The World Bank Bangladesh - Primary Education Development Program III (P113435) 5790593.78 REPORT NO.: RES30642 RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF BANGLADESH - PRIMARY EDUCATION DEVELOPMENT PROGRAM III APPROVED ON AUGUST 25, 2011 TO PEOPLE’S REPUBLIC OF BANGLADESH EDUCATION SOUTH ASIA Regional Vice President: Annette Dixon Country Director: Qimiao Fan Senior Global Practice Director: Jaime Saavedra Chanduvi Practice Manager/Manager: Keiko Miwa Task Team Leader: Saurav Dev Bhatta, Syed Rashed Al-Zayed The World Bank Bangladesh - Primary Education Development Program III (P113435) ABBREVIATIONS AND ACRONYMS DPE Directorate of Primary Education EoP End of Project ERD Economic Relations Division GoB Government of Bangladesh IA Implementing Agency IDA International Development Association PDO Project Development Objective LC Learning Center MoPME Ministry of Primary and Mass Education PDO Project Development Objective ROSC Reaching Out-of-School Children SA Specialized Agency SDR Special Drawing Right TP Training Provider WB World Bank The World Bank Bangladesh - Primary Education Development Program III (P113435) Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. BASIC DATA Product Information Project ID Financing Instrument P113435 Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Partial Assessment (B) Approval Date Current Closing Date 25-Aug-2011 31-Dec-2017 Organizations Borrower Responsible Agency Ministry of Finance Ministry of Primary and Mass Education Project Development Objective (PDO) Original PDO Project Development objectives are to (i) increase participation and reduce social disparities in primary education, (ii) increase the number of children completing primary education and improve the quality of the learning environment and measurement of student learning, and (iii) improve effectiveness of resource use for primary education. OPS_TABLE_PDO_CURRENTPDO Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-55520 16-Dec-2014 25-Jan-2015 01-Mar-2015 31-Dec-2017 400.00 219.08 155.37 IDA-49990 25-Aug-2011 13-Oct-2011 07-Dec-2011 31-Dec-2017 299.74 269.60 8.21 TF-A0977 28-Dec-2015 05-Jan-2016 05-Jan-2016 31-Dec-2017 100.00 57.50 42.50 The World Bank Bangladesh - Primary Education Development Program III (P113435) Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No Note to Task Teams: End of system generated content, document is editable from here. I. PROJECT STATUS AND RATIONALE FOR RESTRUCTURING A. Project Status Context: The Government of Bangladesh (GoB) with support from nine Development Partners(DPs) has been implementing the Third Primary Education Development Program (PEDP 3) since 2012, with IDA Credit financing of US$700 Million ($300 million for the original project and $400 million for the Additional Financing (AF)). PEDP3 has been an important and successful initiative to achieve GoB’s commitment to provide access to quality education for all primary school age children by bringing them into school, improving the quality of learning and ensuring the completion of primary cycle. The Project Development Objectives(PDO) of PEDP3 are to (i) increase participation and reduce social disparities in primary education, (ii) increase the number of children completing primary education and improve the quality of the learning environment and measurement of student learning, and (iii) improve effectiveness of resource use for primary education. PDO status: Progress towards the achievement of the PDO is currently rated Satisfactory.  The end of project (EOP) targets for six of the seven project key performance indicators (KPIs) – primary enrollment rate, cycle completion rate, decreased disparity in access, learning assessment system, utility of learning assessment, competency based Grade 5 exam, decentralized planning through SLIPs – have been met.  As of May 2017, all 7 intermediate output indicators have either met their EOP targets or are on track for achieving them by the end of the project period. The Implementation Progress (IP) of PEDP 3 is currently rated Moderately Satisfactory. B. Rationale for restructuring and extension: The project has achieved 54 out of 59 DLI targets and expects to meet 2 more DLI targets by the end of project period. In spite of these achievements, the recipient has informed IDA through a letter dated 18 December, 2017 that two targets for DLI 3 (Grade 5 Primary Education Completion Exam (PECE) strengthened-- years 5 and 6) and the year 3 target for DLI 4 (teacher recruitment and deployment) will remain unmet. All targets related to DLI3 were achieved until year 4, when the government took a political decision to implement grade 5 exams in a manner that did not conform with the action plan agreed as part of the DLI framework. In the case of DLI 4, while the year 3 target relating to teacher recruitment was achieved, the target The World Bank Bangladesh - Primary Education Development Program III (P113435) related to the approval of the career path, recruitment and promotion rules could not be achieved due to the involvement of stakeholders beyond the control of the executing agency. Hence, funds associated with the unmet DLI targets are proposed to be cancelled. Accordingly, funds will be cancelled from category ‘e’ of schedule 2 of the Credit Number 4999-BD for PEDP by amending Section II definition 7 in the Appendix of the Additional Financing Agreement. Similarly, funds will be cancelled from category 1 of schedule 2, Section IV A (2) of the Additional Financing for PEDP (5552-BD) by amending the Additional Financing Agreement. In the case of the Global Partnership Education (GPE) Trust Fund, cancellation will only involve DLI 3 (unmet targets for year 5 and year 6). II. DESCRIPTION OF PROPOSED CHANGES This restructuring paper seeks authorization for two changes in the design of Third Primary Education Development Program. These are: (i) cancellation of IDA funds amounting to SDR 5,790,593.78 from IDA 4999 and 22,483,333.33 from IDA 5552. Cancellation of funds from the Global Partnership Education Trust Fund amounting to USD 8,333,333.34 that are associated with targets for DLI 3 (years 5 and 6); and (ii) revision of the withdrawal schedule, definitions and other schedule as appropriate to reflect this proposed cancellation. The project closing date, component costs and results framework will remain unchanged. Additional Financing Credit Number 5552-BD and Amendment Credit Number 4999-BD will change as follows: - Category ‘1e’ of schedule 2 of the Amendment Credit Number 4999-BD will be reduced by SDR 5,790,593.78 for not meeting Year 3 of DLI 4 - Category 1 of schedule 2, Section IV A (2) of the Additional Financing Credit Number 5552-BD will be reduced by SDR 22,483,333.33 - Targets for Years 5 and 6 for DLI 3 in Schedule 5 ‘DLI Values’ will be reduced to zero. - DLI 4 Year 3 target in Schedule 5 ‘DLI Values’ will be reduced to zero. Grant Agreement TF 0A0977-BD will change as follows: - Targets for Years 5 and 6 for DLI 3 in Schedule 5 ‘DLI Values’ will be reduced to zero. - Category 1 of schedule 2, Section IV A (2) of the grant agreement will be reduced by USD 8,333,333.34 Note to Task Teams: The following sections are system generated and can only be edited online in the Portal. The World Bank Bangladesh - Primary Education Development Program III (P113435) III. SUMMARY OF CHANGES Changed Not Changed Cancellations Proposed ✔ Reallocation between Disbursement Categories ✔ Other Change(s) ✔ Change in Implementing Agency ✔ Change in DDO Status ✔ Change in Project's Development Objectives ✔ Change in Results Framework ✔ Change in Components and Cost ✔ Change in Loan Closing Date(s) ✔ Change in Disbursements Arrangements ✔ Change in Disbursement Estimates ✔ Change in Overall Risk Rating ✔ Change in Safeguard Policies Triggered ✔ Change of EA category ✔ Change in Legal Covenants ✔ Change in Institutional Arrangements ✔ Change in Financial Management ✔ Change in Procurement ✔ Change in Implementation Schedule ✔ Change in Economic and Financial Analysis ✔ Change in Technical Analysis ✔ Change in Social Analysis ✔ Change in Environmental Analysis ✔ IV. DETAILED CHANGE(S) OPS_DETAILEDCHANGES_CANCELLATIONS_TABLE The World Bank Bangladesh - Primary Education Development Program III (P113435) CANCELLATIONS Value Reason Current Cancellation New Ln/Cr/Tf Status Currency Date of for Amount Amount Amount Cancellation Cancellation P4R DLI IDA-49990- Disburs 187,322,371.0 181,531,777.2 CONDITIONS XDR 5,790,593.76 22-Dec-2017 001 ing 0 4 NOT ACHIEVED P4R DLI IDA-55520- Disburs 269,800,000.0 247,316,666.6 CONDITIONS XDR 22,483,333.33 22-Dec-2017 001 ing 0 7 NOT ACHIEVED P4R DLI TF-A0977- Disburs 100,000,000.0 CONDITIONS USD 8,333,333.34 22-Dec-2017 91,666,666.66 001 ing 0 NOT ACHIEVED OPS_DETAILEDCHANGES_REALLOCATION _TABLE REALLOCATION BETWEEN DISBURSEMENT CATEGORIES Financing % Current Allocation Actuals + Committed Proposed Allocation (Type Total) Current Proposed IDA-49990-001 | Currency: XDR iLap Category Sequence No: 1A Current Expenditure Category: G,W,NCS,PE 1ST SCH DISB -DEC 7 2011 33,301,322.67 33,301,322.67 33,301,322.67 100.00 100.00 iLap Category Sequence No: 1B Current Expenditure Category: G,W,NCS,PE 2ND SCH DISB-JAN 31 2012 8,333,333.33 8,333,333.33 8,333,333.33 100.00 100.00 iLap Category Sequence No: 1C Current Expenditure Category: G,W,NCS,PE 3RD SCH DISB-JUL 31 2012 46,697,371.00 46,697,371.00 46,697,371.00 100.00 100.00 iLap Category Sequence No: 1D Current Expenditure Category: G,W,NCS,PE 4TH SCH DISB -JUL31 2013 46,888,162.36 46,896,201.63 46,896,201.63 100.00 100.00 The World Bank Bangladesh - Primary Education Development Program III (P113435) iLap Category Sequence No: 1E Current Expenditure Category: G,W,NCS,PE 5TH SCH DISB-JUL 31 2014 52,123,383.27 46,324,750.24 46,324,750.24 100.00 100.00 Total 187,343,572.63 181,552,978.87 181,552,978.87 IDA-55520-001 | Currency: XDR iLap Category Sequence No: 1 Current Expenditure Category: Eligible Expenses under Annual Plan 269,800,000.00 157,418,417.12 247,316,666.67 100.00 100.00 Total 269,800,000.00 157,418,417.12 247,316,666.67 TF-A0977-001 | Currency: USD iLap Category Sequence No: 1 Current Expenditure Category: Eligible Expenses under Annual Plan 100,000,000.00 57,500,000.00 91,666,666.66 100.00 100.00 Total 100,000,000.00 57,500,000.00 91,666,666.66 Note to Task Teams: End of system generated content, document is editable from here. The World Bank Bangladesh - Primary Education Development Program III (P113435) Annex 1.a: Revised Disbursement schedule under Credit Number IDA 4999-BD 1) The table under Section IV.A.2 of the Agreement is hereby amended to read as follows: Percentage of Expenditures to be Amount of the Original Financed Financing Allocated (expressed in SDR) (inclusive of Taxes) Category (1) ICB Goods, Works and Non- - - Consulting Services, and Project Eligible Expenditures for: (a) First scheduled disbursement 33,301,323 100% (on or about the Effective Date) (b) Second scheduled disbursement 8,333,333 100% (on or about January 31, 2012) (c) Third scheduled disbursement 46,697,371 100% (on or about July 31, 2012) (d) Fourth scheduled disbursement 46,875,000 100% (on or about July 31, 2013) (e) Fifth scheduled disbursement 46,324,750 100% (on or about July 31, 2014) (f) Cancellation as on December 21, 5,790,594 2017 Cancellation as on Nov 11, 2014 177,629 TOTAL AMOUNT 187,500,000 The World Bank Bangladesh - Primary Education Development Program III (P113435) Annex 1.b: Revised Disbursement schedule under Credit Number IDA 5552-BD The table under Section IV.A.2 of the Agreement is hereby amended to read as follows: Percentage of Amount of the Expenditures to be Financing Allocated Financed Category (expressed in SDR) (inclusive of Taxes) (1) Project Eligible 247,316,667 100% Expenditures under Annual Plans Cancellation as on December 22,483,333 21, 2017 TOTAL AMOUNT 269,800,000 The World Bank Bangladesh - Primary Education Development Program III (P113435) Annex 1.c: Revised Disbursement schedule under TF 0A0977-BD The table under Section IV.A.2 of Schedule 2 to the Agreement is hereby amended to read as follows: Percentage of Expenditures to Amount of the Grant be Financed Allocated (expressed in (inclusive of Taxes) Category USD) (1) Project Eligible Expenditures under Annual 91,666,667 100% Plans Cancellation as on December 24, 2017 8,333,333 TOTAL AMOUNT 100,000,000