ELS ASIA 111 & PACIFIC REGIN} SERIS 22 6 *z| World Bank Discussion Papers China and Mongolia Department Mongolia: Financing Education during Economic Transltlon Kin Bing Wu W/DP 2Q2 March lqq4 Recent World Bank Discussion Papers No. 168 Environmental Managemerit and Urban Vulnerability. Edited by Alcira Kreimner and Mohan Munasinghe No. 169 Common Property Resources: A Mlissing Dimension of Development Strategies. N. S. Jodha No. 170 A Clinese Province as a Reform Experiment: Th1e Case of Hainan. Paul M. Cadario, Kazuko Ogawa, and Yin-Kann Wcn No. 171 Issuesfor Itfiastructure Managetnetit in the 1990s. Arturo Israel No. 172 Japanese National Railways Privatization Study: The Experience ofJapan and Lessonsfor Developitig Counltries. Koichiro Fukui No. 173 T7e Livestock Sector in Eastern Europe: Constraints and Opportunities. Comelis de Haan, Tjaart Schilihom Van Veen, and Karen Brooks No. 174 Assessing Development Finance Institutions: A Public Interest Analysis. 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Sadiq Ahmed No. 192 Telecomtnunications: World Bank Experience and Strategy. Bjorn Wellenius and others No. 193 Information Systems Strategiesfor Public Financial Management. Hywel M. Davies, Ali Hashim, and Eduardo Talero No. 194 Social Gainsfrom Female Education: A Cross-National Study. K. Subbarao and Laura Rancy No. 195 Towards a Sustainable Development: The Rio dejaneiro Study. Edited by Alcira Kreimer, Thereza Lobo, Braz Menezes, Mohan Munasinghe, and Ronald Parker (Continued on the inside back cover.) Mongolia: Financing Education during Economic Transition East Asia and Pacific Region Series China: Reforming Intergovernmental Fiscal Relations. Ramgopal Agarwala. Discussion Paper No. 178. China's Reform Experience to Date. Peter Harrold. Discussion Paper No. 180. Korean Industrial Policy: Legacies of the Past and Directionsfor the Future. Danny M. Leipziger and Peter A. Petri. Discussion Paper No. 197. Poverty Reduction in East Asia: The Silent Revolution. Frida Johansen. Discussion Paper No. 203. China: Reform and Development in 1992-93. Peter Harrold and Rajiv Lall. Discussion Paper No. 215. Macroeconomic Management in China: Proceedings of a Conference in Dalian,June 1993. Edited by Peter Harrold, E. C. Hwa, and LouJiwei. Discussion Paper No. 222. The Development of the Private Sector in a Small Economy in Transition: The Case of Mokigolia. Hongjoo Hahm. Discussion Paper No. 223. EAgrASI & PAFI 22 6 |z| World Bank Discussion Papers China and Mongolia Department Mongolia: Financing Education during Economic Transition Kin Bing Wu The World Bank Washington, D.C. Copyright C 1994 The International Bank for Reconstruction and Development/THE WORLD BANK 1818 H Street, N.W. Washington, D.C. 20433, U.S.A. All rights reserved Manufactured in the United States of America First printing March 1994 Discussion Papers present results of country analysis or research that are circulated to encourage discussion and comment within the development community. 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The complete backlist of publications from the World Bank is shown in the annual Index of Publications, which contains an alphabetical tide list (with full ordering information) and indexes of subjects, authors, and countries and regions. The latest edition is available free of charge from the Distribution Unit, Office of the Publisher, The World Bank, 1818 H Street, N.W., Washington, D.C. 20433, U.S.A., or from Publications, The World Bank, 66, avenue d'16na, 75116 Paris, France. ISSN: 0259-210X Kin Bing Wu is a consultant in the World Bank's Education and Social Policy Department. Library of Congress Cataloging-in-Publication Data Wu, Kin Bing, 1951- Mongolia: financing education during economic transition / Kin Bing Wu. p. cm. - (World Bank discussion papers ; 226) Includes bibliographical references. ISBN 0-8213-2739-9 1. Education-Mongolia-Finance. 2. Education-Economic aspects- Mongolia. 3. State aid to education-Mongolia. I. Tide. II. Series. LB2826.6.M65W8 1993 379.1'1'095173-dc20 93-45507 CIP v CONTENTS Foreword .......................................... ix Abstract .......................................... xi Acknowledgments .................................... xii Acronyms, Abbreviations and Mongolian Terms ................. xiii Currency Equivalent .................................. xiv Executive Summary ................................... xv 1 Achievements and Reforms ........................... 1 A. Background ................................... 1 B. Achievements in Education ......................... 2 C. Recent Reforms ................................ 3 2 The Changing Patterns of Public Expenditures on Education ...... 8 A. Public Expenditures on Education in 1991 ................ 10 B. Austerity Measures ......... ..................... 13 C. Impact on Education and Policy Implications .............. 15 D. Education Expenditures in 1992 and the 1993 Budget .... ..... 20 3 Strategies to Build a Stable Resource Base to Finance Education ... 32 A. Rationalization of Public Expenditures on Education .... ...... 32 B. Reallocation of Public Resources ...................... 35 C. Mobilization of Private and Foreign Resources ............. 36 D. Conclusion . ................................... 39 Annexes .......................................... 41 Employment and Educational Attainment 1.1 Employment by Sector, 1990 .......................... 43 1.2 Employees in the State Sector, 1990 ..................... 44 1.3 Educational Attainment of Population Aged 15 and Over, 1989 ..... 45 - vi - Enrollment 2.1 Estimated School-Age Population and Gross Enrollment Ratios, (GER), 1989 .................................... 46 2.2 Estimated School-Age Population and Gross Enrollment Ratios, 1992-93 ....................... ............... 47 2.3 Girls Enrollment in Primary and Secondary Education by Region, January 1993 ................................... 48 2.4 Girls Enrollment by Grade, January 1993 .................. 49 2.5 Female Students and Teachers in Proportion to Total in Higher Education; and Enrollment of Women in Tertiary Education . 50 2.6 Enrollment in Boarding Schools, 1993 .................... 51 2.7 Dropout from Primary and Secondary Education in 1991-92 and Fall 1992 ...................................... 52 2.8 Changes in Enrollment, September 25 - December 25, 1992 ...... 53 2.9 Dropouts in Grades 1-3, September 25 - December 25, 1992 ...... 54 2.10 Distribution of Overseas Students by Country, 1992-93 .... ...... 55 Teachers 3.1 Student-to-Teacher Ratios by Level of Education and Type of School, 1991-92 . ............................... 56 3.2 Student-to-Teacher Ratios, 1991-92 ...................... 57 3.3 Teachers as a Percentage of Total Staff by Region and by Level of Education, 1991-92 .......................... 60 3.4 Teachers, Administrators, and Other Noninstructional Staff by Institution, 1992-93 ................................ 62 3.5 Composition of Teaching and Noninstructional Staff, 1992-93 ... ... 63 3.6 Movement of Teachers, 1992 ......................... 65 3.7 Movement of Teachers by Reason, 1992 ................... 66 3.8 Education Sector Staff Salaries in the Civil Service Pay Scale ... ... 67 Curriculum 4 Instructional Time Allocated to Various Subjects in Grades 1-10 .... 68 Expenditures 5.1 Government Expenditures by Function, 1990 ................ 69 5.2 Education Expenditure by Function and by Level of Education, 1991 . ........................................ 70 5.3 Education Budget by Function and by Level of Education, 1993 ... . 72 5.4 Education Budget by Source and Function, 1993 ...... . . . . . . . . 73 5.5 Education Budget by Region, 1993 ...................... 74 - vii - 5.6 Local Expenditures, Selected Cities and Aimags, 1991 ... ....... 75 5.7 Local Expenditures, Selected Cities and Aimags, 1992 ... ....... 76 5.8 Local Budgets, Selected Cities and Aimags, 1993 .... ......... 77 5.9 Cost Per Student by Region and by Level of Education in 1993 Budget ....................................... 78 5.10 Budget for Textbooks, 1993 .......................... 82 5.11 Estimated Expenses for Production and Provision of Essential Textbooks, 1993-94 ............................... 83 Organizational Structure and Legal Framework 6.1 The Government Structure of Mongolia ................... 84 6.2 The Structure of the Ministry of Science and Education of Mongolia . 85 6.3 The Education Law .86 6.4 The Education Budget Process, 1992 .90 Donors' Activities in Education 7.1 Projects Funded by Donor Agencies .91 7.2 MOSE's Plan for Foreign Funding .92 Map of Mongolia .93 References .94 Persons Met and Places Visited in 1993 .96 TABLES IN TExr 1.1 Average Gross Enrollment Ratios: Mongolia Compared to Countries of Various Income Levels, 1989. 2 1.2a Educational Institutions. 4 1.2b Enrollment by Level of Education. 4 2.1 Public Expenditures on Education as a Percentage of Total Public Expenditures and as a Percentage of GDP. 9 2.2 International Comparison ......... . . . . . . . . .. . . . . . . . . . 10 2.3 Education Expenditures by Function, 1991 ................. 11 2.4 Savings Due to Austerity Measures, 1992 .................. 14 2.5a Education Revenues and Expenditures, 1992 and 1993 ..... . . . . . 21 2.5b Recurrent Public Expenditures on Education at Constant 1990 Prices . 22 2.6 Enrollment, Expenditures, and Cost Per Student, 1991-93 ..... . . . 23 2.7 Teachers as a Percentage of Total Staff ...... . . . . . . . . . . . . . 26 2.8 Student-To-Teacher Ratios ........ . . . . . .. . . . . . . . . . . . . 27 - viii - 3.1 Strategies to Adjust the Use of Resources to Finance Education . . . . 33 3.2 Estimates of Possible Resources to be Made Available for Reallocation by Rationalizing Expenditures ........ .. . . . . .. . 35 FIGUmE iN TEXT 1.1 The Educational System in Mongolia . ........... ........ . 5 2.1 Enrollment Trends, 1980-92 .16 2.2 Enrollment in Boarding Schools, 1985-92 .18 2.3 Students Studying Abroad, 1985-91 .20 - ix - FoREwoRD Since Mongolia became a member of the World Bank Group on February 14, 1991, the Bank has been directly involved in assisting the country to define a strategy for its transition from a centrally planned to a market-oriented economy. This paper, which discusses implications of this transition for the education sector, is based on the findings of two Bank missions to Mongolia. The first one reviewed public expenditures and assessed private sector development (June 1-12, 1992); the second one provided technical support to assist Mongolia's economic transition (April 19-30, 1993). Both missions were led by Carlos Elbirt. The facts and figures reflect the conditions as of the end of April 1993. This paper is expected to be of interest to those working on reforming formerly socialist economies in general, and Mongolia in particular. Shahid Javed Burki Director China and Mongolia Department - xi - ABSTRACT This paper reviews the changing compositions of public expenditures on education in Mongolia during economic transition, assesses the impact of economic transition in Mongolia, and recommends three complementary strategies to provide a more stable resource base to finance education: * rationalize public expenditures on education by reducing stipends and food subsidies, reducing noninstructional staff, increasing student-to-teacher ratios, converting technical and specialized schools into community colleges, and exploring appropriate technologies for heating; * reallocate resources to strengthen basic education, reduce dropouts, improve primary science education, and invest in books and libraries; and * mobilize new resources by charging tuition fees at all post-secondary levels, by charging realistic interest rates on student loans, by providing a conducive environment for private schools, and by using foreign assistance. - xii - ACKNOWLEDGEMENTS I am grateful to the Ministry of Finance and the Ministry of Education of Mongolia for cooperation and support. I would like to thank Carlos Elbirt, Hongjoo Hahm, Halsey Beemer, Antoine Schwartz, Tom Eisemon, Jamil Salmi, Erik Thulstrup, Nicholas Burnett, Peter Moock, Yan Wang, Gail Stevenson, and Tejaswi Raparla for their thoughtful comments. Kin Bing Wu - xiii - ACRONYMS, ABBREVIATIONS AND MONGOLIAN TERMS Aimag - Province CMEA - Council for Mutual Economic Assistance DANIDA - Danish International Development Agency GDP - Gross Domestic Product GER - Gross Enrollment Ratio ger - Mongolian Tent GNP - Gross National Product IMF - International Monetary Fund MOF - Ministry of Finance MOSE - Ministry of Science and Education MNU - Mongolian National University Somon - District UNESCO - United Nations Educational, Scientific and Cultural Organization - Xiv - CURRENCY EQUIVALENn Currency unit = Tugrik (Tug) Before November 1991: $1.00 = Tug 7 (barter rate) As of June 30, 1992: $1.00 = Tug 40 (for official transaction) $1.00 = Tug 250 (for free market transaction) As of April 30, 1993: $1.00 = Tug 150 (for official transaction) $1.00 = Tug 420 (for free market transaction) As of May 27, 1993: Unified exchange rate based on free-market transaction FISCAL YEAR January 1 to December 31 SCHOOL YEAR September 1 - June 1 TOTAL HouRs OF INSTRUCTION IN SCHOOL YEAR 1990 693 - xv - EXECUTIVE SUMMARY i. From the time of independence in 1921 to 1990, Mongolia had been a centrally planned economy, with extremely close ties with the Soviet Union. Changes in Soviet domestic and foreign policies enabled Mongolia to change its political and economic systems. In 1990, Mongolia held its first multiparty election, and the new coalition government promised to construct a market-oriented economy. In 1991, the withdrawal of Soviet assistance, which accounted for 30 percent of the GDP for some years, and the collapse of the Council of Mutual Economic Assistance (CMEA), which disrupted external trade, made Mongolia's transition fraught with difficulties. Real GDP fell by 10 percent in 1991 and by a further 7.5 percent in 1992. These external shocks necessitated both strong stabilization measures to reduce large fiscal and external deficits in the short term, and changes in macroeconomic and sectoral policies to facilitate sustainable development in the long term. ii. This paper reviews the changing compositions of public expenditures on education during the economic transition, assesses the impact of structural adjustment on education, and recommends strategies to strengthen the resource base to finance education. iii. Mongolia has a rather well-developed human resource base, with an adult literacy rate of 96 percent, and a gross enrollment ratio of 98 percent in primary schools, 85 percent in secondary schools, and 15 percent in tertiary education. These very high levels of educational development were made possible by heavy investment in education. In 1990, education accounted for 17.6 percent of govemment expenditures and 11.3 percent of GDP. The total state fiscal deficit was about 13.5 percent of GDP. iv. Between 1990 and 1992, government expenditures and education expenditures were cut by 57.6 percent and 56.0 percent, respectively. The decline in public spending was more than three times as much as the decline in GDP. In 1993, the allocation to education was reduced to 15.2 percent of the state budget, and to 3.8 percent of GDP. This dramatic contraction of public spending on education is seen in a number of austerity measures, which include halting capital investment in education, retrenching non-instructional staff, introducing partial cost recovery for food in kindergarten and boarding schools, reducing clothing subsidies, phasing out the practice of sending students to former CMEA countries, and charging tuition fees in post-secondary and higher education. In addition, schools are encouraged to generate their own revenues through services to enterprises and renting premises. Private education is also encouraged. As a result, private investment in education has grown, particularly at the tertiary level. v. The composition of public spending in education has changed significantly. Salaries and social security were reduced from 53 percent of the recurrent education expenditures in 1991 to 33 percent in the 1993 budget. Administrative and overhead expenses (including supplies, electricity, heating, transportation), however, rose from 18 percent in 1991 to 35 percent in 1993, overtaking salaries as the largest expenditure item, mainly due to the steep rise in fuel prices. Food subsidies increased from 11 percent - xvi - in 1991 to 21 percent in 1993, largely due to the rise in food prices. Student stipends dropped from 9 percent in 1991 to 7 percent in 1993. Funding for books and libraries remained negligible. vi. The proportion of non-instructional staff remained high, particularly in post- secondary and higher education, and the student-to-teacher ratio became lower due to increasing dropouts, except in higher education. vii. Dropout and non-enrollment in primary and secondary schools, which were negligible before 1991, became a serious problem in poor and pastoral aimags, and increasingly so in Ulaanbaatar. This is due to privatization of livestock that increases the demand for child labor at home, the withdrawal of food and clothing subsidies in boarding schools that raises the direct cost of schooling, and increasing urban unemployment. In 1993, an estimated 23 percent of children of compulsory schooling age were not in Grades 1-8. If this trend is not reversed, about a quarter of Mongolia's citizens in the future will not have the basic skills necessary to adjust to a rapidly changing society. viii. Herders' children who attended boarding schools were affected more severely than other children. Enrollment of boarders in 1992 was only half of that in 1989. In sum, those who bear the brunt of structural adjustment are rural children. ix. Enrollment also declined in kindergarten, vocational education, and post- secondary technical and specialized education. Higher education, however, saw a rise in enrollment because those who can afford to pay tuition fees understand the importance of acquiring new skills in a transitional economy. x. Three complementary strategies are recommended to provide a more stable resource base to finance education: * rationalize public expenditures on education by reducing stipends and food subsidies, reducing non-instructional staff, increasing student-to-teacher ratios, converting technical and specialized schools into community colleges, and exploring appropriate technologies for heating; * reallocate resources to strengthen basic education, reduce dropouts, improve primary science education, and invest in books and libraries; and * mobilize new resources by charging tuition fees at aU post-secondary levels, by charging realistic interest rates on student loans, by providing a conducive environment for private schools, and by using foreign assistance. - 1 - 1. ACHIEVEMENTS AND REFORMS A. BACKGROUND 1.1 From the time of independence in 1921 to the present, Mongolia has made impressive progress in transforming from a nomadic economy to one with an industrial sector, mainly in the production of semiprocessed raw materials. Before 1990, agriculture accounted for about 20 percent of the Gross Domestic Product (GDP), industry for 27 percent, and service for 53 percent. 1/ The growth rate of real GDP was 7 percent in 1981-86, and 4.6 percent in 1987-89. Copper and cashmere are the two major stable exports. About half of the population resides in rural areas and half in urban areas.2/ Of the total working population, about 27 percent was in agriculture, 20 percent in industry, 8 percent in construction, 8 percent in transportation, 6 percent in trade, and 28 percent in government, education, health care, research, banking, housing and municipal services (Annex 1.1). 1.2 Before 1990, Mongolia was a centrally planned economy with extremely close ties to the former Soviet Union and the Council for Mutual Economic Assistance (CMEA). Soviet assistance accounted for about 30 percent of GDP for a number of years. This enabled Mongolia to run large fiscal and external deficits, and to have relatively high growth rates. 1.3 Since the former Soviet Union began to liberalize its domestic and foreign policies in the mid-1980s, Mongolia has greater freedom to change its own system. Popular demonstrations in March 1990 led to the country's first multiparty elections in July 1990, and the formation of a new coalition government committed to "construct a market- oriented economy. " Economic reforms include privatization of livestock and many public enterprises, price liberalization, and the establishment of new institutions for macroeconomic management. On the diplomatic front, new ties were established, and membership in the World Bank Group and the International Monetary Fund (IMF) was accepted in 1991. In the education sector, sweeping reforms also have been instituted. 1.4 In this process of transformation, Mongolia was severely affected by two major external shocks. First, the Soviet Union terminated its financial and technical assistance to Mongolia in 1991, and was unable to supply on a regular basis essential 1/ Mongolia. Toward a Market Economy, World Bank Country Study, 1992, p. 5-6. The agricultural share of 20 percent of the GDP is taken from footnote 4. 2/ The urban areas are broadly defined as three major cities of Ulaanbaatar, Erdenet, and Darhan, and 18 aimag (provincial) centers. - 2 - commodities such as cement, fertilizers, petroleum and spare parts. Second, the collapse of the CMEA in 1991 disrupted Mongolia's external trade. Real GDP fell by 10 percent in 1991 and by a further 7.5 percent in 1992, according to the IMF's estimates. Before 1990, Mongolia's Gross National Product (GNP) was estimated at $1,600 per capita. According to the IMF's reassessment, the GNP per capita was $463, placing Mongolia among the least-developed countries. These external shocks necessitated both strong stabilization measures to reduce large fiscal and external deficits in the short term, and changes in macroeconomic and sectoral policies to restructure the economy and to facilitate sustainable development in the long term. 1.5 It is in this context that this paper reviews Mongolia's achievement in the education sector and its current reform initiatives, examines the changing composition of public expenditures on education, discusses the issues arising from the deepening economic crisis, and makes recommendations to provide a more stable resource base to finance education. B. ACHEIEVENTs IN EDUCATION 1.6 Mongolia has a relatively well-developed human resource base, due to the former socialist policy of emphasizing education. In turn, the educated workforce has made possible Mongolia's economic transformation. In 1989, 96 percent of the working population (those aged 15 and over) was literate, and 7.5 percent had higher education (Annex 1.3). The gross enrollment ratios (GER) were 98 percent in primary schools, 85 percent in secondary schools, and 15 percent in tertiary education (Annex 2.1). These levels of enrollment compare favorably with those in middle-income countries (Table 1.1). Table 1.1: AVERAGE GROSS ENRoLLMENT RATIOS: MONGOLIA COMPARED TO VARIOUS INcOME LEvELS, 1989 Primary Secondary Tertiary Mongolia 98 85 15 Low-Income 105 38 2 Lower Middle-Income 101 54 17 Upper Middle-Income 104 56 17 High Income 105 95 42 Source: Mission estimates and World Development Report, 1992, p. 274. 1.7 Moreover, girls' enrollment is high, particularly at the post-secondary level. In 1993, girls account for 54 percent of the total enrollment in kindergarten, 54 percent in primary and secondary schools, 51 percent in vocational schools, 73 percent in post- secondary technical schools, and 64 percent in higher education institutions (Annexes 2.3 - 3 - to 2,5). This compares favorably with girls' enrollment in most parts of the world. This is due to a number of reasons-the socialist policy of promoting female education, the demand for male labor in a nomadic economy, the higher mortality rate of boys from teenage onward, and the wage compression that does not particularly reward higher levels of education. 1.8 Given that, in 1989, 42 percent of its 2 million population was under the age of 15, and 66 percent of them lived in aimags (provinces), the very high GER had been made possible by heavy investment in education. In 1992, the education system comprised 806 kindergartens, 679 primary and secondary schools, 41 secondary vocational schools, 23 post-secondary technical and specialized schools, and 28 higher education institutions. Sixty-three percent of the primary and secondary schools were located in the aimags. Dormitory facilities were provided to enable children from nomadic families to attend school. Boarders accounted for 15 to 25 percent of enrollment in most of the aimags (Annex 2.6). 1.9 The total enrollment in 1992 was nearly half a million, or one quarter of the population. Of the student population, 81,800 were in kindergarten, 384,000 in primary and secondary schools, 11,500 in secondary vocational schools, 7,700 in post-secondary technical and specialized schools, 14,000 in higher education (12,200 in universities and 1,500 in higher institutes) (Tables 1.2a and 1.2b). In addition, nearly 3,000 students attended technical and tertiary education in former CMEA countries (Annex 2.10). These foreign-trained graduates staff the academic institutions, government ministries, and public enterprises. C. REcENr REFoRMS 1.10 In July 1991, an education law was passed in order to support the democratization process and economic transformation. The law aims at providing greater flexibility and diversification to the education system. Major changes were in the following areas: (a) reorientation of education from communist ideology to national heritage; (b) primary and secondary education; (c) vocational education; (d) post-secondary technical colleges; (e) higher education; (f) private schools; (g) distance education; and (h) open and adult continuous education. Most reform plans are in the process of being implemented, except distance education. Mongolia's new education system is depicted in Figure 1.1. 1.11 Reorientation of curriculum from communism to national heritage. A major thrust of the reform is to phase out communist ideology in the curriculum at all levels in order to support the democratic process, and to revive the Mongolian national heritage that was suppressed under communism. The classical Mongolian script has been reintroduced as the national script to replace the Cyrillic script adopted from Russian. The teaching of the classical script has begun with Grade 1 in 1992, and will move up one grade each year. The classical script is used to teach language and social subjects, while the Cyrillic script is introduced in Grade 5 for teaching science subjects. - 4 - Table 1.2a: EDUCATIONAL NsTI ONS 1991-92 1992-93 (09/25/92) Total (State) Total State Private Kindergarten 771 806 771 35 Primary and Secondary 675 679 679 - Secondary Vocational 41 41 39 2 Post-secondary Technical 32 23 23 - Higher Education 9 28 12 16 Higher Institutes 4 21 5 16 Universities 5 7 7 - Table 1.2b: ENRoLLMENr BY LEVEL OF EDUCATION 1991-92 1992-93 (09/25/92) Enroll- Enroll- % of ment % ment Public Private Public Kindergarten 88,811 16.8 85,691 81,817 3,874 15.5 Primary and Secondary 401,256 76.0 384,069 384,069 - 72.8 Secondary Vocational 12,534 2.4 13,328 11,537 1,791 2.2 Post-secondary Tech- nical 12,789 2.4 7,749 7,749 - 1.5 Higher Education 12,303 2.3 15,639 14,052 1,587 2.7 Higher Institutes - - 3,384 1,587 1,797 - Universities - - 12,255 12,255 - - Total Enrollment 527.693 100.0 506,476 499.224 7.252 100.0 Source: Ministry of Science and Education. 1.12 Primary and secondary education has been restructured from 4+4+2 to 6+2+2. The six years of primary education plus two years of junior secondary education are considered basic education, and will be made free and compulsory for children from the ages of 7 to 14. Students, however, are allowed to leave school after seven years of education. The two years of senior secondary education after basic education will lead to a secondary school completion certificate. Schools for the gifted will be established. 1.13 The emphasis of primary education is on literacy, numeracy, elementary understanding of social and natural environment, respect for adults, basic work and survival skills. The purpose of junior secondary education is to teach social and natural sciences, and to introduce production technology. The main purpose of senior secondary - 5 - Flgure 1.1: THE EDUCATIONAL SYSEm IN MONGOLIA PhD (2.5 or more years after KA) Years in Age LeveL KA (2-3 years beyond BA) 7 6 BA (3-5 years depending on insti- 5 tution and program of studies) 4 Uni- ver- Specialized technical and profes- 3 si- * sional institutes and colleges ties (many being merged into universi- 2 ties from 1992 onward) Vocational Educa- 18/ 1 tion (craftsmen, 19 4 office workers, X saLes people, Secondary Education construction 16/ IX trades, eec.) 17 Vill Vll [ Z~~~iddLe School (includes some prevocational schoots) Vil VI IV ELementary School III 5 4 Kindergarten 3 2 1 100% of age group at each LeveL Source: Seth Spaulding, 'The Education System of Mongolia,' January 1993, p. 8. education is to further develop scientific and technical knowledge, and to prepare students for professional, vocational and technical schools. New subjects introduced in secondary education include natural science (previously physics and astronomy were emphasized), history and social studies (previously suppressed), practical arts and home economics, physical education and health, and moral education. The ninth and tenth grades' curricula will have biology, chemistry, geology, and physics, plus a number of diversified vocational studies. In some schools, students have the option of taking prevocational courses in lieu of traditional science subjects. 1.14 Secondary vocational education is available to students after Grade 8. In the past, secondary vocational education offered two-year and three-year curricula with equal parts of basic studies, training in a specialization, and field work. Beginning in 1991, more emphasis will be placed on specialized studies and less on basic education. Also, a new vocational program will begin from Grades 7 to 10. The local authorities will be given a greater say on the tenth-grade curriculum in order to meet the local needs of employers. 1.15 Post-secondary technical and specialized schools were established in 1964 to coordinate with the introduction of mechanized agriculture and industry. They supplied about half of all technical personnel in Mongolia between 1964 and 1990. The national curriculum in the past was determined by the central government. Now, it will be broken up into core subjects, to be set by the Ministry of Science and Education (MOSE), and other subjects, to be set by local authorities. Short courses for in-service training and for the general public will be introduced. 1.16 Higher education was also restructured. Before 1990, the Mongolian State University was the only university in Mongolia, and there were eight other higher education institutions. Today, there are five universities, plus a number of institutes and colleges. The Russian Language Institute became the Institute of Foreign Languages and merged with the State Pedagogical Institute to become the Pedagogical University. The Polytechnic Institute, the Agricultural Institute, and the Medical Institute became universities. The Institute of Management became the Institute of Administrative and Management Development and offers postgraduate training. 1.17 A number of specialized institutes once attached to a ministry became colleges. For example, the Economic College, which was once part of the Ministry of Finance, became a higher education institute to train specialists in banking and finance, accountancy and business management. The College of Commerce and Industry, formerly part of the Ministry of Trade and Industry, was established to prepare specialists in business administration. By June 1992, 15 private post-secondary institutions were established. Many of these provide training in foreign languages (English, Japanese, Chinese, Korea, French); others teach business courses (Table 1.2b). 1.18 A Higher Education Reform Commission was set up to coordinate curriculum change, to improve relevance and quality of higher education, and to set up Western equivalency academic programs. Beginning in 1992, universities adopted a new degree structure offering the Bachelor's after five years of study, the Master's after another two years of study, and the Doctorate. Research, which used to be conducted in research institutes under the Academy of Science, is to be integrated with teaching at universities. Some research institutes under the Academy of Science have merged with faculties in the universities. For example, the Economics Research Institute of the Academy of Science has merged with the Economics Faculty of the Mongolian National University (which changed its name from Mongolian State University in 1992). A private foundation was set up to promote the advancement of higher education. Another major change took place - 7 - when the State Planning Commission relinquished its control of admissions and setting of enrollment quotas to the universities. Beginning in 1992, each university selects its own students from graduates of 10-year schools and vocational schools, or evening studies. 1.19 Resource Implications. The recent reforms have serious resource implications. The introduction of the classical script and new subjects requires the concomitant development of new curricula and textbooks, and retraining of teachers. The decentralization of educational management and increasing autonomy of higher education institutions necessitate staff training to strengthen the planning and management capacity. 1.20 In addition, the reform of higher education needs to be supported by further education of faculty members in advanced industrialized countries, updating and upgrading of curricular, improvement of libraries and laboratories, and establishment of the international comparability of domestic programs of study. At the same time, the proliferation of small-size higher education institutions in recent years is likely to result in diseconomies of scale and the lack of quality assurance. For example, Mongolian National University had only 2,600 students, Pedagogical University 1,600 students, Agricultural University 1,000 students, and Language Institute 741 students. Only Technical University had a student body that is closer in size to the undergraduate student body of some prestigious private universities in the United States. The 16 private higher education institutes together had a student body of 1,800, or an average of 113 student per institution. These institutions will eventually require consolidation in order to attain the economies of scale. At the very least, arrangements for institutions to share libraries and other facilities are necessary to make better use of available resources. Furthermore, it is necessary to establish the accreditation system in order to assure the quality of educational programs and graduates. 1.21 The reform of higher education will eventually call for the reform of senior secondary education because Mongolia's 10 years of primary and secondary schooling are not comparable to 11 or 12 years of schooling offered by many countries in the world. The shorter secondary cycle necessitates curtailing the curriculum, and requires higher education to make up for part of senior secondary education. Even with the introduction of five years of baccalaureate studies, the total years of schooling for a Mongolian university graduate will still be one year shorter than students in most industrialized countries. This raises the question of quality and international comparability, with implications for overseas studies.3/ 1.22 All of the above issues have serious financial implications. Unfortunately, the current economic situation is unable to sustain the previous level of educational spending, let alone the new demand for additional resources. 3/ Nepal, for example, also has 10 years of primary and secondary education. Until recently, senior secondary education at the university preparatory level was provided in university. This has led to the problem of international comparability. In 1992, the government introduced the 10+2 structure, moving the senior secondary education at the university preparatory level to the schools. - 8 - 2. TUE CHANGING PAT[ERNS OF PUBLIC EXPENDITURES ON EDUCATION 2.1 In 1990, at the beginning of the political and economic transition, education claimed the largest share of government expenditures. It accounted for 17.6 percent of the state budget and 11.3 percent of GDP, and employed 10.7 percent of the total workforce 1/ (Annexes 1.1 and 5. 1). This level of educational spending was very high by international comparison, although the percentage of Mongolia's population aged 14 and below was comparable to the average in developing countries excluding China and India (Tables 2.1 and 2.2). 2.2 Other social expenditures were social security (7.7 percent of GDP in 1990), health (5.4 percent), housing and community amenities (4.3 percent), general public services (3.1 percent), and recreation, culture, and religious affairs and services (2.0 percent). Defense accounted for 4.5 percent of GDP, public order and safety for 1.0 percent, and economic affairs for 21.8 percent.2/ Total public expenditures amounted to 64 percent of GDP, and the budget deficit to about 13.5 percent of GDP3/ (Annex 5.1). 2.3 After the Soviet Union terminated its assistance and the collapse of CMEA disrupted extemal trade, total govemment expenditures as a percentage of GDP were reduced to 58.4 in 1991, and 32.8 in 1992. Public spending on education as a percentage of GDP declined to 10.3 in 1991, and 6.0 in 1992. In 1993, the state budget was estimated to be about 25.0 percent of GDP.4/ Allocation to education was reduced to 15.2 percent of the 1993 budget, or 3.8 percent of GDP, which is comparable to education spending in low-income economies (Tables 2.1 and 2.2). 1/ These figures are revised IMF and World Bank estimates, which are different from the earlier ones reported in Mongolia: Toward a Market Economy, World Bank Country Study, Washington, D.C.: The World Bank, 1992, pp. 12 and 82. 2/ Ministry of Finance figures. 3/ IMF and World Bank estimates. 4/ World Bank estimates. - 9 - Table 2.1: PuBLIC ExPENDIUREs ON EDUCATION AS A PERCENTAGE OF TOTAL PuBLIc ExPENDiTuRES AND AS A PERCENTAGE OF GDP TotaL pub- Education TotaL PubLic Lic expen- expenditures Education public expendi- ditures as as a % of expendi- expen- tures on as X of totaL pubLic tures as a GDP ditures education GDP expenditures X of GDP ------ (Million Tugriks) ------ ----------- (Percentage) ----------- Current Prices 1990 10,514.0 6,744.0 1,182.9 64.1 17.6 11.3 1991 18,913.0 11,050.0 1,955.8 58.4 17.7 10.3 1992 (PreLiminary) 51,754.0 16,965.0 3,084.0 32.8 18.2 6.0 1993 (Budget) 219,957.0 55,000.0 8,376.0 25.0 15.2 3.8 Constant 1990 Prices /a 1990 10,514.0 6,744.0 1,182.9 64.1 17.6 11.3 1991 9,428.2 5,508.5 975.0 58.4 17.7 10.3 1992 (PreLiminary) 8,724.9 2,860.0 519.9 32.8 18.2 6.0 1993 (Budget) 8,605.6 2,151.8 327.7 25.0 15.2 3.8 Change in Real Terms (Percentage) 1990-91 -10.3 -18.3 -17.6 1991-92 (PreLiminary) -7.5 -48.1 -47.9 1992-93 (Budget) -1.4 -24.8 -37.0 1990-92 (PreLiminary) -17.0 -57.6 -56.0 /a The GDP deflator was estimated to be 100.6 percent in 1991, 195.7 percent in 1992, and 330.9 percent in 1993, over the previous year, respectively. The constant 1990 prices were calculated from an index of the GDP. Source: Ministry of Finance, and IMF and World Bank estimates. 2.4 While GDP fell by 17.0 percent in real terms between 1990 and 1992, there was more than a three-fold decline in total government expenditures and education expenditures, which were cut by 57.6 percent and 56.0 percent, respectively. (Table 2.1). 2.5 This dramatic contraction of public spending on education is seen in a number of austerity measures, which include halting capital investment in education, retrenching non-instructional staff, introducing partial cost recovery for food in kindergarten and boarding schools, reducing clothing subsidies, reducing the number of students sent to former CMEA countries, and charging tuition fees in post-secondary and higher education. In addition, schools are encouraged to generate their own revenues through services to enterprises and renting premises. Private education is also encouraged. As a result, private investment in education, particularly at the tertiary level, has grown. The impact of these cuts is examined in the following section. - 10- Table 2.2: INTERNATnONAL COMPARISON Median public expenditures Median public on education % of Country expenditures as a % of population Income Level on education total public aged 14 and as a % of GNP Expenditures below (1985) (1985) (1990) Low (Including China & India) 3.2 15.3 35.2 Low (Excluding China & India) 2.9 12.5 42.5 Lower-Middle 3.9 13.9 37.6 Upper-Middle 4.3 14.9 35.8 High 5.8 13.2 19.9 Source: World Development Report 1992, pp. 268-9; Lockheed and Verspoor, 1991, pp. 33 and 325-329. A. PuBLIc EXPENDiRES ON EDUCATION IN 1991 2.6 In 1991, the recurrent expenditures accounted for 90 percent of the total public expenditures on education, and capital expenditures for 10 percent.6/ This is similar to the pattern in most countries and much of the recurrent expenditures are usually spent on personnel cost because of the personal interaction required in teaching and learning. However, in Mongolia, salaries accounted for only 46.5 percent of the recurrent education expenditures, and social security payment, which is 13.5 percent of the salaries contributed by the employer, for 6.5 percent. This is largely due to wage compression in the formerly socialist system. In comparison, in the 1980s, the median percentage share of teachers' salaries in the recurrent education expenditures was 95 percent in low-income economies, 91 percent in lower-middle-income economies, 88 percent in upper-middle- income economies, and 76 percent in high-income economies.7/ 2.7 Items that particularly stood out in Mongolia's education expenditures were food and student stipends. They accounted for 11.3 percent and 9.1 percent, respectively, of the recurrent expenditures. Funding for books and libraries was a negligible 6/ This paper focuses on the changes in percentage share of education expenditures within government expenditures, and the changes in the percentage share of major components within government expenditures from 1991 to 1993 because they remain the same whether current or constant prices were used. Because the estimates for the budget have been adjusted frequently for changes in exchange rates and for salary increases, these figures should be taken as very rough estimates. 7/ Adriaan Verspoor and Kin Bing Wu, 'Textbooks and Education Development." World Bank, Population and Human Resources Department, Education and Employment Division, Background Paper Series, PHREE/90/31, Washington, D.C., 1990, p. 12. - 11 - 0.3 percent, and administrative and overhead expenses (including supplies, electricity, heating, and transportation) claimed 18 percent of the recurrent expenditures (Table 2.3). Table 2.3: EDUCATION EXPENDITURES BY FUNCTION, 1991 (Million Tugrik, Current Prices) Local Central Total Tugrik % Tugrik % Tugrik X Recurrent Expenditures Personnel expenses 808.0 57.4% 121.9 35.1% 929.9 53.0% Salaries 711.4 50.6% 104.0 29.9% 815.4 46.5% SociaL security tax 96.6 6.9% 17.8 5.1% 114.4 6.5% Adnin. & overhead 273.3 19.4% 46.8 13.4% 320.1 18.2% TraveL 5.9 0.4% 0.4 0.1% 6.3 0.4% Practical subject expenses 13.1 0.9% 22.0 6.3% 35.1 2.0% Research & study tour 0.5 0.0% 0.5 0.1% 1.0 0.1% Books & reading materials 3.9 0.3% 0.9 0.3% 4.8 0.3% Food 181.5 12.9% 17.7 5.1% 199.2 11.4% Student allowance 57.4 4.1% 101.7 29.3% 159.1 9.1% Medicine 0.3 0.0% 0.1 0.0% 0.4 0.0% Furniture & faciLities 22.3 1.6% 4.2 1.2% 26.6 1.5% Clothing & sheet 6.5 0.5% 4.8 1.4% 11.4 0.6% Maintenance 17.3 1.2% 5.1 1.5% 22.4 1.3% Others 8.7 0.6% 10.4 3.0% 19.1 1.1% Saving 2.3 0.2% 0.0 0.0% 2.3 0.1% Subsidies (school products) 2.7 0.2% 8.1 2.3% 10.8 0.6% Evening courses 1.9 0.1% 0.0 0.0% 1.9 0.1% Education activities 1.7 0.1% 0.0 0.0% 1.7 0.1% Local courses & practical subjects 0.0 0.0% 2.9 0.8% 2.9 0.2% Total Recurrent Expenditures 1.407.3 100.0% 347.6 100.0% 1.755.0 100.0% Capital Expenditures Investment (building, equipment) 158.1 42.7 200.8 Total CapitaL Expenditures 158.1 42.7 200.8 Total Expenditures 1.565.4 390.3 1.955.8 Source: Ministry of Finance 2.8 In Mongolia, the public expenditures on primary and secondary education were aggregated together; so it was difficult to compare with those in other countries. However, expenditures of other levels of education were treated separately. After personnel cost, food claimed the biggest share (28 percent) of kindergarten's expenditures, and student stipends accounted for 13 percent of the expenditures on vocational education, 44 percent of those in post-secondary technical education, and 31 percent of those in higher education (Annex 5.2). 2.9 An examination of the deployment of staff found inefficient use of resources. For example, teachers 8/ accounted for 53 percent of the total staff employed in primary and secondary education, 45 percent in vocational schools, 40 percent in technical and post-secondary schools, and 45 percent in higher education (Annex 3.3). By comparison, 8/ The mission considers as teachers only those directly involved in classroom teaching. MOSE, however, includes administrators (such as principles) as teaching staff as well. In this paper, teachers are referred to as those directly involved in the instructional process. - 12 - in a number of middle-income countries, such as Venezuela, as well as New York State, United States, teachers account for about 66 percent of the total workforce in education; and in the newly industrialized countries of East Asia, teachers account for 75 percent of the staff. 2.10 Moreover, the student-to-teacher ratio was low. In primary and secondary education, it was 20:1. Considerable variations in the student-to-teacher ratio existed between aimags and cities at all levels of education, largely due to dispersion of population in the rural areas. For example, in 8-year schools, the student-to-teacher ratio was 32:1 in the cities and 18:1 in aimags. In 10-year schools, it was 28:1 in the cities and 20:1 in the aimags (Annex 3.1). These ratios were low by intemational comparison. For example, the average primary school student-to-teacher ratio was 38:1 in low-income countries, 23:1 in lower-middle-income countries, 25:1 in upper-middle-income countries, and 18:1 in high-income countries.2/ Mongolia's student-to-teacher ratio can be increased by combining classes in urban areas wherever possible, and by using multigrade teaching in rural areas. 2.11 The average student-to-teacher ratio was 16:1 in vocational schools, and 1 1: 1 in post-secondary technical schools, with much variation among institutions (Annex 3.2). A key factor affecting the student-to-teacher ratio in vocational and technical education is how many students the workshop can accommodate and how training is organized. Alternative ways of training, such as the apprenticeship scheme conducted in conjunction with industry, can be explored to improve the ratio. 2.12 In higher education, the student-to-teacher ratio was 10:1. In universities in high-income and upper-middle-income countries, a ratio of 10-20:1 is common. However, in the College of Engineering in Seoul National University in the Republic of Korea, a preeminent institution, the ratio was 30:1 in 1992. Judging from the student-to- teacher ratio, Mongolian higher education still has the capacity to expand enrollment in order to educate those who would have studied in the former CMEA countries. 2.13 These findings led the mission to recommend the following measures to rationalize the public expenditure on education: (a) reduce noninstructional staff (by hiring freeze and natural attrition); (b) increase student-to-teacher ratio (by hiring freeze, by combining classes in urban areas wherever possible, by using multigrade teaching in rural areas, and by increasing enrollment in higher education)10/; (c) ask for in-kind 9/ World Development Report 1992, pp. 274-5. IQ/ This recommendation was based on research findings that larger class size does not affect academic achievement adversely. For example, 13-year-olds in the Republic of Korea and Taiwan (China) on average scored above other industrial countries in international assessment of mathematics and science in 1991. The average class size in Korea is 36 students, and that in Taiwan (China) is 44. See Learning Science and Learning Mathematics, The International Assessment of Educational Progress, Educational Testing Service, February 1992. Also see Marlaine Lockheed and Adriaan Verspoor, Improving Primary Education in Developing Countries, Oxford University Press, Published for the World Bank, 1991. - 13 - contribution in boarding schools (such as asking parents to provide one or two sheep for milk to supplement the nutritional needs of the child, but the sheep can be returned to the family upon the child's graduation); (d) phase out stipends for domestic and overseas students; and (e) charge tuition fees in post-secondary technical and higher education, and to introduce a student loan scheme and merit scholarship to assist students to finance their education. These recommendations were adopted by the government in the second half of 1992. B. AusrERr MEASURES 2.14 Austerity Measures. The economic crisis deepened in 1992. Before 1991, the official barter rate was Tug 7 to $1. In mid-1992, the market rate was Tug 250 to $1; by April 1993, it was Tug 420 to $1. The consumer price inflation rose from 120 percent in 1991 to 202 percent in 1992, and is projected to increase to 291 percent in 1993. MOSE implemented the following measures to cut expenses and recover costs. 2.15 First, MOSE encouraged educational authorities at all levels to generate their own revenue through works and services to the community and enterprises. Such services include training workers for enterprises and renting out classrooms to private schools. This does not include charging tuition fees. 2.16 Second, MOSE established the principle of cost-recovery and urged all post- secondary education institutions to charge tuition fees to cover the cost of teachers' salaries. The tuition fee ranged from Tug 1,500-2,000 per month. Students with good results in the first two quarters, however, are exempted. A student loan scheme is to be implemented by the academic year of 1993-94 to provide financial support to some 30,000 students. 2.17 Third, MOSE refrained from sending students to former CMEA countries. Graduates were brought back. The total number of overseas students in 1993 are less than half of that in 1989. Only those who study in Russia receive Mongolian stipends (1,500 rubles or Tug 800 per month); others are on scholarships of foreign governments. However, paying for the train fare for graduates to return home remains a considerable cost. In addition, the government still pays third-year students the train fare for summer home visit. 2.18 Fourth, food subsidies were reduced drastically. Kindergartens, which used to provide free meals, charged 50 percent of the cost of food, at about Tug 30 per child per day. Boarding schools also charged full price for meat, although not for other food items. This is the equivalent of three sheep per year. Clothing subsidies for boarding schools, which were not a big item, were phased out. The plan is to eliminate subsidies for all food items for boarding schools by 1993-94. 2.19 Fifth, 1,523 schools at all levels of education in the country were asked to reduce the number of their noninstructional staff. On average, each school in the aimag reduced two to three staff, and those in Ulaanbaatar four to five staff. In total, 4,389 - 14 - noninstructional staff were retrenched. This retrenchment, plus over 1,100 teachers or 5 percent of the total teaching force who left the profession voluntarily, led to a reduction of the number of public education sector employees by 10 percent of the 1991-92 level. As a result, the percentage share of salaries and the social security tax declined substantially. 2.20 Sixth, because of the steep rise in energy prices, overhead cost quickly rose to the level of salaries, thereby crowding out expenditures on other items. Some somons (districts) were unable to pay teachers' salaries in winter. MOSE thus closed 80 schools or 18.8 percent of the 426 rural schools during winter months in order to reduce the overhead cost. Of these, 62 schoolsll/ were closed from December 1, 1992 to March 31, 1993, and 18 schools for a month in January 1993.12/ 2.21 These savings totaled Tug 1 billion (Table 2.4). They were, however, offset by increase of teachers' salaries. A teachers' strike over low salaries in November 1992 forced the government to raise their salaries by 70 percent in December 1992. On February 1, 1993, salaries were raised again by over 100 percent as part of the overall pay increase in the civil service. Certain categories received higher salary increases (Annex Table 2.4: SAVINGS DuE To AuSrERrv MEASURES, 1992 Million Percentage Tugrik of total Revenue Generation from Own Sources 15.2 1.5 Reduction of Staff 137.0 13.2 Reduction of Food Subsidies in Kindergartens 160.3 15.5 Reduction of Food Subsidies in Boarding Schools 210.1 20.3 Reduction of Stipends 48.7 4.7 Savings from Energy Expenses 462.3 44.7 Savings from Organization Sources 1.3 0.1 Savings from Management 5.5 0.5 Total 1,034.9 100.0 Source: Ministry of Science and Education. 11/ These included 14 in Bayan-Olgiy, 12 in Uvs, 12 in Bayanhongor, 5 in Ovorhangay, and 6 in DundGobi. 12/ In addition to these closed schools, 75 rural schools are located outside the supply route, and have to buy their own fuel. - 15 - C. IMPACr ON EDUCATION AND POLICY IMPLCATIONS 2.22 The austerity measures affect education in two major ways: (a) teacher attrition, and (b) student enrollment at various levels of education. Both have policy implications. A shortage of teachers will affect the supply of education. High dropout and nonenrollment rates will retard the process of human capital formation, which is essential to ensure future development and to lessen the burden on society. 2.23 Teacher Attrition. In 1992, over 1,100 teachers or 5 percent of the teaching force left teaching in the public sector. The critical policy questions are whether this affects the supply of education, and whether a hiring freeze should be maintained as part of the austerity measures. An analysis of the reasons for leaving found that 570 went to private schools, 244 went to other fields, and 355 left for other reasons such as migration to Kazakhstan, reflecting the opening up of new opportunities in recent years. 2.24 MOSE estimated that two-thirds of the teachers who left public sector teaching were in the cities and one-third in the aimags. There was a much greater movement of teachers and even net gains in richer aimags like Selenge and Tov and in cities of Darhan, Ulaanbaatar, and Erdenet. By contrast, there was little movement of teachers in poor aimags like Bayanhongor and Dundgobi because few employment opportunities existed outside of teaching (Annex 3.7). 2.25 Given that cities and richer aimags have lost and gained more teachers, the student-to-teacher ratio is not likely to change very much. In the poorer aimags, since teachers remain in the profession but the dropout rate has risen substantially, the student- to-teacher ratio is likely to be lower. Judging by the aggregate movement of teachers, it does not appear that there is a severe shortage of teachers that will affect the supply of education. However, the extent of teacher absenteeism and its impact on education remains unclear. 2.26 As to the question of a hiring freeze, it is necessary to review the movement of teachers by subject and by region, and to consider institution by institution. Without information on the numbers of teachers leaving by subject and by school, it is not advisable to lift the freeze. 2.27 Student Enrollment. The austerity measures have differential impact on various levels of education, and on population with different income levels. The adverse impact was strongest in primary and secondary education, although it remains free of charge to all relevant age children. The dropout rate rose from 0.8 percent in 1989 to 4.9 percent in 1991-92, and 3.9 percent in the first three months of 1992-93 (Annex 2.7). MOSE estimates that 93,000 children are not in school in 1993, not counting those whose schools were closed in winter. The mission estimates that about 105,000 or 23 percent of children who should be in Grades 1-8 are not in school (Annex 2.2). In a country that had attained universal enrollment for Grades 1-8, such a large number of out-of-school children signaled a breakdown of the system. - 16 - 2.28 The enrollment trends from 1980 to 1992 clearly show a downward slope from 1990 onward at all levels of education, except in higher education, after a steady increase by the second half of the 1980s (Figure 2.1). The GER in Grades 1 to 3 fell from 100 percent in 1989 to 74-83 percent by the end of 1992 (Annexes 2.1 and 2.2). FIgure 2.1: ENROLLMEZ TRENDS, 1980-92 0number of Students (Thousands) 400 .. 80 B1 52 aS B4 95 8B 87 88 59 9g 91 92 School Year Primary & Seood=r -+- VocatL am Post-Secon.Toh nioal -4-- Higher rAucation Source: Ministry of Soience & Zduoaion 1992 data wre as of 12.25.92. 2.29 MOSE officials attributed the causes of dropping out to privatization of livestock, reduction of food and clothing subsidies in boarding schools, and the lack of teachers in schools. The above analysis of the movement of teachers does not support the proposition that the lack of teachers is a major cause, although the extent of teacher absenteeism and its impact on dropouts remain unclear. This leaves the first two reasons as the most plausible explanations for the rise in dropouts. These two reasons operate on the demand side. Privatization of livestock has led to increasing demand for child labor at home, thereby raising the opportunity (indirect) cost of schooling; the reduction of food and clothing subsidies in boarding schools has increased the direct cost of education. A substantial increase in the direct and indirect cost of schooling in turn dampens the demand for education. These two factors have interacted with the lack of demand for skilled labor, which lowers the benefits of schooling, thereby reducing the demand for schooling. - 17 - 2.30 The lack of data on the effects of structural adjustment on the income of parents and their ability to pay for children's schooling makes it difficult to pinpoint the causes of dropping out. Nonetheless, some circumstantial evidence is available. Livestock in collective farms were privatized in 1991. The total number of livestock allocated to a household may vary from some 30 to 300.13/ In that year, the average dropout rate in the aimags was nearly 7 percent, while that in the cities was 1 percent (Annex 2.7). The highest dropout rates were in DundGobi (17 percent), Ovorhangay (11 percent), Gobi- Altay (10 percent), Hentiy (10 percent), Hovsgul (9 percent), Arghangay (8 percent), and Uvs (8 percent). Except DundGobi and Gobi-Altay, which were poor aimags, the rest were rich in pasture. This pattern of dropout appears to support the proposition that privatization was the cause in 1991. 2.31 The pattern of dropout in 1992-93 reflected a more complicated set of issues. Many children stayed out of school from the start: enrollment in that school year declined by 6.7 percent of the previous year's level, even with an over 2 percent increase of the relevant age group. Therefore, those who attended school and then dropped out were the more persistent ones. In the first three months of 1992-93, the average dropout rate in aimags declined to 4.5 percent, while that in cities rose to 2.8 percent. Dropout rates were highest in poor aimags like Bayanhongor (10 percent) and Sukhbaatar (nearly 9 percent). Dropout rates were also high in pastoral aimags like Ovorhangay (over 9 percent), but relatively low in more densely populated aimags like Selenge (2 percent). Dropout rates were higher in Ulaanbaatar (3 percent) than in industrial cities like Erdenet (0 percent) and Darhan (2 percent) (Annex 2.7). This distribution pattern appears to indicate that elimination of meat and clothing subsidies is a cause for dropout in poor and pastoral aimags, and urban unemployment is a cause for dropout in the cities. 2.32 The most alarming trend is the very high dropout rates in the first three grades. Highest on the dropout list in Grade 1 are Ovorhangay (12 percent) and Bayanhongor (10 percent); in Grade 2, Chor (50 percent), Sukhbaatar (13 percent), Ovorhangay (11 percent), and Bayanhongor (10 percent); and in Grade 3, Sukhbaatar (16 percent), Ovorhangay (9 percent), and Bayanhongor (9 percent). This distribution of dropouts for Grades 1-3 corresponds with the distribution for Grades 1-10 (Annex 2.9). The distribution of dropouts clearly shows that the rural areas are affected more severely than the urban areas, and the remote aimags more so than the aimags closer to the major cities and railway lines. It is unclear whether there is a gender difference in the pattern of dropouts. 2.33 Moreover, boarding schools are affected more severely than other schools. Enrollment of boarders in 1992 was only half of that in 1989, showing the obvious impact of the austerity measures. In 1992-93, schools charged full prices for meat, which was the equivalent of three sheep for a year. A sheep cost about Tug 4,400 in the retail market, and three sheep cost a total of Tug 13,200. This is about half of the annual salaries of the 13/ According to Mr. Orgil of the Mongolian Embassy in Washington, D.C., livestock was allocated to households according to their contribution to the collective farms in the 1950s and 1960s. - 18 - lowest-level government employees. For a poor household with 30 animals IN/ and five children, providing three sheep for each child will cost half of the family's total assets. In addition, the household will have to provide clothing and boots. When full cost recovery is introduced in 1993-94 for other nonmeat food items, enrollment is likely to decline even more. In sum, those who bear the brunt of adjustment are rural children (Figure 2.2). Filgure 2.2: ENROLLMENT iN BOARDING ScHooLs 1985-92 Nmber at Students (Thousands) tl ... ... . . . .. .. .. .. .. .. .. .. .. .. .. .. .... ... . .. x.. .. .. .. ... 4 0U ........... . . . . . . . ............. .... .. . .. . . . . 20 ... ..... ................................................ 0 I L _ L _ I1 IL 1985 1986 1987 1988 1989 1990 1991 1992 Enrollment Source: Kinistry of Science & Education 2.31 Nonenrollment and dropout from basic education warrant policy intervention for two reasons. First, the Mongolian constitution guarantees universal access to basic education, defined as six years of primary education and two years of junior secondary education. Second, basic education provides the broad foundation of literacy, numeracy, and problem-solving skills without which individuals will have little opportunity to continue to improve themselves at later stages in life. Basic education is critical to improving personal and family health, agricultural and industrial productivity, and the environment. Moreover, basic education has a positive impact on intergenerational mobility: better- la/ In Mongolia, it is not unusual that 10-20 percent of livestock perish every winter. For the rural poor, there is little safety net to cushion the impact of natural disasters. - 19 - educated parents provide higher-quality care and facilitate academic achievement of their children. For these reasons, it should be a policy priority to prevent dropouts and to improve the quality of basic education by providing cost-effective inputs, such as textbooks and teachers' guides, and by targeting the poor for assistance, such as providing subsidies for food, clothing and writing materials. Because the demand for schooling is highly related to labor market conditions and overall economic growth, declining enrollment can be reversed when the employment prospects improve. How to bring that about is beyond the scope of this paper, which focuses primarily on the supply side of educational services. Nonetheless, policymakers need to take account of the linkage between education and the labor market. 15/ 2.35 Post-secondary technical and specialized schools also saw a steep decline in enrollment by nearly 40 percent from the previous year's level. This may be attributed to the charging of tuition fees in that year, without being accompanied by a student loan scheme. Those who cannot afford to pay therefore stay away from school. As to the policy implications of this trend, since this level of education is supposed to serve the needs of the economy, it is important to allow enrollment to be driven by demand, rather than by supply. More discussion will be provided in the subsection on labor market linkage. 2.36 The number of students studying abroad also declined sharply (Figure 2.4); in 1992-93, less than 3,000 students study abroad (Annex 2.10). The government will continue to provide stipends to students in Russia and pay for the train fare for all to return home after graduation. In addition, the government also pays third-year students in Russia for home visit in the summer, while continuing to pay their stipends during their home visit. Moreover, the government plans to increase the stipends of those studying in Russia, which is substantially below what Russian students get. In view of the economic crisis, home visit payment is hard to justify in the interest of cost saving. 2.37 In domestic higher education, enrollment has increased by about 8.5 percent. In addition, more than 1,500 students enroll in private higher education institutions. In both public and private institutions, students have to pay fees of up to Tug 20,000 per year, which is the equivalent of an average worker's annual salary. This increase in enrollment reflects the perceived private rate of return to higher education. Students are willing to pay high fees in order to acquire skills required in a transitional market economy. At the same time, those who are willing to pay are those who can afford to pay. Anecdotal evidence shows that these young people are from privileged families, for example, with a parent working in a foreign embassy, or engaging in import and export trade. In the absence of a student loan scheme and needs-based, means-tested grants to the poor, young people from poor families would not be able to attend school, and, will not acquire new skills necessary to better themselves. 15/ Anderson, Kathryn H., Elizabeth King, and Yan Wang, 1993. 'Feedback Effects of the Labor Market on Schooling Choice in Malaysia." Paper presented at the April 1993 meetings of the Population Association of America, Cincinnati, Ohio. - 20 - Fgure 2.3: STIDENTS SUDnING ABROAD, 1985-91 7 T h n d 0 L I~ L I 1985 lo88 1987 1988 1989 1Q90 1991 Secondary Vocational -f- Poat-Sec. Technical -*- Higher Educatlon Source: Ministry of Science & Education D. EDucATION ExPENDunps iN 1992 AND rgn 1993 BuDGET 2.38 In 1992, there was no capital investment in education. Salary expenditures fell from 46.5 percent in 1991 to 30 percent, and social security tax, from 6.5 to 4.7 percent. This is despite the pay raise, and is due to retrenchment and attrition of 10 percent of the employees and the increase in percentage share of overhead cost. The most noticeable change was the sharp increase in heating cost, amounting to 21 percent of the total education expenditures. The percentage share of food also increased to 15 percent due to the rise in food prices. Student allowance was still a sizable 7.3 percent because it was not possible to completely withdraw stipends to those studying abroad (Table 2.5a). 2.39 Although aimags and cities were encouraged to generate their own revenue through paid services and institution's work and services, such revenue accounted for only 4.5 percent of the total expenditures in 1992.16/ The remaining 95.5 percent was covered by public allocation (Table 2.5a). 16/ The percentage share of own revenue in the 1992 expenditures was higher than that in Table 2.4 because it includes other sources of revenues as well. - 21 - Table 2.5a: EDUCATION REVENuES AND ExPENDr1uREs, 1992 AND 1993 (Million Tugrik, Current Prices) 1992 % of 1992 % of Expen- Expen- 1993 1993 ditures ditures Budget Budget Work and Services Revenue 47.1 31.9 Paid Services 71.4 309.0 Other Revenue 29.2 23.6 Own Revenue 147.7 364.5 Personnel expenses 1,129.1 34.9 2,838.7 32.5 Salaries 976.7 30.2 2,501.1 28.6 Social Security 152.4 4.7 337.6 3.9 Admin. & Overhead 1,012.3 31.3 3,062.3 35.0 Administrative 146.0 4.5 412.3 4.7 Energy 138.3 4.3 377.1 4.3 Heat 670.6 20.7 2,169.5 24.8 Petroleum 45.9 1.4 103.3 1.2 Travel Expenses 11.6 0.4 34.8 0.4 Food 485.4 15.0 1,841.9 21.1 Students' Allowance (voc. tech. & higher educ.) 237.2 7.3 587.2 6.7 Medicine Packages 2.0 0.1 4.5 0.1 Other Expenses 355.7 10.3 370.6 4.2 Expenditures 3,233.3 100.0 8,740.0 100.0 Net Public Education Extenditures 3,084.2 8,375.5 Source: Ministry of Finance. 2.40 As many of the austerity measures were implemented in the second half of 1992, the 1993 budget is a better reflection of the government's anticipation of their resource constraints. In 1993, salaries and social security tax are expected to continue to shrink, to 29 and 4 percent, respectively. Administrative and overhead cost will rise to 35 percent, of which heating alone accounts for 25 percent. Food subsidies will rise to 21 percent, while student allowance is expected to decline moderately to 6.7 percent. Own revenue is a modest 4.1 percent of the expenditures, and the state subsidies are to make up for 96 percent in 1993 (Table 2.5a). For a comparison of the recurrent education expenditures between 1991 and 1993 at constant 1990 prices, see Table 2.5b. 2.41 This pattern of resource allocation has implications for equity, efficiency, quality and labor market linkages (Annexes 5.1 to 5.12). - 22 - Table 2.5b: REcuRRENr PuBUc ExPENDIUES ON EDUCATION AT CoN!rANT 1990 PRmcEs, 1991-93 (Million Tugrik) 1991 1992 Expen- Expen- 1993 ditures ditures Budget 1991-92 1992-93 1991-93 --- (Million Tugrik) --- -- (Percentage Change) -- Personnel Expenses 463.6 190.3 111.1 -58.9 -41.7 -76.0 Salaries 406.5 164.6 97.9 -59.5 -40.6 -75.9 Social Security 57.0 25.7 13.2 -55.0 -48.6 -76.8 Admin. & Overhead 159.6 170.7 119.8 6.9 -29.8 -24.9 Administrative - 24.6 16.1 - -34.5 - Electricity - 23.3 14.8 - -36.7 - Heating - 113.0 84.9 - -24.9 - Petroleum - 7.7 4.0 - -47.8 - Travel 3.1 2.0 1.4 -37.7 -30.4 -56.6 Food 99.3 81.8 72.1 -17.6 -11.9 -27.4 Student Allowance 79.3 40.0 23.0 -49.6 -42.5 -71.0 Medicine Packages 0.2 0.3 0.2 69.1 -47.8 -11.7 Others 69.8 60.0 14.5 -14.1 -75.8 -79.2 Recurrent Expenditures 874.9 545.1 341.9 -37.7 -37.3 -60.9 Revenue - 24.9 14.3 Net Recurrent Expenditures 874.9 520.2 327.6 -40.5 -37.0 -62.5 Source: Mission estimates. 2.42 Equity. Inequity in resource distribution is usually reflected in the percentage shares allocated to various levels of education, the per student cost, and how the resources are used. In 1993, kindergarten accounts for 15.5 percent of total enrollment in public institutions, primary and secondary education for 72.8 percent, vocational education for 2.2 percent, post-secondary technical schools for 1.5 percent, and higher education for 2.7 percent. However, 24.4 percent of the resources are allocated to kindergarten, 53.0 percent to primary and secondary education, 4.7 percent to vocational education, 5.6 percent to post-secondary technical schools, and 6.1 percent to higher education (Table 2.6). While the allocation of resources at various levels does not need to be proportional to the enrollment, kindergarten's 17/ large share is high by international comparison. On the other hand, the allocation to higher education is low, considering the higher salaries of faculty members and the greater needs and higher expenses for books and periodicals, computers, and laboratories. 17/ Only 30 percent of the relevant age group enroll in kindergarten. Of those enrolled, 44 percent are in the cities and 56 percent in the aimags. - 23 - Table 2.6: ENROLLNT, ExPENDrTuREs, AND CosT PER STrDENr, 1991-93 Enroll- X of Expenditures X of Unit cost ment TotaL (million Total Unit cost index Tugrik) (Tugrik) Pri.+Sec.=1 Curret Prices Kindergarten 90 072 16.4 333.0 19.1 3,697 1.8 Primary and Secondary 411,700 75.1 838.8 48.2 2,037 1.0 Vocational 17,961 3.2 78.4 4.5 4,364 2.1 Post-secondary Technical 14,986 2.7 133.5 7.7 8,910 4.4 Higher Education 13,223 2.4 212.9 12.2 16,102 7.9 Others - - 142.5 8.2 - - TotaL 547.942 100.0 1.79.2 100.0 1992 (PreLiminary) Ktindergarten 88,811 16.8 664.4 21.5 7 480 1.9 Primary and Secondary 401,256 76.0 1,594.2 51.7 3,973 1.0 Vocational 12534 2.4 183.4 5.9 14,630 3.7 Post-secondary Technical 12789 2.4 185.7 6.0 14,521 3.7 Higher Education 12,303 2.3 229.8 7.5 18,678 4.7 Others - - 226.7 7.4 - - Children's Organizations - - 21.7 0.7 - - ChiLdren's Camps - - 60.1 2.0 - - Foreign Expenditures - 65.0 2.1 - - HisceLlaneous - - 79.9 2.6 - - Total 527.693 100.0 3.084.2 100.0 1993 (Budget) i-naergarten 81 817 15.5 2,046.5 24.4 25,013 2.2 orimary and Secondary 384.069 72.8 4,436.6 53.0 11,551 1.0 Vocational 11,537 2.2 390.6 4.7 43,012 3.7 Post-secondary Technical 7,749 1.5 471.0 5.6 80,534 6.9 Higher Education 14,052 2.7 511.0 6.1 36,365 3.1 Others - 521.5 6.2 - - Children's Organizations - - 56.6 0.7 - - Children's Camas - - 154.9 1.9 - - Foreign Expenditures - - 115.0 1.4 - - Miscellaneous - - 195.0 2.3 - - Total 499.224 100.0 8.376. 100.0 Constant 1990 Prices 11 ( Recurrent ExPenditures only) Kindergarten - - 166.0 19.1 1,843 1.8 Primary and Secordary - - 418.1 48.2 1,015 1.0 Vocational - 39.1 4.5 2,175 2.1 Post-secondary TechnicaL - 66.6 7.7 4,442 4.4 Higher Education - 106.1 12.2 8,027 7.9 Others - - 71.0 8.2 - - Total - 867.0 100.0 1992 (Preliminary) Kindaergarten - - 112.0 21.5 1,261 1.9 Primary and Secondary - - 268.7 51.7 700 1.0 Vocational - - 30.9 5.9 2,466 3.7 Post-secondary TechnicaL - - 31.3 6.0 2448 3.7 Higher Education - - 38.7 7.5 3,149 4.7 Others - - 38.2 7.4 - - Total _ 519.9 100.0 1993 (Budget) Kindergarten - - 80.1 24.4 979 2.2 Primary and Secondary - - 173.6 53.0 452 1.0 Vocational - - 19.4 4.7 1,683 3.7 Post-secondary TechnicaL - 24.4 5.6 3,151 6.9 Higher Education - - 20.0 6.1 1,423 3.1 Others - - 20.4 6.2 - - TotaL - 327.7 100.0 Source: Ministry of Finance and mission estimates. Note: The enrollment in 1993 is based on actual figures, not the Government's projections, which are higher. Therefore, the Government's estimated unit cost is lower than the actual unit cost. The actual enrollment in post-secondary technical schools is less than half of MOF's projection. Subsequently, the unit cost is more than twice as high as was originally estimated. - 24 - 2.41 The per-student cost of primary and secondary education remained the lowest from 1991 to 1993. The per-child cost in kindergarten relative to that of primary and secondary education is not only high but has been on the rise over the same period. A large proportion of the resources in kindergarten is spent on food. The per student cost of secondary vocational and post-secondary technical education also has been on the rise, because enrollment is declining. However, the unit cost of higher education has declined due to growing enrollment (Table 2.6). 2.42 The mission of primary and secondary education is to serve all children of relevant age. Primary and secondary schools are spread out all over the country, and, therefore, have to spend a much higher proportion of the budget on administration (various supplies) and overhead (heating, electricity, transportation). However, kindergarten, post- secondary technical, and higher education institutions are located in cities and aimag centers, and have lower overhead. Administrative and overhead cost accounted for 41 percent of primary and secondary education expenditures, compared with 27 percent of kindergarten expenditures, 32 percent of technical education expenditures, and 21 percent of higher education expenditures (Annex 5.2). The reason is that heating in the big cities is by coal-fired generators, but heating in the aimags is by small diesel engines. Heat generation in the cities is able to attain the economies of scale, but that in the aimags cannot. Moreover, coal is produced in Mongolia, but diesel oil is imported and, therefore, more expensive. When primary and secondary education spends so much on overhead, little is left to invest in educationally effective inputs, such as textbooks and in-service teacher training. 2.43 Moreover, within primary and secondary education, the administrative and overhead cost varies from among aimags and cities. In 1992, the administrative and overhead cost accounted for 31 percent of Ulaanbaatar's expenditure, but for 43 percent of Arhangay's, and 37 percent of Bayanhongor's and Ovorhangay's, respectively (Annex 5.4). The 1993 budget estimates the heating cost in Ulaanbaatar to be only 11 percent, but 43 percent in Ovorhangay (Annex 5.5). Given these different energy costs, what might seem to be a fairly even distribution of resource might have differential impact on education. It is not surprising that the schools closed during the winter were located in aimags where energy cost was particularly high. Children whose schools were closed for one to four months in winter were deprived of nearly half a school-year's instruction. 2.44 A way to cut the overall heating bill is to change the school calendar by having classes during warmer months and having holidays during the coldest months. The limitation to this approach is that children's labor is needed in agricultural and nomadic households during the summer and autumn. So in rural communities where the heating cost is highest, changing the school calendar is not possible. However, in major cities where children's labor is not needed, there is a potential in saving by having classes in the summer. Although heating in cities is much less expensive, there will be a need to save if the government scales back its subsidies on energy. 2.45 MOSE is considering using distance education to address the problem of high dropout rates among herders' children. Distance education is to be delivered by a - 25 - number of ways. For example, several households can organize instructional activities together; mobile teachers can be employed to visit herding households; and the radio can be used to broadcast lessons. Given the dispersal of population, the need for child labor at home, the lack of warm clothing and boots for school, and the inability of poor households to pay, distance education should be explored as an alternative. However, the resource needs should not be underestimated. To minimize the disparity in standards between distance education and regular schooling, investments should be made in the development of relevant curricula and learning materials, training of parents and mobile teachers, provision of free textbooks and writing materials, and the development of an assessment system to monitor learning outcomes. A strong science-based curriculum is likely to serve the interest of parents and children, and to improve family health, animal husbandry, and environmental management. Since parents were not schooled in the Classical Script, text should probably be provided in the Cyrillic Script so that they can teach their children. If resources permit, distance learners should be brought to the school for one or two months during warmer seasons in order to facilitate eventual mainstreaming. 2.46 Another equity issue concerns the stipends for vocational, technical, college, and university students, as well as those trained in foreign countries. Given that a higher level of education will enable the student population to adjust better during the economic transition, it is justifiable to ask them to finance their own education through paying tuition fees. It is necessary to simultaneously introduce a student loan scheme to assist students to pay for tuition fees. Means-tested grants should also be made available to students from particularly poor families, and a few merit-based scholarships should also be established to award exceptional students. 2.47 Efficiency. The education sector still employs about 33 percent of total government staff, and many of them are not directly involved in teaching. In primary and secondary education, teachers as a percentage of total staff in primary and secondary education increased from 53 percent in 1991-92 to 57 percent in 1992-93, while noninstructional staff (such as doormen, cleaners, cooks, and couriers) accounted for about 29 percent of the total staff. Many of these noninstructional staff in primary and secondary schools perform useful functions such as looking after the schools' livestock, and riding long distances on horseback to transmit messages (Table 2.7 and Annex 3.5). 2.48 In vocational, technical, and higher education, teachers accounted for only 39 percent of total staff, but doormen, cleaners, cooks, messengers, and others accounted for 39 percent (Table 2.7). These noninstructional staff do not appear to perform as important functions as their counterparts in the rural areas. In certain institutions, for example, the Agricultural University, noninstructional staff made up 75 percent of the total staff, although it does not have an experimental farm (Annex 3.4). Although in higher education, academic staff's salaries accounted for two thirds of the salaries and noninstructional staff salaries for one third, it should be the long-term goal of MOSE to reduce the percentage of noninstructional staff in vocational, technical, and higher education so that resources can be invested in libraries. - 26 - Table 2.7: TEACHRS AS A PERCENTAGE OF TOTAL STAFF Total Number of Teachers as % Staff Teachers of Total Staff 1991-92 Kindergarten 15,793 8,686 55 Primary and Secondary Education 38,789 20,481 53 Vocational and Technical Education 2,740 1,260 46 Higher Education 2,952 1,341 45 1992-93 Kindergarten (teachers and assistant teachers) 14,408 7,920 55 Primary and Secondary Education 34,199 19,441 57 Vocational, Technical, and Higher Education 8,083 3,120 39 Source: Ministry of Science and Education. 2.51 Another indication that the capacity of the education sector has not been fully utilized is the still low student-to-teacher ratios. Due to decline in enrollment, the student-to-teacher ratio in primary and secondary schools fell from 20:1 in 1991-92 to 19:1 in 1992-93. Preventing dropout and targeting the poor for assistance to bring them back to school will make fuller use of the existing capacity. 2.52 Improvement has been made in the higher education sector. The ratio rose from 10:1 in 1991-92 to 11:1 in 1992-93 due to increase in enrollment. However, there is much variation among institutions. The Mongolian National University has a ratio of 9:1, which is still below the average of 10-15:1 in many countries, and much lower than the ratio of 25:1 in private higher institutions in Mongolia. While the student-to-teacher ratio varies across fields, (for example, over 20:1 in social sciences and 12-15:1 in science), in fields where there is excess capacity, there is an opportunity to expand enrollment. Enrollment expansion will both reduce unit cost and provide learning opportunities to more young people (Table 2.8). 2.53 Raising the student-to-teacher ratio, increasing class size and applying a hiring freeze of teachers have implications for teacher education and employment prospects of graduates. At present, primary school teachers received preservice training in vocational schools, and secondary school teachers in Pedagogical University. If a hiring freeze of teachers in the public sector is maintained for a few years, graduates from these programs are likely to experience reduced employment prospects, except those trained in new subjects that are in high demand, for example, English. - 27 - Table 2.8: STUENT-To-TEAcHR RATIOS No. of No. of Student-to- Students Teachers Teacher Ratio 1991-92 Kindergarten 90,072 8,686 10:1 Primary and Secondary 411,696 20,481 20:1 Vocational 18,961 1,132 16:1 Post-secondary Technical 14,629 1,282 11:1 Higher 13,872 1,341 10:1 1992-93 Kindergarten 85,691 7,920 11:1 Primary and Secondary 369,092 19,441 19:1 Vocational, Technical and Higher Education 34,919 3,120 11:1 Breakdown by Institution, 1992-93 Technical Schools in Central Aimag 8,090 746 11:1 Mixed Voc. & Technical Schools 2,982 213 14:1 Technical Schools 2,256 147 15:1 Specialized Schools 7,749 618 13:1 Assorted Schools in UB & Erdenet 433 14 31:1 Mongolian National University 2,589 289 9:1 Technical University 4,038 398 10:1 Pedagogical University 1,589 153 10:1 Agriculture University 1,012 95 10:1 Medical University 2,669 244 11:1 Mongolian State University (Hovd) 413 38 11:1 Cultural Institute 358 93 4:1 Language Institute 741 72 11:1 Private Tertiary Institutions 1,797 72 25:1 Source: Ministry of Science and Education. 2.54 This raises the questions of the utility and relevance of teacher education, and how much savings can be made if teacher training is organized differently. Would the quality of teacher education be enhanced if Pedagogical University, with 1,600 students and 153 faculty members, was merged with Mongolian National University (MNU), with 2,600 students and 289 faculty members, so that students can attend MNU courses, share libraries and laboratories, and interact with MNU students? Would it provide greater choice of employment to graduates if the emphasis is placed on general education so that when the demand for teachers is weak, graduates can work in fields outside education, but should there be a shortage of teachers, they can be trained quickly in short-cycled preservice pedagogical courses and in continuous inservice courses? These questions need - 28 - to be addressed. Considerable savings can be attained if scarce resources are not used on fields with weak demand, particularly when other cost-effective strategies can be explored. 2.55 Quality. Investments in education must be directed to improving quality of education and learning outcomes. Education research has found that textbooks are one of the most cost-effective inputs in education. Quality of education at all levels is likely to be undermined when resources have not been adequately allocated to these inputs. Without books, little learning can occur even if all relevant school-age children are enrolled. Moreover, without books and journals, students in higher education cannot keep up to date on their knowledge. 2.56 Mongolia has the technical capacity to produce four-colored textbooks, with attractive pictures and layout. However, the problem is due to the lack of foreign exchange to import paper for printing and the negligible allocation to book and library provision. The cost of production, printing, and transportation of essential textbooks to aimags is estimated to be over four times the amount allocated, even without including the cost of paper (Annex 5.12). 2.57 In 1992, the total allocation to books and libraries accounted for only 0.3 percent, which is very low by international comparison.I8/ In 1993, books, newspaper, and other reading materials in libraries accounted for 0.02 percent of kindergarten budget, 0.15 percent of primary and secondary budget, 0.02 percent of vocational budget, 0.07 percent of post-secondary technical budget, and 0.29 percent of higher education budget (Annex 5.10). With such limited allocation to books for libraries, little can be done to improve the quality of education. 2.58 Textbooks and writing materials have never been provided free of charge; students at all levels have to buy them. However, textbooks are becoming more and more expensive, costing Tug 30 to 60 per book. An annual average of six books are needed in the lower primary level, amounting to Tug 180-360 per year. For a family with two to four children in school, this may cost 6 percent of the annual salary of an average worker. A solution is to place many sets of required books in school libraries and set up a book lending scheme to ensure that children have access to books. Development of teacher's guides is also necessary to enable teachers to make full use of the textbooks for instruction. 2.59 If primary and secondary education suffers from the lack of provision of books, higher education is even more severely affected because its needs for laboratories, facilities, materials, computers, and spare parts, in addition to books and journals are greater. The percentage share of higher education has declined from 12 percent in 1991-92 to 6 percent in 1992-93. Although scientific research and development is supported by a separate science budget outside of the education budget, higher education is still in need of a stronger finance base. 18/ In Sub-Saharan Africa, for example, the weighted average percentage of recurrent public expenditure on teaching and learning materials was 2.0 in primary schools, and 2.9 in secondary schools in 1983. See World Bank, Education in Sub-Saharan Africa, 1988, p. 141-142. - 29 - 2.60 The charging of tuition fees is not likely to strengthen the resource base immediately because a large sum has to be set aside to provide student loans. Thus, resources for student loans and for buying books and journals for libraries must come from savings by improving efficiency such as increasing the student-to-staff ratio and the rates of utilization of existing facilities. 2.61 Another issue related to quality is the length of the secondary cycle. It is appropriate that, given the severe resource constraint, priority should be given to quality basic education. However, if Mongolia wants its education system to be comparable with most of the industrialized countries in the world, it will eventually have to reform senior secondary education. Given the enormous resource implications for curriculum change, teacher training, textbook development, and examination reform, this issue should be tackled after Mongolia has attained economic stability. 2.62 Labor Market Linkages. In the transition to a market economy, many public enterprises may have to be closed down, and private enterprises take time to develop. In the foreseeable future, graduates from universities and institutions of technical and vocational education are likely to have difficulty finding employment; primary and secondary graduates are likely to have even fewer prospects. The industrial sector is not likely to be able to absorb graduates, but agriculture, agro-based industries, and trading are likely to have high potential for growth. The budget must be used to support educational content that will build up the knowledge base and skills to enable graduates to engage in productive activities, be that livestock herding or small business. Given the budget constraint, education must be so designed to prepare children who are not likely to complete Grades 1-8, to enable them to acquire literacy, numeracy and problem-solving skills as a basis for continuing education in the future. 2.63 Since 66 percent of primary and secondary school children are in the aimags, and since agriculture is still a predominant economy, it is very important that basic education have a strong science content that includes health, biology, veterinarian knowledge, earth science, and environmental science. 2.64 At present, the traditional cultural content dominates the primary curriculum. The use of the classical script also makes it difficult to teach science. Science is taught for only one hour out of 24 hours per week in Grade 1 and two hours after that (Annex 4.1). This is far below the level that children between the ages of 7 and 11 can benefit from. Although more time is allocated to science in Grade 5 to coincide with the introduction of the Cyrillic script, many children from poor rural families have dropped out of school by then. 2.65 It is advisable to increase budgetary allocation to the development of relevant science curricula in primary schools, inject applied, science-based knowledge in language and mathematics subjects, develop textbooks and teaching guides to disseminate such knowledge, and increase time allocation to science subject in Grades 1-5. These measures are likely to improve the relevance of schooling to production, enable parents to appreciate the usefulness of education, and also engage the interest of children. - 30 - 2.66 In secondary vocational and post-secondary technical education, enrollment is likely to continue to dwindle and the unit cost to rise. The development of vocational and technical education were part of the industrialization process in Mongolia. These schools were established to meet enterprises' demands for specific skilled labor and technicians, and graduates were placed automatically to ensure that they are employed. During the economic transition, many privatized and public enterprises must cut costs and retrench staff, therefore are not likely to have much demand for vocational and technical school graduates. A supply-driven vocational and technical education program will be a serious mistake. Training cannot create jobs. Resources allocated to vocational and technical education are not likely to have high returns if they continue to produce graduates with skills that are unwanted or obsolete in the economy. 2.67 Moreover, studies in a number of countries show that academic/general education yields higher social and private rate of return than vocational/technical education. Strong cognitive skills developed in Grades 1-9 will improve the on-the-job trainability of students, whereas narrow vocational training does not. It is more desirable to strengthen general education than vocational education, with a strong, science-based knowledge, if the goal is to improve labor market outcomes. 2.68 Given the declining enrollment, it is important to review what kind of vocational and technical education is still in demand and continue to draw applicants. Investment can be made in collaboration with enterprises in improving the programs in high demand. However, for those programs which have few applicants, it is better to phase them out and save on administrative and overhead costs. Apprenticeship schemes organized by industry will also be an effective way of training skilled workers. 2.69 Vocational and technical schools are relatively well endowed with buildings and equipment. Where there is low enrollment and excess capacity, these schools can be turned into self-financing community colleges. Short courses on income-generating, small business activities (including information on how to apply for credit, to calculate economic returns, and to keep account) might be more useful and economical than full-length programs that run for two to three years. 2.70 Similarly, in higher education, it is important to let decisions on enrollment in various specialties be guided by market signals. For example, there are few applicants to enter the field of geology because of the perceived lack of employment opportunity, and the department is required to accept all applicants. However, students are willing to pay over Tug 20,000 per year to study in private institutions that offer courses such as languages and business management that will lead to higher-paying jobs in the emerging private sector. One language institute had to turn away two out of every three applicants due to the lack of classrooms. This indicates that a demand-driven educational program will serve the needs of both individual students and the society. Public institutions should expand their programs where the demand is high. 2.71 In the medium term, however, the labor market may be saturated with graduates trained in foreign languages and business management, and other manpower is - 31 - needed. Mongolia's two major stable foreign exchange earners are copper and cashmere, both of which will benefit from improved technology. A critical mass of scientists and engineers is needed to modernize the agricultural, mining, and industrial sectors, and infrastructure. At the minimum, Mongolia should aim at strengthening the indigenous technological capability so that scientists and engineers can assess, select, use, adapt, and improve foreign technology, and develop appropriate technology to adjust to changing circumstances. Since it takes a much longer time to train scientists and engineers than social scientists or translators and managers, universities should continue to train undergraduates in the fields of natural science and engineering in order to maintain the stock, and seek foreign support for retraining of faculty members. A relatively low-cost solution is to negotiate with open learning institutions, such as Britain's Open University, which runs degree courses on a range of science and social science subjects, to use their course materials for undergraduate and graduate education. Students can learn by correspondence under the supervision of their Mongolian professors and can earn both Mongolian and British degrees. - 32 - 3. STRATEGIES TO BUILD A STABLE RESOURCE BASE TO FINANCE EDUCATION 3.1 During Mongolia's transition to a market economy, it is important that the past achievement be preserved and investment in human capital be continued so as to prepare for future development. Given the budget constraint, three complementary strategies can be pursued simultaneously in order to provide a more stable resource base to finance education: (a) rationalize the public expenditure on education in order to save cost and improve efficiency; (b) reallocate the existing budget to priority areas to safeguard equity and improve quality; and (c) mobilize private and foreign resources to support kindergarten, post-secondary and higher education, and distance education (Table 3.1). A. RATIONALIZATION OF PUBLIC ExPENDITURES ON EDUCATION 3.2 Rationalization of the education expenditure must be the first step in education financing. The expenditures of 1992 and the budget of 1993 showed a high proportion of resources going into stipends. In spite of the policy of cost recovery, tertiary-level students with good results in the first two quarters were exempted from a high proportion of the tuition fees. While this policy rewards academic merits, this must be done with selectivity in order to avoid undermining the principle of cost recovery. Moreover, it is not advisable to continue to pay third-year students studying abroad to return for home visit in the summer. 3.3 Given that food accounts for a large share of the 1993 kindergarten budget, the govemment should set a target for the gradual reduction of food subsidies in kindergarten in the next three to five years (Annex 5.3). Other expenses not directly related to education are children's camp (1.9 percent) and children's organization (0.7 percent). Beneficiaries of these expenditures are urban children from better-off families, and the government should not subsidize them. As regards food subsidies in boarding schools, since the charging for meat has immediate adverse impact on enrollment in boarding schools, it is not advisable to charge for other nonmeat food items next year. 3.4 Those vocational and technical programs/schools that have sharply decreased enrollment should be phased out or closed down. The buildings can be converted to self- financing community colleges or education centers. To fully utilize the existing capacity at all levels of education, the government should continue to increase student-to-teacher ratios and refrain from hiring new teachers unless there is a real shortage of teachers in a particular subject in a particular school. 3.5 Higher education also needs to be reorganized in the medium term. Most of the higher education institutions are too small in size to be able to attain the economies Table 3.1: STRATEGIES TO ADJUST THE USE OF RESOURCES TO FINANCE EDUCATION Rationalization of Public Mobilization of Private Expenditures Reallocation of Public Expenditures & Foreign Resources Efficiency Reduce noninstructional staff by hir- Charge tuition fees at post-second- ing freeze & gradual attrition. ary levels & for food in kindergar- Increase student/teacher ratio by in- ten. troducing multigrade teaching in rural Charge realistic interest rates for schools, preventing dropouts in basic student loans. education & increasing intake in Distinguish between merit scholar- higher education. ship & needs-based grants. Be vy Phase out stipends in higher education selective in awarding merit schol- & food subsidies in kindergarten. arship to avoid undermining the pr- Insulate schools to save energy cost. inciple of cost recovery. Restructure & consolidate higher edu- cation institutes. Equity RealLocate resources to basic educa- Use foreign aid to finance the tion from vocational, technical development of distance education, schools, children's camps, & organiza- and to import paper for textbooks. ti1ons. * Target the poor for food, clothing, & learning materials subsidies. Make loans available to alL students. * Provide needs-based, means-tested grants to very poor students. Quality Set aside budget for primary-level Use foreign technicaL assistance to science curricutlu development, & pro- improve planning, management, as- duction of textbooks & teachers' sessment, & accreditation capacity. guides. * Use foreign aid to finance the improvement of higher education. Labor Market Turn vocational & technical schools Strengthen school science. Encourage private vocational, tech- Linkage with low enrollment into self- Encourage courses on self-empLoyment, nical, & higher education by creat- financing community colleges. income-generating activities. ing conducive legaL envirorinent. Set up apprenticeship scheme in enter- Let market signals drive vocational, prises to cut cost of vocational & technical, & higher education. technical education. Use short courses & on-the-job train- ing to develop skills. Source: World Bank missions to Mongolia in 1992 and 1993. - 34 - of scale. While consolidation of institutions may be too daunting a task to take on at this stage, the adoption of a credit unit system and arrangements that allow students to take courses and use libraries and laboratory facilities outside their institutions, and the establishment of the accreditation system are necessary in order to ensure fuller utilization of resources, and to assure quality of educational programs. 3.6 Equally important is to make more efficient use of available resources by expanding enrollment. This is needed to compensate for the drop in students studying in former CMEA countries. The student-to-teacher ratio of private institutions may serve as a useful benchmark for what public institutions can achieve, particularly in the fields of social science, language, and business management. 3.7 The low teacher-to-noninstructional staff ratio is another indicator of inefficient resource use. It is advisable to aim for 66 percent of the total staff to be teachers in primary and secondary schools. A freeze on hiring of noninstructional staff is recommended. However, since housing and medical benefits are tied to employment, consideration should be given to the impact of retrenchment on these employees and their families. If possible, those retrenched should be allowed to continue to have housing and medical benefits. 3.8 Incentives should be set up to find ways of reducing the cost of heating. Mongolia's climate is very cold, and heating is necessary even in spring and autumn. Closing schools in winter is a poor solution because it shortens the school year, thereby severely undermining the quality of education. Mongolia's total instruction hours in a school year was 693, much shorter than 986 hours in South Korea or 840 hours in China. Closing schools in winter will further undermine quality. 1/ It seems worthwhile to consider having schools open in the summer to save on heating costs, as long as they do not interfere with children's participation in parents' economic activities. 3.9 Conducting classes in the ger has been suggested as an alternative to cut the cost of heating. However, this may not be a viable alternative because the ger is not only small but also dark, particularly in the rural areas that have no electricity. Also, new investments in felt tents and wooden platforms are required. These new resources are not available under current financial constraints. 3.10 It is also important to investigate how to insulate school buildings and to heat classrooms economically. Insulation may provide huge savings.2/ Insulation does not involve costly materials, but can be achieved basically by ensuring that there are air-filled spaces in all outer surfaces of the building, particularly the roof through which warm air dissipates. Moreover, since imported diesel oil is costly, thoughts should be given to design stoves that use local fuel (dung or locally produced coal) to heat up classrooms. 1/ UNESCO - World Education Report 1993. P. 134. 2/ Personal communication with Erik Thulstrup, Senior Science and Technology Specialist. Insulation materials such as glass wool is not expensive. Glass wool does not require imported inputs, but can be manufactured by the glass factory. For example, 20 centimeters of glass wool under the roof can assure a stable air mass for roof insulation. - 35 - Adaption of the traditional stove used in the ger, combined with special chimney or movable pipe to release smoke, should be attempted. Instead of heating an entire building, stoves can be used for individual classrooms. 3.11 Mongolian science and engineering professors, researchers, and students can be mobilized to solve these problems. The science budget, which is outside of the education budget, should set aside resources to support research and development in this area. This will support higher education and solve a serious national problem. If appropriate technology can be used to substitute for imported fuel, as well as to produce insulation materials, this will stimulate local industry to manufacture them. The mass application of insulation and heating technology will benefit not only schools, but also homes, hospitals, factories, and other buildings. B. REALLOCATION OF PUBIaC RESOuRCES 3.12 Before any decision on the reallocation of resources can be made, it is necessary to disaggregate the primary education expenditures from those of secondary education. This will enable a closer examination of the level of spending on basic education and other cycles of schooling to assess the impact on equity, quality, and efficiency. This will also facilitate comparison with other countries to provide benchmarks for Mongolia to evaluate the adequacy of its educational spending by level of education. 3.13 In designing the overall strategy for financing education, a distinction must be made regarding where private providers can play a role, and where there is market failure which necessitates government intervention. Given that kindergartens, vocational and technical schools, and higher education institutions are mainly located in the cities, these levels of education can tap the resources of the private sector. The rapid expansion of private kindergarten and professional schools shows that the urban middle class is willing to pay for the services. Since the private sector can take part of the burden of financing and provision of education from the public sector, certain portion of their budget can be reallocated to basic education (Table 3.2). Table 3.2: EsTIMATEs OF RESOURCES TRAT CAN BE MADE AvAILABLE FOR REALLOCAION BY RATIONALiNG EXPENDITURES (Percentage of Total Public Expenditures on Education) Savings X Use for Other Purposes X Reduce noninstructional staff 2 Target the poor for subsidy 7 Phase out stipends in higher education 3 Primary Science 1 Reduce food subsidies in kindergarten 5 Textbooks & Libraries 3 Phase out subsidies to children's 1 Provide student loans 6 organizations & camps & scholarships Turn vocational & technical schools into 6 self-financing community colleges Total 17 17 Source: World Bank missions to Mongolia in 1992 and 1993. - 36 - 3.14 The reduction of noninstructional staff, student stipends in post-secondary and higher education, universal food subsidies in kindergarten, and support to children's camps and organizations, as well as turning vocational and technical schools into self- financing community colleges may free up to 17 percent of the resources for reallocation to assist the poor (to prevent dropout), to improve primary school science and libraries, as well as to provide student loans and scholarships. 3.15 Given the severe resource constraint, it is advisable to focus on providing quality education to all at the primary level rather than spreading resources thinly to cover junior secondary education which is not attainable to rural children in particular. To attract children from poor families to attend primary schools, measures need to be taken to lower the direct cost of schooling by providing subsidies for food, clothing, and writing materials for the first six years of schooling. Targeting designed to help the needy requires further study, but a few strategies can be suggested here. Households with a single parent tend to have greater financial difficulties.3/ Such families can be targeted for assistance. Alternatively, assistance can be targeted to help aimags with unusually high dropout rates or households with fewer than 50 animals and more than one child. 3.16 Part of the reallocated resources should be invested in cost-effective inputs such as textbooks and teachers' guides. While it is unaffordable to provide textbooks free of charge to all children, putting sets of textbooks in school libraries is a strategy to pursue (Table 3.2). C. MOBILIZATION OF PRIVATE AND FOREIGN RESOURCES 3.17 Mobilization of private and foreign resources is necessary to replace dwindling public resources and to finance the many reform initiatives. The three most common methods are to charge tuition fees, to encourage private schools, and to enlist foreign assistance. 3.18 Cost Recovery. Professional and higher education have begun charging tuition fees in 1992-93, and should continue with the practice. The increase in enrollment in spite of the high fees shows that students are willing to invest in their own education. The government has moved in the right direction to set up a student loan scheme to provide financial assistance to students of lesser means. However, the government should make a distinction between merit scholarship, which should be limited to the very excellent students, and needs-based grants, which should be means-tested and available to poor students. The current practice of exempting students with good results in the first two quarters from a proportion of tuition fees does not facilitate cost recovery. It is advisable that both scholarship and grants be made available on a limited basis. The remaining students will be expected to borrow to finance their education. 3/ Caroline Harper, 'Structural Adjustment and Vulnerable Groups in Mongolia: Strategies for Social Policy Planning." - 37 - 3.19 One of the proposals in MOSE is to make all students eligible to borrow from a foundation up to Tug 2,000 per month at an interest rate of 3-5 percent. Loans are to be repaid within a number of years from the time of borrowing. Those who can pay back within three years after graduation will pay less than 3-5 percent interest. Those students who have excellent grades in the first two semesters of the first year are exempted from a large share of the principal. MOSE can be expected to recover about 35 percent of the total amount lent. 3.20 A student loan scheme involves a number of complicated issues, such as what realistic interest rate to charge, how to allocate loans to different fields, how to administer the loan, and how to ensure payback. Mongolia is hampered by the lack of an income tax collection mechanism by which the government can track those who default. A possible way of tracking graduates is through the social security tax system, by which employers can deduct the amount that is due from the graduates. However, this system will only track the salaried class, not the high-income groups of entrepreneurs and traders. The default rate might be high. Furthermore, if only 3-5 percent interest rate is charged when the annual inflation rate is estimated to be over 100 percent, there is no real cost recovery. When administrative cost is taken into account, it may be less costly to provide grants. 3.21 MOSE considers that it is important to establish the principle of cost- recovery and to make sure that it gains public acceptance. It is equally important to establish the institution of student loans in order to build up the experience and personnel so that the mechanism can be improved in the future. 3.22 Partnership with the Private Sector. As mentioned above, the private provider can be highly responsive to changing skill requirements in the labor market. Private institutions that came into existence in 1992 were founded by enterprising teachers and professors who left public institutions to set up their own schools. They rent classrooms from public secondary schools, and hire full-time as well as part-time teachers at above public sector salaries. In spite of the very high tuition fees, there is still excess demand for private education, which is perceived to be more in tune with the market. In this way, both the public and private sectors benefit from the sharing of buildings and from income generation. 3.23 MOSE is in the process of drafting a private education law. One of the proposed stipulations is to require a private provider to own a building in order to obtain permission to operate. It is advisable that MOSE does not set up barriers to entry by insisting on such a stipulation. MOSE also should refrain from putting a ceiling on private institution fees because it will only undermine the quality of education. If the fees are too high for students to pay, they will stop applying to these institutions. In this way, they will send a signal to the private providers not to charge too much. Letting the market regulate the amount of tuition fees in private institutions is the most efficient way of supporting private education. - 38 - 3.24 MOSE, however, has a responsibility to assure that education provided by private institutions has met certain standards. It can do so by setting up a testing and certification system to ensure that graduates meet professional standards in their fields. The certificate conferred should send a signal to future employers about the skill level the student has attained. Moreover, this system should be expanded to serve both graduates from private and public institutions in vocational, technical, and higher education. 3.25 Making Use of Foreign Assistance. Multilateral and bilateral agencies can contribute to capital cost financing and technical assistance, thereby freeing public resources for recurrent and local cost financing. A number of projects have received funding from donors. The Danish International Development Agency (DANIDA) funded retraining of teachers at the Pedagogical University, import of papers, and improvement of textbooks. The United Nations Educational, Scientific and Cultural Organization (UNESCO) funded a Gobi desert women's education project. A private Japanese publishing company printed free of charge Grade 1 classical Mongolian language textbooks. UNESCO and the World Church Council partially funded a project to educate cattle breeders. The United States Information Agency has funded American academics to study higher education reform. The Asian Development Bank is funding a study on the education sector that is likely to lead to a project to improve planning, management, and finance of higher education (Annex 7.1). 3.26 In addition, MOSE has requested support in the following areas. In higher education, funding is needed for the training of Higher Education Reform Commission staff and university administrative staff in planning, accounting, and management. To improve natural science instruction and research and foreign language education in higher education, donors are invited to support twinning arrangements with universities in other countries, and to facilitate faculty training, curriculum development, and to upgrade scientific equipment and language laboratories. To improve the development and production of teaching materials and textbooks for all levels of education, donors are invited to conduct a university system-wide study of text and teaching materials, and to collaborate with universities on a feasibility study on the financing of a production center for the local production of teaching and other equipment and supplies such as workbooks, pencils, ink, chalk, and paints. In addition, the Inspectorate Board has inquired about the possibility of World Bank support to set up a national assessment system to monitor educational progress, to set up a system to test teachers and to evaluate the quality of schools in various levels of education, and to train staff (Annex 7.2). 3.27 In planning for foreign funding, it is advisable to think of physical constraints such as the cost of heating, electricity and petroleum. Equipment like televisions and video-discs cannot be effective media in schools unless a stable supply of electricity, spare parts, and software can be assured. It is also advisable to make sure that the existing capacity is fully utilized before purchasing new equipment. For example, the newly privatized Rainbow Press, formerly the government's printing press to produce textbooks for the country, has a very experienced professional staff and sophisticated East German presses that can produce four-colored books. However, the necessity for the government to pay a private press to print textbooks gives rise to an interest in acquiring - 39 - new printing presses for use only by the government. The duplication of equipment will not only waste public resources, but also undermine the development of the private sector. Also, in some instances, it is more economical to import finished products (such as pencils and ink) than to build factories to produce them because the inputs and fuel have to be imported. 3.28 Since Mongolia has a very ambitious educational reform program, it is necessary to set priorities in order to make the maximum use of available resources. Among the first priorities are: (a) to build MOSE's planning and management capacity in order to improve the overall efficiency of resource use; (b) to import essential education inputs such as paper for printing (after DANIDA's grant expires), books, journals, microfiche, and databases on CD-ROM for updating university libraries; (c) to direct a market-oriented approach to vocational and technical education and training; and (d) to finance scholarships to retrain professors and researchers. 3.29 Among the second priorities are: (a) to set up an assessment system to monitor learning achievement in primary and secondary education to improve educational quality; (b) to set up a testing and certification system to ensure that graduates of professional education from private and public institutions have attained professional standards; (c) to upgrade laboratories; (d) to undertake a feasibility study in collaboration with Mongolian scientists and engineers to explore low-cost options for school building insulation; and (e) to set up distance learning installations. D. CONCLUSION 3.30 The magnitude of the contraction of public resources in general and in education expenditures in particular is unprecedented, not only in Mongolia but also in most countries of the world. The three complementary strategies of rationalization, reallocation, and mobilization of resources aim at improving efficiency, distributing the cost of adjustment more equitably, assuring minimum quality, and strengthening labor market linkages. If the challenge of continuing investments in human capital under extremely adverse conditions can be met, there will be a strong foundation for future development. ANNEXES - 43 - ANNEX 1.1 EMPLOYMENT BY SECTOR, 1990 No. of Employees Percentage ('000) of Total Material Sector 468.8 71.9 Agriculture 178.3 27.4 Forestry 2.6 0.4 Industry 135.6 20.8 Construction 51.4 7.9 Transport 50.8 7.8 Communications 7.1 1.1 Trade 42.2 6.5 Other material production 0.6 0.1 Nonmaterial Sector 182.7 27.9 Housing & municipal services 27.4 4.2 Science, research and development 12.9 2.0 Education, culture and arts 69.5 10.7 Health care, social security, sports 44.1 6.8 Banking, finance, credit, insurance 3.1 0.5 Government 20.8 3.2 Other nonmaterial 4.9 0.8 Total 648.4 100.0 Source: State Statistical Office. - 44 - ANNEX 1.2 EMPLOYMENT IN THE STATE SECTOR, 1990 No. of Employees Percentage ('000) of Total Agriculture 40.1 8.7 Forestry 2.6 0.6 Industry 114.6 24.7 Construction 46.4 10.0 Transport 42.8 9.2 Communications 7.1 1.5 Trade 40.6 8.8 Other material production 0.6 0.1 Housing & municipal services 23.1 5.0 Science, research and development 12.9 2.8 Education, culture and arts 68.8 14.8 Health care, social security, sports 43.6 9.4 Banking, finance, credit, insurance 3.0 0.6 Government 12.8 2.8 Other nonmaterial 4.9 1.1 Total 463.9 100.0 Source: State Statistical Office. EDUCATIONAL ATrAeNMNT OF POPULATION AGED 15 AND OVER, 1989 Higher Post- VocationaL 10-year 8-year Primary Literate but Illiterate Total Education Secondary Secondary SchooLs SchooLs Education No Schooling Age 15-19 - 159 2,269 39,144 118,221 57,220 2,342 2,225 Age 20-24 5,492 4,827 21,289 69,377 79,728 11,284 1,997 2,058 Age 25-29 18,610 2,056 24,778 45,043 69,099 16,311 2,134 1,512 Age 30-34 16,512 1,237 20,640 25,049 50,544 18,745 1,610 947 Age 35-39 13,411 830 15,667 15,476 28,481 16,662 1,406 682 Age 40-44 12,255 623 10,299 9,268 18,110 17,221 1,946 666 Age 45-49 9,787 517 7,634 5,504 15,238 24,118 4,232 1,257 Age 50-54 5,897 376 4,487 2,847 9,586 24,074 6,550 1,613 Age 55-59 4,012 392 3,237 1,808 6,690 22,203 9,613 2,265 60 & Over 3,055 672 3,220 1,889 6,539 36,300 39,304 27,884 Subtotal 89.031 11.689 113.520 215.405 402.236 244,138 71.134 41.109 1.188.262 X of TotaL 7.5 1.0 9.6 18.1 33.9 20.6 6.0 3.5 Source: Ministry of Science and Education. - 46 - ANNEX 2.1 ESTMATED SCHOOL-AGE POPULATION AND GROSS ENROLLMEN RATIOS (GER), 1989 (BASED ON CENsuS OF 1989, JULY 15) No. of School- Enrollment GER age Children 1989/90 Primarv and Secondary Age 7/Gr. 1 54,972 58,063 1.06 Age 8/Gr. 2 55,101 55,019 1.00 Age 9/Gr. 3 52,237 51,691 0.99 Age 10/Gr. 4 53,735 52,855 0.98 Age 11/Gr. 5 50,826 47,739 0.94 Age 12/Gr. 6 50,865 47,076 0.93 Age 13/Gr. 7 50,131 45,915 0.92 Age 14/Gr. 8 50,089 46,073 0.92 Age 15/Gr. 9 48,631 20,994 0.43 Age 16/Gr.10 46,558 19,295 0.41 Total 513.145 444.720 0.87 Vocational Age 15/Yr. 1 48,631 13,322 0.27 Age 16/Yr. 2 46,558 11,445 0.25 Age 17/Yr. 3 41,494 6,427 0.15 Total 136,683 31.194 0.23 Colleges Age 17/Yr. 1 41,494 5,386 0.13 Age 18/Yr. 2 44,056 5,049 0.12 Age 19/Yr. 3 40,841 4,223 0.10 Age 20/Yr. 4 41,584 2,618 0.06 Total 167.975 17,276 0.10 Universities Age 17/Yr. 1 41,494 2,538 0.06 Age 18/Yr. 2 44,056 2,435 0.06 Age 19/Yr. 3 40,841 2,714 0.06 Age 20/Yr. 4 41,584 2,466 0.06 Age 21/Yr. 5 39,366 1,694 0.04 Age 22/Yr. 6 39,006 308 0.01 Total 246.347 12.155 0.05 Source: Ministry of Science and Education. - 47 - ANNEX 2.2 EsTMATED SCHOOL-AGE POPULATION AND GROSS ENRoLLMEN RATIOS, 1992-93 (Based on Census of 1989, July 15) No. of School- Enrollment GER Enrollment GER Out-of-school age ChiLdren ---- 9/25/92 --- --- 12/25/92 --- ChiLdren (Gr. 1-8) Primary and Secondary Age 7/Gr. 1 61,091 51,925 0.85 49,732 0.81 11,359 Age 8/Gr. 2 56,650 43,901 0.77 41,810 0.74 14,840 Age 9/Gr. 3 56,219 48,587 0.86 46,892 0.83 9,327 Age 10/Gr. 4 /a 54,972 14,704 0.27 14,725 0.27 40,247 Age 11/Gr. 5 /a 55,101 76,353 1.39 73,037 1.33 -17,936 Age 12/Gr. 6 52,237 40,189 0.77 38,131 0.73 14,106 Age 13/Gr. 7 53,735 39,767 0.74 38,011 0.71 15,724 Age 14/Gr. 8 50,826 35,116 0.69 34,025 0.67 16,801 Age 15/Gr. 9 50,865 17,171 0.34 16,800 0.33 Age 16/Gr.10 50,131 16,356 0.33 15,929 0.32 Total 541.8234,7 069 0.71 369.092 0.68 104.4 VocationaL Age 15/Yr. 1 50,865 - - 4,370 0.09 Age 16/Yr. 2 50,131 - - 4,987 0.10 Age 17/Yr. 3 50,089 - - 1,183 0.02 Total 151.085 = 10.540 0.07 ColLeges Age 17/Yr. 1 50,089 - - 1,912 0.04 Age 18/Yr. 2 48,631 - - 2,223 0.05 Age 19/Yr. 3 46,558 - - 2,409 0.05 Age 20/Yr. 4 41,494 - - 1,471 0.04 TotaL 145.278 8.015 0.06 Universities Age 17/Yr. 1 50,089 - - 4,591 0.09 Age 18/Yr. 2 48,631 - - 3,534 0.07 Age 19/Yr. 3 46,558 - - 2,531 0.05 Age 20/Yr. 4 41,494 - - 2,055 0.05 Age 21/Yr. 5 44,056 - - 1,723 0.04 Age 22/Yr. 6 40,841 - - 469 0.01 Total 271.669 14.903 0.05 /a Due to merging of 7-year and 8-year curricula in 1992, students who started school at age 8 were promoted directly to Grade 5 without going through Grade 4. This led to the drastic drop in enrollment in Grade 4 and rise in Grade 5. Source: Ministry of Science and Education. - 48 - ANNEX 2.3 GIRLS ENROLLMET iN PR1MARY AND SECONDARY EDUCATION BY REGION, JANUARY 1993 Total Girls Girls as % Enrollment Enrollment of Total Arhangay 14,754 8,227 56 Bayan-Olgiy 12,606 6,682 53 BayanHongor 12,990 7,070 54 Bulgan 9,472 5,259 56 Gobi-Altay 11,623 6,524 56 Dornod 8,472 4,612 54 DornoGobi 15,513 7,126 46 DundGobi 8,155 4,677 57 Dzavhan 15,968 7,888 49 Ovorhangay 14,295 8,091 57 OmnoGobi 7,096 3,994 56 Sukbaatar 9,395 5,195 55 Selenge 17,571 9,633 55 Tov 18,595 10,465 56 Uvs 15,162 8,555 56 Hovd 13,356 7,400 55 Hovsgol 16,547 9,407 57 Hentiy 12,896 7,135 55 AimaF Total 234.466 127,940 55 Darhan 15,847 8,516 54 Ulaanbaatar 104,813 54,918 52 Erdenet 9,670 5,172 53 Chor 2,182 1,292 59 Special 2,114 1,252 59 City Total 134,626 71.150 53 Total 369.092 199,090 54 Source: Ministry of Science and Education. - 49 - ANNEX 2.4 Gnus ENROLLMENT BY GRADE, JANUARY 1993 Total Girls Girls as % Enrollment Enrollment of Total Kindergarten 85,691 45,855 54 Primary and Secondary Grade 1 49,732 24,877 50 Grade 2 41,810 20,995 50 Grade 3 46,892 23,876 51 Grade 4 14,725 7,753 53 Grade 5 73,037 37,972 52 Grade 6 38,131 21,109 55 Grade 7 38,011 21,419 56 Grade 8 34,025 19,542 57 Grade 9 16,800 11,187 67 Grade 10 15,929 10,360 65 Total 369.092 199.090 54 Vocational Year 1 4,370 2,376 54 Year 2 4,987 2,627 53 Year 3 1,183 380 32 Total 10,540 5.383 51 Colleces Year 1 1,912 1,486 78 Year 2 2,223 1,776 80 Year 3 2,409 1,733 72 Year 4 1,471 862 59 Total 8.015 5.857 73 Universities Year 1 4,591 3,083 67 Year 2 3,534 2,259 64 Year 3 2,531 1,521 60 Year 4 2,055 1,209 59 Year 5 1,723 1,078 63 Year 6 469 321 68 Total 14.903 9.471 64 Source: Ministry of Science and Education. - 50 - ANNEX 2.5 FEmALE STUDENTS AND TEACRS IN PROPORTION TO TOTAL IN IfGHER EDUCATION Students Teachers Total FemaLe X of Total Total FemaLe X of TotaL ProfessionaL Schools in Tov Aimag 8,090 4,047 50.0 746 419 56.2 Mixed Voc. & Technical Schools 2.982 1,713 57.4 213 128 60.1 Technical Schools & Colleges 2,256 1,988 88.1 147 87 59.2 ColLeges 7,749 5,537 71.4 618 336 54.4 MongoLian State University in Hovd 413 280 67.8 38 7 18.4 Assorted Schools in UB & Erdenet 433 158 36.5 14 6 42.9 Language Institute 741 552 74.5 72 60 83.3 Mongolian State University 2,589 1,505 58.1 289 93 32.2 TechnicaL University 4,038 1,528 37.8 398 128 32.2 Pedagogical University 1,589 1,150 72.4 153 38 24.8 Agriculture University 1,012 494 48.8 95 25 26.3 Medical University 2,669 2,110 79.1 244 122 50.0 Cultural Institute 358 185 51.7 93 53 57.0 Privatized SchooLs 1,797 1,222 68.0 72 30 41.7 Total 36,716 22.469 61.2 3.192 1.532 48.0 Source: Ministry of Science and Education. ENROLLMENT OF WOMEN IN TERTIARY EDUCATION BY FIELDS, 1991 Post-secondary technical Higher education and soecialized schools Total FemaLe X of TotaL Female X of students students women students students women Pedagogy 1,991 1,516 76 2,720 2,188 80 Medicine 3,075 2,255 73 3,559 3,191 89 Trade and business 629 398 63 1,804 1,265 70 Foreign languages 740 579 78 Social sciences 31 22 71 Mathematics 206 102 50 Source: Ministry of Science and Education. - 51- ANNEX 2.6 ENROLLmENT IN BOARDING ScHooLs, 1993 Total Boarding School Boarders as Enrollment Enrollment % of Total Arhangay 14,970 2,222 14.8 Bayan-Olgiy 12,453 1,920 15.4 BayanHongor 14,400 3,337 23.2 Bulgan 10,226 1,509 14.8 Gobi-Altay 12,388 3,056 24.7 Dornod 8,932 498 5.6 DornoGobi 15,775 560 3.6 DundGobi 8,607 904 10.5 Dzavhan 15,641 2,680 17.1 Ovorhangay 15,984 2,554 16.0 OmnoGobi 7,409 1,093 14.8 Sukhbaatar 10,364 1,634 15.8 Selenge 18,010 925 5.1 Tov 19,325 2,359 12.2 Uvu 16,166 2,522 15.6 Hovd 14,157 2,255 15.9 Hovsgol 17,298 3,881 22.4 Hentiy 13,490 893 6.6 Asimaa Total 245,595 34.802 14.2 Darhan 16,187 55 0.34 Ulaanbaatar 108,326 432 0.4 Erdenet 9,684 37 0.4 Chor 2,377 42 1.8 Special 1,900 City Total 138,474 566 0.4 Total 384.069 35.368 9.2 Source: Ministry of Science and Education. - 52 - ANNEX 2.7 DRoPoUr FROM PRMARY Am SECONDARY EDUCAIION IN 1991-92 AND FALL 1992 Drooout in 1991-92 Dropout in FaLt 1992 Total Total X of Total TotaL TotaL I of TotaL Changes EnrotLment EnroLLment Changes EnroLLment Enrollment Arhangay 1,359 16,866 8.1 216 14,970 1.4 Bayan-Olgiy 1,085 17,737 6.1 -153 12,453 -1.2 BayanHongor 1,034 15,359 6.7 1,410 14,400 9.8 BuLgan 517 11,028 4.7 754 10,226 7.4 Gobi-Altay 1,334 13,028 10.2 765 12,388 6.2 Dornod 213 9,402 2.3 460 8,932 5.2 DornoGobi 532 16,050 3.3 262 15,7T5 1.7 DundGobi 1,518 9,112 16.7 452 8,607 5.3 Dzavhan 703 18,585 3.8 -327 15,641 -2.1 Ovorhangay 1,919 18,062 10.6 1,689 15,984 10.6 OmnoGobi 463 7,757 6.0 313 7,409 4.2 Sukhbaatar 621 10,864 5.7 969 10,364 9.4 SeLenge 340 19,031 1.8 439 18,010 2.4 Tov 1,357 21,069 6.4 730 19,325 3.8 Uvs 1,418 17,583 8.1 1,004 16,166 6.2 Hovd 1,151 15,941 7.2 801 14,157 5.7 Hovsgol 1,832 19,950 9.2 751 17,298 4.3 Hently 1,416 14,365 9.9 594 13,490 4.4 Aimag Total 18,812 271,789 6.9 11,129 245,595 4.5 Darhan 59 16,870 0.4 340 16,187 2.1 ULaanbeatar 1,217 109,354 1.1 3,513 108,326 3.2 Erdenet 10 9,748 0.1 14 9,684 0.1 Chor 36 2,387 1.51 195 2,377 8.2 SpeciaL 1,547 0 0.0 -214 1,900 -11.3 City TotaL 1,322 139,906 0.9 3,848 138,474 2.8 TotaL 20,134 411,695 4.9 14,977 384,069 3.9 Source: Ministry of Science and Education. CHANGES IN ENRoLLMENT, SEPrEmBER 25 - DECEMBER 25, 1992 I II III IV V VI Vil Vill IX X Changes Arhangay 77 79 31 -75 -54 65 65 5 24 -1 216 Bayan-OLgiy 17 -11 -54 49 -76 -32 -8 -15 8 -31 -153 BayanHongor 201 160 161 -73 429 225 127 89 57 34 1,410 BuLgan 92 81 95 34 145 127 67 103 2 8 754 Gobl-ALtay 82 71 106 18 212 88 85 52 39 12 765 Dornod 99 69 57 4 117 28 54 34 -7 5 460 DornoGobi 38 48 85 -36 38 0 57 12 95 -75 262 DundGobi 83 52 98 1 86 29 35 28 22 18 452 Dzavhan -82 -40 -75 109 -111 -3 -38 -70 -37 20 -327 ovorhangay 284 186 208 31 446 326 119 109 -21 1 1,689 OmnoGobi 28 47 30 6 97 44 8 36 14 3 313 Sukhbaatar 106 122 223 -7 188 118 103 66 29 21 969 SeLenge 135 2 18 -189 343 34 62 2 39 -7 439 Tov 56 117 88 51 142 116 115 58 -16 3 730 Uvs 116 119 113 7 324 149 119 28 29 0 1,004 Hovd 82 67 83 6 201 108 125 71 43 15 801 Hovsgot 110 141 121 2 123 60 99 32 52 11 751 Hentiy 87 44 62 43 119 77 95 71 -13 9 594 AimeA TotaL 11.129 Darhan 53 112 -30 22 65 27 33 59 13 -14 340 ULaanbaatar 429 452 302 196 498 457 517 386 60 216 3,513 Erdenet 74 7 -7 -8 7 20 -34 -42 -16 13 14 Chor 14 151 15 2 4 9 -8 7 -4 5 195 Special 12 15 -35 -214 -27 -14 -41 -30 -41 161 -214 City Total 3.848 TotaL 2.193 2091 1.695 -21 3.316 2.058 1.756 1.091 371 427 14.977 Source: Ministry of Science and Education. DROPOUTS IN GRADES 1-3, SEPrEMBER 25, 1992 - DECEmER 25, 1992 Grade 1 Grade 2 Grade 3 Grades 1-3 Drop- Dropout Drop- Dropout Drop- Dropout Drop- Dropout outs Enroliment Rate outs Enrollment Rate outs EnroLtment Rate outs Enrollment Rate Arhangay 77 2,076 3.7 79 1,939 4.0 31 1,926 1.6 187 5,941 3.2 Bayan-OLgiy 17 1,910 0.9 -11 1,525 -0.7 -54 1,382 -3.9 -48 4,817 -1.0 BayanHongor 201 1,991 10.1 160 1,656 9.7 161 1,847 8.7 522 5,494 9.5 BuLgan 92 1,294 7.1 81 1,147 7.0 95 1,330 7.1 268 3,771 7.1 Gobi-Altay 82 1,593 5.2 71 1,310 5.4 106 1,560 6.8 259 4,463 5.8 Dornod 99 1,366 7.3 69 1,143 6.0 57 1,197 4.8 225 3,706 6.1 DornoGobi 38 2,237 1.7 48 1,646 2.9 85 2,104 4.0 171 5,987 2.9 DundGobi 83 1,385 6.0 52 1,155 4.5 98 1,222 8.0 233 3,762 6.2 Dzavhan -82 2,017 -4.1 -40 1,775 -2.2 -75 1,883 -4.0 -197 5,675 -3.5 Ovorhangay 284 2,462 11.5 186 1,764 10.5 208 2,205 9.4 678 6,431 10.5 OmnoGobi 28 1,214 2.3 47 884 5.3 30 1,067 2.8 105 3,165 3.3 Sukhbaatar 106 1,368 7.8 122 936 13.0 223 1,443 15.5 451 3,747 12.0 SeLenge 135 2,417 5.6 2 1,945 0.1 18 2,374 0.8 155 6,736 2.3 Tov 56 2,597 2.2 117 2,132 5.5 88 2,579 3.4 261 7,308 3.6 Uvs 116 2,200 5.3 119 1,830 6.5 113 1,785 6.3 348 5,815 6.0 Hovd 82 1,925 4.3 67 1,591 4.2 83 1,774 4.7 232 5,290 4.4 Hovsgol 110 2,498 4.4 141 1,993 7.1 121 2,208 5.5 372 6,699 5.6 Hentiy 87 1,896 4.6 44 1,611 2.7 62 1,768 3.5 193 5,275 3.7 Aimag TotaL 1.611 34.446 4.7 1.354 27.982 4.8 1.450 31.654 4.6 4.415 94.082 4.7 Darhan 53 2,004 2.6 112 1,714 6.5 -30 2,074 -1.5 135 5,792 2.3 ULaanbeatar 429 13,436 3.2 452 12,409 3.6 302 13,160 2.3 1,183 39,005 3.0 Erdenet 74 1,477 5.0 7 1,264 0.6 -7 1,264 -0.6 74 4,005 1.9 Chor 14 341 4.1 151 302 50.0 15 322 4.7 180 965 18.7 SpeciaL 12 221 5.4 15 230 6.5 -35 113 -31.0 -8 564 -1.4 City TotaL 582 17.479 3.3 737 15!919 4.6 245 16.933 1.5 1.564 50.331 3.1 Total 2.19 51.925 4.2 2.091 43.901 4.8 1.695 48.587 3.5 5.979 144,413 4.1 Source: Ministry of Science and Education. - 55 - ANNEX 2.10 DImnoN OF OvmsEAS STuDEWrs BY CouNrRY, 1992-93 Existing New Students Graduates Students Total Russia La 1,800 235 20 1,585 Ukraine 385 141 26 270 Turkey 19 - 20 39 Romania 12 6 - 6 Poland 23 14 3 12 Hungary 54 24 10 40 Korea, Rep. of 3 - - 3 China 44 9 15 50 Germany 324 180 - 144 India 8 1 8 15 Japan 24 9 21 36 Czechoslovakia 150 18 - 132 Bulgaria 81 14 - 67 Korea, DPR 25 2 - 23 Total 2.952 653 123 2,422 La Only students studying in Russia are provided stipends of 1,500 rubles per student, amounting to Tugrik 40 million in 1992-93. Source: Ministry of Science and Education. - 56 - ANNEX 3.1 SIDENT-TO-TEACER RAnos BY LEVEL OF EDUCATION, 1991-92 Total Cities Aimags Primary and Secondary 4-year schools 22 25 21 8-year schools 19 32 18 10-year schools 21 28 20 Total 20 28 19 Vocational 16 20 13 Post-Secondary 11 10 15 Hicher 10 10 10 DIRIBUTION OF STuDENTS AND TEACHERS BY TYPE OF SCHOOL, 1991-92 Total % of Total Cities % of Cities Aimags % of Aint Students 4-year 9,960 2.4 1,342 1.0 8,618 3.2 8-year 95,578 23.2 23,894 17.2 71,161 26.2 10-year 306,158 74.4 113,123 81.8 192,011 70.7 Total 411,696 100.0 138.359 100.0 271,790 100.0 % of total 100.0 33.6 66.0 Teachers 4-year 462 2.3 53 1.1 409 2.9 8-year 4,929 24.0 741 15.0 3,902 27.7 10-year 14,739 72.0 4,022 81.2 9,683 68.9 Special La 351 1.7 139 2.8 70 0.5 Total 20,481 100.0 4,955 100.0 14,064 100.0 % of total 100.0 24.2 68.7 Source: World Bank missions to Mongolia in 1992 and 1993. -57 - ANNEX 3.2 STUDENT-TO-TEACEER RATIOS, 1991-92 No. of No. of Student-to- students teachers teacher ratio Primary and Secondary Arhangay 16,866 909 19 Bayanolgin 17,737 1,049 17 Bayanhongor 15,359 797 19 Bulgan 11,928 594 20 Gobi-Altay 13,028 666 20 DornoGobi 9,402 455 21 Dornod 16,050 693 23 DundGobi 9,112 566 16 Dzavhan 18,585 1,113 17 Ovorhangay 18,062 1,018 18 OmnoGobi 7,757 426 18 Sukbaatar 10,864 510 21 Selenge 19,031 832 23 Central 21,069 918 23 Uvs 17,583 942 19 Hovd 15,942 784 20 Hovsgul 19,950 1,103 18 Hentiy 14,365 689 21 Total of Aimaas 271,790 14.064 19 Darhan 16,870 773 22 Ulaanbaatar 109,354 4,955 22 Erdenet 9,748 471 21 Khotin Dun 2,387 119 20 Total of Cities 138,359 6.318 22 Total of Aimaas & Cities 411,696 20.481 20 ... Coniinued - 58 - ANNEX 3.2 No. of No. of Student-to- students teachers teacher ratio Vocational Arhangay 514 36 14 Bayanolgin 798 67 12 Bayanhongor 462 38 12 Bulgan 351 21 17 Gobi-Altai 454 26 17 DornoGobi 217 16 14 Dornod 352 36 10 DundGobi 449 34 13 Dzavhan 661 41 16 Ovorhangay 616 45 14 OmnoGobi 249 16 16 Sukbaatar 0 0 0 Selenge 1,158 114 10 Central 1,325 98 14 Uvs 342 25 14 Hovd 0 0 0 Hovsgul 383 34 11 Hentiy 303 22 14 Total of Aimaqs 8.634 669 13 Darhan 1,840 98 19 Ulaanbaatar 7,005 333 21 Erdenet 482 32 15 Khotin Dun 0 0 0 Total of Cities 9,327 463 20 Total of Aimaps & Cities 17.961 1.132 16 ... Continued - 59 - ANNEX 3.2 No. of No. of Student-to- students teachers teacher ratio Colleae Arhangay 480 32 15 Bayanolgin 141 11 13 Bayanhongor 0 0 0 Bulgan 598 47 13 Gobi-Altai 540 28 19 DornoGobi 564 59 10 Dornod 487 13 37 Dzavhan 382 26 15 Selenge 664 30 22 Central 20 10 2 Hovd 375 26 14 Total of AimaQa 4.231 282 15 Darhan 1,883 88 21 Ulaanbaatar 8,294 900 9 Erdenet 221 12 18 Total of Cities 10.398 1.000 10 Total of Aimaas & Cities 14.629 1,282 11 Higher Education Hovd 470 49 10 Ulaanbaatar 13,402 1,292 10 Total 13,872 1.341 10 Source: Ministry of Education. - 60 - ANNEX 3.3 TEACHERS AS A PERCENTAGE OF TOTAL STAFF BY REGION AND BY LEvEL OF EDUCATION, 1991-92 Total Teachers as % Staff Teachers of Total Staff Primarv and Secondary Schools Arhangay 2,001 909 45.4 Bayan-olgiy 2,226 1,049 47.1 Bayanhongor 1,691 797 47.1 Bulgan 1,282 594 46.3 Gobi-Altay 1,326 666 50.2 DornoGobi 816 455 55.8 Dornod 1,296 693 53.5 DundGobi 1,156 566 49.0 Dzavhan 2,938 1,113 37.9 Ovorhangay 2,068 1,018 49.2 OmnoGobi 851 426 50.1 Sukbaatar 982 510 51.9 Selenge 1,435 832 58.0 Central 1,876 918 48.9 Uvs 1,906 942 49.4 Hovd 1,641 784 47.8 Hovsgul 2,552 1,103 43.2 Hentiy 1,246 689 55.3 Darhan 1,174 773 65.8 Ulaanbaatar 7,456 5,054 67.8 Erdenet 675 471 69.8 Chor 195 119 61.0 Total 38,789 20,481 52.8 Vocational Schools and Colleaes Arhangay 77 32 41.6 Bayan-Olgiy 25 11 44.0 Bulgan 128 47 36.7 Gobi-Altai 62 28 45.2 DornoGobi 95 59 62.1 Dornod 46 13 28.3 Dzavhan 66 26 39.4 Selenge 131 30 22.9 Hovd 73 26 35.6 Darhan 248 88 35.5 Ulaanbaatar 1,789 900 50.3 Total 2.740 1.260 46.0 ... Continued - 61- ANNEX 3.3 Total Teachers as I Staff Teachers of Total Staff Hioher Education Mongolian State University 753 279 37.1 Agricultural University 329 138 41.9 Medical University 498 272 54.6 Technical University 602 304 50.5 Institute of Languages 158 74 46.8 Institute of Culture 83 60 72.3 Teacher's Institute at Hovd 143 49 34.3 Pedagogical University 386 165 42.7 Total 2.952 1.341 45.4 Source: Ministry of Education. - 62 - ANNEX 3.4 TEACHERS, ADMrNIsRAToRs, AND OTHER NONINSTRUCrIONAL STAFF BY INSMIUrION, 1992-93 a No. of Deans & Noninstruc- Teachers as X Teachers Heads Lb tionaL Staff of Total Staff Vocational and Technical Technical SchooLs in Central Aimag 746 3 1053 41.4 Mixed VocationaL and Technical Schools 213 7 314 39.9 Technical SchooLs & Colleges 147 2 207 41.3 Colleges 618 60 978 37.3 Assorted SchooLs in US & Erdenet 14 10 30 26.2 Higher Education MongoLian National University 289 54 385 39.7 MongoLian National University in Hovd 38 6 101 25.9 TechnicaL University 398 46 565 39.4 PedagogicaL University 153 32 193 40.5 AgricuLture University 95 31 413 17.6 Nedical University 244 28 220 49.6 CulturaL Institute 93 7 68 55.4 Language Institute 72 6 90 42.9 Private Tertiary Institutions 72 3 99 41.4 /a There is a slight discrepancy in number of staff in this table from the previous table. This is due to the collection of statistics at different times of the year of 1992. /b Deans and Heads of Departments are counted as staff rather than teachers. Source: World Bank missions to Mongolia in 1992 and 1993. - 63 - ANNEX 3.5 COMPOSrrON OF TEACHING AND NONINSTRUCTIONAL STAFF, 1992-93 ,L Number of staff % of Total Staff Kindergarten Principals 785 5.5 Teachers 3,732 25.9 Methodologists 103 0.7 Music Teachers 366 2.5 Assistant Teachers 3,719 25.8 Bookkeepers 158 1.1 Doctors 121 0.8 Others 5,424 37.7 Total Teaching Staff 7,920 55.0 Total Noninstructional Staff 6,488 39.6 Total Kindergarten Staff 14.408 100.0 Primary and Secondary Education Principals 617 1.8 Vice Principals 1,019 3.0 Psychologists 53 0.2 Teachers 19,441 56.9 Heads of Departments 28 0.1 Aimag Inspectors 72 0.2 Aimag Methodology Chairmen 22 0.1 Methodologists 116 0.3 State Inspectors 22 0.1 Assistants 372 1.1 Accountants 572 1.7 Doctors 251 0.7 Librarians 462 1.4 Furniture Custodians 978 2.9 Typists 388 1.1 Doormen 2,563 7.5 Cleaners 3,835 11.2 Supervisors of organization 14 0.0 others lb 3,374 9.9 Total Teaching Staff 19,441 56.9 Total Noninstructional Staff 14,758 43.2 Total Staff 34,199 100.0 ... Continued - 64 - ANNEX 3.5 Number of staff % of Total Staff Vocational. Post-Secondary Technical, and Hiqher Education Teachers 3,120 38.6 Heads of Departments 210 2.6 Heads of Branches 53 0.7 Deans 30 0.4 Subject Supervisors 41 0.5 Vice Directors 79 1.0 Directors 69 0.9 Researchers 67 0.8 Research Assistants 39 0.5 Accountants 177 2.2 Furniture Custodians 239 3.0 Librarians 166 2.1 Doctors 53 0.7 Laboratory Assistants 525 6.5 Typists 104 1.3 Doormen 660 8.2 Cleaners 1,022 12.6 Others 1,429 17.7 Total Teaching Staff 3,120 38.6 Total Noninstructional Staff 4,963 61.4 Total 8.083 100.0 La To be consistent with the basis for calculating student-to-teacher ratio, only those who are directly involved in teaching are classified as teaching staff. /j& Others include cooks, heating maintenance personnel, and horsemen (messengers). Horsemen are particularly useful in the rural areas. Source: World Bank missions to Mongolia in 1992 and 1993. - 65 - ANNEX 3.6 MOVEMENT OF TEACHERS, 1992 Number of Teachers 1/1/92 3/1/93 Change % of 1992 Arhangay 813 738 75 9.2 Female 586 560 26 4.4 Bayan-Olgiy 1,057 822 235 22.2 Female 558 453 105 18.8 Bayanhongor 780 780 0 0.0 Female 497 497 0 0.0 Bulgan 600 554 46 7.7 Female 417 398 19 4.6 Gobi-Altay 737 710 27 3.7 Female 477 462 15 3.1 Dornogobi 404 376 28 6.9 Female 310 296 14 4.5 Dornod 693 786 -93 -13.4 Female 448 521 -73 -16.3 Dundgobi 501 501 0 0.0 Female 360 360 0 0.0 Dzavhan 1,292 1,180 112 8.7 Female 915 879 36 3.9 Ovorhangay 1,143 1,124 19 1.7 Female 826 817 9 1.1 Omnogobi 472 443 29 6.1 Female 337 319 18 5.3 Sukhbaatar 510 480 30 5.9 Female 346 321 25 7.2 Selenge 887 910 -23 -2.6 Female 676 707 -31 -4.6 Tov 918 964 -46 -5.0 Female 681 711 -30 -4.4 Uvs 1,130 1,042 88 7.8 Female 813 760 53 6.5 Hovd 868 840 28 3.2 Female 477 531 -54 -11.3 Hovegol 1,171 1,100 71 6.1 Female 800 729 71 8.9 Hentiy 863 834 29 3.4 Female 621 611 10 1.6 Darhan 773 794 -21 -2.7 Female 596 614 -18 -3.0 UlaanBaatar 5,124 5,137 -13 -0.3 Female 4,039 4,046 -7 -0.2 Erdenet 469 460 9 1.9 Female 368 376 -8 -2.2 Chor 116 110 6 5.2 Female 91 89 2 2.2 Special 38 38 0 0.0 Female 28 28 0 0.0 Total 21.359 20.731 628 2.9 Female 15.267 15.083 184 1.2 Source: World Bank missions to Mongolia in 1992 and 1993. MOVEMENT OF TEACHERS BY REASON, 1992 To ch.- Gmc by Gant by Go for From From Camo for To Otber To ;tkw Cation To otbr To tmm- other Crirt-l other From other oaer otr city otr TOW aima sl fir seloos priva Retied Died ling ram raingmwes airy smut sbools ram Arhna 75 15 17 6 13 25 30 4 4 2 0 1 -14 -5 -17 .6 Fands 26 11 12 2 3 2 1s 0 1 2 0 1 -12 .3 -7 -3 soY-olgib 23 54 41 4 1 26 35 2 5 309 0 0 -42 -4 .34 4 FaK 105 2 30 0 0 2 28 0 2 114 0 0 -36 .5 .27 .5 3sYOnow 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Foaml 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 sljj 46 33 9 4 7 34 3 0 1 2 0 0 -26 4 4 .5 Femal 19 23 7 4 2 14 3 0 1 2 0 0 -22 -5 4 -2 Gobi-Akia 27 21 16 3 7 12 26 1 3 9 0 3 -27 -5 .23 -19 Fins 25 13 12 0 4 2 24 0 2 4 0 1 -15 -3 -19 -10 D ,moeobi 23 27 15 3 19 3 7 3 1 6 0 1 -20 .2 -23 -22 Fb1l 14 23 12 2 6 5 7 1 1 2 0 0 -14 .1 .14 -16 Dom 493 1 76 7 6 24 21 4 7 17 0 2 .24 -6 -72 -166 Fae -73 5 53 5 5 7 14 1 5 12 0 2 -15 .4 -4 .113 DryloM 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Feale 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 D _vhmn 104 21 79 11 25 25 43 5 6 3 1 6 -47 -10 -50 -14 Fe 36 13 50 9 5 6 31 2 3 0 0 4 -36 -7 -36 43 o.- sy 19 4 19 3 5 3 2 0 0 0 0 0 -17 0 0 0 Fa-l 9 4 11 2 1 1 2 0 0 0 0 0 -12 0 0 0 On-obi 29 i5 7 13 1 13 17 2 0 5 0 20 -19 .5 .31 -9 Fab IS 10 6 6 0 6 13 1 0 3 a 13 -12 .5 -21 -2 9ulsusr 30 7 37 3 20 8 55 0 2 1 0 1 -23 .3 -37 -31 Fai. 25 4 24 1 2 1 36 0 2 0 0 0 -12 .2 -17 .13 se -23 22 32 14 2 40 33 5 0 5 0 10 46 -23 -16 -201 Feima -31 15 25 5 0 13 27 2 0 4 0 s .37 .14 -13 -71 Toe -46 13 35 2 1 30 11 2 0 2 0 43 -50 .19 -30 -95 Famal -30 9 22 2 s 23 10 2 0 0 0 26 44 .14 -17 -56 ULi B Is 17 27 14 33 72 3 17 3 0 5 43 -9 -17 .32 Feral. 53 12 12 5 4 9 65 2 16 2 0 2 -44 4 -12 -12 Hovd 28 55 is 5 a 48 35 1 1 1 1 2 -59 -5 -d -23 Feral. .54 20 13 0 0 4 21 0 0 0 0 2 -46 -3 47 -23 Hosg 71 21 42 9 23 22 59 3 20 7 0 27 - -12 0 42 Femal 71 is 27 5 6 7 56 1 17 6 0 17 -52 -20 -16 -12 Iomiy 29 30 47 4 10 29 21 1 6 16 0 11 -30 .7 44 55 FinS. 10 15 31 4 5 11 21 1 6 6 0 6 25 -6 -28 -37 Dubl .21 27 72 3 17 39 19 4 1 12 2 9 -40 -4 49 -57 FeaL -IS 24 n3 3 7 21 16 2 0 4 2 6 -34 -27 62 .33 Uks-Bfmr -13 134 Is0 34 48 137 94 9 3 52 0 29 -112 -253 -231 .137 Femal. .7 1II 132 22 29 78 71 4 3 42 0 17 -2Wo -170 .166 46 ERl 9 11 39 27 20 9 13 3 0 4 0 20 -27 -33 -39 -28 Fainl 4 10 31 11 2 4 12 1 0 2 0 9 -16 -23 -27 -24 c-or 6 7 10 5 7 5 5 1 0 0 0 3 .3 -11 -11 .17 Femle 2 4 9 1 3 3 4 0 0 0 0 7 .3 .7 4 .11 SPDso 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 Femal 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 TOWI 628 436 we 137 244 570 E1 2 77 355 4 -753 -64 427 -906 Faint la 346 7 _ 224 479 30 5B 04 2 S _ 317 - -531 Source: Mluisty of Sciewce and Culture. - 67 - ANNEX 3.8 EDUCATION SECrOR STAFF SALARIES IN THE CIVIL SERVICE PAY SCALE Civil Monthly service salaries Teaching level grade (tugrik) A-1 2,300-3,200 Cleaner, helper, courier, assistant cook, heating assistant, nurse. A-2 2,700-3,500 Typist, copyist, guard, cook, laboratory assistant doctor, nurse-educator in nursery. A-3 2,900-4,200 Driver, electrician, environment monitor, veterina- rian, librarian, teacher of music and dance, assis- tant kindergarten teachers. A-4 3,300-4,400 Chief clerk, technicians, trained librarian. A-5 3,500-4,700 Secretary of directors, accountant, teachers of kin- dergartens, primary and secondary schools, vocational schools, and post-secondary schools, director of nur- sery, senior librarian. B-1 3,800-5,100 Researcher, kindergarten teacher with higher educa- tion, library director, engineer, senior accountant, economist, legal advisor. B-2 4,000-5,300 Secondary school teachers with higher education, directors of kindergartens, researcher, doctor. B-3 4,200-5,500 Teacher in technical institutes, educator-expert in secondary schools. B-4 4,500-5,800 Directors of secondary schools, deputy director of vocational schools, assistant teacher in university, researcher of national research center, director of environment monitoring center. B-5 4,900-6,100 Professor of university, senior teacher in post- secondary schools, director of vocational schools, deputy director of college. B-6 5,100-6,300 Senior professor of state university, deputy director of college, senior researcher in research center, director of medical center, principal doctor. B-7 5,400-6,700 Directors of post-secondary schools, principal researcher in research center. B-8 5,600-6,900 Deputy directors of state university, director of institutes, deputy director of President's Office the Academy of Science. B-9 6,300-7,600 Director of University, Vice President of Academy of Science. Source: Coopers and Lybrand, p. D1-D3. - 68 - ANNEX 4 INSTRUCTIONAL TIM ALLOCATED TO VARIOUS SUBJECrs IN GRADES 1-10 (HOURS) Mongolian Grade Language Math Science Geography History English Others TotaL 1 9 5 1 - - 9 24 2 9 5 2 - - 9 25 3 9 5 2 - - - 9 25 4 9 5 2 - - - 9 25 5 7 5 2 - 2 5 8 29 6 6 5 2 2 2 5 7 29 7 6 5 6 2 2 3 5 29 8 5 5 7 2 2 3 5 29 9 4 6 8 2 1 3 4 28 10 4 6 10 - 2 3 4 29 Total 68 52 42 8 11 22 69 272 Source: Ministry of Science and Education. - 69 - ANNEX 5.1 GovERNmENT ExPENDITUREs BY FUNCTION, 1990 Millions % of % of of Total GDP Tugriks Expenditure Total Expenditures 6.710.61/ 100.0 64.1 General public services 329.2 4.9 3.1 Defense 473.4 7.1 4.5 Public order & safety 102.5 1.5 1.0 Education 1,182.9 17.6 11.3 Health 569.5 8.5 5.4 Social security 801.9 11.9 7.7 Housing & community 445.7 6.6 4.3 amenities Recreation, culture and 210.0 3.1 2.0 religious affairs and services Economic affairs 2,284.7 34.0 21.8 Other 303.7 4.5 2.9 Timing adjustment 7.1 0.1 0.1 Sources: Ministry of Finance, IMF and World Bank Estimates l/This table is based on revised IMF estimates of June, 1993. Total government expenditures in this table are slightlv different from the number reported in Table 2.1, which was collected in April, 1993. - 70 - ANNEX 5.2 EDUCATION ExPENDruRE By FUNCTION AND BY LEvEL OF EDUCATION, 1991 (ITousand Tugrik) Local/total Tugrik Kinderqgarten Salaries 138,181 41.5 Social security tax 18,868 5.7 Administrative and overhead 69,089 20.7 Travel expenses 523 0.2 Practical expenses 924 0.3 Books, newspapers, magazines 187 0.1 Food subsidies 92,549 27.8 Medicine 199 0.1 Furniture and facilities 6,431 1.9 Clothing and sheets 2,669 0.8 Maintenance and repair 2,607 0.8 Other expenditures 775 0.3 Total 333,002 100.0 Primary and Secondary Schools Salaries 501,160 59.7 Social security tax 65,783 7.8 Administrative and overhead 156,293 18.6 Travel expenses 3,746 0.4 Practical subject expense 3,758 0.4 Research and study tour 0 0.0 Books, newspapers, magazines 3,465 0.4 Food (boarding schools) 74,440 8.9 Medicine 30 0.0 Furniture and facilities 11,069 1.3 Clothing and sheets 2,008 0.2 Maintenance and repair 11,138 1.3 Other expenses 4,012 0.4 Savings 1,993 0.2 School lunch 1,029 0.1 Total 839.927 100.0 ... Continued - 71- ANNEX 5.2 Central Local Total Tugrik % Tugrik % Tugrik % Vocational Schools Salaries 10,071 27.0 12,996 31.6 23,066 29.4 Social security tax 1,357 3.6 1,688 4.1 3,045 3.9 Admin. and overhead 6,647 17.8 9,441 23.0 16,088 20.5 Travel expenses 33 0.1 161 0.4 193 0.2 Practical subject expense 2,620 7.0 1,671 4.1 4,291 5.5 Research and study tour 0 0.0 488 1.2 488 0.6 Books, newspapers, journals 30 0.1 16 0.0 46 0.1 Food 11,010 29.5 4,453 10.8 15,464 19.7 Student stipends 3,172 8.5 7,352 17.9 10,524 13.4 Medicine 21 0.1 4 0.0 25 0.0 Furniture and facilities 565 1.5 396 1.0 961 1.2 Clothing and sheets 573 1.5 359 0.9 932 1.2 Maintenance and repair 484 1.3 736 1.8 1,220 1.6 Other expenses 387 1.0 1,330 3.2 2,048 2.6 Total 37.301 100.0 41.092 100.0 78.393 100.0 Post-secondary Technical Schools Salaries 20,171 29.5 16,399 25.2 36,570 27.4 Social security tax 3,148 4.6 4,120 6.3 7,268 5.4 Administrative and overhead 8,761 12.8 7,859 12.1 16,620 12.4 Travel expenses 34 0.0 216 63.1 251 0.2 Practical subject expense 4,016 5.9 2,011 3.1 6,030 4.5 Books, newspapers, magazines 114 0.2 62 0.1 175 0.1 Food (dorm) 2,784 4.1 720 1.1 3,504 2.6 Student stipends 27,329 40.0 30,745 47.2 58,074 43.5 Medicine 14 0.0 8 0.0 21 0.0 Furniture and facilities 871 1.3 1,028 1.6 1,899 1.4 Clothing and sheets 123 0.2 331 0.5 455 0.3 Maintenance and repair 616 0.9 1,163 1.8 1,780 1.3 Other expenses 372 0.5 499 0.7 868 0.6 Total 68.356 100.0 65.162 100.0 133.518 100.0 Universities Salaries 65,577 32.1 2,612 30.3 68,189 32.0 Social security tax 11,762 5.8 590 6.8 12,353 5.8 Administrative and overhead 27,066 13.2 2,153 25.0 29,230 13.7 Travel expenses 141 0.1 26 0.3 167 0.1 Practical subject expense 14,782 7.2 286 3.3 15,067 7.1 Research and study tour 483 0.2 48 0.6 531 0.2 Books, newspapers, magazines 735 0.4 31 0.4 766 0.4 Food (Boarding Schools) 3,922 1.9 0 0.0 3,922 1.8 Student stipends 63,728 31.2 2,608 30.3 66,337 31.2 Medicine 86 0.0 0.2 0.0 87 0.0 Furniture and facilities 2,464 1.2 45 0.5 2,509 1.2 Clothing and sheets 4,138 2.0 45 0.5 4,183 2.0 Maintenance and repair 9415 4.6 170 1.9 9,584 4.5 Total 204.312 100.0 8.614 100.0 212.925 100.0 Source: Ministry of Finance. -72- ANNEX 5.3 EDUCATION BUDGET BY FUNCFON AND BY LEVEL OF EDUCATION, 1993 Kindergarten % Primary & Secondary % Salaries 461,117.3 20.6 1,614,067.6 36.0 Social Security 62,250.0 2.8 217,899.1 4.9 Admin. & Overhead 605,070.1 27.0 1,841,801.1 41.1 Travel 3,976.3 0.2 18,755.2 0.4 Food 1,052,477.3 46.9 686,941.5 15.3 Medicine 1,230.0 0.1 1,922.1 0.0 Other Expenses 56,685.4 2.5 115,181.5 2.6 Total Expenditures 2.242.776.3 100.0 4,484.104.2 100.0 Total Revenue 196,281.0 47,492.0 Subsidies 2.046.495.3 4.436.612.2 Vocational % Post-secondary Technical % Salaries 53,336.2 12.9 117,781.5 25.0 Social Security 7,200.4 1.7 15,900.0 3.4 Adckin. & Overhead 227,147.2 55.0 150,518.8 32.0 TraveL 1,919.4 0.5 1,455.5 0.3 Student allowance 94,268.0 22.8 189,030.0 40.1 Medicine 29.5 0.0 49.2 0.0 Other Expenses 6,709.7 1.6 20,223.5 4.3 Total Expenditures 412.,928.4 100.0 471.019.9 100.0 Total Revenue 22,318.0 23,938.6 Subsidies 390.610.4 471,019.9 Higher Education X Salaries 157,302.2 28.5 Social Security 21,236.0 3.9 Admin. & Overhead 117,955.0 21.4 Travel 2,114.4 0.4 Student allowance 216,170.0 39.2 Medicine 393.6 0.1 Other Expenses 36,766.4 6.7 Total Expenditures 551.937.6 100.0 Total Revenue 40,935.0 Subsidies 511.002.6 Source: Ministry of Finance. - 73 - ANNEX 5.4 EDUCATION BUDGET BY SOURCE AND FUNCTION, 1993 (Thousand Tugrik) Local X Central % TotaL X Institution's services 31,788.6 9.9 100.0 0.2 31,888.6 8.8 Paid services 267,944.0 83.3 41,010.0 95.8 308,954.0 84.8 Other revenues 21,938.0 6.8 1,700.0 4.0 23,638.0 6.5 Own Revenue 321.670.6 100.0 42,810.0 100.0 364.480.6 100.0 SaLaries 2,334,503.6 30.2 166,592.3 25.5 2,501,095.9 29.9 SociaL Security 315,158.0 4.1 22,490.0 3.5 337,647.9 3.0 Admin. & Overhead 2,952,737.8 38.2 109,551.0 16.9 3,062,288.8 36.6 Admiin. 398,115.7 5.2 14,189.3 2.2 412,305.0 4.9 Electricity 362,854.3 4.7 14,276.1 2.2 377,130.4 4.5 Heat 2,100,328.1 27.2 69,205.6 10.6 2,169,533.7 25.9 Fuel 91,439.7 1.2 11,880.0 1.8 103,319.7 1.2 Travel 31,738.3 0.4 3,075.5 0.5 34,813.8 0.4 Food 1,829,794.7 23.7 12,093.2 1.9 1,841,887.9 22.0 Student aLlowance 295,086.0 3.8 292,094.0 44.9 587,180.0 7.0 Medicine 4,136.1 0.1 393.6 0.1 4,529.7 0.1 Other Expenses 283,913.5 3.7 86,667.0 13.3 370,580.5 4.4 Expenditures 8.047.068.0 692.956.6 8.740.024.5 Education Expenditures 7725.397.4 100.0 650.146.6 100.0 8.375.543.9 100.0 Source: Ministry of Finance. - 74 - ANNEX 5.5 EDuCATION BUDGET BY REGION, 1993 (Thousand Tugrik) Revenue X Expenditures X State SLbsidies X Arhangay 8,893.0 2.4 435,665.9 5.0 426, m .9 5.1 Bayan-Olgiy 8,261.0 2.3 332,740.6 3.8 324,479.6 3.9 Bayanhongor 9,468.0 2.6 324,412.0 3.7 314,944.0 3.8 BuLgan 9,533.6 2.6 264,350.2 3.0 254,816.6 3.0 Gobi-Altay 8,693.0 2.4 362,574.3 4.2 353,881.3 4.2 Dornogobi 7,931.0 2.2 190,004.0 2.2 182,073.0 2.2 Dornod 10,226.0 2.8 247,580.2 2.8 237,354.2 2.8 Dundgobi 8,997.0 2.5 217,568.5 2.5 208,571.5 2.5 Dzavhan 13,090.0 3.6 426,186.6 4.9 413,096.6 4.9 Ovorhangay 9,685.0 2.7 457,470.5 5.2 447,785.5 5.4 Omnogobi 6,314.0 1.7 208,231.6 2.4 201,917.6 2.4 Sukhbaatar 7,092.0 2.0 176,533.8 2.0 169,441.8 2.0 Selenge 15,710.0 4.3 297,572.3 3.4 281,862.3 3.4 Tov 14,386.0 4.0 411,126.2 4.7 396,740.2 4.7 Uvs 10,132.0 2.8 259,657.4 3.0 249,525.4 3.0 Hovd 14,161.0 4.0 301,391.3 3.5 287,230.3 3.4 Hovsgol 13,884.0 3.8 422,442.2 4.8 408,558.2 4.9 Hentiy 8,780.0 2.4 249,998.2 2.9 241,218.2 2.9 Aimag TotaL 185.236.6 50.8 5.585.505.8 63.9 5.400.269.2 64.5 Darhan 14,295.0 3.9 306,904.7 3.5 292,609.7 3.5 ULaanbaatar 110,950.0 30.4 1,954,801.7 22.4 1,843,851.7 22.0 Erdenet 9,445.0 2.6 158,777.0 1.8 149,332.0 1.8 Chor 1,744.0 0.5 42,779.2 0.5 41,035.2 0.5 City Total 136.434.0 37.4 2.463,262.6 28.2 2.326.828.6 27.8 Central Goverrnent 42,810.0 11.8 692.956.6 7.9 650.146.6 7.8 Total 364.480. 100.0 8.741.725.0 100.0 8.377.244.4 100.0 Source: World Bank missions to Mongolia in 1992 and 1993. - 75 - ANNEX 5. LOCAL EXPENDmRES, SELECTED CITIES AND AIMAGS, 1991 (Thousand ugrik) Total Utaanbaatar Darhan Erdenet ua X Ua T X u % Tug X Salaries 711,405 45.7 176,867 50.4 33,033 38.4 15,434 37.5 Social security tax 96,568 6.2 23,686 6.7 5,407 6.3 2,166 5.3 Administrative (utilities, suppLies) 26,3337 16.9 71,069 20.2 13,968 16.2 6,851 16.6 Travel (for teachers) 5,864 0.4 143 0.0 112 0.1 117 0.3 PracticaL subject 13,135 0.8 2,971 0.8 1,358 1.6 811 2.0 Research (study tour) 536 0.0 0 0.0 0 0.0 0 0.0 Libraries, extracurricuLar activities 3,900 0.3 302 0.1 29 0.0 28 0.1 Food (boarding schs) 180,455 11.6 34,764 9.9 7,122 8.3 4,195 10.2 Student Stipends 57,359 3.7 170 0.0 13,261 15.4 976 2.4 Medicine (boarders) 281 0.0 0 0.0 34 0.0 0 0.0 Furniture & facilities 22,316 1.4 5,715 1.6 542 0.6 832 2.0 CLothing & Sheet 6,514 0.4 1,906 0.5 373 0.4 297 0.7 Maintenance 17,287 1.1 3,706 1.1 718 0.8 523 1.3 Others 10,961 0.7 1,783 0.5 326 0.4 313 0.8 Investment (building, equipment) 158,118 10.2 24,891 7.1 9,332 10.8 8,430 20.5 Subsidies (school products) 2,705 0.2 1,419 0.4 120 0.1 0 0.0 Food (school lunch) 1,029 0.1 173 0.0 197 0.2 30 0.1 Evening courses 1.948 0.1 1,081 0.3 5.5 0.0 154 0.4 Education activities 1,726 0.1 225 0.1 178 0.2 0 0.0 Total 1.555.452 100.0 351.117 100.0 6 100.0 41.157 100.0 Arhangav Sukbeatar Central Tuq X TUY X Tug X Salaries 29,634 42.7 16,897 45.1 36,776 44.8 Social security tax 3,951 5.7 2,318 6.2 4,859 5.9 Administrative 9,890 14.2 5,729 15.3 16,029 19.5 TraveL (for teachers) 281 0.4 128 0.3 344 0.4 PracticaL subject expenses 178 0.3 122 0.3 1,059 1.3 Research (study tour) 0 0.0 0 0.0 488 0.6 Libraries, extracurricular activities 46 0.1 25 0.1 72 0.1 Food (Boarding schools) 8,653 12.5 5,290 14.1 11,785 14.4 Student allowance (for tech. & high education) 3,928 5.7 223 0.6 1,283 1.6 Medicine (boarders) 0 0.0 0 0.0 0 0.0 Furniture & facilities 491 0.7 203 0.5 1,724 2.1 Clothing & sheet 122 0.2 118 0.3 427 0.5 Maintenance 555 0.8 464 1.2 978 1.2 Others 225 0.3 89 0.2 814 1.0 Saving 0 0.0 0 0.0 0 0.0 Investment (building, equipment) 11,466 16.5 5,853 15.6 6,002 7.3 Subsidies (school products) 0 0.0 0 0.0 0 0.0 Food (school lunch) 46 0.1 33 0.1 35 0.0 Evening courses 0 0.0 0 0.0 0 0.0 Education activities 0 0.0 0 0.0 438 0.5 Total 69.47 100.0 37.490 100.0 82.114 100.0 Source: Ministry of Finance. - 76 - ANNEX 5.7 LOCAL ExI'ENDrURES, SECTED CriEs AND AMAGS, 1992 (Thousand Tugrik) Arhancay Bavanhongor Ovorhanaay TUA Tuuggim Salaries 26,107.4 35.5 24,453.6 38.2 30,099.3 37.6 SociaL Security 3,679.0 5.0 3,312.6 5.2 3,990.1 5.0 Admin. & Overhead 31,389.3 42.7 23,932.5 37.4 30,023.8 37.5 Travel 171.7 0.2 456.6 0.7 294.8 0.4 Practical Work 267.7 0.3 262.1 0.4 234.0 0.3 Books 76.6 0.1 91.3 0.1 102.2 0.1 Food 9,406.5 12.8 7,551.1 11.8 13,018.3 16.3 Furniture 582.2 0.8 1,896.5 3.0 322.7 0.4 CLothing 104.4 0.1 40.6 0.1 44.1 0.1 Repair & Maintenance 154.1 0.2 512.2 0.8 1,293.1 1.6 Other Expenses 1,555.8 2.1 1,543.2 2.4 613.6 0.8 Total ExPenditures 7.494.7 100.0 64.052.3 100.0 80.036.0 100.0 Sukbaatar Selenae Ulaanbaatar TuA Tus a SaLaries 15,859.3 38.8 28,220.6 39.9 154,760.4 54.9 SociaL Security 2,251.4 5.5 3,830.1 5.4 19,828.5 7.0 Acdnin. & Overhead 13,603.3 33.2 25,752.7 36.4 86,713.0 30.8 Travel 148.7 0.4 259.9 0.4 136.9 0.1 Practical Work 107.2 0.3 161.6 0.2 1,717.6 0.6 Books 43.6 0.1 38.3 0.1 249.0 0.1 Food 4,538.6 11.1 5,661.5 8.0 3,365.3 1.2 Medicine - - - - 8.9 0.0 Furniture 296.6 0.7 1,205.5 1.7 4,143.7 1.5 Clothing 11.2 0.0 205.4 0.3 685.4 0.2 Repair & Maintenance 1,269.7 3.1 2,050.6 2.9 4,060.8 1.4 other Expenses 2,796.4 6.8 3,303.9 4.7 6,115.2 2.2 Total Expenditures 40.926.0 100.0 70.690.1 100.0 281.784.7 100.0 Source: World Bank missions to Mongolia in 1992 and 1993. - 77 - ANNEX 5.8 LOCAL BuDGETS, SELECTm CITIES AND AIGS, 1993 (housand Tugrik) ArhansaY Bavanhonaor Ovorhansav SaLaries 97,751.9 22.4 93,142.3 28.7 92,629.0 20.3 Social Security 13,196.5 3.0 12,574.2 3.9 12,504.9 2.7 Admin. & Overhead 211,141.5 48.5 133,068.7 41.0 235,922.0 51.6 Administration 11,328.5 2.6 11,302.7 3.5 26,441.9 5.8 Electricity 31,206.0 7.2 23,786.0 7.3 9,273.6 2.0 Heat 166,851.4 38.3 95,274.0 29.4 196,213.5 42.9 Fuel 1,755.6 0.4 2,706.0 0.8 3,993.0 0.9 TraveL 1,164.2 0.3 865.0 0.3 1,318.0 0.3 Food 94,636.6 21.7 76,502.0 23.6 97,074.2 21.2 ALLowance 8,138.0 1.9 3,072.0 1.0 3,768.0 0.8 Medicine 0.0 0.0 0.0 0.0 29.5 0.0 Other Expenses 9,737.2 2.2 5,187.8 1.6 14,224.9 3.1 Total Exoenditures 435.765.9 100.0 324.412.0 100.0 457.470.5 100.0 Sukbaatar Selenge Ulaanbaatar 15N X Tug X ia T Salaries 55,604.5 31.5 105,971.8 35.6 652,239.1 33.4 Social Security 7,506.6 4.3 14,306.2 4.8 88,052.3 4.5 Admin. & Overhead 71,379.9 40.4 93,258.8 31.3 462,571.3 23.7 Administration 6,317.9 3.6 3,888.4 1.3 161,470.8 8.3 ELectricity 8,654.2 4.9 18,369.0 6.2 50,372.4 2.6 Heat 55,978.8 31.7 66,150.4 22.2 222,711.1 11.4 FueL 429.0 0.2 4,851.0 1.6 28,017.0 1.4 Travel 741.4 0.4 920.0 0.3 3,600.0 0.2 Food 39,632.9 22.5 62,701.7 21.1 458,683.7 23.5 Allowance 0.0 0.0 9,540.0 3.2 160,748.0 8.2 Medicine 0.0 0.0 0.0 0.0 3,204.6 0.2 Other Expenses 1,668.5 1.0 10,874.8 3.7 124,002.3 6.4 Total Exoenditures 176.533. 100.0 297.5n.3 100.0 1.953.101.3 100.0 Source: World Bank missions to Mongolia in 1992 and 1993. - 78 - ANNEX 5.9 Cosr PER STUDENT BY REGION AND LEvEL OF EDUCATION IN 1993 BUDGET La (Thousand Tugrik) No. of Per Student PupiLs X Budget X Cost Kindergarten Arhangay 2,200 2.5 74,690.2 3.7 33.95 Bayan-Olgiy 2,075 2.4 47,791.8 2.3 23.03 Bayanhongor 2,490 2.9 75,233.5 3.7 30.21 BuLgan 2,585 3.0 66,300.9 3.2 25.65 Gobi-ALtay 2,520 2.9 70,476.4 3.4 27.97 DornoGobi 2,580 3.0 50,394.7 2.5 19.53 Dornod 3,550 4.1 68,175.9 3.3 19.20 Dundgobi 2,310 2.7 56,259.1 2.8 24.35 Dzavhan 2,700 3.1 65,648.5 3.2 24.31 Ovorhangay 2,805 3.2 100,548.0 4.9 35.85 OmnoGobi 1,870 2.2 53,531.0 2.6 28.63 Sukhbaatar 1,921 2.2 44,346.8 2.2 23.09 SeLenge 4,020 4.6 72,846.4 3.6 18.12 Tov 3,380 3.9 90,328.4 4.4 26.72 Uvs 3,080 3.6 65,154.3 3.2 21.15 Hovd 2,375 2.7 53,484.2 2.6 22.52 Hovsgol 3,010 3.5 85,541.6 4.2 28.42 Hentiy 2,910 3.4 81,238.6 4.0 27.92 Aimag TotaL 48.381 55.9 12.21.990.0 59.7 25.59 Darhan 4,490 5.2 94,950.3 4.6 21.15 ULaanbaatar 29,860 34.5 647,752.2 31.7 21.69 Erdenet 3,370 3.9 69,655.1 3.4 20.67 Chor 460 0.5 12,146.9 0.6 26.41 City Total 38.180 44.1 824.504.5 40.3 22.48 Total 86.561 100.0 2.046.495.0 100.0 23.64 ... Conninued - 79 - ANNEX 5.9 No. of Per Student PupiLs X Budget X Cost Primary and Secondary Arhangay 15,,580 3.9 317,760.6 7.2 20.40 Bayan-Olgiy 15,580 3.9 248,859.6 5.6 15.97 Bayanhongor 14,448 3.6 213,587.0 4.8 14.78 BuLgan 10,491 2.6 153,962.0 3.5 14.68 Gobi-Altay 13,428 3.4 254,027.9 5.7 18.92 DornoGobi 9,560 2.4 102,388.4 2.3 10.71 Dornod 16,426 4.1 135,313.3 3.1 8.24 Dundgobi 9,121 2.3 132,216.3 3.0 14.50 Dzavhan 17,793 4.5 286,289.6 6.5 16.09 Ovorhangay 18,617 4.7 322,564.8 7.3 17.33 OmnoGobi 7,640 1.9 135,508.3 3.1 17.74 Sukhbeatar 10,990 2.8 120,550.2 2.7 10.97 SeLenge 18,663 4.7 161,044.4 3.6 8.63 Tov 19,690 5.0 212,709.5 4.8 10.80 Uvs 16,579 4.2 174,584.5 3.9 10.53 Hovd 14,970 3.8 173,213.0 3.9 11.57 HovsgoL 14,969 3.8 301,138.1 6.8 20.12 Hentiy 13,660 3.4 141,323.6 3.2 10.35 AimaT Total 258.205 65.1 3587.041.0 80.9 13.89 Darhan 16,491 4.2 112,386.8 2.5 6.82 Utaanbaatar 109,450 27.6 644,413.6 14.5 5.89 Erdenet 10,269 2.6 64,579.9 1.5 6.29 Chor 2,408 0.6 28,190.8 0.6 11.71 City Total 138.618 34.9 849.571.1 19.2 6.13 Total 396.823 100.0 4.436.612.0 100.0 11.18 .C. -onnnued - 80 - ANNEX 5.9 No. of Per Student Students X Budget X Cost Vocational Arhangay 145 1.4 7,303.0 1.5 50.37 Bayan-Olgiy 301 2.9 13,996.7 2.8 46.50 Bayanhongor 256 2.5 17,582.9 3.5 68.68 Bulgan 345 3.3 16,641.9 3.4 48.24 Gobi-Altay 229 2.2 11,433.2 2.3 49.93 DornoGobi 145 1.4 7,738.7 1.6 53.37 Dornod 432 4.2 19,511.1 3.9 45.16 Dundgobi 275 2.7 13,002.4 2.6 47.28 Dzavhan 288 2.8 19,476.3 3.9 67.63 Ovorhangay 314 3.0 19,376.8 3.9 61.71 OmoGobi 200 1.9 7,239.4 1.5 36.20 Selenge 562 5.4 30,617.0 6.2 54.48 Tov 462 4.5 65,996.6 13.3 142.85/a Uvs 255 2.5 6,749.1 1.4 26.47 HovsgoL 223 2.2 14,574.6 2.9 65.36 Hentiy 225 2.2 13,742.2 2.8 61.08 Aimag Total 4.657 44.8 284.981.9 57.4 61.19 Darhan 350 3.4 13,081.5 2.6 37.38 Utaanbaatar 2,223 21.4 84,244.6 17.0 37.90 Erdenet 291 2.8 8,302.4 1.7 28.53 Chor 2,864 27.6 105,628.5 21.3 36.88 City Total 5 728 55.2 211.257.0 42.6 36.88 TotaL 10.385 100.0 496.238.9 100.0 47.78 ... Continued -81- ANNEX 5.9 No. of Per Student Students X Budget X Cost Post-secondary Technical Schools Arhangay 468 2.8 20,655.5 3.3 44.14 Bayan-OLgiy 160 0.9 7,851.2 1.3 49.07 Bulgan 180 1.1 13,447.0 2.2 74.71 Gobi-Altay 435 2.6 13,522.8 2.2 31.09 DornoGobi 481 2.8 15,689.2 2.5 32.62 Dornod 258 1.5 9,093.8 1.5 35.25 Dzavhan 402 2.4 27,907.8 4.5 69.42 Selenge 233 1.4 12,022.9 1.9 51.60 Tov 404 2.4 17,062.0 2.7 42.23 Hovd 215 1.3 15,743.8 2.5 73.23 Aimag Total 3.236 19.1 152.996.0 24.5 47.28 Darhan 1,687 10.0 49,584.8 8.0 29.39 Ulaanbaatar 8,752 51.7 267,152.8 42.8 30.52 Erdenet 25 0.2 1,286.3 0.2 51.45 Chor 10,464 61.8 318,023.9 51.0 30.39 City Total 13.700 80.9 471.019.9 75.5 34.38 Total 16.936 100.0 624.015. 100.0 36.84 Universities Hovd 415 3.1 40,723.5 8.0 98.13 Darhan 229 1.7 12,591.7 2.5 54.99 Ulaanbaatar 12,556 95.1 457,687.4 89.6 36.45 (Central Budget, transferred from UB Last yr) Total 13.200 100.0 511.002.6 100.0 38.71 /a Two vocational schools were transferred to primary and secondary education but the budget remained with vocational education. That is why the per student cost is so high. Note: Plan based on the exchange rate of $1 = Tug 150. Source: Ministry of Finance. - 82 - ANNEX 5.10 BUDGET FOR TEXTBOOKS, 1993 (Thousand Tugrik) Total Book Budget As X Education Book As X of of Total Budget Budget TotaL Education Budget Book Budget Kindergarten 2,046,495.3 370 0.0 4.2 Primary & Secondary 4,436,612.2 6,600 0.2 74.2 Vocational 390,610.4 90 0.0 1.0 CoLLeges 471,019.9 340 0.1 3.8 Universities 511,002.6 1,500 0.3 16.9 TotaL 7.855,740.4 8.900 100.0 100.0 Source: Ministry of Finance. - 83 - ANNEX 5.11 ESTIMATED EXPENSES FOR PRODUCTION AND PROVISION OF ESSENTIAL TEXTBOOKS, 1993-94 Sb O No. of Manzcript PodoCgkn Pper Trupot TOal pac b SLa_a Fapm Cot Cost Cd Mongolia SCr I 9,ODD 55,000 56,7CO M9,500 1.099,500 359,300 2,413,S00 M dgolia Lanp I 5,00D 55,00D 31.50 49,500 619,500 199,500 1,350,OD Mallcatim I 4,ODD 55.00W 25,200 399,600 504,0DD 159,600 1,088,400 Reading I1 8,oo 50,aoo 50,400 766,5O W79,000 312,000 2,007,600 Mongolian guW 0 6,000 50,000 37,80D 574.650 659,250 234,000 150,570 Madmtios D1 4,000 50,000 22,900 363,2DD 45S,100 145,000 989,2co Iocal Asa Stunie D 4,000 50,000 229o0 363,2cC 458,10D 145,000 9S,920 Labor Truig D 8,000 50,000 50.400 766,23 8W79,00D 312,000 2,007,60D Mat3ucsntics DI 9,000 50.000 56,700 10,750 984,000 378,000 2,229,450 Reding I 9,000 50,000 s6,70D 0,750 984,000 37S,000 2,229,450 Local Ana Stwln M 4,000 50,OOD 25,90 363,200 458,00D I45,0C 989,2c0 Reading IV 9,00D 20,000 50,400 305,600 382,100 130,00 8"6,613 Read-o IV (Cyriulic) 16,DDD I0,CC 100,800 237,700 339,600 76,500 754,60C Moolirn LAnW IV 6,00o 20,ODD 37,800 178,290 254,700 108,2D0 578,990 Matl3tctios IV 8,0DD M0,000 5,400 237,72D 339,6W 153,000 735,750 Cyrilc Script IV I,O00 50,000 6,300 2s7,2co 424,600 153,000 937,soD F-nglih V 8,000 40,000 5,400 475,510 679,300 306,18) 1,466,210 Rualan LanuW V 10o,o 8D,0OO 63,000 849,150 1,698,30D 604,800 3,215,250 Mongolian Writins VI 10,000 8,000 63,000 849.150 1,698,300 6D4,800 3,215,250 Matitnudo VI 12,018 70.,10 75,600 891,600 1,783,233 545,100 3,295,500 Montgolian Writing VI 12,0CO 80,000 75,620 1,018,950 2,037,900 623,000 3,755,450 Litratm 38,S00 80,0D0 113,400 1,528,400 3.056,800 669,500 5,368,30D World History 10,020 80,000 63,D00 849,150 1,6.300 612,000 3,222,450 Algebra IX 10,000 10,000 63,000 148,610 212,300 65,20D 489,110 Pyskis DC 9,000 10,000 56,72 133,700 199,000 64,100 445,500 Biolog EC 9,ooo 10,00D 56,7co 133,700 191,00D 64,100 445,500 Geonuuy IX 9,000 10,ODO 56,7 133,700 191,0O0 64,100 445,500 Camnigy IX 9,00 30,000 56,700 133,700 191,000 64,100 445,500 GeogrpI0 O0,o 140,0 63,0DD 148,610 212,300 65,2Do 489,110 Mtktims IX I0,0S 10,OD0 63,000 148,610 212,300 65,2cO 489,110 bifomtcm Scian 6,000 30,000 37,.80 89,110 127,300 59,800 314,010 Algbra X 10,OD 10,000 63,000 148,610 232,30D 65,220 489,110 Nabs. 10,00 10,00 63,000 148,610 212,300 65,2CC 489,110 Cfistay X 8,0D0 10,000 54,020 118,860 309,800 62,9S0 405,56C Geograpby 10,O0 10,ODO 63,09) 148,610 212,300 65,2C0 489,110 Genrety X 9,0GO 10,SSO 56,700 133,700 191,00D 64,100 445,500 Ma:.=tis 10,SO I0,000 63,0020 148,610 212,300 65,2D0 489,110 lnfomtiran Scince I0,0D 10,000 63,000 148,610 212,300 65,20D 489.110 Literate 12,0DO 10,000 75,600 178,290 254,700 66,900 575,490 Total 350.500 1,325,ODD 2,105.400 16.577.810 25.58D.450 S.395,30D 52,648960 /a One sheet of paper is about 24 pages. Note: Manuscript+Printing+Transportationcost Tugrik 27,078,510 Manuscript + Printing +Transportation+ Papercost Tugrik 52,648,960 Budget allocation Tugrik 6,600,000 Source: Ministry of Science and Education. - 84 - ANNEX 6.1 THE GOVERNmENT STRucrURE OF MONGOLIA President (largely ceremonial) Prime Minister (designated by Parliament), Chairman of the Cabinet State Great Khural (Parliament) 6 elected members, 72 representing the People's Revolutionary Party Prime Minister's Office (Secretariat) and 4 representing other parties I (as of elections in June 1992) _T Cabinet (19 Members), Prime Minister, Chairman; Vice Prime Minister, First Vice Chairman; Standing Committees (each Chairman of the NationaL Development Agency, Member of Parliament can be Vice Chairman. Cabinet members appointed by on three committees) the Prime Minister and confirmed by ParLiament Ministers of: 2 Law | Population and Social Policy Government Administration 2 Econominics Finance I | ~~~Parliamentary Rules II Budget | _ and Regulations Law I -Trade and Industry Education, E a Foreign Relations Science and Culture Bureau of Parliamentary Agriculture and Food Admninistration (headed by Secretary GeneraL of Energy Parliament and appointed by ParLiament) Geology and Mineral Resources Communications and Transport Construction and Urban Development Environmental Protection and Control Labor and Population Policy Science and Education Culture Health Defense Source: Seth Spaulding, "The Education System of Mongolia," January 1993, p. 46. - 85 - ANNEX 6.2 THE STRUCTuRE OF THE M Y OF SCIENCE AND EDUCATION OF MONGOLIA DMINISTER OF SCIENCE AND EDUCATION (Cabinet post)l |EXECUTIVE MINISTER] ACEDITATION AND I THL PROFESSIOPAL LICENDPRMN , ~~~BUREAU DIRECTOR, Service Bureau: _ADMINISTRATIVE -Ministry Secretariat, DEPARTMENT finance, supplies s EDUCATION RESEARCH IcSTITUTEt Apoinistrative oversighte teaching policy, execution of education o aws MONGOLIAN SCRIPT TRAIsING I I~~~~~~~~~~~~~CENTER DIRECTOR GENERAL, SCIENCE AND A TECHNOLOGY POLICY DEPARTMENT UNIVERSITIES *Mongolian State National l ~~~~~~~~~~~~~University Deputy Director and 11 officers: science Technical University policy- oversight of technotogical_* Pedagogical University projects; university science development; P -edical University development and supervision of science SHAgricultural University doctora1 programs INDEPENDENT POST-SECONDARY DIRECTOR GENERAL, HIGHER, VOCATION AL COLLEGES PAD TECHOICAL EDUCATION DEPARTMENT (12 as of November 1992) Deputy Director and 7 officers: post- secondary policies, curriculy;, management POST-SECONDARY SPECIALIZED and structure, and student policies SCHOOLS (11 as of November 1991, mostly in provinces) [DIRCTO GEERAL, GENERAL AND PRESCHOOL EDUCATION DEPARTMENT VOCATIONAL CHOOLS _(35 post-secondary s ~~~~~~~~~~~~~Industrial Training eputy rector and 8 officers: general Centers) and preschooL education poLicy; curricuLum, nonformaL education and rural education policies| DIRECTOR, FINANCE AND SUPPLY DEPARTMENT| 18 officers: finance and accounting; capital| |resources; salary policies; statistical Iinformation HEAD, EXTERNAL RELATIONS AND COOPERATION BUREAU 6 officers: external relations and contracts; oversight of cooperative international efforts Source: Seth Spaulding, "The Education System of Mongolia," January 1993, p. 41. - 86 - ANNEX 6.3 THE EDUCATION LAW Part II The Purpose of the Education Law Section 1 The purpose of the Education Law of Mongolia is to provide the people the right to learn. Section 2 The Education Law 1. The Education Law is part of the constitution of Mongolia and the other laws of Mongolia. 2. The Education Law will be consistent with international agreements made by Mongolia. Section 3 The Main Principle of Education 1. Education should be oriented toward humanity and democracy, and should be founded on scientific and cultural tradition. 2. Mongolia will adopt the following principles in pursuing its education policy: (1) Education will be under Government supervision and control. (2) The Government will not discriminate against any citizens who want to learn. (3) The Government will provide basic education for all citizens. (4) The Government will provide free elementary, junior secondary, and secondary education. (5) The Government will provide alternative and open education. (6) The Government will guarantee the right to learn the Mongolian language. Section 4 The Rights and Responsibilities of the Citizens in Learning 1. All citizens have the right to learn in schools, with pay or free, and to pursue professional and science degrees. - 87 - ANNEX 6.3 2. By the age of 17 years, all citizens should have secondary education. Section 5 The Structure of Education The educational system consists of early childhood education, basic education, secondary education, and professional education. Section 6 Educational Methods 1 . Citizens can have an education through formal or nonformal channels. 2. Organizations and citizens can provide formal and nonformal education. 3. The Government will regulate formal education, but not nonformal education. Section 7 Education Credentials 1. Scientific and teaching organizations will issue certificates to people who have a certain level of education. 2. The Ministry of Science and Education will provide guidelines of providing educational credentials. Part II The Educational Organization Section 8 The Educational Organization 1. Educational organizations include scientific and pedagogical organizations, which provide education by formal or nonformal means. 2. The early childhood education organizations, primary, secondary, and professional schools are part of the formal education system. 3. The responsibility of the scientific and pedagogical organizations is to define the scientific basis of teaching and development. Section 9 The Early Childhood Education Organization Nurseries will take care of children at the age of 3. The kindergarten will teach 3- to 8-year-old children. -88- ANNEX 6.3 Section 10 Secondary School The secondary school will organize teaching. Part III Section 13 Educational Management 1 . The state policy on education is determined by a supreme organ of the state and implemented by the Government. 2. Central and local state organizations of education are responsible for educational matters. The Government determines the authority of educational boards. Section 14 Professional Control of Education The Government approves the authority of the board for professional control. Section 15 Administration of Educational Organizations 1. Headmasters (principals) who are appointed by a central organization of education or its authorized boards manage public schools and other educational institutions. 2. The central organization of education approves the authority of educational boards. 3. An advisory council, which consists of educational officials and representatives of public organizations, can be set up to assist educational institutions. The central organization of education approves the authority of the advisory council. Part V Section 21 Duties and Rights of Participants in the Education System Teachers have the following rights: 1. To be provided with the opportunity to teach. 2. To select scientific training methodology. 3. To consult with the parents concerning questions of study and students. - 89 - ANNEX 6.3 4. To assess the knowledge and abilities of students. 5. To select students and organize individual training, and to conduct research work. Section 22 The Teacher's Duties 1. To respect authority and to provide an example of moral conduct. 2. To combine adequate training with practical life and production experiences. 3. To continue to improve their skills and knowledge. 4. To carry out teaching responsibilities. 5. To have pedagogical knowledge. Section 27 Duties of Public Organizations Public organizations have the following duties: 1. According to the agreement, they must pay tuition fee of students. 2. To assist employees' children to study. 3. The central organization of education will decide whether or not to set up educational institutions in foreign countries. 4. The central organization of education will decide whether or not to allow foreign education institutions to operate in Mongolia. Section 28 To Register Educational Institutions and to Stop Their Activities 1. The central organization of education shall register new institutions on the state list. 2. The central organization of education has the powers to stop the activities of education institutions if they do not satisfy the requirements. - 90 - ANNEX 6.4 THE EDUCATION BUDGET PROCESS, 1992 1. The education budget is a consolidation of central and local (city and aimag) governments' budgets. Local governments are expected to make up their own budgets based on their own revenues and estimated expenditures. The central government subsidizes the shortfalls in local budgets. 2. Budgetary planning for the next-year budget, which is the same as the calendar year, begins in August every year. The education departments of aimag and city governments estimate the number of students to be enrolled in primary, secondary, and vocational education in the coming year, and the financial requirement to provide services. At the same time, universities and other institutions of higher learning, also prepare their budgets for submission to the government. The local budget bureau then consolidate the local budgets and submit them to the Ministry of Finance (MOF). 3. MOF uses a formula based on student-to-teacher ratios and per student cost for various levels of education for allocation decisions. For example, the student-to- teacher ratios are 25:1 to 27:1 at the primary level, 16:1 to 18:1 at the secondary level, 15: 1 in vocational schools, 14:1 in colleges, and 6:1 to 8:1 in universities and other higher education institutions. The cost per student varies, depending on localities and types of schools. In boarding schools, it can be 50 percent higher than the unit cost in city schools. MOF decides the amount of subsidies, that is the expenditures that cannot be covered by local revenues. It also prepares the central government's education budget that includes stipends for students studying abroad, domestic travel, examination, and teacher retraining. It then consolidates the education budget and submits it to the Cabinet for approval. - 91 - ANNEX 7.1 PROJECTS FUNDED BY DONOR AGENCIES Projects Donor Status Amount in $ Production of Textbooks Danida Grant Aid in providing paper Structure and content of Danida Funded 3 years from $1.7 million secondary education September 1992 Gobi women's education UNESCO Seven years from September $1.9 miLLion 1992 CLassical script Grade 1 Private Japanese Printed aLL Grade 1 textbook Publisher in Mongolian language books Japan CattLe breeders' education UNESCO, World Partially funded from 1991 $70,000 (needed Church Council for 3 years additional S96,000) Improvement of planning, USIA, ADB, invite USIA provided traveL money First phase: $1.5- management, finance, and other donors to US academics; ADB 1.9 million administration of higher financed sector studied in education 1993 Source: Higher Education Reform for a Democratic Society and a Market Economy, 1992. Higher Education Reform Commission. - 92 - ANNEX 7.2 MOSE's PLAN FOR FOREIGN FUNDING Proposed projects Status Development and production of teaching Request submitted to Japan for printing materials and textbooks for primary, equipment and paper secondary, and higher education. Improvement on technical education and Request submitted to ItaLian goverrnent for research in Technical University. Laboratory equipment Improvement of science education and research Request for laboratory equipment submitted to at Mongolian National University, AgricuLturaL Turkey University, Medical University, and Pedagogical University. Improvement of foreign Language education at the Mongolian Nationat University and Pedago- gical University. Local production of teaching materials and supplies (workbooks, pencils, ink, chalk, paints). Source: Higher Education Reform for a Democratic Society and a Market Economy, 1992. Higher Education Reform Commission IB8O 25509 RUSSIAN FEDERATION r - ~~~~~~~~~~~~~~ISOVSGOL ; J t~~~~~~~~~~~~W4 8AYN-lGY BAAN tG B ULGAN JOeN CHINA - + n *,i% b,. ,D VVd.4..A '1 I rARI IANGAY ULA N AT HENTIY HOVD \ T 6DONO M0N25,09IMA 1/J 4SUKBATAR/ CHINA r / GOHI-At TAY / VORHANGAYf DUNDGOHI\ _ \> H~~~~~~~~~~~AYANI iONGOR - a g ~~~~~~~~~~~~~~~DORNOGOBI V ( l f ~~~~MONGOLIA \ ~~~~~~~~OMNO5GOBI1J &6 @ moo d0 of PfM o_ @s pod of rN svoulz aUAs /~~~~~~~~~~~~la-Ans 050 00 7 wnd -Famem zY OVzo of veX bovedo UilS O jO 100 150 200~~~~~~~~~~~~~~~~~~~,IS0 10 l ) MON25509.1MA 1/19/994 - 94 - REFERENCES Anderson, Kathryn H., Elizabeth King, and Yen Wang. "Feedback Effects of the Labor Market on Schooling Choice in Malaysia." Paper presented at the April 1993 meetings of the Population Association of America, Cincinnati, Ohio. Asian Development Bank. Technical Assistance to Mongolia for Human Resource Development and Education Reform. 1992. Coopers and Lybrand. 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Mongolian Higher Education Reform Commission. "Higher Education Reform for a Democratic Society and a Market Economy." 1992. Mongolian Ministry of Science and Education. "Draft Project on Getting Assistance in the Field of Education." 1992. "The Inspectorate Board's Request for World Bank Funding." November 1992. - 95 - Noss, Andrew. "Education and Adjustment: A Review of the Literature." Policy Research Working Paper No. 701. Washington, D.C.: The World Bank, 1991. Psacharopoulos, George. "Return to Investment in Education: A Global Update." Policy Research Working Paper No. 1067. Washington, D.C.: The World Bank. 1993. Schwartz, Antoine and Gail Stevenson. "Public Expenditure Reviews for Education: The Banks' Experience." Policy Research Working Paper No. 510. Washington, D.C.: The World Bank, 1990. Spaulding, Seth. "The Education System of Mongolia." Fourth Edition, January 1993. Verspoor, Adriaan and Kin Bing Wu. "Textbook and Educational Development." World Bank Population and Human Resources Department, Education and Employment Division, PHREE/90/31. Washington, D.C. 1990. World Bank. Mongolia: Toward A Market Economy. World Bank Country Study, Washington, D.C. 1992. Developing The Private Sector and Rationalizing Public Expenditures. China and Mongolia Department, Country Operations Division. 1992. World Development Report. New York: Oxford University Press. 1992. Vocational and Technical Education and Training. A World Bank Policy Paper. Washington, D.C. 1991. - Primary Education. A World Bank Policy Paper. Washington, D.C. 1990. Education in Sub-Saharan Africa: Policies for Adjustment, Revitalization, and Expansion. A World Bank Policy Study. Washington, D.C. 1988. UNESCO. World Education Report 1993. Paris. 1993. Yusuf, Shahid, and Shahid Javed Burki. Developing Mongolia. World Bank Discussion Papers No. 145. 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