Document of The World Bank Report No: 65869 v1 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF EDUCATION FOR ALL FAST TRACK INITIATIVE CATALYTIC TRUST FUND (EFA-FTI) GRANT - 3 (TF095896) TO THE REPUBLIC OF TAJIKISTAN November 16, 2011 ABBREVIATIONS AND ACRONYMS CF Catalytic Fund CWs Civil Works DA Designated Account EMIS Education Management Information System FTI Fast Track Initiative MOE Ministry of Education MOF Ministry of Finance M&E Monitoring and Evaluation Regional Vice President: Philippe H. Le Houerou Regional Director: Motoo Konishi Sector Director: Ana Revenga Sector Manager: Alberto Rodriguez Task Team Leader: Saodat Bazarova 2 TAJIKISTAN FAST TRACK INITIATIVE CATALYTIC FUND GRANT - 3 P115343 CONTENTS Page A. SUMMARY ............................................................................................................... 4 B. PROJECT STATUS ................................................................................................. 4 C. PROPOSED CHANGES .......................................................................................... 4 3 FAST TRACK INITIATIVE CATALYTIC FUND GRANT - 3 RESTRUCTURING PAPER SUMMARY This Restructuring Paper seeks your approval to: 1. Reallocate proceeds of the Grant; 2. Increase the Designated Account authorized allocation from USD1.0 million to USD 1.5 million; and 3. Reduce the scope of work in component 3.3 by canceling one of the originally planned surveys but without changing the Results Framework. This is in response to the letter-request from the Ministry of Finance as of October 10, 2011. PROJECT STATUS The FTI Catalytic Fund third year allocation for Tajikistan (FTI-3) of USD13.5 million was approved in November 2009, signed in December 2009 and became effective in April 2010. The Closing Date is September 30, 2012. The two previous FTI allocations totaling USD18.4 million were successfully implemented during 2006-2010. The joint donor FTI-2 Implementation Completion Review and FTI-3 Progress Review conducted in December 2010 rated FTI Grants as satisfactory. The implementation of the FTI-3 is progressing well. Noteworthy progress includes: (i) the design for rehabilitation and construction of 30 schools (benefitting 13,000 students) has been completed and civil works are underway on 23 of them; (ii) reading materials for primary grades were procured and are being distributed to schools; (iii) the first round of the directors training on financial management (relevant to per capita financing) have been conducted, and the training monitoring and evaluation report is being prepared for the round table; (iv) the first round of the mentoring visits and program monitoring have been conducted, and reports are being prepared for the round table discussion; (v) the MOE conducted the Regional Conference on per capita financing in general education; (vi) all but one EMIS models are completed and installed at the districts level (September 2011 was the first time when school data were fully collected as per the EMIS); and (vii) the MOE has finalized the Draft National Strategy for Education Development (NSED), and work on the Action Plans is underway. The latest review of the financial management arrangements at MOE was conducted in June 2011. That review showed that the financial management arrangements were moderately satisfactory and overall acceptable to the Bank. The MOE submits quarterly IFRs on time and they are usually found to be satisfactory to the Bank. However, the 4 project audit for FY2010 remains outstanding. The selection of the audit firm was conducted by the State Investment Committee as part of the block audit arrangement for all WB-funded operations in the country. It is expected that the audit reports will be submitted to the Bank by mid-December 2011. PROPOSED CHANGES • Components This Restructuring Paper proposes to reduce the scope of sub- component 3.3 “Evaluation of Supply- and Demand-Side Schemes to Promote Enrollment and Attendance.� This sub-component was designed to support the development of a policy and program to ensure that all children complete basic education through: (a) monitoring and evaluation (M&E) of three initiatives to increase enrollment and attendance supported by different donors at the time of the FTI-3 preparation, and (b) carrying out a study on bussing, covering such issues as extent and location of needs, costs and benefits, sustainability and modalities of operation. At the Government’s request, the M&E of the three initiatives will no longer be financed under the FTI-3, per reasons listed below. This change will not affect respective indicators in the Project Results and Monitoring Framework. The reasons of the cancellation proposal are as follows: 1. The recent data show enrolment in basic education was high in 2009, and has been increasing since 2007. 85% of children complete basis education. 2. Two out of three initiatives which the Grant indented to monitor and evaluate have been stopped now for different reasons. 3. USAID has launched a regional School Dropout Prevention Pilot Program which would be an overlap with the Grant. The bussing study will still be carried out to inform MOE on the transportation policy in the remote areas to improve school attendance, especially in the winter period. • Financing o Disbursement arrangements. The MOF requests increasing the Designated Account’s authorized allocation from USD1.0 million to USD 2.0 million to accommodate the increased flow of funds due to the civil works. The Grant is expected to disburse around USD7.6 million to 30 contractors within nine months. Existing DA ceiling slows down the disbursement. At the advice of the Loan Department it was agreed that the DA ceiling should increase to USD1.5 million. If cleared, that will be reflected in the new Disbursement Letter. 5 o Reallocations. This Restructuring Paper also seeks your approval to reallocate Grant Proceeds as per the table below: Allocation in USD % of Financing Category of Expenditure Current Revised Current Revised 1) Goods, Training, 5,810,000 5,828,000 100% 100% Consultants’ Services and Incremental Operating Costs, including audit under the Project (2) Works under Part A of 7,300,000 7,672,000 100% 100% the Project (3) Unallocated 390,000 0 Total amount 13,500,000 13,500,000 The proposed reallocation of funds will allow covering the increased costs for construction works as part of school design improvement due to the world prices increase for construction materials and labor since the FTI-3 preparation. 6