its outcome. In otherwords, the decentralization process is the chosen way to achieve the main objectives of thereform, including a more effective relationship with the society, especially beneficiaries of theeducation sector.

9. The current institutional arrangements are plagued with inefficiencies due to MINED'shighly centralized structure. To remedy these problems, the proposal has developed the followingguidelines: (a) at the preschool and basic levels the management of services would be turned over:(i) to the community in rural areas by expanding the EDUCO model to the whole system; and (ii)in urban areas, management of resources would be the responsibility of schools with a gradualprocess of transfer of funds and responsibilities to intermediary bodies (department, district); (b)at the secondary level, resources would be directly transferred to schools; (c) for technicaleducation, management would be transferred to other entities of the private sector (NGOs orprofit oriented); and (c) at the university level, mechanisms of control of the provision and thequality of services would be created.

10. To guarantee that these changes are made, actions directed towards the improvement ofthe administrative and planning systems are required. Many of them are detailed in the proposal.Some of these include: an adjustment plan for technical and administrative personnel; creation of apermanent system of technical assistance for administrative matters; revision of MINED'sorganizational structure; implementation of technical and administrative career plans; reform ofthe legal framework of the education sector; and improvements in the budget planning system.

1:Asaap2\ann_prop.doc

102 Annex 6Prioritization of Municipios


PRIORITIZATION OF MUNICIPIOS

1. The Ministries of Education (MINED) and Health (MOH), working together, havedeveloped a system to classify the rural areas of the municipios' in order to target social servicesto those areas which are most in need. A ranking system for the rural areas in all 262 municipiosin the country was developed based on the following indicators: (a) 1st grade repetition rate; (b)percentage of overage students in grades 1-9; (c) net enrollment rate for grades 1-9; and (d)percent of undersize children. The first three indicators are based on data collected in 1993, andthe last on the 1988 census of size.

2. Each indicator was classified into four categories and was assigned points according to thecategory.

REPETITION RATE PERCENTAGE OF OVERAGE STUDENTSRange Points Range Points0-10 1 0-18 1

10.1-20 2 18.1-36 220.1 - 30 3 36.1 - 54 3

30.1+ 4 54.1+ 4

NET ENROLLMENT RATE PERCENTAGE OF UNDERSIZE CHILDRENRange Points Range Points0-40 4 0-15 1

40.1 - 50 3 15.1- 30 250.1 - 60 2 30.1 - 40 360.1+ 1 40.1+ 4

These points were then summed for a total point score. Priority was assigned to the followingranges of point scores:

Range Priority13 -15 111-12 28 -10 31-7 4

Priority 1 represents those areas most in need of services.

3. The following table presents the 135 municipios selected by MINED to receive services.Activities in two parts of the project will be targetted to these municipios: the Expansion ofAccess to Preschool and Basic Education Component, and the School Health and NutritionSubcomponent.

A municipio is the second administrative level of the governmental system. The levels, in order, are:departamento, municipio, cant6n, caseria, comunidad.

103 Annex 6Pnoritization of Municipios

Net1st Grade Overage EnrollmentRepetition Students Rate

Department Municipio Rate (Grds 1-9) (Grds 1-9) UndersizeAhuachapan Apaneca 11.0 45.3 29.8 47.6Ahuachapan Concepci6n de Ataco 8.8 39.6 52.5 45.2Ahuachapan El Refugio 0.0 0.0 0.0 32.0Ahuachapan Guaymango 13.4 43.9 32.3 42.5Ahuachapan Jujutla 14.6 75.7 48.5 30.1Ahuachapan San Francisco Menendez 15.6 72.7 58.7 29.4Ahuachapan San Pedro Puxtla 5.8 49.2 75.3 51.4Ahuachapan Tacuba 13.1 54.5 51.6 46.6Cabafias Cinquera 2.0 0.0 0.0 n.a.Cabanias Guacotecti 16.4 64.8 79.8 37.1Cabafias Ilobasco 28.1 72.5 78.6 36.2Cabafias Jutiapa 35.5 71.9 49.1 26.1Cabafias Sensuntepeque 27.2 79.3 75.4 36.1Cabanias Tejutepeque 16.5 46.2 18.7 28.3Cabafias Villa Dolores 21.6 60.4 63.4 56.7Cabafias Villa Victoria 35.9 67.1 34.6 45.6Chalatenango Agua Caliente 21.5 82.6 66.4 25.3Chalatenango Arcatao 2.0 0.0 0.0 27.0Chalatenango Citala 12.8 70.0 51.0 21.9Chalatenango Comalapa 21.7 61.1 88.0 40.4Chalatenango Concepci6n Quezaltepeque 18.6 52.7 50.7 38.6Chalatenango El Carrizal 14.2 80.0 102.9 45.4Chalatenango El Paraiso 11.0 72.5 72.6 34.2Chalatenango La Laguna 11.2 73.5 60.6 58.6Chalatenango La Palma 18.2 59.4 76.3 38.3Chalatenango Las Vueltas 2.0 0.0 0.0 n.a.Chalatenango Nueva Trinidad 2.0 0.0 0.0 n.a.Chalatenango San Antonio de la Cruz 47.6 60.8 60.8 40.7Chalatenango San Antonio los Ranchos 2.0 0.0 0.0 n.a.Chalatenango San Femando 7.8 84.8 0.0 42.8Chalatenango San Francisco Morazan 2.0 84.7 52.0 50.0Chalatenango San Isidro Labrador 2.0 0.0 0.0 n.a.Chalatenango San Jose las Flores 2.0 0.0 0.0 n.a.Chalatenango San Luis del Carmen 2.0 50.2 66.9 17.4Cuscatlan Candelaria 9.0 33.3 29.4 60.0Cuscatlan El Carmen 11.6 49.0 39.8 50.0Cuscatlan El Rosario 20.6 72.7 141.5 35.7Cuscatlan Monte San Juan 8.1 56.6 36.3 46.4Cuscatlan San Jose Guyabal 20.8 52.4 56.6 42.9Cuscatlan San Ram6n 29.1 49.3 59.0 40.1La Libertad Chiltiupan 14.6 43.2 66.1 41.4La Libertad Comasagua 12.1 42.9 73.8 37.3La Libertad Huizucar 4.8 31.5 73.6 43.4

104 Annex 6Pnoritization of Municipios

Net1st Grade Overage Enrollment

Repetition Students RateDepartment Municipio Rate (Grds 1-9) (Grds 1-9) UndersizeLa Libertad Jayaque 11.8 47.3 71.5 46.7La Libertad Jicalapa 19.6 74.7 44.8 36.9La Libertad Nuevo Cuscatlan 20.3 63.3 0.0 30.2La Libertad Sacacoyo 14.3 52.9 75.2 46.4La Libertad San Matias 11.3 66.9 33.0 33.8La Libertad San Pablo Tacachico 9.8 55.2 62.6 37.6La Libertad Tamanique 13.2 50.1 159.9 38.1La Libertad Teotepeque 18.5 77.2 64.5 29.0La Libertad Tepecoyo 12.1 35.4 37.7 43.4La Paz Jerusalen 53.1 56.4 35.2 30.7La Paz Mercedes la Ceiba 2.0 0.0 0.0 16.6La Paz Paraiso de Osorio 0.0 12.0 17.5 49.4La Paz San Antonio Masahuat 38.8 74.2 61.9 32.0La Paz San Emnigdio 41.1 86.3 64.3 33.3La Paz San Juan Talpa 30.2 70.8 66.9 30.3La Paz San Juan Tepez6ntes 18.7 52.5 64.8 46.8La Paz San Luis la Herradura 32.9 67.0 50.7 27.9La Paz San Rafael Obrajuelo 43.7 61.9 93.1 36.7La Paz Santa Maria Ostuma 23.5 44.0 57.8 45.0La Uni6n Bolivar 25.3 65.3 65.9 16.6La Uni6n Conchaqua 28.9 72.9 50.4 30.9La Uni6n El Carmen 25.4 68.9 61.3 38.5La Uni6n Intipuca 23.0 89.0 35.1 28.2La Uni6n Lislique 5.2 57.1 48.8 54.4La Uni6n Meanguera del Golfo 12.3 73.6 57.6 23.0La Uni6n Nueva Esparta 28.2 76.1 62.7 33.4La Uni6n San Jose la Fuente 4.2 50.5 40.9 45.4Morazan Arambala 2.0 0.0 0.0 28.0Morazan Cacaopera 28.8 75.7 19.5 35.5Morazan Chilanga 22.4 65.8 44.7 36.9Morazan Corinto 19.4 78.5 31.7 51.0Morazan Delicias de Concepci6n 18.8 54.7 30.7 39.1Morazan El Divisadero 28.2 54.4 64.9 31.9Morazan Guatajiagua 20.2 71.8 28.8 27.2Morazan Jocoaitique 2.0 0.0 0.0 30.0Morazan Jocoro 16.8 48.3 71.8 38.5Morazan Lolotiquillo 13.2 86.4 61.1 25.8Morazan Osicala 19.8 68.9 28.2 30.2Morazan Perquin 3.6 33.8 4.5 51.8Morazan San Fernando 2.0 0.0 0.0 36.0Morazan San Isidro 61.9 94.3 25.6 14.0Morazan San Sim6n 13.6 67.9 36.5 50.0Morazan Sensembra 24.5 67.5 43.6 75.0



Department Municipio Rate (Grds 1-9) (Grds 1-9) UndersizeMorazan Sociedad 33.2 79.6 70.9 37.0Morazan Yamabal 55.1 80.1 48.5 36.4San Miguel Carolina 5.4 88.4 46.6 24.0San Miguel Ciudad Barrios 13.9 79.2 39.8 33.5San Miguel El Transito 8.6 50.0 79.7 37.6San Miguel Lolotique 12.6 45.0 74.7 38.7San Miguel Nuevo Eden de San Juan 10.7 90.3 74.0 31.0San Miguel Quelepa 19.9 59.5 43.0 15.4San Miguel San Antonio del Mosco 29.1 84.2 13.2 28.0San Miguel San Gerardo 2.6 85.4 52.2 27.0San Miguel San Jorge 3.3 69.6 55.6 30.4San Miguel San Luis de la Reina 15.9 84.9 40.9 31.0San Miguel Sesori 18.0 81.9 48.2 23.5San Salvador Ayutuxtepeque 18.5 53.8 103.9 38.4San Salvador Guazapa 41.6 78.9 38.5 27.5San Salvador Nejapa 25.5 72.5 33.9 30.0San Salvador Panchimalco 31.3 70.8 43.5 44.3San Salvador Rosario de Mora 40.5 80.0 62.2 27.5San Salvador Santiago Texacuango 28.2 55.7 29.2 50.4San Salvador Santo Tomis 14.8 51.8 44.7 43.8San Vicente Apastepeque 26.5 61.3 78.9 39.6San Vicente San Cayetano Istepeque 14.5 61.1 68.2 42.0San Vicente San Ildefonso 32.8 68.1 63.3 31.4San Vicente San Lorenzo 19.4 49.9 99.0 38.2San Vicente Santa Clara 19.3 75.0 39.9 23.1San Vicente Santo Domingo 4.4 38.0 79.7 46.9San Vicente Tecoluca 19.8 73.8 74.4 26.2Santa Ana El Porvenir 28.4 60.9 50.8 32.5SantaAna Masahuat 22.0 51.0 59.8 43.4Sonsonate Cuisnahuat 21.3 72.7 58.6 37.1Sonsonate Izalco 22.8 66.4 58.6 33.3Sonsonate Juayua 20.1 60.6 60.4 39.6Sonsonate Nahuizalco 17.8 65.3 43.1 41.0Sonsonate Salcoatitan 10.9 44.6 32.7 39.1Sonsonate San Antonio del Monte 12.3 69.8 55.5 39.6Sonsonate San Julian 35.0 79.1 49.7 27.6Sonsonate Santa Catarina Mazazuat 18.4 42.1 46.1 37.8Sonsonate Santo Doniingo de Guzman 10.6 71.4 42.4 38.8Usulutan Alegria 10.3 62.5 54.8 39.2Usulutan Berlin 20.2 61.5 26.9 37.9Usulutan California 2.0 75.0 16.6 19.2Usulutan Concepci6n Batres 29.9 70.3 81.5 36.5Usulutan Estanzuelas 17.3 61.4 72.9 39.2



Departrnent Municipio Rate (Grds 1-9) (Grds 1-9) UndersizeUsulutan Nueva Granada 13.4 80.4 27.4 28.4Usulutan Ozatlan 26.4 69.1 64.4 31.1Usulutan San Agustin 17.2 42.2 52.3 49.5Usulutan San Diomnsio 21.2 64.0 37.4 53.8Usulutan Santa Elena 16.4 52.8 44.4 37.8

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107 ANNEX 7Expansion of Access to Preschool and

Basic Education Component


EXPANSION OF ACCESS TO PRESCHOOL AND BASIC EDUCATION COMPONENT

Background

1. Despite the efforts of MINED in the last years, serious problems of coverage remain, especiallyin rural low-income areas. This results in a lack of equity in the offering of education services. As thedata demonstrate, despite the fact that basic education is guaranteed by the Constitution, the reality isthat the coverage is less than universal. One of the best ways to increase coverage is to improve theadministration of education services, and one of the most effective ways to improve the administrationis to increase the involvement of the community. Thus, since 1991, MINED has established theincrease in coverage as an objective in its education policy, emphasizing preschool and basic educationservices for the rural sectors through the EDUCO model.

2. A fundamental element for the achievement of a quality school is the availability of adequatephysical infrastructure. The prime priority for the Government for improving school infrastructure isthe rural sector, especially in those schools administered under the EDUCO system. Rural schools areclearly deficient in space provided by the community and much of the space is in a precarious state.According to Social Investment Fund (Fondo de Inversi6n Social - FIS) projections, the Governmentestimates that the financing of EDUCO schools would require approximately US$26 million. Emphasiswill be given to the geographically unattended areas insuring a norm of a maximum distance of 2.5 kmfor children to travel to school. Infrastructure for new schools will be provided by FIS under anagreement with MINED.

Objectives

3. The objectives of this component are to support the increase of rural coverage in preschool andbasic education, and to strengthen the administrative mechanism through community participation asdeveloped under EDUCO.

Subcomponent la. Expansion of Access to Preschool and Basic Education

Description

4. This subcomponent will support the expansion of the EDUCO program by: (a) increasing thecoverage of preschool education services in rural areas from 26 percent to 40 percent which willincrease coverage to 32,000 children in 1,000 new sections; (b) expanding the basic educationcoverage in rural schools in 1st to 6th grades, from 77 percent to 90 percent by the end of 1999. Thiswill include the natural growth of the population covered in existing EDUCO sections and theexpansion to other communities in which there are currently no services (64,000 children attending2,000 new sections); (c) changing the administration of education services in rural areas by graduallytransforming 3,070 traditional sections into EDUCO sections; (d) completing the second phase of the



microlocation study' for those schools not surveyed in the first phase to support policies optionsregarding the infrastructure program; and (e) rehabilitate infrastructure to foster the transformation ofrural traditional schools to EDUCO schools, providing adequate infrastructure that will beadministered by the ACEs. The program will have the support of FIS to provide new schools whenthey do not exist, including some substitution of current infrastructure that is inadequate.2

Implementation Strategies

5. For the creation of new sections, the strategy includes the following criteria: (a) the existenceof a minimum school-age population (25 students per section) available to attend in both preschool andbasic education (1st & 2nd cycles); (b) a community that demands education services and demonstratesa minimum level of organization; (c) the existence of physical space with at least minimum conditions;(d) the existence of qualified teachers in the community; and (e) municipios defined as priorities (seeAnnex 6).

Mechanisms for Execution

6. The program for the creation of new sections has been adjusted to the capacity of MINED.The results of a pilot program that will be executed by MINED in the current year to determine thecapacity of private institutions to accomplish the tasks of organization and promotion of thecommunity will be evaluated.

7. The preliminary experiences and some studies seem to demonstrate that there exist in thecountry a considerable number of institutions that could offer services. This is of great importancebecause the planned increase of coverage already requires support for MINED.

Rehabilitation of Education Centers

8. The project will finance the rehabilitation of the schools that are transformed to the EDUCOmodel. The deterioration of these 3,070 schools is estimated as 17 percent of the cost of building newschools. The rehabilitation of 1,535 classrooms will be required for the 3,070 sections that areestimated for transformation. This will require a cost estimated at US$2,600 per classroom, orfinancing of US$4 million that would be administered within the framework of this project. This willbe critical to foster the process of administration/maintenance under the full responsibility of the ACEs.Under the SSRP, MINED started a program for maintenance of schools with the support of the ACEsthat will guarantee the maintenance of infrastructure.

' Under the SSRP, an intensive survey of the existing education infrastructure has been undertaken to determinethe costs for providing infrastructure, the amount of rehabilitation required for existing infrastructure, and theareas where services are needed.2 The infrastructure needs will not be financed using project funds.

109 ANNEX7Expansion of Access to Preschool and


Subcomponent lb. Strengthening the EDUCO Program

Description

9. The first phase of EDUCO has given birth to a radical departure in the way basiceducation is administered and operated in El Salvador. This rests on the principle of localresponsibility through elected Community Education Associations (Asociaciones Comunalesparala Educaci6n - ACEs) for the provision of basic education services for the children of a givencommunity. ACEs have emerged with little planned effort to develop the specific skills which areessential if they are to support the physical extension of schools, hire and monitor the performanceof teachers, develop supplementary education programs for adults through associated ParentsSchools.

10. Given the close linkage between ACEs/Parents Schools and the wider process ofcommunity organization and development, MINED decided to explore and test ways ofstrengthening community-based strategies by working through NGOs or private organizationswhich already have the track record and specific skills needed to work at this level. The pilot willbe developed in three departments (Cabanas, La Union and Ahuachapan) and an evaluation of thestrategy will be made at the end of the year. Based on the success of the pilot, the schedule will beexpanded according to the following table.

-Schedulfor Ex p dithe Pilot EpenenceYear I Year 2 Year 3 Year 4 Year 5

ACEs 300 500 1,000 1,800 2,500Departments 3 7 14 14 14

11. The involvement of the private and nongovernmental sector as working partners isregarded as fundamental to the EDUCO approach as a whole, and especially to the communitycomponent, as the programn enters its second phase.

Objectives 4

12. The broad goal of the community participation component is to strengthen thecommunity's engagement with the basic education sector, whether in the delivery of services or aslearners. There are four basic objectives in the attainment of this: (a) to build skills and capacityin parents to operate ACEs effectively; (b) to improve the organization and learning environmentof Parents Schools as an essential component of the ACE strategy; (c) to further develop andrefine mechanisms which will ensure that the local community participates permanently andeffectively in the management of the basic education services serving its children; and (d) toexecute further in-depth studies of the operation of the current ACE model, drawing out thelessons which can enhance community participation both in service delivery and in their owneducation.



Implementation

13. In the first phase of EDUCO, the ACE concept, and even the structure, was present inmany instances but was largely unsupported by an institution-building effort on the part ofMINED. The second phase of EDUCO must therefore address the institution-building and humanresource development needs of the ACEs and of MINED itself. This implies necessarily drawingon experience outside government as in the case of the current (1995) pilot project.

14. It is envisaged that, within the framework of the proposed project, a national pilotprogram should be set up, subject to competitive bidding, limited to NGOs or privateorganizations, which over the full five years of project implementation would develop, implementand document a support mechanism for ACEs and Parents Schools. The specific fieldcomponents of such a program would be: (a) the expansion of access to preschool and basiceducation employing the ACE mechanism; (b) the development and implementation of trainingprograms for ACE, their members, their teachers and their supervisors; (c) the development andimplementation of training and staff development programs for MINED personnel so as to ensureeffective monitoring and support for the program; (d) the development and application ofcurriculum, materials and training methodologies to address the range of problems faced by ACEsand their clientele.

15. The system of competitive bidding for social sector projects is already well established inEl Salvador. The disadvantages are that the procedure can be administratively demanding andthat the awarding agency, in this case MINED, must have a very clear perception of the purposesof the exercise and the qualities sought in the ultimate winner. This relates again to the need forenhanced understanding of the program on the part of MINED. The advantages of the system arethat it ensures the donor a measure of neutrality in the allocation of funds; that unless one agencyis dominant in a particular field, there can be a beneficial coalition building effect among thebidders and, of course, it can have a restraining effect on costs.

16. It is recommended that the funding banks and the national authorities proceed as follows:(a) agree in principle to proceed with a competitive bidding process for the NGO-privateorganization/community participation component of the proposed project; (b) reach mutualconsensus, drawing on external consultancy if necessary, on the criteria and content of a publicRequest for Proposals; and (c) establish procedures for public announcement, submission ofproposals, refereeing and contracting.

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1 1 1 ANNEX 8Improvement in Education

Quality Component


IMPROVEMENT IN EDUCATION QUALITY COMPONENT

SUBCOMPONENT 2A: CURRICULUM DEVELOPMENT

Background

1. Curriculum is a fundamental component of the education process. It determines the socio-cultural contents that will ultimately shape the education of students. The main problems affectingcurriculum in El Salvador are lack of connection with the cultural environment, and the poor teachingmethodologies adopted by schools. These methodologies reinforce conservative teaching practices,which emerge from obsolete pedagogic methods that disregard education as a dynamic social process.This phenomenon is especially severe in El Salvador, a country which recently finished a violentconflict, and is currently struggling to consolidate its peace process.

2. Another important problem of the curriculum is its lack of continuity. The curriculum for thefirst two cycles of basic education (1st to 6th grades) has been developed, by the EducationImprovement Program (Programa de Mejoramiento Cualitativo de la E4*caci6n),which was initiatedby MINED at the beginning of the 1990s within the USAID-financed SABE Project (Proyecto deSolidfJicaci6n de la Educaci6n ). No curriculum for the 3rd cycle (7th to 9th grades) has beenadopted. This fact hinders a consistent development of students. In addition, no curriculum has beendesigned especially for rural areas.

Objectives

3. The main subcomponent objectives are to: (a) improve the quality of education for ruralpreschool and the 3rd cycle of basic education (7 to 9 grades) through a curriculum improvementprogram; (b) enhance the quality, and facilitate the use, of curricular instruments, planning programs,and supporting materials at the preschool and basic education levels; (c) promote participation of thecommunity, teachers and school children, and the use of local resources in the process of qualityimprovements at the preschool and,basic education levels; and (d) design and implement multigradeprograms for basic education students in rural areas.

Description

4. The subcomponent will complement curriculum activities initiated by the SABE ProjectThese activities would involve: (a) defining learning objectives and content for core curriculummodules at the preschool level in rural areas; (b) creating a curriculum for the 3rd cycle of basiceducation (grades 7 to 9) that complements the one designed for the 1st and 2nd cycles; (c)developing a multigrade pilot program in EDUCO schools; and (d) establishing a new studentpromotion system.

112 ANNEX 8Improvement in Education

Quality ComponentImplementation Strategies

5. The subcomponent will use the following strategies: (a) participation of all individuals involvedin the education process for the diagnosis of education, cultural and social needs; (b) decentralization ofthe curricular process to the teachers. Based on the general curriculum guidelines established by theNational Directorate of Education and the local conditions, teachers should adapt their teachingpractices to better fit student needs; (c) development of a multigrade methodology for education inrural areas, including specific instructional materials and community involvement in school activities;and (d) use of appropriate technologies and innovative methodologies for adopting curriculumrequirements to children and community's characteristics. These strategies would increase andfacilitate active participation of children, parents, teachers and other community members. Finally, thesubcomponent would also use: (e) implementation of systematic mechanisms for monitoringcurriculum instruments and curriculum improvements..

6. The subcomponent will provide: (a) technical assistance for studies of curriculum andstudent promotion; (b) production and distribution of approximately 26,000 curriculum guides forthe 3rd cycle of basic education, and 31,000 curricular guides for rural schools; and (c)production of materials for multigrade classrooms.

SUBCOMPONENT 2B: TEXTBOOKS AND INSTRUCTIONAL MATERIALS

Background

7. MINED had three institutions specializing in designing and providing printed materials: (a)Centro de Producci6n de Materiales Educativos (CENPROME); (b) Servicios Tecnicos Pedag6gicos,whose main project was the Plan Nacional de Libro Escolar (PLANALIBRE); and (c) EducationTechnology. All of them received aid fromAlianzapara elProgreso, USAID and IBRD.

8. In 1990, the National Directorate of Education (Direcci6n Nacional de Educaci6n - DNE),which includes the Directorate of Education Materials (Direcci6n de Materiales Educativos - DME),was created. Since 1991, DME has developed a program of providing conventional and non-conventional materials for basic education with resources from the SABE Project. This program led tothe gradual inclusion of recurrent expenditures on instructional materials into the ordinary budget ofMINED.

9. Currently, school textbooks are produced by education specialists, supervised by MINEDcurriculum staff. Textbook printing is done by the private sector under the coordination of the DME.The supervisors are in charge of following up the distribution of textbooks and instructional materialsto guarantee that all schools receive the mnaterials as planned.

10. Deficiencies in the number of textbooks provided to students and schools was clear in a recentevaluation study' that showed that one-third of traditional teachers and 43 percent of EDUCO teachersreported that their students had no textbooks.

World Bank. 1994. 'El Salvador - Community Education Strategy: Decentralized School Management."Country Department II, Human Resources Operations Division, Latin America and the Caribbean RegionalOffice, Washington D.C.


Quality Component

Objectives

11. The main objectives of the subcomponent are to: (a) provide to preschools, basic educationcenters and Model Schools for Education Development (Escuelas Modelos de Desarrollo Educafivo -EMDEs) the materials needed for the development of the national curriculum to support improvementsin education, and enhance teacher and student performance; (b) achieve long term sustainability in theprovision of instructional materials which support the development of the curriculum and the quality ofthe education provided; (c) design and implement a Basic Package of Instructional Materials Systemfor preschool and basic education students in rural and urban areas; (d) promote the development of apernanent system for the production and distribution of textbooks and instructional materials, topreschool and basic education students; and (e) provide equipment, furniture and instructionalresources to the district pedagogic centers.

Descniption

12. The subcomponent will support: (a) the production and distribution of approximately3,500,000 books, including two instructional booklets for preschool students, and four textbooks(Spanish, mathematics, natural sciences and social studies) for grades I through 9; (b) modularstudent instructional guides, to foster auto-instructional use by students, will be provided tostudents in grades 1 through 6, both in urban areas and in the multigrade classes in rural areas;and (c) books for about 3,400 school libraries will be provided to preschool and primary schoolsin urban and rural areas; 2,000 classroom libraries will be provided to preschool and basiceducation EDUCO schools; and 200 laboratory kits will be produced for 3rd cycle schools. Eachschool library will have 2 copies of about 100 titles plus reference books, and each classroomlibrary will be made up of 2 copies of about 20 titles plus reference books; (d) a package ofinstructional materials (canasta bdsica) to be distributed annually to all preschool and primaryschools in urban and rural areas; (e) equipment and laboratory kits to 3rd cycle basic educationschools.


13. Basic school package (canasta bszca). MINED will continue the policy of distributinginstructional material packages to schools at all levels. Through this strategy MINED will guaranteethat the schools/sections have all necessary materials for curricular activities. Two strategies will beused for the provision of the basic instructional materials: (a) distribution of the canasta basica tourban schools; and (b) provision of funds (local level and school funds) to schools to purchaseinstructional materials.

14. Textbooks, and curriculum guides and study programs. MINED will provide textbooks for the1st and 2nd cycles of basic education; notebooks for first grade; and the booklets for preschooleducation. Under this project, textbooks and curriculum guides and study programs for the 3rd cycleof basic education will be prepared and distributed.

15. School and classroom librarv books. Through this program, library books will be provided forpreschool and basic education schools. In addition, specialized libraries will be created in the TeacherTraining Centers (Centros de Capacitaci6n de Maestros - CCMs), and in the EMDEs.


Quality Component

16. For the distribution of textbooks and the canasta basica, MINED will use the distributionsystem established under SSRP which involved the contracting of private transportation firms tocarry pre-packaged textbooks and instructional materials from the central warehouses to thedepartments, and from the departments to the districts. The distribution plan ensures that theinstructional materials will arrive at schools before the beginning of each school year, and newtextbooks will arrive before the usable life of existing textbooks expires.

SUBCOMPONENT 2C: IN-SERVICE TEACHER TRAINING SYSTEM

Background

17. One critical input for improving quality in El Salvador is teacher training, pre-service andin-service. Teacher training specifically designed for preschool education or the early years ofbasic education barely exists. Currently, with the support of the SABE Project, several in-serviceteacher training activities have been developed to support curriculum implementation.Approximately 90 schools have been used either as in-service teacher training units or resourcecenters. The impact of these activities has been limited due to the lack of pre-service trainingprograms for basic education teachers, and the lack of a systematic approach to improve thequality of the teacher training programs.

Objectives

18. The major objectives of the component are: (a) develop a decentralized in-service trainingprogram through the EMDEs; (b) diagnose the in-service training needs at the local level (theschools) for teachers, directors, and supervisors; (c) provide technical assistance to the curriculumstaff groups, at the national, regional and local levels (EMDEs); (d) design a follow-up model tocreate feedback from the central to the regional level; from the regions to the EMDE; and fromthe EMDEs to their associated schools; (e) establish a system to disseminate training results andteaching experiences among teachers in the same education levels; (f) identify the pre-servicetraining needs for preschool and basic education and prepare an action plan for implementation;and (g) prepare a study on human capital available for secondary education and an action plan toidentify further investments needed at the secondary level.

Description

19. The proposed project will support the establishment of an integrated/decentralized trainingsystem. This system will gradually phase three CCMs into existing education facilities, andestablish a network of EMDEs which will function as in-service training and pedagogical resourcecenters. The EMDE concept has been built upon the existing experience of the EducationTraining Centers (Centros Educativos de Capacitaci6n - CECs) which were developed under theSABE project on a experimental basis.

20. The proposed project will provided technical assistance for the: (a) design of plans andprograms for in-service teacher training programs; (b) design of a systematic assessment system toidentify in-service training needs for preschool and basic education levels; (c) production oftraining modules and evaluation of outcomes; (d) development of an assessment study of the pre-


Quality Component

service training needs for basic education and preschool teachers, and (e) establishment of anaccreditation system for teachers.

21. Training will be developed as: (a) seminars for teachers working in the EMDEs (80hours); (b) programs offering specialized courses for: (i) preschool teachers (80 hours); (ii) basiceducation teachers in grades 1 to 6 (80 hours), basic education teachers in grades 7 to 9 (80 hoursyear 3, 40 hours years 4 and 5); (iii) EDUCO multigrade teachers (120 hours); (iv) schoolprincipals (80 hours); and (v) supervisors (120 hours); and (c) follow-up teacher training at theEMDEs through 12 workshops per year, supported by the district supervisors.

22. The project will also provide: (a) funds for contracting out selected content/pedagogicaltraining programs to universities or research centers; (b) funds for contracting a study onsecondary education development; (c) furniture, equipment and rehabilitation of facilities to beused as the CCMs and the EM4DEs; and (d) specialized training libraries at the EMDEs.


23. The strategy will be based on the establishment of a training system designed to beimplemented through: (a) the DNE at the central level which will be responsible for establishingnational teacher guidelines; (b) the CCMs at the regional level; and (c) the EMDEs at the locallevel.

24. The CCMs will be responsible for: (a) developing teacher training programs for preschooland basic education teachers; (b) supporting the in-service teacher training programs to beimplemented by the EMDEs; (c) preparing teacher training instructional materials, and pilottraining programs; (d) contracting out content training programs to universities; and (e)monitoring teacher training programs.

25. Training personnel at the CCMs. The training professionals, currently working at theRegional Departments of Education (about 12 in each of the regional training units), will form thebasic staff of the CCMs.

26. EMDE training activities. The EMDEs will be responsible for: (a) in-service trainingactivities with the support of the CCMs; (b) functioning as resource centers for associatedschools; and (c) providing opportunities for exchange of pedagogical experience among teachersof the associated schools.

27. Teachers trained under the Basic Education Leadership Training Program (Capacitaci6nde Lideres de Educaci6n Basica - Becas CAPS) will be assigned to each of the schools in thenetwork to function as animators of the in-service teacher training activities. An incentive will beestablished to those schools and teachers that take part as trainers or monitors of associatedschools.

28. Criteria for selecting the Model School. The following are the criteria to establish anEMDE: (a) the existence of school principal and teachers trained by the Becas CAPs program;and (b) infrastructure to accommodate the equipment and library to support the in-service training


Quality Component

activities. EMDEs will be gradually organized and equipped following the implementationschedule for decentralization of activities to departments and districts ( see Annex 9).

29. The implementation of the in-service training system will parallel the development of theprototypes in the three selected departments (see Annex 9). During the pilot implementation ofthe prototypes, the CCMs and existing CECs will continuing developing the training programsfollowing the guidelines and plans of the DGE. Special training programs for the trainers will beprovided by the staff development program.

SUBCOMPONENT 2D: EDUCATION ASSESSMENT SYSTEM

Background

30. Under the SABE project, MINED began using achievement tests to assess the impact ofthe new core curriculum for grades 1-6. However, the results of this exercise showed thatMINED's resources and capacity are too limited to monitor and evaluate academic achievementand standards of teaching across the country, and in the different modalities of education servicesprovided. There is a need to create in the Ministry of Education an evaluation system to supporteducation policy options regarding teacher training, textbooks and instructional materials.

Objectives

31. The objective of this subcomponent is to: (a) provide national, uniform criteria todetermine the basic academic objectives sought at the end of each of the three basic educationcycles (grades 3, 6, and 9) based on the development of learning capabilities and cognitivedevelopment; (b) improve classroom pedagogical methodologies, reinforcing the responsibility ofschools and teachers for the learning achievement of their students; (c) mobilize public opinion tosupport education reform; (d) provide a basis to target education investments to those schoolswith the highest risk of student failure; (e) help define the priority needs for pre-service and in-service training programs; and (f) strengthen the country's technical capacity for monitoringstudent achievement as a tool to increase the education system's efficiency and accountability.

Description

32. Considering the lack of experience in the country in carrying out achievement tests on apermanent basis, this subcomponent would provide: (a) technical assistance for: (i) furtherdeveloping the existing system, including the preparation of tests, and implementing it on anationwide level; and (ii) designing training programs for the development of technical skills forboth local university/research center staff and MINED Curriculum Directorate staff membersresponsible for the coordination of the evaluation assessment system; (b) funding for equipment,office furniture and operating costs for an external evaluation unit (university/research center); (c)the production and implementation of a sample of language and mathematics achievement tests,and a survey to determine the impact of selected associated factors to the learning process forgrades not covered by the SABE Project; and (d) supplies, materials and computer services.

33. The system of external evaluation will test, each year, a nationally representative sample ofthose students finishing each cycle of the basic education system (grades 3, 6 and 9) on Spanish


Quality Component

and mathematics. Additionally, readiness tests will be administered at the beginning of first gradeand at the end of third grade. To cover the whole learning evaluation process a survey on theimpact of associated factors that might impact the learning process, will be applied to the sampleof schools selected. Three major criteria would be considered in the sample selection: (a) typeand size of school according to official categories; (b) source of funding (public, private andpublic/private); and (c) geographic area (department, rural, urban and urban-marginal areas).


34. MINED will be responsible for: (a) coordinating the student achievement evaluation; (b)selecting the external agency to implement the evaluation under terms of reference approved by theBanks; and (c) disseminating the results of the evaluation.

35. The external agency (university or research center) will be responsible for: (a) selecting thecontents to be measured based on the study programs; (b) developing the pilot test; (c) producing thetests; and (d) testing the school and student samples selected.

36. Test samples. The tests will be administered every year to samples of 10 percent of thosechildren finishing each cycle of basic education. The only exception will be the readiness tests whichwill be administered to all students at the beginning of first grade and at the end of third grade. Thesamples from preschool and basic education schools should be determined according to the distributionof the countrys population and sorted by: type of school (size according official categories); fundingsources (public or private); and geographic area (departments, rural, urban and marginal-urban areas).

37. Pilot test. A pilot test will be developed consisting of two parts: (a) a survey of students andteachers to gather information on teacher and student reactions to the test; and (b) the test itself. Theinformation obtained in the pilot will help to classify the items in three categories: usable items; items tobe improved; and items to be discarded. The items which can be improved will be revised and re-elaborated for further development. The usable items will be included in the definitive version of thetests, and will be part of an item bank.

38. Final tests. The final tests will be designed to measure 14, 18 and 20 goals of the 1st, 2nd and3rd cycles, respectively. Each goal will be measured with three items, rendering 42, 54 and 60 itemsper test respectively. For each course and cycle there will be as many parallel forms as possible, takinginto consideration the number of items contained in the item bank for each goal. A survey will be usedto collect information on associated factors.

39. Technical aspects. For interpreting the test results (related to criteria), it is necessary todetermine passing grades (number of points) or domain, per goal, in each cycle.

40. Dissemination of test results. The dissemination of the results of the tests will be done as partof the overall evaluation system coordinated by MINED's Evaluation Unit (Unidad de Analisis de laCalidad de Educaci6n - UACE) in the Planning and Organization Department (Oficima dePlanificaci6ny Organizaci6n - ODEPOR)

41. In close coordination with DNE, UACE will be responsible for: (a) defining the informationrelated to student achievements to be disseminated; (b) canrying on additional evaluation studies with


Quality Componentthe same sample of schools, if needed; and (c) producing reports and supporting materials to deliverthe achievernent test results to different target population (parents, teachers, and community).

SUBCOMPONENT 2E: SCHOOL HEALTH AND NUTRITION PROGRAM

Background

42. Hunger and malnutrition diminish the physical and mental capacity of poor children.Protein-energy malnutrition and the lack of certain micronutrients, especially iodine and iron,reduce learning capacity and academic achievement. Deficiencies of vitamin A and iron alsoreduce resistance to infections which can increase absenteeism associated with poorer schoolachievement. In addition, research shows that children who go to school without breakfast havedifficulty concentrating, and perform less well than children who have had breakfast. This effectis greatest in children who are also malnourished. School nutrition and health programs toalleviate hunger and malnutrition can complement other effort to improve the quality of primaryeducation and contribute to improving the efficiency and effectiveness of the education system.

43. Hunger and protein-energy malnutrition. According to the first height-for-age census of1st grade school children conducted in 1988, one-third of Salvadoran children are malnourished.In the least developed municipiosY, the prevalence rises to more than half. A Ministry of Health(MOH) study conducted in 1994 corroborates the results of the census. It showed that 61percent of preschool children in the least developed municipios are malnourished.

Objectives

44. The overall objective of the component is to improve the nutrition and health of school-aged children in the 135 target municipios (see Annex 6). Improvements in children's nutritionstatus are intended to contribute to increased learning capacity which will improve educationeffectiveness and efficiency. The specific objectives are: (a) increase knowledge of nutrition andhealth among school children; (b) change certain health and nutrition practices among schoolchildren; (c) decrease overall prevalence of parasitic infection in school children, and in the entirecommunity, served by the school-based anthelminthic program; (d) improve the micronutritientstatus (vitamin A, iron and iodine) of school children receiving treatment through schools, and (e)identify alternative mechanisms to facilitate the implementation of the school feeding program.

Description

45. To begin to address some of the nutrition and health needs of school-aged children, theproject will include a component which will support interventions and activities to: (a) increaseknowledge and change practices related to nutrition and health in the school community; (b)prevent and treat significant nutrition and health problems of school-aged children; and (c)evaluate the on-going school feeding program while identifying and testing alternative schoolfeeding models for the municipios with the most poverty.

2 A municipio is the second administrative level of the governmental system. The levels, in order, are:departamento, municipio, cant6n, caseria, comunidad.


Quality Component

46. To improve knowledge and change practices related to school health and nutrition, theprogram of Science, Health and Environment includes objectives related to nutrition and health.The subcomponent will ensure that these objectives are incorporated into the curriculum of basiceducation, as well as into the pre-service and in-service teacher training programs. Instructionalmaterials to support the curriculum will be developed under the Improvement in EducationQuality Component.

47. To prevent and treat significant nutrition and health problems of school-aged children, thesubcomponent will support the following interventions:

(a) Vitamin A. iron, iodine and anthelminthics. A total of 238,000 primary schoolchildren in the poorest municipios in the country will receive iodized oil capsules,vitamin A supplements, and anthelminthic treatment once a year, and ironsupplements every week, through the schools. The teacher will have theresponsibility for distributing the medicines in cooperation with the community andthe representatives who are in charge of the school feeding program. Thernicronutrition supplementation will be coordinated with the fortification effortsunderway in the country. Where possible anthelminthic treatment will becombined with efforts to improve the school sanitary environment.

(b) Vision and hearing. Vision and hearing problems will be identified in the groupreceiving treatment as described in (a), and remedial actions taken for impairedchildren. One teacher in each school will be trained to apply simple vision andhearing tests. According to norms established with MOH, or with NGOs, childrenwill be referred to a second level for diagnosis and eventual treatment.Agreements will be established with NGOs to treat certain cases. The teacher willalso institute measures to facilitate teaching children who have sensory problems,such as moving the child to the front of the room. The pilot project will determinethe effectiveness of these additional treatments and their operational feasibility.

(c) Evaluation. The component will also support a case/control evaluation of thesenutrition and health interventions. The impact on school (attendance, dropout,repetition) as well as on health and nutrition (iodine, iron and vitamin A status,parasitic infection, weight height) will be assessed. Issues related to costs anddelivery will also be evaluated.

48. School meal program. MINED distributes lunch or an afternoon snack to almost allschool children through donations by international organizations, primarily the World FoodProgram (Programa Mundial de Alimentacion - PMA). The ration of rice, oil, canned meat, andnutritive drink provides approximately 400 calories and 11 grams of protein, and costsapproximately 1 colon (US$0. 11) per child per day. The subcomponent will support anevaluation of the school feeding program focusing on: distribution, storage, preparation of thefood, number of rations, actual nutritional content of rations, consumption, participation of thecommunity, and other operational issues. Based in part on the problems and issues identifiedthrough the evaluation, two pilot studies will be supported to test alternative school feedingmodels to eliminate logistical or other problems. One study will evaluate a system ofdecentralized food purchases, providing money directly to the community with which to purchase

120 ANNEX8Improvement in Education

Quality Component

food locally. Another pilot will study an alternative program which delivers ready-to-eat snacks(cookies and a nutritive drink) in those areas where infrastructure is inadequate for preparing foodat school. The proposed project will contribute only with the evaluation of programns actuallyundertaken by other GOES agencies.


49. To assure close coordination of the three agencies involved in the implementation of thissubcomponent, technical agreements between MINED and MOH, and MIINED and the NationalSecretariat of the Family (Direcci6n de Logistica Alimentaria de la Secretaria Nacional de laFamilia) will be signed. MOH will be responsible for: (a) revising the technical content of thetraining programs; (b) identifying the areas of highest risk of deficit of micronutrients; (c)approving the proposed therapeutic norms; (d) treating sensorial problems detected; and (e)participating in the evaluation of the impact of the nutrition intervention. The reactivation orcreation of mixed commnissions of education and health at the central, regional and local levels isproposed to assist in the coordination of both the education and health sectors. The NationalSecretariat of the Family will be responsible for administering the school feeding program.

50. Among the low cost interventions of known efficacy and easy implementation, thedecision has been made to apply programs of extended coverage (iodine, vitamin A, anti-parasiticagents). For those activities that require a major effort from the education sector, pilot studieswill be performed to evaluate their feasibility before implementing programs of major coverage(iron, detection of vision and auditory problems).

51. Technical assistance will be offered to the Nutrition Unit (Unidad de Alimentaci6n) ofMINED to strengthen its capacity to manage.

an3_qual.doc

121 ANNEX 9Institutional Modernization Component


INSTITUTIONAL MODERNIZATION COMPONENT

Subcomponent 3a.: Modernization of MINED.

Objectives

1. The main objective of this component is to carry out institutional modernization andstrengthening of the education sector, a necessary condition to achieve the Basic EducationModernization Project's objectives in terms of: (a) expanding access to, and improving the qualityof, preschool and basic education; (b) reinforcing the Ministry of Education's (MINED's)capacity to set policies and guidelines for the sector; and (c) improving the public system'scapacity for delivering education services effectively and efficiently.

Description

2. The modernization component includes: (a) design and implementation of a neworganizational structure for MINED, including central, departmental, district, and communitylevels to reinforce education activities at the school center; (b) revision of the legal framework tosupport the new organization; (c) design and implementation of the systems to support educationoperations: resources management, information, planning, evaluation and monitoring,communication and supervision; (d) establishment of a staff development program to improve thetechnical capabilities of managers, technical/pedagogical, and administrative staff to supportimprovements in the provision of education services; (e) introducing an adequate structure ofsalaries and incentives to the teachers and administrative staff; and (f) development of a PilotBasic Education Fund to support pedagogical and methodological innovations.

3. To achieve the goals of the education reform and to establish new ways to deliverservices, new processes, procedures and systems will be developed. These new processes andsystems will also be tested during the implementation of the pilot program (see para. 6). Theimplementation of the actions to foster policy development and changes on a long-term basis willbe based on the review of MINED's organizational structure and legal framework.

4. The changes to be made aim at establishing:

(a) a Decentralized System of selecting, preparing and providing fiscal resources,human and financial, that give automatic increases to the education centers andimprove the efficacy and efficiency of the system.

(b) Planning, Management Information and Evaluation Systems of resourcesallocation (human, physical and financial) based on the needs and prioritiesidentified at the local level, and linked to the planning systems at the departmentaland central levels. Management evaluation measures the opportunity, adequacyand cost of the contribution of education services in improving the activities ofassigning resources. Evaluations will also look at the impact of services in terms

122 ANNEX 9Institutional Modemization Component

of effects on production, social equity and in the achievement of society'saspirations, measuring the relationship between benefits and costs.

(c) Monitoring Systems able to influence policy formulation and analysis, to improveresource allocation and the budget process, and to conduct joint evaluations withexternal agencies to measure the impact of education interventions. Theconsolidation of the evaluation system within the education sector is one of thepriorities for the education reform. The evaluation activities are essential to fosterthe technical-pedagogical system with dependable information necessary for thedevelopment of strategies, technology and material to support qualityimprovements. These activities will also support the planning activities which mustbe based on reliable, and updated information.

(d) a Management Information System (MIS) capable of supporting the decision-making process in the areas of planning, budgeting, and evaluation of educationactivities. Project activities in the MIS will strengthen the current MINEDComputer Center in terms of personnel and equipment.

(e) Education Supervision. Although restructured in 1991, the supervision systemhas not been able to provide sound technical support and guidance to teachers intraditional or EDUCO schools. Several assessment studies done by MINED showthat supervisors undertake a variety of activities without a regular pattern forsupporting teachers in making learning more effective. To solve this problem, thissubcomponent would support activities to: (i) reorient the supervision system inthe direction of providing technical support to teachers and school principals; (ii)disseminate results of education program evaluation; and (iii) give feedback tocorrect shortcomings in the education process. To increase the professionalcapacity of the supervisors, the program seeks to achieve a qualitative change intheir functions by increasing the time employed in monitoring teaching activitiesand by reducing their strictly administrative responsibilities. The major issues to beaddressed by the subcomponent regarding the supervision system are: (i)establishing adequate supervision mechanisms; (ii) defining a clear assignment ofactivities; (iii) enhancing supervisor technical skills and basic equipment; and (iv)establishing incentives for the supervision system to visit schools in remote ruralareas. The new organizational structure for the supervision system will be basedon studies and processes to be tested in the pilot phase of this component (seepara. 6).

(f) a Communication Program to provide a permanent information channel withinMINED, between MINED and the public, and to receive feedback from thesector's stakeholders. The reform of the education sector has to be built on aneffective communication strategy, both to ensure citizen participation in theeducation endeavor and to facilitate participation, commitment and the sharing ofcommon goals by the main actors in the education sector. A communicationstrategy will include: (i) a social communication program to support communityparticipation and provide education planners with feedback; and (ii) institutionalcommunication activities to generate a flow of information within and among the

123 ANNEX9Institutional Modernization Component

different agencies involved in planning, financing, administration, evaluating andexecuting education services. The communication strategy will use social researchtechniques, particularly the 'focus groups" technique, in the design execution andmonitoring of these programs. MINED's communication structures will bestrengthened in order to facilitate the coordinating and monitoring roles of theMinistry. A long term communication plan for MINED will be developed as partof the project. In addition, there will be a training program for the staff of theCommunications Unit.

(g) Staff Development Program. The staff training program is an integral part of theprocess of introducing new instruments and work methods into the educationsector. The administrative staff must be regularly brought up to date oninnovations and administrative technologies developed in the sector. Technicaland managerial training must be provided not only for those to whomresponsibility is being transferred, but also to central officials who will have tolearn how to support local implementors more effectively. The design andimplementation of the staff development program will follow MINED'sreorganization to improve, in a timely and coordinated way, the skills ofadministrators and technical/administrative and pedagogical personnel required bythe institutional development process. The staff development program will beprovided through 15 courses, 10 seminars, and 15 scholarships for short coursesspecializing in education policy analyses, information, planning, budgeting,education methodology and human resources management.

5. Modernization Implementation. With project implementation it is expected that theeducation units will have different functions and responsibilities as follows:

(a) School level. The schools (education centers) will be responsible for: (i) operatingthe education activities; (ii) preparing their school education plans; (iii)administering their financial/material resources; (iv) selecting their teachers; (v)generating data and indicators regarding the results of their operation (e.g. data onpromotion, repetition, desertion and coverage); and (vi) administering funds forsmall purchases.

(b) District level. The basic function of the district is to coordinate between thedepartment and the schools. The districts do not make autonomous administrativedecisions. The supervision districts will be responsible for: (i) coordinatingactivities and processes between the schools and the department; (ii) consolidatingand providing school needs in terms of teachers, textbooks, school material, schoolmeal program, and technical assistance for supporting teachers solveteaching/learning problems; (iii) collecting information on public and privateschools within their jurisdiction; and (iv) supporting teacher training activities inthe Model Schools for Education Development (Escuelas Modelos de DesarrolloEducativo - EMDEs).

(c) Departmental level. The departments, organized as small and responsive offices,will be responsible for: (i) preparing departmental plans by specifying education

124 1 ANNEX9Institutional Modemnization Component

program objectives and goals, budgetary allocations by school, and modalities ofservice delivery (public, EDUCO, private subsidized); (ii) coordinating theadministration of the human, physical, and financial resources at that level; (iii)monitoring the quality of school facilities and equipment; (iv) managingdepartment budgetary allocations and accounting; (v) consolidating and analyzingpublic and private school data; (vi) monitoring district supervision activities; and(vii) promoting community participation.

(d) MINED, at the central level will be responsible for setting goals and generalguidelines, establishing priorities and quality standards, and providing systematicevaluation of the public and private education systems. Its major activities will be:(i) defining policies, education goals and program objectives; (ii) defining targets,budgets and personnel posts for each department/district and school; (iii)establishing basic curriculum contents and quality standards for teacher trainingprograms, textbooks, instructional materials and learning achievement; (iv)evaluating student learning achievement, departmental evaluation of managementprocess, and outcomes, and impact evaluation of education programs; (v) definingphysical investments; (vi) establishing recruitment standards for both teachers andadministrative staff, and establishing career planning services and personnelincentive systems; (vii) controlling cash flows, accounting and budgeting at thenational level; (viii) procurement activities when justified by economy of scale,distribution cost and timeliness of delivery; and (ix) monitoring departmentalactivities.

6. Implementation Strategy. The implementation of the new structure will be testedinitially in a limited number of departments which will serve as prototypes of the new structure.The reorganization of functions and roles between levels, across all systems, and the strengtheningof managerial capacity at all levels, will be implemented in their entirety in the prototypedepartments. Only after evaluating and standardizing the experiment will the new processes andprocedures be extended to the remaining departments. This strategy will allow for the control andsimultaneous testing of project components, particularly the modalities of delivery of theeducation services envisioned by the education reform.

Subcomponent 3b: Pilot Basic Education Fund Program

Background

7. As a consequence of the peace agreements and the economic opening of the country,economic, political, and social changes occurring in El Salvador open new possibilities forcooperation between the public and private sectors. As part of the principles of education reform,MINED needs to explore various methods of delivering education services, in order to improvethe quality and efficiency of the public and private sectors. Innovative methods of combining thepublic and private sectors in the provision of education services can eventually be adopted on abroader scale within the modernization of the education sector.

125 , ANNEX 9Institutional Modernization Component

Objectives

8. The main objectives of this program are to: (a) test alternative methods of providing basiceducation through the municipios, NGOs or other non-profit private institutions; (b) establish amore substantial and incentive-driven financing mechanism for piloting school-orientedinterventions to solve particular administrative and/or learning/teaching problems; (c) makeprovision for future public education initiatives in the areas of pedagogical innovations andinstitutional modernization which cannot be anticipated or launched immediately; and (d)disseminate the pilot results.

Description

9. During project implementation, the subcomponent will finance at least four innovativesubprojects that contribute to improving the quality, efficiency, and coverage of preschool andbasic education in the country. The funds allocated to this subcomponent would be set aside tofinance subprojects under the procedures, principles, and criteria of selection described in para 19.The subcomponent will provide: (a) financial resources for implementing and identifying theapproved subprojects; (b) support to establish a monitoring system to follow-up the educationinterventions financed by the program; (c) support to fully evaluate all subprojects funded; (d)technical assistance for selecting the proposals; and (e) support for disseminating the results.

10. The Fund's resources (US$1,916,000) will be divided as follows: US$31,000 forassessment and US$1,885,000 to finance pilot subprojects. It is expected that the Fund will notbe depleted before its third year. Therefore, approximately US$628,000 will be used annually:US$571,000 to operate the pilot subprojects and US$57,000 to evaluate the implementation andimpact of the pilot subprojects.


11. Organization and Administration. The subprojects submitted for financing would bepresented twice a year to a Review Committee which would analyze, rank and recommendapproval of the subprojects according to established criteria (see para. 19). The ReviewCommittee would be composed of the Minister, Vice Minister of Education, the Project Manager,directors of MINED, and, as required, experts in subjects related to the types of subprojectproposals.

12. The Minister and Vice Minister of Education will supervise the Fund. They will beresponsible for: (a) establishing the goals and policies of the Fund based on the Basic EducationModernization Project's principles and guidelines; and (b) defining the Fund's goals.

13. A Review Committee will be formed, which will evaluate each one of the proposed pilotsubprojects. This Committee will be formed by five voting members: the Project Manager, whowill preside over Committee, the Manager of OPCI, and the three Project Component Directors.The Committee will be in charge of receiving the proposals.

14. The Project Manager will be responsible for: (a) managing the Pilot Basic EducationFund; (b) implementing the policies defined by the MINED, including the allocation and


disbursement of resources; and (c) preparing the procedures that will be forwarded to thepresentation and evaluation of the proposals.

15. The Review Committee will nominate a Technical Group to rank the proposals applyingthe established criteria (see Table 1). The Committee is responsible for: (a) receiving theproposals; (b) selecting a technical group to rank the proposals; (c) reviewing proposalclassifications; (d) approving proposal classifications; (e) preparing the list of recommendedproposals to be approved by the Minister and Vice Minister; (f) establishing subprojectmonitoring and evaluation mechanisms; and (g) disseminating results generated by thesubprojects. The 'ho objection" of the Banks is a pre-requisite for the final approval of theproposed subproject. Every time a proposal is rejected, the Review Committee must send aformal reply to the requester explaining the reasons for the proposal's rejection.

16. Once a proposal is approved, a technical agreement (convenio) between MINED and therequester will be signed whereby the former agrees to disburse the resources approved under theproposal, and the latter agrees to implement the proposed subproject.

17. Eligible Subprojects. Every year, the Review Committee will choose the subprojectsthat will receive financing, selecting the subprojects with the most merit according to the criteriaset in the annual priority plan established by the National Council of Education Innovations.Potential replicability is a general criteria for subproject eligibility.

18. For subproject expansion, the proposal plan should include: (a) coverage (timetable,number of units to be established in each region, number of children that will benefit fromsubproject, and cost); (b) organization of the management control; (c) organization of the qualitycontrol; (d) financial plan and disbursement mechanisms; and (e) cost estimate of the expansionsubproject.

Evaluation of Proposals

19. Each proposal will be classified and evaluated according to how it fits into the annualpriority plan of MINED. The classification system will be based on considerations such ascoverage, quality, efficiency, focus, and cost. The factors for consideration will reflect thepriorities of MINED policies and will be established annually. Points will be assigned to each oneof the five areas (coverage, quality, efficiency, focus of objectives, and cost). The subproject withthe largest number of total points will be selected. As a disbursement condition, the forms used toapply for the Fund, which will include a clear list of its conditions and pre-requisites, will beagreed with the Banks. _mod.doc

--i.- *sALllD btU1X II V I 11| Itt nrs* |l oDX t


Ministry of EducationOrganizational Chart

SECRETARIADE

ESTADO

ASESORIA CONSEJO NACIONALJURIDICA DE CULTURA

AUDITORIA L PLANIFICACIONINTERNAI EDUCATIVA

OFIC. DE PROYECTOS DE LCOMUNICACIONES Coop. INTERNACIO

DIRECCION NACIONAL DIRErCION NACIONAL DIRECCION NACIONALDE ERUCACION DE SUPERVISION ADMON.

GDRECCION DE DIRECCION DE DIRECCION GECURRICULO EDUC. SUPERIOR FINANZAS

GIRECCION DE G DIRECCION DE DIRECCION DECAPACITACION I EDUC DE ADULTOS RECURSOS HUMANOS

DIRECCION DE MAT. | DIIRECCION DE EDUC. DIRECCIN DE APROVEDUCATIVOS FISICA Y DEPORTES Y SUMINISTROS

UNIDAD DE ASISTENCIA DIRECCION DE DIRECCION DEALIMENTARIA JUVENTUD SERVICIOS GENERALES

UNtOAD DE EDUCACION DIRECCION DE BIENESTAR|ESPECIAL L MAGISTERIAL

DIREC. DE CONSTRUC. YMANTENIMIENTO

|RED DE BIBLIOTECAS EDUC CON PARTICIP.PUBLICAS , | DE LA COMUNIOAD

|GERENCIA

REGIONAL

ASESORIA JURIDICA E PLANIFICACION EDUCATIVAGEPO. GEUASREGIONAL REGO P G

AUDITORIA INETERANAREGIONA

COMUNICACIDOL OFIC. REG. DE PFROYECTOSREGIONAL DE COOP ENTERNACIONAL

|RED DE BIBLIOTECAS l DC. CON PARTICIPACIO|t PUBLICAS REGIONAL l L DE LA COMUNIDAD

|DIRECCION REGIONAL j|DIRECCION REGIONAL ||DIRECCION REGIONAL|DE EDUCACION DE SUPERVISION } DE ADMINISTRACION

DEPTO. DE EDUCACION | SUPERVISiON l DEDEPTOGERTOSI PARtVULARIA | DEPARTAMENTAL FINANZAS

B EASICA DISUPERVISIONAL l HUtMANOSEI

|DEPTO. DE EDUCACION C N DEPTO. DE APROVIS. EME IA Y SUPERIOR | SUMINISTROS r

|DEPTO. DE EDUCACION i||DEPTO. DE SERVICIOS DE ADULTOS | GENERALES |

DEPATMNOD | DEPTO. D1E CONSTROUC. -C CAI AIO | YMNE:NIMIE~NTO r

| [ D~~~~~~EPTO DE BIENESTAR t [ ~~~~~~~~MAGISTERIAL

,~~ ~ ~~~~~~~~~~~~~~~ I

128 ANNEX 10Project Administration


PROJECT ADMINISTRATION

1. Project implementation would be carried out within the existing organizational structure ofMINED through the Project Management Office which would be drawn from existing unitswhose operational and administrative responsibilities are directly linked to project components.Overall responsibility for implementation of the proposed project would be vested in the Ministerof Education who would be supported in general policy setting and institutional coordination by acommittee composed of the Vice Minister of Education and Project Component Directors.' Tofacilitate project implementation, a Project Manager would be appointed. The Project Managerwould report directly to the Vice Minister of Education on the day to day operations of theproject, and would be responsible for calling the directors to committee meetings.

PROPOSED PROJECT ADMINISTRATION

VICEMINISTER

ProjePtManager

.................... ..... =.. .... .............................. .... ........ ProjectManagement

OfficeEDUCO Qn iality Management

Unit Improvement Modernizatin_ ~~Unit Unit

MINED directors involved in implementation of project activities.

EL SALVADORMODERNIZATION OF BASIC EDUCATION PROJECT

Components Project Cost Summary

% % Total(¢ 000) (US$ 000) Foreign Base

Local Foreign Total Local Foreign Total Exchange Costs

A. Expansion of Access to Preschool and Basic EducationExpansion in the Rural Areas 28,083.4 18,083.8 46,167.1 3,209.5 2,066.7 5,276.2 39 7Strengthening the EDUCO Program 51,402.2 880.0 52,282.2 5,874.5 100.6 5,975.1 2 8

Subtotal Expansion of Access to Preschool and Basic Education 79,485.5 18,963.8 98,449.3 9,084.1 2,167.3 11,251.3 19 15B. Improvement in Education Quality

Curriculum Improvement 5,572.2 5,603.9 11,176.1 636.8 640.5 1,277.3 50 2Textbooks 15,828.3 138,305.9 154,134.2 1,809.0 15,806.4 17,615.3 90 24Instructional Materials 49,813.2 48,444.1 98,257.3 5,692.9 5,536.5 11,229.4 49 15In-Service Teacher Training 74,807.3 8,972.5 83,779.8 8,549.4 1,025.4 9,574.8 11 13Education Assessment System 13,349.7 12,421.6 25,771.3 1,525.7 1,419.6 2,945.3 48 4School Health and Nutrition Program 7,951.6 4,870.8 12,822.4 908.8 556.7 1,465.4 38 2

Subtotal Improvement in Education Quality 167,322.3 218,618.8 385,941.2 19,122.6 24,985.0 44,107.6 57 61C. Institutional Modernization

Modernization of MINED 48,669.2 31,547.4 80,216.7 5,562.2 3,605.4 9,167.6 39 13Communications Program 8,494.8 3,248.6 11,743.4 970.8 371.3 1,342.1 28 2Basic Education Fund Program 16,400.0 264.0 16,664.0 1,874.3 30.2 1,904.5 2 3

Subtotal Institutional Modernization 73,564.0 35,060.1 108,624.1 8,407.3 4,006.9 12,414.2 32 17D. IDB Loan Inspection and Supervision (FIV) - 3,210.4 3,210.4 - 366.9 366.9 100 1E. Project Coordination and Management 20,988.6 18,009.3 38,997.9 2,598.7 1,858.2 4,456.9 46 6

341,360.4 293,862.4 635,222.8 39,212.6 33,384.3 72,596.9 46 100Physical Contingencies 11,111.2 12,576.7 23,687.9 1,269.9 1,437.3 2,707.2 53 4Price Contingencies 23,075.8 19,998.3 43,074.1 2,637.2 2,285.5 4,922.8 46 7

375,547.4 326,437.4 701,984.8 43,119.7 37,107.1 80,226.8 47 111

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Expendture Accounts by Components - Totals incuxdkig Conthigencies(USS '000)

Expasion of Access toPreschool and Baste

Education hIprovement hI Education QuaSty knsttutlonal ModernItzatIon IDS LoanExpansion School Baskc hspectton Project

lIthe Strengthentig Wervice Education HaIth and Education aN CoordhilonRural the EDUCO Curuttctm InstructIonal Teacher Assessunn Nutrtltn ModernIzatIon Conunrtcilon Furad Supevon adAreas Program tmprovemen Textbooks MaterIals TratnIng System Program ofMINED Program Program (FMV, Management Total

L Inveutmwqt CostsA. CMVL WORKS 4.706.6- - -- 1.936.1- - - - - - 6.642.76. VEHICLES -4-7-. 28.7 27.4 763.8 29.9 363.9 i,233.7

C. EQUIPtMENT AND FURNITUREOFFICE FURNITURE 16.7 - - -- - - - 230 2 - --- 246.9OFFICE EQUIPMENT 16.6 22.6 - 9.5 95.9 21 4 - - 229.5 395.3COMPUTER EQUIPMENT 1.0 - - - - 6.7 4.3 721.6 - 56.1 769.7SCHOOL FURNITURE-- - -- 944.8 - - - - - 944.6

SubtOOLEQUIPMENTANDFURNITURE 34.3 - 967.3 6.7 13.7 1,047.5 21.4 - 285.6 2.376.60. TEXTBOOKS,Dt11. MAT., & MCRONUTRIENTS

TEXTBOOKS - - - 19,853.3 - - - - - 19,853.3DIDACTIC MATERIALS - - 140.2 - 12,696.6 300.0 381.4 - 13,518.1MICRONUTRIENTS - - -- .- 775.8 775.6

Subtota TEXTBOOKS3ID. MAT., &M1CRONUTRIENTS - '140.2 19,853.3 12,696.6 300.0 - 1,157.2 - - 34,147.2E. TEACHER TRAINING

TRAININGCOURSES 13.4 - 2260 - - 7,337.1 184.1 - 809.3 - - - - 8,569.8STUDY TOURS - - 47.1 -- - -- -- - - 47.1

Subtota TEACHERTRAINtNG 13.4 273.1 - 7,337.1 184.1 809.3 ,616.F. STAFF TRAINING

COURSESANDSEMINARS 12.7 - 11.0 - 2-58.9 8 6 8-92.6STUDY TOURS - - - .- - -- 247.7 8.6 --- 256.3

SublotUSTAFFOTRANING 12.7 11.0 - - 1,106.6 8.6 - - - 1,139.0G. TECHNICAL ASSiTANCE

INTERNATIONAL T.A, 825.2 101.9 189.0 - - 43.5 101.3 31.4 533.2 30.6 371.7 8049 3,032.6LOCALTA 14.6 6,310.1 - - 8.9 109.2 35.8 7.7 1,308.6 210.6 - - - 8,005.6STUDIES - - 675.5 - - 35.3 2,660.6 - 98.0 - - 520.6 3,990.1

SubtotalTECHKtCALASSISTANCE 839.6 6,412.0 664.5 - 6.9 118.0 2,797.6 39.1 1,939.6 210.6 30.6 371.7 1,325.7 15.029.2H. PRINTING OF MATERIALS - - 39.3 - - 65.8 - 556.0 - - - 661.2I. PUBLIC CAMPAJGNS - - - - - - - - - 1,199.0 - 1,199.0J. EDUCATION FUND - - - - 1,874.3 - - 1.874.3

Total tnvestnt Costs 5,606.9 6,412.0 1,328.1 19.853.3 12,705.5 10,757.1 3,054.3 1,237.3 6,223.1 1,469.5 1,904.8 371.7 1,995.2 72,918.7L1 Rnacist Costs

A. SALARIES 113.0 94.2 - -- - - - 1.213,7 - - - 1,243 5 2,664.56. OFFICE SUPPUES - - - - 62.8 - - 545.8 - - 608.6C. OPERATIONANDAMAINTENANCE 3.6 . 29.9 2.2 34.7 884.8 - - - 315.0 1,270.20. OTHER OPERATINGCOSTS 261.2 - 28.2 - 251.9 1.010.7 1,212.8 2,764.8

Total Recrert Costs 377.9 94.2 28.2 - 92.6 2.2 286.7 3,655.0 - - - 2,771.2 7,30f.1Total PROJECT COStS 5,984.9 6,506.3 1,356.3 19,853.3 12,705.5 10,49.8 3,056.4 1,524.0 9.878.1 1,469.5 1.904.8 371.7 4,766.5 80,226.8

Taxs 6461 - 52. ` 1,269.7 1,370.5 32.7 106.6 575.7 156.6 - - 12.6 4,395.5Foreign Exchange 2,309.0 101.9 677.7 17,814.5 6,264.8 1,150.5 1,472.3 578.7 3.912,5 409.9 30.6 371.7 2,013.2 37,107.1

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Expenditure Accounts by Years - Totals Including Contingencies(US$ '000)

Totals Including Contingencies1996 1997 1998 1999 2000 Total

I. Investrent CostsA. CIVIL WORKS 1,785.5 2,182.3 1,815.3 859.7 - 6,642.7B. VEHICLES 173.2 407.8 652.6 - - 1,233.7C. EQUIPMENT AND FURNITURE

OFFICE FURNITURE 8.1 89.1 97.5 52.2 - 246.9OFFICE EQUIPMENT 39.2 318.6 37.5 - - 395.3COMPUTER EQUIPMENT 432.4 210.9 146.4 - - 789.7SCHOOL FURNITURE - 527.4 417.4 - - 944.8

Subtotal EQUIPMENT AND FURNITURE 479.8 1,145.9 698.7 52.2 - 2,376.6D. TEXTBOOKS,DID. MAT., & MICRONUTRIENTS

TEXTBOOKS 558.6 1,533.0 10,610.8 6,428.4 722.4 19,853.3DIDACTIC MATERIALS 453.0 3,496.5 3,005.8 3,834.1 2,728.7 13,518.1MICRONUTRIENTS - 775.8 - - - 775.8

Subtotal TEXTBOOKS,DID. MAT., & MICRONUTRIENTS 1,011.6 5,805.3 13,616.6 10,262.6 3,451.2 34,147.2E. TEACHER TRAINING

TRAINING COURSES 895.8 1,408.8 2,023.5 2,254.3 1,987.5 8,569.8STUDYTOURS 13.0 16.2 17.8 - - 47.1

Subtotal TEACHER TRAINING 908.7 1,425.0 2,041.3 2,254.3 1,987.5 8,616.9F. STAFF TRAINING

COURSES AND SEMINARS 208.3 189.6 164.7 143.4 176.7 882.6STUDY TOURS 29.1 59.5 69.9 48.3 49.5 256.3

Subtotal STAFF TRAINING 237.3 249.1 234.6 191.7 226.3 1,139.0G. TECHNICAL ASSISTANCE

INTERNATIONAL T.A. 1,332.3 501.7 407.5 407.1 383.8 3,032.6LOCAL T.A. 773.5 972.6 1,487.4 2,059.4 2,712.8 8,005.6STUDIES 2,023.9 1,041.7 210.5 687.6 26.3 3,990.1

Subtotal TECHNICAL ASSISTANCE 4,129.7 2,516.0 2,105.4 3,154.1 3,122.9 15,028.2H. PRINTING OF MATERIALS 43.7 288.3 141.4 76.0 111.8 661.2I. PUBLIC CAMPAIGNS 386.7 279.8 203.5 133.9 195.0 1,199.0J. EDUCATION FUND 251.4 251.4 457.1 457.1 457.1 1,874.3

Total Investment Costs 9,407.7 14,550.9 21,966.7 17,441.6 9,551.8 72,918.7II. Recurrent Costs

A. SALARIES 505.9 519.0 532.5 546.4 560.6 2,664.5 oB. OFFICE SUPPLIES 57.8 178.1 121.0 124.2 127.4 608.6 rDC. OPERATION AND MAINTENANCE 72.1 185.0 341.3 350.1 321.7 1,270.2 n

D. OTHER OPERATING COSTS 508.1 596.7 580.8 534.2 544.9 2,764.8 r-tTotal Recurrent Costs 1,143.9 1,478.9 1,575.7 1,555.0 1,554.7 7,308.1 Total PROJECT COSTS 10,551.6 16,029.8 23,542.4 18,996.6 11,106.5 80,226.8 co X

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Project Components by Year - Investment/Recurrent Costs(US$0'00)


A. Expansion of Access to Preschool and Basic EducationExpansion in the Rural Areas

Investment Costs 1,313.0 1,607.3 1,602.6 907.9 176.1 5,606.9Recurrent Costs 71.1 73.8 75.7 77.7 79.7 377.9

Subtotal Expansion in the Rural Areas 1,384.0 1,681.1 1,678.3 985.6 255.8 5,984.8Strengthening the EDUCO Program

Investment Costs 450.7 529.8 1,079.5 1,851.4 2,500.7 6,412.0Recurrent Costs 17.9 18.4 18.8 19.3 19.8 94.2

Subtotal Strengthening the EDUCO Program 468.6 548.1 1,098.4 1,870.7 2,520.5 6,506.2Subtotal Expansion of Access to Preschool and Basic Education 1,852.6 2,229.2 2,776.6 2,856.3 2,776.3 12,491.0B. Improvement in Education Quality

Curriculum ImprovementInvestment Costs 385.6 466.6 289.7 167.7 18.5 1,328.1Recurrent Costs 12.7 4.6 4.4 3.8 2.7 28.2

Subtotal Curriculum Improvement 398.3 471.2 294.1 171.5 21.2 1,356.3Textbooks

Investment Costs 558.6 1,533.0 10,610.8 6,428.4 722.4 19,853.3Instructional Materials

Investment Costs 241.8 3,190.8 2,882.6 3,701.1 2,689.3 12,705.5In-Service Teacher Training

Investment Costs 734.6 2,706.7 2,919.0 2,437.4 1,959.5 10,757.1Recurrent Costs - 68.0 8.0 8.2 8.4 92.6

Subtotal In-Service Teacher Training 734.6 2,774.7 2,927.0 2,445.6 1,967.9 10,849.8Education Assessment System

Investment Costs 1,876.5 545.2 32.1 566.8 33.8 3,054.3Recurrent Costs - 0.5 0.5 0.5 0.6 2.2

Subtotal Education Assessment System 1,876.5 545.7 32.6 567.3 34.3 3,056.4School Health and Nutrition Program

Investment Costs 242.6 982.3 12.5 - - 1,237.3Recurrent Costs 29.7 115.0 86.9 28.2 26.9 286.7

Subtotal School Health and Nutrition Program 272.3 1,097.2 99.4 28.2 26.9 1,524.0Subtotal Improvement in Education Quality 4,082.0 9,612.5 16,846.5 13,342.1 5,462.1 49,345.3C. Institutional Modernization

Modernization of MINEDInvestment Costs 2,016.8 1,675.0 1,314.9 600.4 616.0 6,223.1Recurrent Costs 546.1 704.8 793.1 813.7 797.3 3,655.0

Subtotal Modemization of MINED 2,563,0 2,379.8 2,108.0 1,414.0 1,413.3 9,878.1Communications Program

Investment Costs 524.1 356.9 221.1 158.4 209.0 1,469.5Basic Education Fund Program 0

Investment Costs 282.0 251.4 457.1 457.1 457.1 1,904.8Subtotal Institubonal Modernization 3,369.1 2,988.1 2,786.2 2,029.6 2,079.5 13,252.4D. IDB Loan Inspection and Supervision (FIV)

Investment Costs 371.7 - - - - 371.7Subtotal IDB Loan Inspection and Supervision (FN) 371.7 - - - 371.7 w xCE. Project Coordination and Management

Investment Costs 409.9 706.1 544.8 165.1 169.3 1,995.2Recurrent Costs 466.4 493.9 588.3 603.5 619.2 2,771.3

Subtotal Project Coordinaton and Management 8762 1,200.0 1133.0 768.6 788.65Total PROJECT COSTS 10,551.6 16,029.8 23,542.4 18,996.6 11,106.5 80,226.8

Total Investment Costs 9,407.7 14,550.9 21,966.7 17,441.6 9,551.8 72,918.7m:\esal\basied)enCOMYIFrTl ecun Costs 1,143.9 1,478.9 1,575.7 1,555.0 1,554.7 7.308,1


Project Components by Year - Base Costs(US$ '000)

Base Cost1996 1997 1998 1999 2000 Total

A. Expansion of Access to Preschool and Basic EducationExpansion in the Rural Areas 1,264.3 1,493.4 1,451.3 839.5 227.7 5,276.2Strengthening the EDUCO Program 462.5 527.4 1,030.0 1,709.8 2,245.4 5,975.1

Subtotal Expansion of Access to Preschool and Basic Education 1,726.8 2,020.7 2,481.3 2,549.3 2,473.1 11,251.3B. Improvement In Education Quality

Curriculum Improvement 385.9 445.1 272.9 155.2 18.3 1,277.3Textbooks 525.2 1,404.7 9,476.7 5,595.8 612.9 17,615.3Instructional Materials 227.7 2,923.8 2,574.5 3,221.7 2,281.7 11,229.4In-Service Teacher Training 664.8 2,511.2 2,602.8 2,125.4 1,670.6 9,574.8Education Assessment System 1,843.7 524.7 29.1 518.6 29.1 2,945.3School Health and Nutrition Program 266.8 1,055.7 93.2 25.7 24.0 1,465.4

Subtotal Improvement in Education Quality 3,914.1 8,865.2 15,049.2 11,642.5 4,636.6 44,107.6C. Institutional Modernization

Modemization of MINED 2,469.4 2,239.6 1,936.4 1,276.7 1,245.5 9,167.6Communications Program 498.9 328.3 198.1 139.0 177.9 1,342.1Basic Education Fund Program 281.6 251.4 457.1 457.1 457.1 1,904.5

Subtotal Institutional Modernization 3,249.9 2,819.3 2,591.6 1,872.8 1,880.6 12,414.2D. IDB Loan Inspection and Supervision (FIV) 366.9 - - - - 366.9E. Project Coordination and Management 865.0 1,141.5 1,045.4 702.5 702.5 4,456.9

Total BASELINE COSTS 10,122.7 14,846.7 21,167.5 16,767.1 9,692.8 72,596.9Physical Contingencies 296.7 585.9 938.3 635.1 251.2 2,707.2Price Contingencies 132.2 597.2 1,436.6 1,594.3 1,162.5 4,922.8

Total PROJECT COSTS 10,551.6 16,029.8 23,542.4 18,996.6 11,106.5 80,226.8

Taxes 546.8 1,171.3 1,042.0 941.8 693.5 4,395.5Foreign Exchange 4,625.8 6,805.9 13,692.2 9,213.8 2,769.5 37,107.1

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Project Components by Year - Totals Including Contingencies(US$ '000)


A. Expansion of Access to Preschool and Basic EducationExpansion in the Rural Areas 1,384.0 1,681.1 1,678.3 985.6 255.8 5,984.8Strengthening the EDUCO Program 468.6 548.1 1,098.4 1,870.7 2,520.5 6,506.2

Subtotal Expansion of Access to Preschool and Basic Education 1,852.6 2,229.2 2,776.6 2,856.3 2,776.3 12,491.0B. Improvement in Education Quality

Curriculum Improvement 398.3 471.2 294.1 171.5 21.2 1,356.3Textbooks 558.6 1,533.0 10,610.8 6,428.4 722.4 19,853.3Instructional Materials 241.8 3,190.8 2,882.6 3,701.1 2,689.3 12,705.5In-Service Teacher Training 734.6 2,774.7 2,927.0 2,445.6 1,967.9 10,849.8Education Assessment System 1,876.5 545.7 32.6 567.3 34.3 3,056.4School Health and Nutrition Program 272.3 1,097.2 99.4 28.2 26.9 1,524.0

Subtotal Improvemnent in Education Quality 4,082.0 9,612.5 16,846.5 13,342.1 5,462.1 49,345.3C. Institutional Modernization

Modemization of MINED 2,563.0 2,379.8 2,108.0 1,414.0 1,413.3 9,878.1Communications Program 524.1 356.9 221.1 158.4 209.0 1,469.5Basic Education Fund Program 282.0 251.4 457.1 457.1 457.1 1,904.8

Subtotal Institutional Modernization 3,369.1 2,988.1 2,786.2 2,029.6 2,079.5 13,252.4 wD. IDB Loan Inspection and Supervision (FIV) 371.7 - - - - 371.7E. Project Coordination and Management 876.2 1,200.0 1,133.0 768.6 788.6 4,766.5Total PROJECT COSTS 10,551.6 16,029.8 23,542.4 18,996.6 11,106.5 80,226.8

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135 ANNEX 12Tentative Procurement Plans

EL SALVADOR BASIC EDUCATION MODERNIZATION PROJECTTENTATIVE PROCUREMENT PLANS

Main Procurement for Project Subcomponent Financing Method |Pequalify Date of PNTextbooks

I pkg, $600,000 Textbooks & IDB (90%) ICB YES 9/953 pkgs, $1,200,000 Instructional Materials ICB NO 9/961 pkg, $200,000 NCB NO 9/976 pkgs, $10,000,000 ICB NO 9/973 pkgs, $5,400,000 ICB NO 9/981 pkg, $600,000 ICB NO 9/99up to 10 pkgs, $2,000,000 PLB NO

Instructional Materials: includes materials for teachers and students, libra, books and science labs3 pkgs, $3,100,000 Textbooks & IBRD ICB NO 9/963 pkgs, $2,600,000 Instructional Materials (90%) ICB NO 9/971 pkg, $200,000 NCB NO 9/974 pkgs, $3,600,000 ICB NO 9/982 pkgs, $2,600,000 ICB NO 9/99up to $1,400,000 to be shopping

transferred to ACEsVehicles: Four-wheel drive vehicles and motorcycles for supervisors

I pkg, $170,000 School Health & IBRD LIB NO 1/962 pkgs, $400,000 Nutrition Program (90%) LIB NO 1/971 pkg, $600,000 Modernization of LIB NO 1/98

MINEDSupervision System

1 pkg, $63,000 In-Services Teacher IDB (90%/o) shopping NOTrainingCommunicationsProgram

Furniture for training centers and EDUCO management2 pkgs, $500,000 In-Service Teacher IDB (90%/6) ICB NO 3/971 pkg, $300,000 Training ICB NO 11/97up to 10 pkgs, $400,000 Expansion of Access PLB NO

Office furniture for departmental o fices and supervisor offices1 pkg, $90,000 Modernization of IBRD NCB 1 NO 10/951 pkg, $95,000 MINED (90%) NCB NO 8/961 pkg, $50,000 NCB NO 8/97

Office equipmentfor central and departmental officesup to $270,000 Modernization of IBRD shopping NO

MINED (90%/.)Project Management

Computer equipment for central and departmental officesI pkg, $330,000 Modernization of IBRD ICB NO 11/951 pkg, $200,000 MINED (90%/O) NCB NO 11/96up to $150,000 Project Management | shopping NO l

MicronutrientsI pkg, $186,000 School Health and IBRD LIB NO2 pkgs, $950,000 Nutrition Program j (90%) LIB NO

Civil works: rehabilitation and repair of classrooms, regional teacher training centers, local pedagogical resourcescenters, and some administrative buildings

Executed under FIS | Expansion of Access |DB (90%) PLB NOprocedures, $6,600,000 In-service Teacher

I TrainingModernization of

_ MINED l__ l l l

136 ANNEX 12Tentative Procurement Plans

Maint ProurementforProject J Subcompnent Financin Method Pr D Pat-PN...Teacher Training: contracting services to develop materials and train teachersUp to 3 contracts, $870,000 In-service Teacher IDBI IC YES 9/95Up to 4 contracts, $1,360,000 Training (100%) IC YES 9/96Up to 6 contracts, $1,900,000 IC YES 9/97Up to 7 contracts, $2,200,000 IC YES 9/98Up to 6 contracts, $1,900,000 IC YES 9/99Staff Training: contracting services to develop materials and train managerial, technical, and administrative staffUp to 2 contracts, $200,000 Staff Development IBRD LC YES 3/96Up to 2 contracts, $180,000 Program (100%) LC YES 4/97Up to 2 contracts, $160,000 LC YES 5/98Up to 2 contracts, $140,000 LC YES 6/99Up to 2 contracts, $170,000 LC YES 6/00Technical AssistanceContracting services to provide Expansion in Rural IDB IC, LC YES 96-2000expertise to MINED in many Areas (100%)areas (firms and individualconsultants, $779,000)Contracting local NGOs Strengthening of the IBRD LC YES 96-2000($5,650,000) EDUCO Program (100%)Contracting firms and individual Curriculum IBRD IC, LC YES 96-2000consultants ($182,000) Development (100%)Contracting firms and individual In-service Teacher IDB IC, LC YES 96-2000consultants ($175,000) Training (100%)Contracting local institutions to Education Assessment IBRD LC YES 96-2000carry out student assessments System (100%)($2,548,000)Individual consultants IC, LC YES 96-2000($134,000) _

Contracting firms and individual Modernization of IBRD IC, LC YES 96-2000consultants ($1,500,000) MINED (100%)Contracting firms and individual Supervision System IBRD IC, LC YES 96-2000consultants ($309,000) (100%)Contracting local firms to develop Communication IDB LC YES 96-2000public campaigns ($200,000) Program (100%)Contracting firms and individual Project Management IDB IC, LC YES 96-97consultants to assess secondary (100%)educationContracting firms and individual Project Management IBRD IC, LC YES 96-2000consultants ($4,350,000) (100%)

NOTES: US$ equivalent.PN Procurement NoticeICB International Competitive BiddingLIB Limited International BiddingNCB National Competitive BiddingPLB Private Local Bidding (at least five invitations)IC International ConsultantsLC Local ConsultantsShopping Purchasing of goods using at least three quotationsl :Ap2\annpln2.doc

137 ANNEX 13Disbursements

EL SALVADOR BASIC EDUCATION MODERNIZATION PROJECTDISBURSEMENTS

Allocation of IBRD Loan ProceedsAllocation ofLoan Amount

Disbursement Category (US$ million) Percentage to be Financed1. Equipment, Furniture, and Vehicles 1.6 100% of foreign expenditures,and

87% of local expenditures2. Educational Materials 11.7 100% of foreign and 87% of local

expenditures3. Technical Assistance, Training and 14.0 100% of expenditures, excluding taxes

Studies4. Micronutrients 0.7 90% of expenditures5. Salaries and Operating Costs 2.6 90% of expenditures until an aggregate

amount of US$1.6 million is reached;60% until an aggregate amount ofUS$2.5 million is reached; thereafter30%

6. Unallocated 3.4Total 34.0

Allocation of 1IDB Loan ProceedsAllocation ofLoan Amount

Disbursement Category (US$ mnillion) Percentage to be Financed1. Civil Works 5.2 90% of foreign and local expenditures,

excluding taxes2. Equipment, Furniture, and Vehicles 1.0 100% of foreign expenditures, 90% of

local expenditures, excluding taxes3. Didactic Materials 16.3 100% of foreign and local expenditures

excluding taxes4. Technical Assistance, Training and 8.9 100% of expenditures, excluding taxes

Studies5. Basic Education Fund 1.5 90% of expenditures, excluding taxes6. Salaries and Operating Costs 0.7 90% of expenditures until an aggregate

amount of US$0.4 million is reached;60% until an aggregate amount ofUS$0.6 million is reached; thereafter30%

7. Unallocated 3.7Total 37.3

138 ANNEX 13Disbursements

IBRD Estimated Schedule of Disbursements(US$ million)

.. ..... ........ Disbursed CumuativeBa.k Fisca .. : Dur in Disbursemient Disbursement B of

Ye r :Semester Endig AiSemester Aount as % of Ttal Loan96 June 30, 1996 1.8(a) 1.8 5 32.297 Dec. 31, 1996 1.3 3.1 18 30.9

June 30, 1997 3.0 6.1 27.998 Dec. 31, 1997 4.1 10.2 42 23.8

June 30, 1998 4.0 14.2 19.899 Dec. 31, 1998 3.0 17.2 59 16.8

June 30, 1999 3.0 20.2 13.800 Dec. 31, 1999 3.5 23.7 80 10.3

June 30, 2000 3.5 27.2 6.801 Dec. 31, 2000 3.4 30.6 100 3.4

IJune 30, 2001 3.4 34.0 0.0Includes Special Account first deposit of US$1.5 million that may also cover retroactive financing up to

US$300,000 for eligible expenditures.

IDB Estimated Schedule of Disbursements(US$ million)

. .. . . . . . . . . . . . . . . , . . . . . . . . . . .

Ba.. ..... i . .... ...l . Duriin Disbureet Disbrseen Dalc o~f.Year0-0- Semes000:;0-t;rtr Ending 0;0000 Semster Amun as % of To;0t fi00000000; im0 tal ;200Loan;0 000096 June 30, 1996 0.0 0.0 0 37.397 Dec. 31, 1996 1.8 1.8 10 35.5

_______June 30, 1997 1.8 3.6 33.798 Dec. 31, 1997 3.2 6.8 27 30.5

June 30, 1998 3.2 10.0 ______27.3

99 Dec. 31, 1998 7.0 17.0 64 20.3June 30, 1999 7.0 24.0 ______ 13.3

00 Dec. 31, 1999 4.5 28.5 88 8.8June 30,2000 4.5 33.0 ______4.3

01 Dec. 31, 2000 2.5 35.5 100 1.8_______June 30, 2001 1.8 37.3 _______0.0

sml_dsb2.doc

139 ANNEX 14Project Performance Indicators

EL SALVADOR BASIC EDUCATION MODERNIZATION PROJECTPROJECT PERFORMANCE INDICATORS

A. Development Objectives

.. . .,: ... : . , . - - -' '. ' - ....................' ' ' ivewwdd''-t'

_______________. .. - -.-.. - .. ..--Annual t Mi.-T;.$

impact Ind'tor Methodology Level of Observation - Revmw --. :-ewObjective: Expand Access at the Basic LevelIncrease in gross Education Statistics System Yes Yesenrollment rate for basic SystemeducationIncrease in the percentage Education Statistics System No Yesof those students who Systemfinish 6th gradeAverage classroom size of Education Statistics System Yes Yes32 students SystemIncrease attendance Observation, interviews, Sample of municipios with No Yes

study nutrition interventionsObjective: Improve the Qu lity and Effectiveness of Basic Education X _

Increase in academic Analysis of Achievement System No Yesachievement in core skills test resultsin Spanish andMathematicsReduction in the dropout Education Statistics System No Yesrate SystemReduction in the repetition Education Statistics System Yes Yesrate SystemnImprove quality and Evaluation of pilot At least four subprojects No Yesefficiency in the provision subprojectsof servicesObjective: SupportMore Dynamic and Participatory School ManagementImprovement in the ability Focus groups, document School No Yesof parents' associations to reviewsupport and manage theprovision of educationservices at the local level


B. Quantitative Indicators

C6ornnent/Subcompdnent: i Unit TOre Year1 YerYar Yar Y 5Operational Manual December

1995Legal opinion asserting that pilot Marchprograms could be implemented under 1996the current legal framework and/oradequate provisions takenExpansion OfAccess To Preschool And Basic EducationExpansion of preschool classrooms section 1,000 250 250 250 250 0Expansion of lst/2nd cycle section 2,000 500 500 500 500 0Transforming EDUCO sections section 3,070 600 935 935 600ACEs strengthened by private orgs. ACE 2,500 300 200 500 800 700School infrastructure classroom 3,070 600 935 935 600Evaluation of private institutions study 1 1 _

Design of simplified transfer system system 2 1 1Training of ACE members parents 580 7,000 8,200 9,400 10,600

Improvement In Education QualityInstructional booklets for preschool number 807,000 142,000 151,000 161,000 171,000 182,000Textbooks for 1st cycle (grds. 1-3) number 0 1, 892,000 636,000 0Workbooks for 1st grade students number 1,391,000 272,000 273,000 277,000 282,000 287,000Textbooks for 2nd cycle (grds. 4-6) number 1,082,000 0 796,000 286,000 0 0Textbooks for 3rd cycle (grds. 7-9) number 521,000 0 0 325,000 196,000 0Classroom libraries number 3,349 0 500 1,000 1,000 849Science labs for 3rd cycle number 202 0 202 0 0 0Rehab of EMDE Infrastructure number 238 100 100 38Teacher training needs analysis study 1Design of Teacher Training Plan study 1 1 1Study of Textbook Cost-Recovery study 1 | 1Secondary Education Studies study 4 2 2

Training of multigrade teachers number 200 1,000 1,000 1,000 0Training of preschool teachers number 3,600 900 900 900 900Training of lst/2nd cycle teachers number 30,000 7,500 7,500 7,500 7,500Training of 3rd cycle teachers number 5,800 1,450 1,450 1,450 1,450Contracting institution for student contract I 1testingAchievement tests for 3rd/6th grds tests 4 2 2Achievement test for 9th grade tests 2 1 1Readiness test for Ist grade tests 2 1 1Readiness test for 3rd grade tests 2 1 1Selection of local university/research January 30,center to develop the education 1996assessment system


..~~ ~ ....... ........... Y .2|.Y .3 - | e -

ISiibtr.~~n nent I Ytar I 1 YearZ I"Year.3 1 Ytar4 eInsttutional Modernization And StrengtheningInformation system Design the District and District and District and District and

systems of departmental departmental departmental departmentalhumnan reports of the 4 reports of the 4 reports of the 4 reports of the 4resources, systems (human systems (human systems (human systems (humanstatistics, resources, resources, resources, resources,budget, statistics, statistics, statistics, statistics,infrastructure budget, budget, budget, budget,and supply. Its infrastructure infrastructure infrastructure infrastructurecollection and supply) in and supply) in 7 and supply) in and supply) ininstruments the 3 depts. depts. 10 10 depts. 14 the 14 depts.applied. Design and departmental departmentalProcess of application of networks networkssupport for the the 4 systems. 7 functioning. functioning.PIL, (canasta) departmentaland texts networksanalyzed. The 3 functioning.networks of theprototype deptsfunctioning.

Planning System Guide for the Guide for the Guide for the Guide for thePIL designed PIL designed PIL designed PIL designedand applied in and applied in and applied in and applied in100% of the 100% of the 100% of the 100% of theurban schools & urban schools & urban schools & urban schools &50% of rural 50% of rural 50% of rural 50% of ruralschools in the 3 schools in the 7 schools in the schools in theprototype depts. Second 10 depts. 14 departments.departnents. version of the Departmental National plan

guides. plan with with ceilings byDepartmental ceilings by department.guide applied in school.3 depts.

Management Indicators Indicators Indicators Indicators Evaluation ofEvaluation System designed and designed and designed and designed and the management

applied to all applied in all the applied in all the applied in all the in the 14 depts.the districts in districts of the 7 districts in the districts in thethe prototype prototype depts. 10 prototype 14 depts.departments. Evaluation of depts. Evaluation of

management in Evaluation of the managementthe prototype the management in the 10 depts.depts. Second in the 7 depts.version of theindicators.


* ISubco=:onent Year 1 .Year .2 .Year3 Y : ar4 Y Orgarizational Manuals of the Departmental Administrator/ Administrator!Development functions and structure teacher ratio teacher ratio

requirements of applied with 30% less than at 30% lower thanthe departmental selected the beginning of at the beginningstructure. Tests personnel the program (in of the programof the according to the 10 depts). In (in 14 depts).evaluation of requirements. the non-teaching In the non-the Administrator! personnel, the teachingachievements teacher ratio technical personnel, theapplied & 30% less than at personnel ratio technicalanalyzed. the beginning of 50% higher than personnel ratio

the program (in at the beginning 50% higher than7 depts) of the program at the beginningDepartmental (in 10depts). of the programstructure (in 14 depts).

evaluation_of_rdefined. th_o_ec__ntennAdministration CVs CVs CVs CVs AdministrativeSystem systematized . systematized . systematized. systematized . officials

More than 50% More than 50% More than 50% More than 50% provided for inof the Centros of the Centros of the Centros of the Centros 14 depts.Escolares Escolares Escolares Escolarescontracting & contracting & contracting & contracting &paying paying paying payingautomatically automatically automatically automaticallyfor services (n for services (n for servtces (in for services (inthe prototype the 7 depts). the 10 depts). the 14 depts).depts). Have the Administrative Administrative

registries of officials officialspreselected provided for in provided for inteachers & the 7 depts. 10 depts.information ofvacancies in theentire country.

Supervision System Supervisor Training for Training for Training forguides supervisors in 7 supervisors in supervisors indeveloped and depts. CECs 10 depts. CECs 14 depts. CECssupervisors provided for and provided for and provided for andtrained in the 3 supervisor supervisor supervisorprototype depts. offices equipped offices equipped offices equippedCECs provided in the 7 depts. in the 10 depts. in the 14 depts.for andsupervisoroffices equippedin the 3prototype depts.

Public Expenditures In The Education SectorEducation 2.52% of GDP 2.64% of GDP 2.76% of GDP 2.88% of GDP 3.00% of GDPExpenditures I I I I I


~~~~~~~~~~~~~~~~~. ... .. . .... ..5

~~~~~~~~~~~. . . . . ... .,.,,. , .,,,,,,,,.,............... .. . . .. . .... . .

Growth in Budget GDP Growth GDP Growth GDP Growti GDP Growth GDP GrowthAllocations plus 1% plus 1% plus 1% plus 1%Allocation of 68% of ordinary 71% of ordinary 74% of ordinary 77% of ordinary 80% of ordinaryOrdinary Budget to budget budget budget budget budgetPreschool and BasicEducationTimely Provision of Timely Timely Timely Timely TimelyCounterpart Funds provision of provision of provision of provision of provision of

counterpart counterpart counterpart counterpart counterpartfunds according funds according funds according funds according funds according

I to action plan to action plan. to action plan to action plan to action plan

I:B=p2\smmpa£doc

144 ANNEX 15Tenns of Reference for Project

Review and Supervision Schedule

EL SALVADOR BASIC EDUCATION MODERNIZATION PROJECTTERMS OF REFERENCE FOR PROJECT REVIEW AND

SUPERVISION SCHEDULE

1. Given that the project is cofinanced by the IBRD and IDB, and the comprehensive scopeof the actions that MINED has to perform to carry out education reform, the proposed projectwill require close supervision, especially in the early years. An average of 20 staff weeks (SW)per Bank of supervision are consequently budgeted for the first two years and an average of 19SWs a year subsequently. The first year figures includes 10 SW per Bank for the project launchmission. Fourteen staff weeks per Bank will be budgeted in 1998 to support the Mid-termReview.

2. The composition and staffing level of the supervision program for each year of project arepresented in Table 1. The supervision teams will be carefully planned, and will consist of the TaskManagers, IBRD and IDB staff, and consultants with expertise in the areas of education(evaluation, teacher training, textbooks and curriculum), community organization, informnation,communication, management and institutional development, procurement and projectimplementation. Supervision missions will normally be conducted twice a year, in March andSeptember of each year, beginning in September of 1996. All missions will involve discussionswith project officials in MINED headquarters, as well as field visits, on the basis of which them-nission will evaluate the project.

3. Project Launch Seminar. A Project Launch Seminar will be conduct around January 1996,to: (a) review and approve the Annual Work Program for 1996, and to review counterpartfunding provision included in MINED's 1996 budget; (b) review implementation of the project'srules and procedures manual, and familiarize MIPLAN, and MINED central and departmentaloffices with the project's planning and performance monitoring procedures and the Banksguidelines and procedures on procurement, disbursement and auditing requirements; (c) reviewthe project's requirement for progress reports on the implementation of the Annual WorkPrograms; and (d) the logical framework of the project. The seminar will be followed up by aseries of departmental seminars organized by MINED to provide relevant information and discussproject implementation procedures with the other international and national agencies involved inimplementing education projects and with the department and local officials of MINED.

4. Annual Review. The purpose of the annual review is to assess project performance againstspecific objectives and targets, primarily through the analysis of two documents: (a) the ProjectImplementation Report for the year under review; and (b) the Project Action Plan for the nextcalendar year. Annual Reviews will take place in September of each year.

5. In preparation for the Annual Project Review, the Project Manager, in coordination withresponsible units, will prepare and present to the Banks, no later than August 31st of each year,the following documents:

(a) Project Implementation Report for the year under review, covering:

(i) compliance with the Project Operations Manual;(ii) compliance with the covenants of the Banks Loan Agreements;

145 ANNEX 15Terms of Reference for Project


(iii) information pertaining to all Project Monitoring and Impact EvaluationIndicators;

(iv) status of procurement of goods and services;(v) progress report of Basic Education Fund subprojects approved; and(vi) highlights of findings, lessons learned and problems pertaining to the

technical, institutional, administrative or financial implementation of theproject;

(b) Project Action Plan for the next calendar year, covering:

(i) program of activities for each subcomponent of the Project;(ii) schedule of activities for each subcomponent of the Project;(iii) detailed teacher training plan;(iv) detailed plan for increasing/expanding EDUCO classes and assignment of

teachers to expand the preschool and basic education in the rural areas;(v) detailed multigrade plan;(vi) detailed institutional modernization activities, including plan for

decentralization of activities to schools and departments, staff developmentactivities;

(vii) detailed procurement plan;(viii) detailed budget by source of funds and uses, for each quarter, specifying

counterpart funds requirements;(ix) detailed communication plan;(x) relative weights that define eligibility of Basic Education Fund subprojects;

and(xi) specific reports when needed.

6. Project Mid-term Review. This review will be carried out no later than two and a halfyears after the initiation of project implementation (September 1998) and will take the place of theAnnual Review in that year. It will have the participation of both IBRD and IDB. The focus ofthe review is to ascertain to what extent the project has achieved its development objectives.During such review, special attention will be paid to the education sector policies related to theproject, the effectiveness of the institutional modernization measures taken, the Basic EducationFund, the evaluation of the nutrition and health subcomponent, and the allocation of fiscal fundsto the education sector. The Project Manager will prepare the same reports for the Project Mid-term Review as for the Annual Project Reviews. However, if special issues warrant more detailedanalysis, additional studies will be carried out under the coordination of the Project Manager.

7. Modifications to Project Design and Implementation Plans. During Annual ProjectReviews and the Project Mid-term Review, there is the opportunity to update project targets anddiscuss changes needed in project design or implementation plans. In this context, IBRD and IDBmay require that MINED prepare an action plan for the Banks review and approval within twomonths following the completion of the Project Review. MINED will incorporate the changesagreed upon in the Project documents, including, the Project Operations Manual if warranted.The Project Manager will be responsible for organizing the Mid-term Project Review andensuring that agreed follow-up actions, satisfactory to the Banks, are taken in a timely manner.


Review and Supervision ScheduleTable 1: Supervision/ Project Launch and Annual Reviews

IBRD IDB1996 January Task Manager(s) 4 4(IBRD 20SW) Project launch Educator 1 2(IDB 20SW) Workshop Nutritionist I -

Community Org.Specialist I .Procurement Specialists 1 1Implementation Specialist I IInstitutional Development - -

Specialist I -

Logical Framework Specialist - 2September (Annual Task Manager 3 3Review) Educators (Textbooks , Teacher 2 2

Training and EvaluationSpecialists)Nutritionist I -

Procurement Specialist I 1Implementation Specialist 1Information System Specialist I IInstitutional Modernization Spec I ICommunication Specialist. -

1997 March Task Manager 2 2(IBRD 18SW) Educator 2 2(IDB 18SW) Nutritionist I -

Community Organization Spec. IInstitutional Development 2 2Communication Specialist -

September Task manager 3 3(Annual Review) Educators 2 2

Nutritionist I -

Community OrganizationSpecialist IImplementation Specialist IProcurement Specialist I IInstitutional Development 2Communication Specialist - 1

1998 March Task Manager 2 2(IBRD 21 SW) Educators 2 2(IDB 21 SW) Nutritionist I -

Community Organization Spec. -I

Institutional ModernizationSpecialist 2 1Communication Specialist -I

September Task manager 3 3(Mid-term Review) Educator-Training and Evaluation

Specialists 3 4Nutritionist I -

Community OrganizationSpecialist 2 1Implementation Specialist - IProcurement Specialist 1Institutional Modernization Spec. 2 1Financial Specialist 1 IInformation System Specialist I

._____________ _________________ Communication Specialist -



: -.- : -:::. . |-.SUPERSIQN T.1EAM TF G :: weeks)I1BRD 1DB

1999 March Task Manager 2 2Educators - 2

(1BRD 17SW) Nutritionist 1 -

(IDB 17SW) Community Organization Spec. I -

Institutional Development Specialist 2 2September Task Manager 3 3(Annual Review) Educator 2 3

Nutritionist I-Conummity Organization Specialist 1 IInplementation Specialist I IProcurement Specialist I IInstitutional Development Specialist 2 1Coxmmunication Specialist - 1

2000 March Task Manager 2 2(IBRD 19SW) Educator -Training Specialist - 2(1DB 19SW) Nutritionist 1 -

Community Organization Spec. 1 -

Institutional Modernization 2 2Specialist

December Task manager 3 3(Final Supervision Educator 3 3and Project Nutritionist 1 1Implementation Community Organization Specialist 1Completion) Implementation Specialist I

Procurement Specialist I IInstitutional Development 2 1Specialists -

Communication Specialist 1Financial Analyst

ann sup.doc

1996 ( 1997 I 199B 1999 2000ID Task Name Q1 Q2 Q3 04 0| Q20Q3 q4 |Q 2 Q3 Q4 Q1 Q2 Q3 Q4 1 0 2I EXPANSION OF ACCESS TO PRESCHOOL AND BASIC ED -

2 Expansion of Preschool and Basic Education in Rural i

3 Study Redstribution of TeacherslHuman Resources

4 Create New EDUCO Sections

9 Transform Existing Traditional Sections

14 Rehabilitation of Infrastructure for Transformed School _ _ _ _ _

15 Strengthening the EDUCO Program

16 Study Private Organizations -

17 PIlot Test New Methods

1S Evaluate Participation of NGOs -

19 Evaluate Muligrade Experience -

20 Design Parents School Program

21 Evaluate Parents School Program il S

22 Communication Campaign 00

23 Pilo Test New Financial Mechanisms

24 Revise Legal Framework 00

25 IMPROVEMENT IN EDtUCATION QUALITY 4

26 Curriculun Development

27 Textbook Cost-Recovery Study

28 Curriculum Improvement Program (Preschool, 3rd Cy

29 Improve Quality and Use of Curriculum I I I

30 Promote Participation of Community

31 Design and Implement Multigrade Programs I .

32 Textbooks and Instructional Materials i _

Task M Summary ' Rolled Up ProgressProect El Salvador Basic Education M r,______Date: 8/215 Progress Rolled Up Task *.File Name: ES70795.MPP LilsD RoldUpMe3Milestone *Rolled UpMILestone (J>

(3 0%

1996 ~~~~1997 1991999 2000ID Task Namne Q1 02 Q3 Q4 |Q 2 3 |4 01 02 03 |4 0 1 02 03 4 0 Q1 02 03 Q433 Provide Materials . ,_._:

34 Sustainable Provision System

35 Design Basic Package of Instruclional Materials Syste

36 Implement Basic Package of Instructional Materials Sy __

37 Develop System for Production and Distribution of Tex

38 Provide Equipment, Fumiture, Instructional Resources

39 In-Service Teacher Training System

40 Design Decentralized Training Program

41 Implement System __

42 Diagnose In-Service Training Needs

43 Technical Assistance to Curriculum Staff Groups :

44 Establsh Dissemination SystemE

45 IdentIfy Pre-Service Training Needs

46 Prepare Pre-service Assessment Study .

47 Education Assessment System

48 Provide Criteria

49 Improve Methodologies :

SO Mobilize Public Opinion =

61 Provide Mechanism to Target Resources

52 Define Priority Needs for Training Programs

53 Strengthen Technical Capacity to Monitor Achievemen .s

64 School Health and Nutrition Prograrn

55 Revise Technical Content of Training Programs .

56 Identify Areas of Highest Risk

Task __Summary Rolled Up Progress°DProject: El Salvador Basic Education M TsumyolUPgeDate: 8/2195 Progress Roled Up TaskFHe Name: ES70795.MPP M R

Milestone *Rdled Up Milestone K) SoD o8

a e. a a a a ~~~~~~~~~~a a 4 U * o ~1 ~ - a a ua a .- a a t . a- a a -J

Ln ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~ ~~ ~ ~~~~~~~~~~~~~~~~~~~-

ial~~~~~~~~~~~~~~~~m

i i - - . - - - - -... .. . . . .. . . . .. . . . . .. . . . .. . . . .. . . . .. . . . .. . . . ..-.. . .. . . . ..... .. . . . .. . . . .. . . . .. . . . . . . . . .. . . . .. . . . .. . .. . . . .

Rm c u tn,~~~~~~~~~~~~~~~~~~~~~~~~~~~M

A, 91 ~ ~ ~ ~ ~ ~ ~ ~ ~~~~~~~~~~1........................... ............ ................................................

10M~~~~~~~~~~~~~~~~~~~~~~~~~~~~~')-

olnpoq*S onlnumnlulj P* a

91 XaNw 05 1~~~~~~~~~~~~~~~~~

151 ANNEX 17Education Projects

Funded By IDB


EDUCATION PROJECTS FUNDED BYINTER-AMERICAN DEVELOPMENT BANK

(US$ thousands)

Executing ApprovalLoan: Agency Objective Date Amount

50/IT-ES University of El Education improvement 12/20/62 670Salvador in general areas and

basic sciences264/SF-ES Centroamerican Expansion and improve 7/9/70 2,000

University, Jose the academic and fiscalSimeon Canias structures

537/SF-ES Centroanerican 2nd stage project to 12/8/77 9,000University, Jose expand and imnprove theSime6n Canias acadermic and physical

infrastructuresATN/TF-1469-ES Ministry of Contribute to financing 8/10/76 70

Planning the cost of a study aboutthe supply and demandfor human resources forsecondary and highereducation

ATN/SF-1793-ES Salvadoran Fund Study of Technical 12/12/82 85for Studies of Pre- Feasibility and Economicinvestment a Expansion and

Improvement ofTechnical Education

ATN/SF-261 1-ES Ministry of Training and Program 8/26/85 7Education for Illiteracy and Adult

EducationATN/TF-2659-ES Ministry of Preparation of a 11/18/85 117

Education Program for Illiteracyand Adult Education

ATN/SF-2329-ES Salvadoran Fund Preparation of studies of 95for Studies of Pre- backing for the requestinvestment for a loan for the Project

for Non-UniversityTechnical Education

PR-1703-ES Ministry of Rehabilitation of the 2/28/90 14,400Education Centroamerican

Technological Institutea Partial support to the education sector.

152 ANNEX 18List of Documents in Project File

EL SALVADOR BASIC EDUCATION MODERNIZATION PROJECTLIST OF DOCUMENTS IN PROJECT FILE

Artana, D. 1995. "El Programa Educativo del Gobiemo de El Salvador, Consistencia con las MetasMacroec6nomicas de Mediano Plazo."

Ayala Alvarado, R. 1994. "Plan Global Trabajo Comunitario con las Asociaciones Comunales para laEducaci6n - ACE."

Bodnar de Pilla, G. 1994. "Investigaci6n Cualitativa Educaci6n Media."

de Barraza, S.R. 1995. "Reflexiones Sobre las Lirmitantes del Sector Educaci6n." (SocialAssessment)

"Diagnostico del Sistema de Desarrollo de Recursos Humanos de El Salvador." 1994. Un proyectodel Harvard Institute for International Development con la colaboraci6n de Fundaci6nEmpresarial para el Desarrollo Educativo, Universidad Centroamericana Jos6 Simeon Cafias.

Diaz Diaz, H. 1993. "Indicadores Estadisticos Basicos del Programa EDUCO."

Femandez Rojos, H. 1993. "Amilisis de los Procesos de Gesti6n del Programa EDUCO."

Lindo-Fuendes, H. 1994. "Informe, Investigaci6n Cualitativa Sobre la Educaci6n en El Salvador."

Lindo-Fuentes, H. 1995. "Social Assessment Report on Basic Education in El Salvador: CommunityParticipation Component." (Social Assessment)

Lindo Gutierrez, I. 1994. "Investigaci6n Cualitativa, Educaci6n Basica."

Manuel Enriquez Hinds. Letter From Minister of Finance to Mr. James D. Wolfensohn, President,World Bank, July 20, 1995. (Commitment to increase education budgets)

Marinio Solano, G. 1993. "Sistematizaci6n del Programa EDUCO."

MINED. 1995. "Convenio-Contrato Celebrado entre el Ministerio de Educaci6n y El Fondo deInversi6n Social (FIS)."

MINED. 1994. "EDUCO - Una Experiencia en Marcha."

MINED. 1995. "Memoria de Labores 1989-1994."

MINED. 1995. "Proyecto, Apoyo a la Reforma Educativa, Sector Educaci6n." Propuesta para serpresentada al Banco Intemacional de Reconstrucci6n y Fomento (BRIN) y al BancoInteramericano de Desarrollo (BID).

MIPLAN. 1994. "Plan de Desarrollo Econ6mico y Social 1994-1999."

Mora Mora, J. 1992. "Analisis Comparativo de Secciones de Primer Grado EDUCO y no EDUCO."

Parra Sandoval, C.F. 1992. "Testimoniales de Una Experiencia en Marcha."

153 ANNEX 18List of Documents in Project File

Prawda, J. "Educational Decentralization in Latin America, Lessons Learned." A View fromLATHR, No. 27. World Bank, Human Resources Division, Technical Department, LatinAmerica and the Caribbean Region, Washington, DC.

Quintana, J. 1992. "Informe Tecnico: Modelo de Simulaci6n Financiera."

Quintana, J. 1993. "Economia de la Educaci6n," Informe del Proyecto: Solidificaci6n del Alcance dela Educaci6n Basica.

Quintana, J. 1995. "Cuadros Sobre Tasas de Escolanizacion y Transici6n de la Educaci6n Parvulariay Basica Segun Datos de Poblaci6n y Matricula de 1993."

Quintana, J. 1995. "Modelo de Simulaci6n para la Planificaci6n Educativa."

Quintana, J. 1995. "Otros Trabajos Producidos por el Consultor."

Quintana, J. 1995. "Sistema de Asignaci6n de Prioridades para la Selecci6n de Municipios de laZona Rural."

Quintana, J. 1995. "Sistema de Base de Datos de EDUCO."

Rand. 1994. "Report on the Financial Impact of the Proposed Education Reform Program," by M.R.Kilbum and N. Sastry.

Rand. 1995. "An Analysis of the Unit Costs of Preschool and Primary School Education in ElSalvador," by E. Melamid, N. Sastry, and R. Ross.

Ripoll, M. 1995. "Boletin Informativo y Formulario Aplicaci6n Fondo Innovaciones Educativas."

Universidad Francisco Gavidia. 1995. "Informe Final de los Resultados de la Investigaci6n SobreEstadisticas Educativas."

World Bank. 1993. Report and Recommendation of the International Bank for Reconstruction andDevelopment to the Executive Directors on a Proposed Second Structural Adjustment Loan ofUS$50 million to the Republic of El Salvador. (contains country assistance strategy).

World Bank. 1994. "Cost Comparison of EDUCO Schools and Traditional Schools," by M. Minowa.

World Bank. 1994. "El Salvador - Community Education Strategy: Decentralized SchoolManagement." Country Department II, Human Resources Operations Division, LatinAmerica and the Caribbean Regional Office.

World Bank and IDB. 1994. "El Salvador - Moving to a Gender Approach in El Salvador: Issues andRecommendations."

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