The World Bank Rwanda Priority Skills for Growth Additional Financing (P172735) Program Information Documents (PID) Appraisal Stage | Date Prepared/Updated: 24-Feb-2020 | Report No: PIDA212829 Jan 27, 2020 Page 1 of 9 The World Bank Rwanda Priority Skills for Growth Additional Financing (P172735) BASIC INFORMATION OPS_TABLE_BASIC_DATA A. Basic Program Data Country Project ID Program Name Parent Project ID (if any) Rwanda P172735 Rwanda Priority Skills for P252350 Growth Additional Financing Region Estimated Appraisal Date Estimated Board Date Practice Area (Lead) AFRICA 09-Mar-2020 30-Apr-2020 Education Financing Instrument Borrower(s) Implementing Agency Program-for-Results Financing Ministry of Finance and Ministry Of Education Economic Planning Program Development Objective(s) The Program Development Objective is to expand opportunities for the acquisition of quality, market-relevant skills in selected economic sectors. The selected economic sectors include Energy, Transport and Logistics, and Manufacturing (with a focus on ‘Made in Rwanda’ products such as construction materials, light manufacturing and agro-processing). Building skills to advance the country’s economic agenda is a key priority of the GoR’s ongoing Economic Development and Poverty Reduction Strategy-2 (EDPRS 2) launched in 2013. EDPRS 2 builds on the country’s Vision 2020 which seeks to transform the country by raising its per capita GDP to middle-incomelevel by 2020. The Program is grounded in the Government of Rwanda’s (GoR) National Employment Programs (NEP) approved by Cabinet in 2014. NEP was designed to address the employment challenges in Rwanda and equip its population with the skills required to supporteconomic development. The main results areas of the operation are: (i) reinforcing governance of the skills development system; (ii) ensuring provision of quality training programs with market relevance; (iii) expanding opportunities for continuous upgrading ofjob-relevant skills for sustained employability; and (iv) capacity building for implementation. The Program will disburse against achievement of specific Disbursement Linked Results (DLRs) in these results areas COST & FINANCING SUMMARY (USD Millions) Government program Cost 100.00 Total Operation Cost 100.00 Total Program Cost 100.00 Total Financing 100.00 Jan 27, 2020 Page 2 of 9 The World Bank Rwanda Priority Skills for Growth Additional Financing (P172735) Financing Gap 0.00 FINANCING (USD Millions) Total World Bank Group Financing 100.00 World Bank Lending 100.00 B. Introduction and Context Country Context 1. The future of Rwanda’s growth will be strongly influenced by the skills available for productive use. Rwanda aspires to reach upper-middle income status by 2035-an ambitious goal that will require substantial investments in human capital to dramatically improve knowledge and skills of the population. The Government is committed to investing in workforce skills across the education and training system. Among other objectives, Rwanda’s National Strategy for Transformation (NST 2018–2024 ) focuses on the need for human capital development and includes a target to increase the proportion of students pursuing TVET from 31.1 percent in 2017 to 60 percent by 2024, and the need to make TVET training relevant to labour market needs. Sectoral and Institutional Context 2. Rwanda’s skills base is considered a constraint to growth. Ongoing efforts to strengthen the skills development have been constrained by several factors. First, opportunities to grow skills through employment are limited because more than 90 percent of enterprises in Rwanda operate in the informal sector where there is little support for upskilling. Second, about 14 percent of the workforce in Rwanda is unemployed and not actively building relevant and/or market relevant skills. Among the unemployed, youth between 16 to 30 years of age are disproportionately represented in that they account for a third of the unemployed while making up about 27 percent of the country’s population. Third, about 60 percent of the employed are in agriculture, retail and construction, where incomes and skill requirements are relatively low. 3. These challenges point to the need for skills development and employment promotion strategies that can: (a) support skills upgrading in the informal sector to improve enterprise productivity and worker mobility; (b) enable job seekers, notably youth, to acquire the higher level skills demanded by the formal sector where better paying jobs can be found; and (c) support the growth of non-traditional economic sectors by ensuring that employers in these sectors have an adequate supply of workers with the required skills. These strategies underpin the NEP and will continue to be a major focus of the follow-on NSDEPS. Jan 27, 2020 Page 3 of 9 The World Bank Rwanda Priority Skills for Growth Additional Financing (P172735) PforR Program Scope 4. The proposed AF will support the NSDEPS through the second phase of the PSG PforR and result in the following changes. The Project Development Objective (PDO) and Results Areas (RAs) are unchanged, given that the original conceptual framework remains valid. Design of the AF is informed by parent Program implementation experience, NEP evaluation findings, and evidence on good practices in skills development. The AF will result in the following key changes: (i) increased funding to the PSG PforR from US$120 million to US$220 million and extension of the closing date for disbursement of the additional IDA funds; (ii) changes in PDO indicators including notably, the introduction of a new indicator on the quality and market relevance of Technical Vocational Educational Training (TVET) and higher education programs; (iii) scaling up of Disbursement Linked Indicators (DLIs) (DLIs 3, 4, 5, and 6); (iv) introduction of three new DLIs 7, 8 and 9; (v) revised Results Framework (RF) and Program beneficiaries; (vi) introduction of new actions in the Program Action Plan (PAP); and (viii) addendums to the original technical, fiduciary and safeguard. Table 1 is a summary of the proposed DLI matrix. Table 1: Summary DLI Matrix for the AF DLI DLRs AF Amount (US$ million) DLI 3: Number of DLR 1: Achievement of targeted number of programs in period 1 1.47 accredited new or updated programs DLR 2: Achievement of targeted number of programs in period 2 1.47 taught by staff participating in industry DLR 3: Achievement of targeted number of programs in period 3 1.18 attachments in Energy, T&L, and DLR 4: Achievement of targeted number of programs in period 4 0.88 Agroprocessing sectors DLI 4: Number of DLR 1: SDF operational manual revised to reflect changes in program 2.0 graduates of SDF- design under each window and training targets supported programs by window DLR 2: Achievement of graduate targets by window in period 2 5.0 DLR 3: Achievement of graduate targets by window in period 3 5.0 DLR 4: Achievement of graduate targets by window in period 4 3.0 DLI 5: Improved DLR 1: New experts’ pool in BRD staffed up in period 2 to: (i) operate 3.0 sustainability of the new student loan administration system; and (ii) track the financing for long term employment of graduates who benefited from student loans training programs as measured by student DLR 2: Percentage point improvement from baseline in loan recovery 5.0 (0.625 for loan recovery rate every 1.0% increase) DLI 6: Capacity building DLR 1: Three-year program implementation plan developed by 1.0 for targeted entities in MINEDUC specified areas Jan 27, 2020 Page 4 of 9 The World Bank Rwanda Priority Skills for Growth Additional Financing (P172735) DLI DLRs AF Amount (US$ million) DLR 2: MOU/contracts signed by UR, WDA, RDC-CSO and RP with 1.5 (0.2 for each relevant partner institutions/firms for technical support in specified signed areas MOU/contract) DLR 3: Completion of progress milestones in capacity building plans in 5.5 period 3 DLR 4: Completion of progress milestones in capacity building plans in 2.0 period 4 DLI 7: Strengthened DLR 1: Triple Helix Model (THM) and operations manual developed 1.0 NSDEPS implementation, M&E, DLR 2: Expert group in RDB-CSO set up to support and monitor cross- 1.0 reporting ministerial NSDEPS implementation DLR 3: Phase 1 of the LMIS upgraded, operationalized and used 3.0 DLR 4: THM pilot implemented & evaluated 2.0 DLR 5: Mid-term progress reporting format to capture relevant data 0.5 on NSDEPS implementation developed DLR 4: NSDEPS mid-term progress report published on LMIS portal 0.5 DLI 8: Students enrolled DLR 1: Period 1 TVET & Degree program enrollments 2.0 (0.47 per 100 in new/updated students) programs in Energy, T&L, and DLR 2: Period 2 TVET & Degree program enrollments 3.0 (1.0 per 100 Agroprocessing students) DLR 3: Period 3 TVET & Degree program enrollments 3.0 (1.0 per 100 students) DLR 4: Period 4 TVET & Degree program enrollments 2.0 (1.0 per 100 students) DLI 9: Upgrading of DLR 1: Contracts signed by UR and RP with technical support firm(s) on 10.0 teaching-learning facilities upgrading environment (staffing and facilities) DLR 2: Costed staffing and faculty pipeline development plans 2.0 ( 1.00 million developed by UR and RP per plan ) DLR 3: Number of full-time Equivalent positions filled at RP and UR as 5.0 (0.01 million per the staffing plan. per FTE position) DLR 4: Number of existing/ pipeline faculty enrolled in Bachelors, 5.0 (0.01 million Masters and PhD programs as per the staffing plan. per enrollment ) DLR 4: Number of SMART classrooms and labs installed in UR; number 10.0 (1.0 per of SMART classrooms and workshops installed in RP installed facility) DLR 5: Number of new/updated programs in Energy, T&L, and 12.0 (1.0 per Agroprocessing that being taught by instructors who use SMART program) classrooms ; new methodologies for pedagogical and ICT-enabled continuous student assessment. Total 100.0 Jan 27, 2020 Page 5 of 9 The World Bank Rwanda Priority Skills for Growth Additional Financing (P172735) C. Program Development Objective(s) Program Development Objective(s) 5. The Project Development Objective (PDO) and Results Areas (RAs) are unchanged, given that the original conceptual framework remains valid. The PDO is to expand opportunities for the acquisition of quality, market-relevant skills in selected economic sectors. The selected economic sectors include Energy, Transport and Logistics, and Manufacturing (with a focus on ‘Made in Rwanda’ products such as construction materials, light manufacturing and agro-processing). Table 2 is the revised PDO indicators and targets. 6. The main results areas of the operation are: (i) reinforcing governance of the skills development system; (ii) ensuring provision of quality training programs with market relevance; (iii) expanding opportunities for continuous upgrading ofjob-relevant skills for sustained employability; and (iv) capacity building for implementation. 7. The Program will disburse against achievement of specific Disbursement Linked Results (DLRs) in these results areas Table 2: Revised PDO Indicators and Targets Result Area PDO Indicator AF End Target Baseline (September 2023) Ensure provision of quality training No change. New or updated programs accredited 13 46 programs with market relevance for occupations in at least one of the selected economic sectors. New. Share of TVET and degree graduates in 20 60 % occupations related to Energy, T&L, and Agro- (% female) processing sectors employed or self-employed 12 months after graduation. Expanding opportunities for No change. Percentage of SDF supported trainees 0 64 Continuous upgrading of job- employed/self-employed six months after (% female:34) relevant skills for sustained graduation (% of female graduates). employability. Revised. Improved sustainability of financing for 27% 31 % long-term training programs as measured by student loan recovery. Target is revised from 11% increase to 15% increase from baseline to reach 31% by end of AF period. Capacity Building for Revised. Capacity building for targeted entities in No Yes, completion of Implementation 5 areas, each with progress milestones, is mandatory milestones and completed. progress milestones in the Capacity building for targeted entities is scaled up specified capacity building from 5 areas to 7 areas of specified areas. areas Mandatory milestones are introduced in addition to progress milestones for each of the specified areas. Jan 27, 2020 Page 6 of 9 The World Bank Rwanda Priority Skills for Growth Additional Financing (P172735) D. Environmental and Social Effects 8. The environment and social aspects of the parent Program will not change under the AF either in scope or scale. The main justification for PSG AF is scaling up and the proposed AF will build on the parent program to consolidate gain under Phase I and scale up successful interventions. Therefore, the original Environment and Social Systems Assessment (ESSA) remains valid and applicable to the AF. Among the new implementing entities und the AF include Rwanda Development Board (RDB), which participated in the implementation of the original program and was assessed while preparing the ESSA. The ESSA for example identified RDB among government institutions with already significant capacity to manage environment and social risks appropriately. The existing RDB’s system for screening is quite robust, even at the county level. If an ESIA is required, proponents must by law contract a certified firm to conduct an ESIA study, which is then reviewed and cleared by RDB. The second new implementing agency is Rwanda Polytechnic (RP) which has prior experience working with bank. Program designs and screening processes have excluded actions/activities that would have significant adverse impacts that are sensitive, diverse or unprecedented on the environment and/or affected people. 9. As the AF does not change the priority areas of the approved parent program, there are no new significant environmental and social issues identified for this AF. However, there are several measures focused on capacity building and improving systems to manage the environmental and social aspects of that need to be strengthened in the Program Action Plan. They include: (a) WDA to conduct an OHS audit of all benefiting SDF institutions and come up with approportionate mitigation measures by July 2020; (b) Establish a consolidated GRM under SDF beneficiating institutions and under BRD loan scheme and regularly report on of the GRM by June 2020; (c)Training in OHS and grievance redress mechanism for all SDF beneficiaries of all cohorts by June, 2020; (d) The UR/RP targeted departments to develop customized laboratory operations and safety manuals and moving machines in the laboratories that requires also proper OHS measures to be in place and proportionate laboratory waste disposal mechanism by July 2020; and to develop a harmonized and effective communications strategy related to the available training programs that benefit both girls and boys for the UR/RP to increase the awareness levels for equal participation in the intended training programs by November, 2020. 10. Communities and individuals who believe that they are adversely affected as a result of a Bank supported PforR operation, as defined by the applicable policy and procedures, may submit complaints to the existing program grievance redress mechanism or the WB’s Grievance Redress Service (GRS). The GRS ensures that complaints received are promptly reviewed in order to address pertinent concerns. Affected communities and individuals may submit their complaint to the WB’s independent Inspection Panel which determines whether harm occurred, or could occur, as a result of WB non-compliance with its policies and procedures. Complaints may be submitted at any time after concerns have been brought directly to the World Bank's attention, and Bank Management has been given an opportunity to respond. For information on how to submit complaints to the World Bank’s corporate Grievance Redress Service (GRS), please visit http://www.worldbank.org/GRS. For information on how to submit complaints to the World Bank Inspection Panel, please visit www.inspectionpanel.org. E. Financing 11. The effectiveness of funds flow arrangements from the government treasury in MINECOFIN to the implementing agencies is considered satisfactory. Tables 3 shows the preliminary Program financing. Jan 27, 2020 Page 7 of 9 The World Bank Rwanda Priority Skills for Growth Additional Financing (P172735) Table 3: Preliminary Program Financing Financing Source Original Program AF Program Total US$ millions US$ millions US$ millions BORROWER/RECIPIENT 843 143.7 986.7 IBRD/IDA 120 100.0 220.0 OTHER(DPs TBC) 190 116.0 306.0 TOTAL 1,153 359.7 1,512.7 . CONTACT POINT World Bank Name : Ruth Karimi Charo Designation : Senior Education Specialist Role : Team Leader(ADM Responsible) Telephone No : 5327+6099 / Email : rcharo@worldbank.org Borrower/Client/Recipient Ministry of Finance and Economic Borrower : Planning Contact : Antonia Mutoro Title : Director General Telephone No : 250788301163 Email : directorgeneral@cesb.gov.rw Implementing Agencies Implementing Ministry Of Education Agency : Contact : Samuel Mulindwa Title : Permanent Secretary Telephone No : 250788387575 Email : smulindwa@mineduc.gov.rw Jan 27, 2020 Page 8 of 9 The World Bank Rwanda Priority Skills for Growth Additional Financing (P172735) FOR MORE INFORMATION CONTACT The World Bank 1818 H Street, NW Washington, D.C. 20433 Telephone: (202) 473-1000 Web: http://www.worldbank.org/projects Jan 27, 2020 Page 9 of 9