Document of The World Bank

FOR OFFICIAL USE ONLY

Report No. 47453-NG

PROJECT APPRAISAL DOCUMENT

ON A

PROPOSED IDA CREDIT

IN THE AMOUNT OF SDR 63.6 MILLION (US$95 MILLION EQUIVALENT)

TO THE

FEDERAL REPUBLIC OF NIGERIA

FOR A

LAGOS EKO SECONDARY EDUCATION PROJECT

May 18, 2009

Human Development 3 Country Department AFCW2 Africa Region

This document has a restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization.

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CURRENCY EQUIVALENTS

(Exchange Rate Effective March 31, 2009)

Currency Unit = Naira N148 = US$1

US$1.495 = SDR 1

FISCAL YEAR January 1 – December 31

ABBREVIATIONS AND ACRONYMS

ASC Annual School Census

BES BPP

Basic Education Service Bureau of Public Procurement

CMD CPS CUBE CWIQ

Centre for Management Development Country Partnership Strategy Capacity Development for Universal Basic Education Core Welfare Indices Questionnaire

DFID DPAC DPL

UK Department for International Development District Project Advisory Committee Development Policy Lending

EA ECCD EFA EKO EMIS ESMF, ESMP EPDF ESP ESSPIN ETF

Environmental Assessment Early Child Care and Development Education for All Yoruba word meaning “education” Education Management Information System Environmental & Social Management Framework, ESM Plan Education Program Development Fund Education Sector Plan Education Sector Support Program in Nigeria Education Trust Fund

FCSC FCT FPM FTI

Federal Consultative Steering Committee Federal Capital Territory Financial Procedures Manual Fast-Track Initiative

GDP GER

Gross Domestic Product Gross Enrollment Ratio

HIV/AIDS Human Immunodeficiency Virus/Acquired Immune Deficiency Syndrome

IBRD ICT ICR IDA IFR

International Bank for Reconstruction & Development (The World Bank) Information and Communication Technology Implementation Completion Report International Development Association (The World Bank) Interim Financial Report

JSS JSSCE

Junior Secondary School (grades 7-10) JSS Certificate Examination

LASEEDS Lagos State Economic & Empowerment Development Strategy

iii

LASEPA LASGEMS LASTVEB LASU LEAP LCA LGA LGEA LMDGP LSG

Lagos State Environmental Protection Agency Lagos State Government Education Management System Lagos State Vocational Education Board Lagos State University Lagos Economic Advancement Program Local Council Area Local Government Area Local Government Education Area Lagos Metropolitan Development and Governance Project Lagos State Government

M&E MDGs MOE MOU MTEF MTESS

Monitoring & Evaluation Millennium Development Goals Ministry of Education Memorandum of Understanding Medium-Term Expenditure Framework Medium-Term Education Sector Strategy

N NECO NEEDS NERDC NESSC NLSS

Naira National Examinations Council National Economic Empowerment & Development Strategy Nigerian Educational Research & Development Council National Education Sector Steering Committee National Living Standards Survey

OP/BP Operational Policies/Bank Procedures (World Bank)

PEMFAR PEP2 PFMU PHRD PAC PIC PIM PO PPF PSU PTA, PTO

Public Expenditure Management and Financial Accountability Review Second Primary Education Project Project Financial Management Unit Population & Human Resource Development (Japanese grant) Project Advisory Committee Project Implementation Committee Project Implementation Manual Procurement Officer Project Preparation Facility Project Support Unit Parent-Teacher Association, Parent-Teacher Organization

SBMC SDG, SDGM SEEDS SEMIS SESP SMOE SOE SPAC SSS STEP-B SUBEB SY

School-Based Management Committee School Development Grant, SDG Manual State Economic Empowerment & Development Strategy School-level EMIS State Education Sector Project State Ministry of Education Statement of Expenditure State Project Advisory Committee Senior Secondary School (grades 10-12) Science & Technology Education in Post-Basic Education Project State Universal Basic Education Board School Year

TA TEPO TG/PS TPA TRC

Technical Assistance Teachers Establishment & Pensions Office Tutor-General/Permanent Secretary Ten Points Agenda Technical Review Committee

iv

TVET Technical-Vocational Education & Training

UBE, UBEC UNESCO UNICEF UNILAG

Universal Basic Education, UBE Commission United Nations Educational, Scientific & Cultural Organization United Nations Children's Fund University of Lagos

WAEC WASSCE

West Africa Examinations Council West Africa Senior Secondary Certificate Examination (the WAEC exam)

ZOPA Zonal Project Administrator

Vice President : Obiageli Katryn Ezekwesili Country Director : Onno Ruhl

Sector Director : Yaw Ansu Sector Manager : Lynne D. Sherburne-Benz

Task Team Leader : Marito H. Garcia

v

Federal Republic of Nigeria

Lagos Eko Secondary Education Project

TABLE OF CONTENTS

Page

I. STRATEGIC CONTEXT AND RATIONALE ............................................................................... 1

A. Country and sector issues.................................................................................................... 1

B. Rationale for Bank involvement ......................................................................................... 6

C. Higher level objectives to which the project contributes .................................................... 7

II. PROJECT DESCRIPTION .............................................................................................................. 7

A. Lending instrument ............................................................................................................. 7

B. Project development objective and key indicators .............................................................. 8

C. Project components ............................................................................................................. 8

D. Lessons learned and reflected in the project design .......................................................... 12

E. Alternatives considered and reasons for rejection ............................................................ 12

III. IMPLEMENTATION ................................................................................................................. 13

A. Partnership arrangements (if applicable) .......................................................................... 13

B. Institutional and implementation arrangements ................................................................ 14

C. Monitoring and evaluation of outcomes/results ................................................................ 16

D. Sustainability..................................................................................................................... 17

E. Critical risks and possible controversial aspects ............................................................... 18

F. Loan/credit conditions and covenants ............................................................................... 19

IV. APPRAISAL SUMMARY .......................................................................................................... 19

A. Economic and financial analyses ...................................................................................... 19

B. Technical ........................................................................................................................... 20

C. Fiduciary ........................................................................................................................... 21

D. Social................................................................................................................................. 24

E. Environment ...................................................................................................................... 25

F. Safeguard policies ............................................................................................................. 26

G. Policy Exceptions and Readiness...................................................................................... 26

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Annex 1: Country and Sector Background ................................................................................................. 27

Annex 2: Major Related Projects Financed by the Bank and/or other Agencies ....................................... 49

Annex 3: Results Framework and Monitoring ............................................................................................ 50

Annex 4: Detailed Project Description ....................................................................................................... 56

Annex 5: Project Costs ................................................................................................................................ 74

Annex 6: Implementation Arrangements .................................................................................................... 75

Annex 7: Financial Management and Disbursement Arrangements ........................................................... 82

Annex 8: Procurement Arrangements ......................................................................................................... 97

Annex 9: Economic and Financial Analysis ............................................................................................. 104

Annex 10: Safeguard Policy Issues ........................................................................................................... 112

Annex 11: Project Preparation and Supervision ....................................................................................... 114

Annex 12: Documents in the Project File ................................................................................................. 115

Annex 13: Statement of Loans and Credits .............................................................................................. 116

Annex 14: Country at a Glance ................................................................................................................. 118

Annex 15: DFID ESSPIN ........................................................................................................................ 120

MAP IBRD No. 36893 ............................................................................................................................. 121

NIGERIA LAGOS EKO SECONDARY EDUCATION PROJECT

PROJECT APPRAISAL DOCUMENT AFRICA AFTH3

Date: May 18, 2009 Team Leader: Marito H. Garcia Country Director: Onno Ruhl Sector Manager: Lynne D. Sherburne-Benz Sector Director: Yaw Ansu

Sectors: Secondary education (90%); General education sector (10%) Themes: Education for the knowledge economy (67%); Improving labor markets (33%)

Project ID: P106280 Environmental screening category: “B” Partial Assessment

Lending Instrument: Specific Investment Loan

Project Financing Data [ ] Loan [X] Credit [ ] Grant [ ] Guarantee [ ] Other: For Loans/Credits/Others: Total Bank financing (US$ millions): 95.00 Proposed terms: 40 years maturity, with a 10-year grace period.

Financing Plan (US$m) Source Local Foreign Total

BORROWER/RECIPIENT 0.00 0.00 0.00 International Development Association (IDA)

95.00 0.00 95.00

Total: 95.00 0.00 95.00 Borrower: Federal Ministry of Finance Finance Building Central Business Area Abuja Nigeria Responsible Agency: Office of the Commissioner of Education Lagos State Ministry of Education The Secretariat Alausa, Ikeja Nigeria Tel: 234-805-495-0021 ronkeazeez@aol.co.uk Federal Ministry of Education c/o STEP-B Project Plot 245, Samuel Adesujo Adeulegun St.

Central Business District Abuja Nigeria Tel: 234-803-385-4351 stepbfme@yahoo.com

Estimated disbursements (Bank FY/US$m)FY 2010 2011 2012 2013 Annual 12.00 25.00 28.00 30.00 Cumulative 12.00 37.00 65.00 95.00 Project implementation period: Start June 16, 2009 End: December 31, 2013 Expected effectiveness date: September 15, 2009 Expected closing date: December 31, 2013

Does the project depart from the CAS in content or other significant respects? [ ]Yes [X] No Does the project require any exceptions from Bank policies? Have these been approved by Bank management?

[ ]Yes [X] No [ ]Yes [X] No

Is approval for any policy exception sought from the Board? [ ]Yes [X] No Does the project include any critical risks rated “substantial” or “high”? [X]Yes [ ] No Does the project meet the Regional criteria for readiness for implementation? [X]Yes [ ] No

Project development objective: The development objective of the project is to improve the quality of public junior and senior secondary education in Lagos State. The project will support over half a million public school students in 637 secondary schools, over 7,000 teachers and school administrators and will strengthen the capacity of education district, state and federal institutions. Project description: The project would support the government’s priority of human capital development by directly supporting public junior and senior secondary schools through school grants, performance-based incentives, teacher training and standardized testing of its students. Component 1: Promoting Secondary School Effectiveness through School Development Grants: School grants will be provided annually to all public secondary schools, (amount based on school enrollment), to support activities that impact student learning outcomes. The five technical colleges also will apply for public-private partnership grants to strengthen the linkages between the colleges and industry with the aim of making them more relevant to the labor market in Lagos. Quality improvements are further encouraged through the availability of additional performance awards to those top 40 percent of schools demonstrating learning gains. Component 2: Enhancing Quality Assurance for Junior and Senior Secondary Schools: The second component of the project establishes a standardized system for measuring student’s learning achievements in core subjects (English, math and science) which will be used to track project results and provide important feedback for teachers, principals, parents and students. Since teachers play a critical role in improving the quality of learning, the project also will support enhanced professional development for public secondary school teachers, particularly in the core subject areas and current pedagogy. Component 3: Project Coordination and Management: This component will provide resources to Lagos State for effective project coordination, implementation, monitoring and evaluation, capacity building and the implementation of an information and communications strategy. Component 4: Strengthening the Federal Post-Basic Education Strategy: The last component is a small allocation to the Federal Ministry of Education to strengthen policy

dialogue, build capacity, provide technical assistance for developing the national post-basic education strategy, and support policy dialogue on the strategy with States. Which safeguard policies are triggered, if any? Environmental Assessment (OP/BP 4.01). Significant, non-standard conditions, if any, for: Board presentation: None. Loan/credit effectiveness:

(i) Subsidiary Financing Agreement has been signed between the Federal Ministry of Finance and Lagos State; and

(ii) Ratification and Legal Opinion. Covenants applicable to project implementation:

(i) Carry-out the project in accordance with the Financing Agreement and PIM and shall not amend, suspend, abrogate, repeal or waive any provision of the PIM without prior approval of the Bank.

(ii) Maintain PFMU with sufficient staff and resources acceptable to the Bank. (iii) Ensure monitoring of agreed project performance indicators and progress

benchmarks. (iv) During the implementation of the project, provide the Bank for its review, a quarterly

report on the progress achieved in the carrying out of the Project no later than 45 days after the end of the period covered by such report, as set forth in the PIM.

(v) Jointly undertake with the Bank a review of the project activities based on the report referred to in subparagraph (iv) above.

(vi) Financial covenants are the standard ones as stated in the Financing Agreement Schedule 2, Section II (B) on Financial Management, Financial Reports and Audits and Section 4.09 of the General Conditions.

I. STRATEGIC CONTEXT AND RATIONALE

A. Country and sector issues

1. The Lagos Eko Secondary Education Project (“Eko” is the Yoruba word for education) will support the main objectives of the Nigeria Country Partnership Strategy (CPS) and the implementation of the education sector plan for Lagos State. Lagos was selected on the basis of (a) its demonstrated commitment and ownership to the development of the education sector; (b) poor quality of public education, especially in urban slum areas; (c) its significant role in Nigeria’s economic growth; and (d) the quality of its Education Sector Plan (ESP).

2. Country context and macro-economic situation. Nigeria is the largest country in Sub-Saharan Africa in terms of population (estimated around 140 million) and has a decentralized government structure. There are 36 States and the Federal Capital Territory (FCT) and 774 local government areas (LGAs). Despite being the 6th largest exporter of oil, Nigeria is one of the poorest countries in the world with per capita income of US$920, and with a very high level of inequality--approximately 54 percent of the population is estimated to be poor.1 Nigeria’s oil revenues grew from an annual average of about US$15 billion between 2000 and 2003 to about US$36 billion annually between 2005 and 2008. On the macroeconomic front, real GDP growth was 6.3 percent in 2007, and is projected to increase further in 2008 but at a lower rate due to the global economic slowdown and falling oil prices. Inflation rates of 40 percent per year in the 1990s declined to a range of 14 to 18 percent during 2001-2005 and to single digits in 2007; and in spite of recent increases in food and energy prices, inflation was under 15 percent in 2008.

3. Lagos State macro-economic situation. Lagos is a predominantly urban state, with an estimated population of 9 million.2 It is a mega-city of dominant economic importance not only for Nigeria but in West Africa. It is the premier manufacturing and port city in the region with the largest concentration of multinationals and financial institutions in the country. Lagos is the second largest contributor to the GDP of Nigeria. The state accounts for about 80 percent manufacturing value-added in Nigeria and over 65 percent of its commercial and industrial activities. Lagos has over 2000 industries and over 250 financial and allied institutions with the most active stock exchange in the country. Despite its dominant economic status in Nigeria’s non-oil economy, Lagos is a poor city with poor social indicators. Although its annual budget dramatically improved in the last three years, it remains small relative to the resources necessary for adequate service delivery and infrastructure. According to the National Living Standards Survey (NLSS), 67 percent of the population of Lagos lives on less than one dollar a day and, as such, are considered to be poor. The poverty ranking of the state is 23rd out of the 36 states in the Federation. Lagos has one of the highest incidences of poverty and inequality in the country. Overall, Lagos ranks 11th in terms of poverty incidence and 1st in terms of inequality. Almost 70 percent of the Lagos population lives in slums in extremely poor environmental conditions.

1 World Bank (2007) Nigeria: Poverty Assessment. 2 The 2006 Nigerian census puts the population of Lagos at 9 million, but the authorities of Lagos have disputed this

figure. According to the Lagos Central Bureau of Statistics, the population is closer to 17.5 million (2008) with annual population growth of roughly 4 % over the last 10 years. World Urbanization Prospects (2003) estimated the population as 11 million.

2

Table 1: Poverty Data in Selected Nigerian States

State Total

Population* Poverty

Headcount (%)

Population living in Poverty

Poverty Gap Gini Index

(%)

Enugu 3,257,298 36.8 1,198,686 12.0 44 Jigawa 4,348,649 90.9 3,952,922 47.3 44 Lagos* 9,013,534 67.0 6,039,068 35.6 64 Kaduna 6,066,562 40.9 2,481,224 12.7 42 Kano 9,383,682 49.7 4,663,689 18.0 43 Sources: Provisional Results of the 2006 Nigeria Census by State & Nigeria Poverty Assessment (2007, draft). * Population data from the 2006 Census are contested. Many argue that the population of Lagos is likely to be closer

to 17 million. This would give the population living in poverty in Lagos as 11.39 million. 4. Nigeria’s education sector. Nigeria’s education system comprises 9 years of basic education (6 years of primary and 3 years of junior secondary), 3 years of senior secondary, and 4 years of tertiary education. The provision of education is a concurrent responsibility of the federal, state and local governments, with a fast growing private education sector also active at all levels of the education system, especially at the primary level. The Federal Government plays a dominant role in the provision of post secondary education, while state and local governments have principal responsibility for the provision of secondary and primary education. The Federal Government also provides additional direct funding for education at the state and local government levels through the Universal Basic Education Commission (UBEC) for the implementation of the Universal Basic Education program (UBE), the Education Trust Fund (ETF), which is mainly for physical infrastructure, and the virtual poverty fund from the debt relief initiative, for the achievement of the Millennium Development Goals (MDGs).

5. Lagos’ education sector.3 Lagos State offers tuition-free education for basic and secondary education. As of 2008, 11,387 schools (public and private) enrolled an estimated 2.3 million students. Of these schools, 1,030 are public primary, 319 public junior secondary and 318 public senior secondary schools with enrollment of about 1 million students. The Ministry of Education reports 7,511 private primary schools, 1,172 private junior secondary and 1,037 private senior secondary schools, although officials agree that these figures are substantially underestimated since the number of private schools is difficult to capture, given that many are unregistered. For tertiary education, the state also has 5 public technical colleges, 5 universities (2 public and 3 private), 2 polytechnics, 1 monotechnic and 4 Colleges of Education. The high demand for education, combined with the ever-growing population has spawned a dramatic growth of private schools over the last two decades, especially at the primary level. As a result, the majority of lower income groups in Lagos enroll their children in public schools, particularly at the secondary level, whereas the majority of the middle and high income groups send their children to private schools. For example, most civil servants in Lagos send their children to private schools. Only 57 percent in the poorest quintile attend secondary school, compared to 94 percent in the highest income quintile (CWIQ, 2005). Out of school youth (roughly estimated between 1 and 2 million4) remains a considerable challenge in Lagos where the opportunity costs of attending secondary school are high and the availability of quality public secondary education is constrained by the enrolment ”bulge” from the high completion rates in primary education and

3 It is difficult to estimate the number of private schools since many are neither registered nor have applied for

registration. New schools are being established at a far greater number than can be accurately monitored. 4 The EFA Action Plan from 2004 estimated 2.5 million out of school children, although the most recent EMIS data

suggests 1.3 million not enrolled in school between 6-14 years of age. The lack of data on private schools and unavailable population figures makes it difficult to estimate.

3

fast increasing population. However, it should be noted that the Lagos household survey showed that the State has a high adult literacy level (93 percent).

6. Lagos’s education sector faces several critical challenges, including: (i) low access to junior secondary and senior secondary education for the poor; (ii) poor quality of education at all levels, leading to weak skills development and limited employability; (iii) inadequate funding and lack of accountability/quality mechanisms; (iv) limited capacity for policy making, management, and monitoring and evaluation; (v) weak alignment of curriculum to labor market needs; and (vi) large private provision of primary and some secondary schools not systematically monitored or supervised by the State. The Lagos Eko project will focus on addressing only several of these issues.

a) Access to education at junior and secondary education, is low for the poor. Lagos enjoys a strong culture of school attendance (nearly all children attend primary school, either public or private) and no gender disparities seem to exist in this age group. School enrollment is nearly 100 percent for 6-14 year old children (fig. 1), but declines to 65 percent by senior secondary and is estimated at around 40 percent for the lowest income quintiles. Although progression of students from primary to junior secondary school is automatic, completion rates in secondary schools are considerably lower, reflecting the inadequacies of the learning environment (poor infrastructure, overcrowding, limited learning materials, etc.), availability of schools (both public and private), and indirect costs of education. Until this year, core textbooks and other essential learning materials had been in chronically short supply in most public secondary schools. Transportation issues (traffic congestion, distance to nearest school, urban expansion) further exacerbate children’s access to education. The low quality of education combined with high opportunity costs at the secondary level contributes to the decline in enrollment in secondary schools. Furthermore, the low employment rate of secondary school graduates acts as an additional deterrence.

Sources: ASC, CWIQ 2006.

0

20

40

60

80

100

120

3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

Age

Attendance rate (%)

Male Female

Figure 1: Age Specific Attendance Rates by Age 3-30 years old, Lagos State, 2006

4

Table 2: Primary and Junior Secondary Gross Enrollment Rates by Household Consumption Quintile, Jigawa and Lagos, 2006

State & Gender

Primary by Income Quintile Junior Secondary by Income Quintile

1st 2 3 4 5th 1st 2 3 4 5th Jigawa State

Female 29 39 52 86 84 23 27 47 62 125 Male 23 25 42 65 71 6 9 8 40 47

Lagos State Female 13 104 130 109 104 45 71 85 104 117 Male 10 67 100 101 113 57 82 78 94 89

Source: CWIQ 2006; where 1= lowest income quintile and 5 = highest income quintile.

b) Quality and relevance of basic and secondary education is inadequate for skills development. The quality of primary and secondary education has markedly deteriorated over the last decade. The Ed tap Survey conducted by the Federal Ministry of Education in 2007 reveals that as many as 60 percent of graduates are unemployable primarily because they do not have sufficient skills to adapt to the needs of the ever changing and dynamic business environment. The quality and relevance of education must be improved to provide basic life skills, knowledge and key competencies for all students, and more broadly to contribute to non-oil labor market growth. Although data is scarce on learning outcomes, available examination results show poor results. For example, excluding a few high performing schools, only eight percent of candidates obtained five credit passes in the 2007 WASSCE examination. The main contributing factors to low learning outcomes are the poor conditions of the learning environment to support teaching and learning (e.g., inadequate physical infrastructure, poor conditions of facilities, including water and sanitation, inadequate distribution of core textbooks and instructional aids); and inadequate opportunities for teachers to develop and maintain skills.

c) There is inadequate funding, the quality of education expenditures is low; and there is a lack of accountability mechanisms. Education financing in Nigeria is the responsibility of all tiers of the government. Data on education expenditures is inadequate to examine the source and use of education spending for education. However, available data suggest that education funding in Lagos state has been declining in real terms. The share of the state education sector in total state recurrent expenditure was 25 percent in 2005, although the data are insufficient to determine LGA expenditures. The share of primary education has remained fairly constant at 35 percent since 2001, which is relatively low compared with other states. The share of secondary education has also remained relatively stable at 50-55 percent. The share of higher education increased from 10 percent in 2001 to 14 percent in 2005. Despite high shares of public spending on primary and secondary education, with the bulk of resources going to teacher salaries, the quality of learning conditions is very poor. Lagos follows the traditional incremental budgeting model, with the result that budgeted expenditure and actual expenditure deviated significantly with less than one third of the approved budget being spent (especially for capital expenditures). Available evidence suggests inefficiencies in the delivery of education services, such as teacher deployment, where the most deprived areas lack qualified teachers. A Medium-Term Education Sector Strategy (MTESS) has already been prepared (2008) to cost education initiatives and expenditure plans over the next three years.

5

d) Weak skills development not responsive to labor market needs. Most secondary schools are teaching with very little practical or technical content. Low test scores across the State reflect the poor level of knowledge attainment including even basic literacy and numeracy skills which are critical to support the demand for the Lagos labor market (both formal and informal). Unqualified teachers in the core subjects of English, Math and Sciences are contributing to the problem. And the lack of emphasis on more progressive pedagogy is stunting student’s abilities to adapt to the changing workforce needs. The poor reputation of technical education and training has further eroded the quality of the technical programs as students and parents see these colleges as “schools of last resort.”5 The lack of prestige for these programs, combined with the unqualified teachers, outdated curriculum, and inadequate public funding are hampering the government’s goal of increasing TVET participation to 20 percent as compared to the current 2 percent enrollment. Only 30 percent of all courses in technical colleges are accredited and women are grossly underrepresented (20 percent). To ensure more relevant teaching and courses of study, the government plans to encourage the TVET colleges to establish partnerships with the private sector.

Table 3: Total Number of Academic Schools in Lagos State (2007/08) Number of Schools Enrolment

Public Primary 1,030 454,808

JSS 319 318,664 SS 318 265,233

Total 1,667 1,038,705 Private

Primary 7,511 907,767 JSS 1,172 182,218 SS 1,037 168,841

Total 9,720 1,258,826 Total Public and Private

Primary 8,541 1,362,575 JSS 1,491 500,882 SS 1,355 434,074

Total 11,387 2,297,531 Source: SUBEB and Ministry of Education, 2007/2008 EMIS (includes 5 public technical SS colleges).

e) Role of the private education sector. An interesting phenomenon of the education sector in Lagos is the exceptionally large private sector provision of primary and secondary schools, nearly 60 percent of all primary and secondary enrolment. In 2007/08, Lagos had 1,667 public primary and secondary schools, but 9,720 private primary and secondary schools (Lagos State Government Education Management Systems-LASGEMS), typically small to medium size schools located within the neighborhood. The bulk of private schools service primary students. Private education providers have filled a gap in Lagos and demonstrate the large demand for quality education. The failure of the public school system is one reason parents opt for private education. The strikes and teacher walkouts are still remembered by many parents today. The inability of the government to keep pace with the ever expanding population has also created an attractive business opportunity for school proprietors. Private schools are the only option in some of the newly settled outer areas of Lagos where no public schools exist yet. Another advantage the private providers offer is extra child care for

5 The five technical colleges in the state have a total student enrolment of 5,374. The National Policy on Education

envisages 20% of all students leaving JSS would enter technical colleges. The current ESP therefore plans to increase the number of technical schools to 25 over the next 10 years.

6

working mothers. Private providers can often offer a more conducive learning environment with small classes, better infrastructure, motivated and accountable teachers and learning materials. Unregistered private schools, however, may not always provide a quality education. The unregulated expansion and establishment of private schools is a major issue for the MoE, but the private school department within the Ministry is not equipped to deal with the volume of schools nor does it have the capacity to properly monitor the sector. While the IDA credit focuses on public secondary education, private education policy and regulation will be supported by other development partners.

7. Government strategy. At the federal level, the Federal Government launched the UBE Program (1999) making it compulsory for every child to receive nine years tuition free education, and the UBE bill was passed in May 2004. In 2003, the Government prepared the NEEDS, a major multi-sectoral reform program that sees educational reforms as a vital transformational tool and instrument for socioeconomic empowerment. In June 2005, a National Committee was inaugurated to monitor and allocate additional funds from the debt relief funds for the achievements of the MDGs. The Federal Government launched a major education reform program in 2006, which stressed the importance of institutional reforms to improve the efficiency and effectiveness of service delivery at all levels of education.

8. At the state level, the Lagos State Economic and Empowerment Development Strategy (LASEEDs) was developed in 2007, recognizing that enhancing the Lagos State citizens’ access to education can help reduce extreme poverty and provide empowerment. The Education Sector Plan was subsequently presented in October 2008 and aims to provide accessible, equitable, quantitative and qualitative education for all, fostering self-reliance and socioeconomic development in Lagos. The ESP broadly lays out guidelines for strengthening and expanding educational opportunities at all levels from ECCD to tertiary. The Bank and DFID are working with the State to finalize the ESP and support key areas. More recently, the Ten Points Agenda, also referred to as the Lagos Economic Advancement Program (LEAP) sets out the main strategies for achieving efficient and adequate social services and infrastructure to stimulate and create gainful employment through such educational policies as the construction of millennium schools, curriculum review, rehabilitation of all schools and libraries, provision of school furniture and equipment, self-sustaining tertiary education and teachers welfare enhancement.

B. Rationale for Bank involvement

9. The country partnership strategy aims to achieve the following results: (i) improved governance; (ii) maintaining non-oil growth; and (iii) promoting human development. The proposed project would support results packages (ii), and (iii) through improvements in the quality of secondary education, which will contribute to improved productivity, skills development and ultimately non-oil growth. The rationale for bank support for Lagos education is summarized below:

a) Strong political ownership and commitment to the education sector. Lagos has embarked on substantive economic and governance reforms since 1999. A new Government was elected in April 2007 on a platform that put education reforms at the top of the agenda. A set of PHRD supported studies have helped to inform the design of the project components. Textbooks in core subjects (English, Math, Integrated Science, Biology, Computer Science, Agric Science, Yoruba) have been purchased (N 2.9 billion) and were recently distributed to all public school children. Funding will be set aside in subsequent years for replacement stock. Approximately N 37 million has been spent on teachers’ guides in these core subjects. Over N 12 billion has been spent since June 2007 on new construction, rehabilitation and

7

school furniture. Additional support for infrastructure upgrading is being provided through the Lagos Metropolitan Development Governance Project (LMDGP).

b) Poverty targeting in Lagos. Lagos has poor education indicators, especially affecting poor households. Despite the relatively good gross enrollment indicators and low gender disparities in primary education, there remain a very high absolute number of poor households and children not receiving quality education services and/or not completing the general education cycle. Most poor children do not have access to quality basic and secondary education (GER 40 percent), resulting in high drop out and low completion rates and poor education outcomes. By targeting public secondary education, the project will focus on students from poor families.

c) Role of Lagos in Nigeria’s economic growth. Supporting the quality of secondary education will directly contribute to the skills/growth agenda that is vital for Lagos, given its national strategic importance as the major commercial/financial and logistical hub for Nigeria and the West Africa region. The Lagos education system provides opportunities for children from other parts of Nigeria as evidenced by the high percentage (almost 90 percent) of students that are from other States and/or Zones of origin taking the JSS examination.

d) Strong historical Bank support to the state. The Bank has a strong historical program of support to the Lagos government’s development program.6 The Bank’s engagement would enhance policy guidance to the SMOE and provide linkages between the Bank and other projects that are supporting Lagos state. Collaboration between the LMDGP and Lagos Eko is providing synergies for school construction under the former project and delivery of services under the latter. The previous UBE project established a precedent for project support directly to schools (through self-help grants) by working through departments within both the SMOE and SUBEB. In addition, the state has a well-established PFMU to handle bank-financed financial management activities.

C. Higher level objectives to which the project contributes

10. The project is consistent with the objectives and approach of the CPS that supports Nigeria’s National Economic Empowerment and Development Strategy (NEEDS). The State Economic Empowerment and Development Strategy (SEEDS) places a high priority on developing human capital for economic growth, particularly in the non-oil sector. The focus of the Lagos Eko project is to assist the State to improve the performance of secondary school students, thereby contributing to the objectives of supporting non-oil economic growth and human capital development. The project will also strengthen accountability through standardized assessments to measure learning outcomes.

II. PROJECT DESCRIPTION

A. Lending instrument 11. The Lagos Eko project will be implemented as a four-year Specific Investment Loan (SIL) of US$95 million (of which US$5 million will support Federal Ministry of Education secondary education strategy and oversight activities). The proposed approach will allow Lagos

6 The Lagos Partnership Strategy (2009) is under preparation to support an integrated vision of donor coordination in

support of the Lagos development strategy. Current World Bank assisted projects include FADAMA, Health Sector Development, Lagos Urban Transport, Urban Water Sector Reform II, and LMDGP.

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and the Bank to (a) target investments in specific priority areas, based on the Lagos ESP; (b) support innovative mechanisms to strengthen the Government’s capacity for the delivery of public secondary education services; and (c) provide a platform for other donors (i.e., DFID, EFA-FTI, etc.) to support the education sector in Lagos.

B. Project development objective and key indicators 12. The development objective of the Lagos Eko project is to: improve the quality of public junior and senior secondary education in Lagos State. The significant level of private schooling, access to federal UBEC funds, and high enrollment rate in primary school guided the decision to concentrate on addressing quality issues at the secondary level. The project will support 583,900 public school students in 637 schools. Current achievement/test scores indicate students are not performing as mandated by the curriculum. More worrying is the lack of employment options for many graduates given their limited and/or mismatched skills. Using school grants and student assessments, the project will support the promotion of school learning in Lagos. Support to five technical and vocational colleges will further enhance linkages to the labor market. Although secondary education is the focus of the interventions, some of the institutional reforms (i.e., assessments, teacher training) and support to the Federal MoE will impact the education system more broadly. And, DFID, through ESSPIN will provide complementary technical assistance for the education sector, with a focus on basic education.

13. Project performance will be monitored through a set of key performance indicators (see Annex 3). The PDO outcome indicators specifically measure the increase in the percentage of public junior secondary students obtaining results “at and above credit” in the junior secondary certificate examination in English, mathematics, and integrated science; and the increase in the percentage of public senior secondary students obtaining “pass grade” results in the West African senior secondary certificate examination in English, mathematics, and biology.

C. Project components 14. The proposed Lagos Eko project will address the government’s priority of human capital development by directly supporting public junior and senior secondary schools through school grants, performance-based incentives, teacher training and standardized testing of its students. 15. Component 1: Promoting Secondary School Effectiveness through School Development Grants (Estimated base cost: US$62.6 million). The objective of the school development grants is to raise education outcomes in junior and senior secondary education by providing public secondary schools in Lagos access to yearly discretionary resources with an explicit focus on improving the quality of education services as priority needs are defined at the school level. School progress will be rewarded through additional performance grants for the top 40 percent of schools based on criteria for measuring quality improvements (i.e., test scores, teacher attendance). Grants based on private-sector partnerships also will be provided for the five technical colleges. 16. Subcomponent 1.1: Secondary School Development Grants (US$45.6 million): The grants will be provided annually to all public secondary schools, to augment schools’ non-salary expenditures to improve learning performance. The initial grant is expected to be between N 2 and 3.5 million (approximately US$13,000-23,000) depending on the size of the school. Approximately 632 schools and 5 technical colleges would receive the grant based on an approved school improvement plan which would include activities that impact student learning

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outcomes. Training will be provided to school leaders, district officers, and School-Based Management Committees (SBMCs) in school improvement planning and grant operations. Project Implementation Committees (PICs) would be formed to prepare the school improvement plans. Proposals would be reviewed and approved at the District level and endorsed at the State level according the School Development Grants Manual (SDGM). The execution of the grants will be facilitated and monitored by Zonal Project Administrators (ZOPAs) to ensure standards of reporting and accountability are upheld. In Lagos, junior secondary schools already have experience in grant operations through the provision of minimal monthly resources for operational expenditures from the SMoE and the provision of self-help funds from UBEC. However, most schools do not receive sufficient funding to support their needs. It is expected that by the fourth year of project implementation, assessment scores in core subjects of the secondary schools will increase from project baseline.

a) In order to encourage interventions that will show results in improving learning, infrastructure expenditures will be capped at (30 percent) of grant resources. Investments in school infrastructure improvements are being planned for under State budget allocations with support from UBEC and ETF, and from the Bank supported LMDGP (US$25 million for school construction/rehabilitation). Examples of activities that could be supported are: (a) instructional materials and other learning inputs; (b) training opportunities for teachers; (c) teacher development and support programs; (d) lab equipment; (e) academic competitions and prizes; (f) allowances for volunteer teachers; (g) remedial courses; (h) library books; (i) reading enrichment; (j) strategies for skill development programs/ICT to improve secondary teaching and learning; and (k) innovative activities (e.g., preparation of school-level educational management information systems). The SDGM will provide guidance on eligible expenditures and implementation of this component.

b) About 9,400 principals, vice principals, inspectors, ZOPAs and other officials at the district and LGA, including the SBMCs, will be trained on the establishment and monitoring of school improvement plans, grant implementation, effective schooling, preparation of annual student performance improvement plans, financial management and grant performance monitoring and reporting.

17. Subcomponent 1.2: Secondary School Performance Awards (US$10.3 million): The objective of this subcomponent is to sustain the gains made in learning outcomes by providing additional performance based resources to qualifying schools. These follow-on grants would reward the schools for progress in improving learning outcomes and would be used to fund activities eligible under subcomponent 1.1. The awards would be given to schools which have achieved improvements based on the school’s composite score in standardized tests in English, mathematics, and science as compared to previous year’s results; significant improvement in teacher attendance; and organization and demonstrated evidence of participation by a school-based management committee. Standardized learning assessments and achievement tests will be administered on a yearly basis and determined electronically at the Lagos State Board of Examinations. The expected outcome of this sub-component is that principals and teachers make concerted effort to maintain or raise the level of achievement of their students. It is expected that by the fourth year of the project, at least 40 percent of secondary schools maintain learning gains. The quality assurance/measurement tools will be supported and financed under Component 2. 18. Subcomponent 1.3: Public-Private Partnership Grants in Technical Education (US$6.6 million): The objective of this sub-component is to improve the quality of teaching, research and skills development at the technical colleges and make them more relevant to the

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demands of employment and entrepreneurship in Lagos. The five technical colleges (enrolling 5,374 students) would receive additional funding in order to strengthen the linkages between the colleges and industry. Funds of up to N 40 million (US$285,000) would be provided for twinning arrangements between the private sector and technical colleges to strengthen the linkages between skills training and labor market demand. Cooperation between technical colleges and private sector industry, professional associations, and/or private institutions is expected to lead to more relevant teaching, research and development activities. The first year of the project will be devoted to capacity building for the technical colleges to develop their PPP proposals. The expected outcomes of this subcomponent are that graduates of the technical colleges find gainful employment, pass the relevant academic or professional exams, and/or are admitted to post-secondary institutions. This subcomponent would support partnerships between the technical colleges and private sector, strengthen the school-industry advisory agency (LASTVEB), develop relevant training curricula and certification systems, and promote sharing of industry equipment and skilled personnel with schools. 19. Component 2: Enhancing Quality Assurance for Junior and Senior Secondary Schools (Estimated base cost: US$13.7 million). The objective of this component is to establish a standardized system for measuring student’s learning achievements in core subject areas and support teachers to develop the skills needed to better teach these areas. This component would support the improvement of the quality assurance systems in Lagos State to measure progress, identify deficits, provide feedback to service providers, and establish appropriate benchmarks/standards. This critical data will provide continuous assessment and impact evaluation of project and government interventions. Furthermore, it will measure the learning outcomes in schools to give the government a comprehensive picture of progress in the secondary education sector, at the same time providing a transparent yardstick to hold schools, teachers, and district officials accountable for delivering a quality education. 20. Sub-component 2.1: Standardized Testing for Secondary Schools (US$2.9 million): The objective of this sub-component is to establish a standardized system for measuring learning achievements, and to support the development of the performance grants scheme of the project. By forming a complete series of examinations that is consistent and comparable, improvements in student learning outcomes can be better understood and managed. Reliable information about student’s learning will help teachers, parents and principals to set achievable benchmarks for improving instruction and learning. Specifically, this subcomponent will support: (i) the establishment of an education baseline and revalidation of standardized tests; (ii) the standardization of unified examinations for secondary students, particularly for the core subject areas for junior secondary grades one and two and senior secondary grades one and two; and (iii) institutional strengthening of the Lagos State Examinations Board. Technical assistance will be provided for test development and evaluation design, data handling and analysis, field testing assessment instruments, training and orientation for test administrators and training for examinations bodies. The necessary equipment (e.g., optical marker recorder paper, machines and scanners) also will be financed under the project.

21. Sub-component 2.2: Strengthening Teachers’ Professional Development (US$10.8 million): The objective of this sub-component is to establish a mechanism for identifying training and capacity development needs of secondary schools, develop the interventions to address those needs, and link secondary schools with institutions providing those interventions. To help schools address the demand for high quality teaching in the core education areas, the project will support the development of teachers’ professional knowledge and skills by increasing the capacity of service providers to offer high quality courses in core competencies in

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English, Math and Science teaching. Activities that will be supported include: (i) assessing capacity development needs analysis of teachers and school leaders; (ii) capacity building for the Teachers Establishment and Pensions Office (TEPO); (iii) training courses (competitively contracted) developed and delivered at teacher development institutions in core subject areas and school management; (iv) support for teacher subject conversion in math, science and English; (v) strengthening subject associations and their outreach efforts into the schools; and (vi) the establishment and publication of a training information website and teacher training information bulletin. Current pedagogic methods (e.g., active learning) will be offered to help teachers improve the learning outcomes of their students. Approximately 5,385 JSS and SS math, English and science teachers and 1,700 principals and vice-principals will receive support under this subcomponent. The teacher formation institutions and in-service training agencies will offer training courses year round and during summer break. Teachers may participate in more specialized or customized training, to be funded under the school development grants. 22. Component 3: Project Coordination and Management (Estimated base cost: US$4.6 million). Effective implementation of the project will depend upon efficient coordination mechanisms, proper financial management and procurement practices, timely implementation, and effective monitoring and evaluation of project outcomes in Lagos. This component will provide the necessary resources for effective coordination and monitoring and evaluation, and the implementation of an information and communications strategy. To support the Lagos public secondary schools, management and oversight would be organized at the State level (SMOE in close coordination with the relevant parastatals) and Education District level (TG/PS, ZOPAs and LGEAs). The technical support for implementation includes a team of short and long-term consultants, specializing in project implementation (including project management, financial management, procurement and M&E), resident in the MOE, and providing regular support to Districts. The capacity building support for implementation would begin during project preparation and necessary training would be provided to project implementers. For the Monitoring and Evaluation, the SMOE will continue to update data to facilitate accurate reporting on the key progress indicators identified in the Results Framework as described in Annex 3. Most of the data for monitoring project outcomes will come from the Education Management Information System (EMIS), collection of school data by ZOPAs, regular project reports, and the Exams Board, supplemented by project studies and a baseline survey. 23. Component 4: Strengthening of the Federal Post-Basic Education Strategy (Estimated base cost: US$5 million): The objective of this component is to provide capacity building and technical assistance to the Federal Ministry of Education to enhance the development of the national post-basic education strategy and support policy dialogue on the strategy with States. Activities are expected to include technical assistance and studies to support key policy reforms (e.g., examination system, technical and vocational education), national dialogue on post-basic education and development of the National Secondary Education Sector Strategy, training and capacity building, international study tours /visits and exchange programs. Support will also be provided to help at least three States prepare their secondary education strategies. Pilots may be proposed to encourage innovative linkages for supporting state specific post-basic strategies. This component also would provide support for the federal coordination of State level education projects, including funds for the National Education Sector Steering Committee (NESSC).

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D. Lessons learned and reflected in the project design 24. Bank-financed education projects have a mixed track record in Nigeria. The Second Primary Education Project (PEP2) closed in December 2004. It was implemented at the federal level and provided funds for both federal and state level activities to increase access and quality. Although the centralized implementation was problematic, ultimately a demand driven, community focused infrastructure program was established and continues today. The UBE Project (closed in June 2006) supported the capacity of 16 participating States and the Federal government to manage and implement the program to achieve universal basic education. Unlike PEP2, it was implemented at the State level by providing an initial allocation of US$5 million to each state. The unsatisfactory performance of this project was related to (a) faulty project design (e.g., allocation of a fixed amount of project funds for each of the 16 participating states without having a clear project implementation plan); (b) weak implementation capacity at all levels; and (c) ineffective performance of technical assistance provided by the DFID-financed technical assistance project --Capacity Development for Universal Basic Education (CUBE)--, which was not adequately aligned, from the design stage, to the implementation of the UBE Project .7 The current State Education Sector Project8 in Kaduna, Kano and Kwara has only been under implementation for about one year, but already some lessons are being applied, such as the focus on school grants. The Lagos Eko project will build upon the lessons learned under previous Bank projects by:

a) Designing a project based on priorities of state’s education sector plan to avoid ad hoc implementation and have maximum impact on the achievement of state’s education goals. In addition, similar to SESP, the design of the Lagos Eko project will be focused on a limited number of complementary interventions that can be measured and evaluated;

b) Being ready to be implemented by having: (i) a well-prepared project implementation plan with the relevant procurement documents; (ii) a team of qualified project staff with experience and knowledge in Bank-financed project implementation, with limited turnover; (iii) a role and funding for the Federal Ministry of Education; and (iv) complementary technical assistance;

c) Strong State level political ownership and commitment to the objectives of the project;

d) Sufficient credit amount to have a catalytic impact on the implementation of the ESP;

e) Enhanced communication and engagement with Federal ministries to ensure that legal issues such as Subsidiary Financing Agreements, etc. are handled without delay; and

f) Establishing a rigorous monitoring and evaluation system to track results and make changes as and when needed.

E. Alternatives considered and reasons for rejection

25. Development Policy Lending (DPL) and a Sector-Wide Approach (SWAp). Sector adjustment lending was considered to support broader reforms such as improved staff deployment, financial management and accountability arrangements, and of exerting leverage on the State Government for policy reforms in the sector. However, it was agreed that it would be

7 The Project was rated unsatisfactory for most of the implementation period. At the request of the Government, a

portion of the undisbursed credit amount (SDR 27 million) was cancelled in March 2006, and the project was closed on June 30, 2006 because it would not be able to meet its development objectives.

8 The State Education Sector Project (SESP) and the Science and Technology Education in Post-Basic Education (STEBP) Project were approved by the Bank Board in FY07 and became effective in FY08.

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helpful to demonstrate results on the ground quickly to complement the ongoing package of investments being undertaken to improve the Lagos public education system. Furthermore, the planned technical assistance program supported by DFID (through ESSPIN) will support education policy reform, helping to pave the way for DPL assistance in the near future. The Bank is discussing a DPL framework with Lagos government for the next generation of projects. 26. Single State Project vs. Multiple State Project. The ongoing SESP provides support to three States, based on broad project development objectives with small adjustments tailored to the implementation of each States’ ESP. The specific characteristics of the Lagos education sector set it apart from other States given the large private sector, population size and flow, and labor market conditions. Therefore the focus of the project, on secondary education rather than basic education, would have been less relevant to most other states in Nigeria. Furthermore the quality of preparation is enhanced if resources and TA can be focused on one State at a time. Although some small efficiencies were gained by preparing the program for more than one state at a time, the workload and costs were equal to preparing three projects at one time. 27. Horizontal Adaptable Program Lending. The horizontal adaptable program approach was considered to provide support to additional States as they finalized their Education Sector Plans and applied for donor financing. It was agreed that given the differences among States and the inability to predict IDA allocations beyond two or three years, the horizontal APL would not be appropriate at this time. As alternative sources of funding such as EFA-FTI catalytic funds or Education Program Development Funds (EPDF) are introduced to support State ESPs, and DFID launches its ESSPIN operation, a more strategic framework for investing in the education sector may be necessary to address the growing number of states requesting assistance from IDA. 28. Scope of the Project. The decision to focus on secondary education rather than the entire sector reflects the government’s priority in addressing the “bulge” from the significant increases in primary and junior secondary enrollment while at the same time addressing the pressures from a dynamic labor market. The exceptionally large private sector provision, particularly at the primary level, relieves some of the congestion at public primary schools, but private secondary schools are less numerous and serve a much smaller population. Although some private providers have filled the gap in Lagos, the demand for secondary school combined with the increasing demand from the labor market for enhanced skills requires significant investments in the quality of secondary education. The project team considered how to provide some support for private schools, given the large number of children enrolled. The limited oversight, data, and/or regulation of the private school sector presented a challenge for engaging in reforms at this time. It was also agreed that the project should support the government’s priority of targeting needier students and schools as evidenced by the low transition rates from primary to junior secondary and especially from junior secondary to senior secondary for the lowest income quintiles. It was therefore agreed, that the project would be simplified to focus on public secondary schools to address poverty targeting and skills strengthening. Activities addressing private school regulation and policy will be supported by DFID through ESSPIN. III. IMPLEMENTATION

A. Partnership arrangements (if applicable) 29. The CPS delineates the partnership collaboration between the Bank, DFID, USAID and AfDB. The main external partner in the education sector in Nigeria is DFID, which is providing technical assistance, which although delivered separately, complements the implementation of

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SESP in Kaduna, Kano and Kwara. Similarly, DFID will complement IDA support for the Lagos Eko project under their new program –ESSPIN- which will provide a comprehensive range of technical assistance to support systemic reform in the delivery of basic education (beginning March 2009). ESSPIN is expected to provide flexible technical assistance to respond to state government priorities. Support under ESSPIN will aim to strengthen government systems for the planning, delivery, monitoring and resourcing of education in Lagos. Activities would cut across all levels of the education system, with a focus on basic education. A number of areas have been identified as potentially suitable for ESSPIN support. These include: reform of inspectorate services, communications, public financial management, EMIS, and private sector policy and regulation. A full description of ESSPIN’s proposed work program in Lagos will be provided in the project files and an initial summary is provided in Annex 15. 30. Given the commitment to harmonization and coordination of support in Nigeria, DFID and the Bank will work closely together to ensure that IDA activities and ESSPIN work in a complementary and collaborative way to support implementation of Lagos State’s education strategy. This may be within the context of an MOU between DFID, the Bank and Lagos across the full range of CPS development support to Lagos, and through coordination under the NESSC and/or education sector reviews. ESSPIN is expected to make technical assistance available to the Lagos Government and Federal Ministry of Education (and its agencies) by effectiveness. The State Project Advisory Committee (SPAC) established to oversee the project will also be used more broadly as the oversight committee for Lagos ESSPIN activities. This will encourage greater synergies and coordination of activities between the programs. An annual sector review led by Lagos may also be considered to evaluate progress in implementation of the ESP and donor supported projects. 31. International Finance Corporation provides some funding to support private education investments in Nigeria. One investment is through a Nigerian company "SocketWorks" which helps university students overcome the digital divide. IFC is investing in the establishment of a private boarding school (Day Waterman College) in Ogun State opening in September 2009. The Bank and IFC are working together to explore the possibility of supporting vocational and technical education in Lagos and other interested states through the National Board of Technical Education.

B. Institutional and implementation arrangements 32. The majority of project activities will be implemented at the State level. For the State activities, the State Ministry of Education will be the responsible agency for project execution in close coordination with the Education Districts, LGEAs, SUBEB, and federal agencies. The Federal Ministry of Finance (FMoF) will be the representative of the Recipient as it relates to the financial and legal obligations of the Government. Lagos State will sign a subsidiary financial agreement with the FMoF. The FMoE and FMoF will have oversight of the project and the FMoE will play a coordinating and monitoring role in the implementation of the project. The FMoE will also be responsible for implementation of the activities under Component 4. 33. A National Education Sector Steering Committee (NESSC), formerly the Federal Consultative Steering Committee (FCSC) under SESP, will be established to provide an annual forum where project performance and implementation issues can be discussed and knowledge shared at the State and Federal levels. The Committee would be managed and chaired by the FMoE or his/her representative and includes key stakeholders responsible for project monitoring and implementation. The mandate, structure and details of the NESSC will be jointly agreed by

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FMoE, WB, DFID and other partners. This would be the main policy body for all state based education projects at the federal level. Funding for the meetings and monitoring will be supported under the federal component, while Lagos State participation in these meetings will be funded under the credit. The NESSC could provide oversight of all donor education programs (e.g., Lagos Eko, SESP and ESSPIN) to harmonize donor activities, improve coordination, monitor performance targets, enhance implementation, address cross-cutting issues, and ensure that States learn from each other and comply with ongoing federal reforms. 34. A State Project Advisory Committee (SPAC) will be established to govern the project in Lagos and would be chaired by the Hon. Commissioner of Education. This committee will review progress reports, approve/endorse annual work programs and budgets, advise on key implementation issues, and ensure that agreed activities are met. The SPAC will oversee implementation more broadly of the education sector plan, MTESS and other donor activities (e.g., ESSPIN). The SPAC membership will include key stakeholders responsible for the implementation of project components and will comprise key departments in the SMoE, as well as external agencies/parastatals involved in implementation of the Lagos Eko project and other education projects. The Commissioner of Education in Lagos will have overall responsibility for the SPAC. The SPAC may establish, on an as needed basis, working groups/committees to provide technical assistance and expertise. 35. The SPAC will be assisted by a Project Support Unit (PSU) which has been established to support the coordination, procurement management and monitoring and evaluation of project activities. The PSU is located in the office of the Commissioner of Education. PSU staff will be selected based on agreed TOR; will receive sufficient training in Bank-financed project implementation prior to effectiveness; and will receive support from consultants as needed. 36. At the Education District level,9 the Tutor General/Permanent Secretary in each of the six districts, will have implementation oversight and will coordinate project activities in each district, with close coordination from SUBEB and SMoE. The Project Implementation Manual (PIM) will provide greater detail on the roles and responsibilities of key officers who will be responsible for coordination and monitoring. The school grants will be the responsibility of the Tutor-General/Permanent Secretary of the district. They would chair a District Project Advisory Committee (DPAC) to provide policy oversight, evaluate and approve the school grant proposals, and oversee project implementation. DPAC would also establish ad hoc committees such as the Technical Review Committee (TRC) on an as needed basis. Zonal Project Administrators (ZOPAs) have been assigned in each district to help schools collect and maintain key data, strengthen their school improvement plans, prepare monitoring reports for the districts and provide overall implementation support as needed. They will play a key role in facilitating school grant implementation and management. The transfer of grant funds directly to the school account would be contracted through a commercial Bank. School based Project Implementation Committees (PICs) will be responsible for monitoring how the grants are executed with support from the SBMCs, individual school PTAs, and ZOPAs. The head teacher/principal would be the primary signatory of the school bank account. All schools receiving support under the project will be trained and well-versed in the School Development Grants Manual. 37. The secondary school grants for technical and vocational colleges will be governed by the newly established Lagos State Tech and Vocational Education Board (LASTVEB).

9 There are 6 Education Districts in Lagos State with each District overseeing 3 Local Government Areas

(LGAs). Two districts oversee 4 LGAs bringing the total number of LGAs in Lagos to 20.

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LASTVEB will oversee the public-private partnership grant proposals at the state level once it is established. Until then, a Technical Project Committee will assume these functions at the State level. The DPAC would approve the grant funding based on recommendations by the assigned TRCs. Technical assistance will be provided to strengthen the capacity of LASTVEB. 38. Implementation oversight for the standardized testing and school ranking will be carried out by the Lagos State Examinations Board. To enhance the standardized test revalidation and improve capacity, international consultants will provide support. 39. Teacher development activities will be managed by the PSU with support from international and national consultants to: (i) identify training providers; (ii) assess the quality of training programs; (iii) develop new training courses to improve the content and pedagogy of core subject areas, including conversion courses to increase the number of math, science and English teachers; and (iv) strengthen subject associations and their outreach efforts. 40. The Federal component of the project would be managed by the STEP-B Project Management Unit (PMU) within the FMoE. A technical officer would be added to the PMU to liaise with the Department of Basic and Secondary Education, which would be the component’s coordinating department within the FMoE. Any IDA resources used to support additional activities and strategies from States would be proposal-based. 41. The Lagos Project Financial Management Unit (PFMU) will be responsible for managing the financial affairs of the project at the State level. The Accounts Unit of the Federal Project Management Unit of the STEP-B project (AU/PMU) will be responsible for managing the financial affairs of the project at the Federal level. The PFMU is staffed with relevant qualified accountants and internal auditors who have been trained and are fully familiar with the procedures and requirements for Bank funded projects. An experienced and qualified internal auditor will be engaged from the OAGF for the AU/PMU. The PFMU and AU/PMU will be responsible for ensuring compliance with the financial management procedures manual, including, submission of un-audited consolidated Interim Financial Reports on a semester basis and audited annual consolidated financial statements to IDA. Regarding the flow of funds and banking arrangements, IDA will disburse the Credit through segregated Designated Accounts (DA), managed by the PFMU and AU/PMU respectively. PFMU and AU/PMU will maintain adequate FM arrangements to support the deployment of project resources in an economic, efficient, and effective manner to achieve the stated development objectives. The PSU and Federal PMU, supported by the PFMU and AU/PMU, will have overall accountability for financial management of their respective DAs, specifically responsible for (i) preparing activity budgets, monthly Designated Account (SA) reconciliation statements, Statement of Expenditure (SOE), Withdrawal Schedules, semester Interim Financial Reports (IFRs), and annual financial statements; and (ii) ensuring that the project financial management arrangements are acceptable to the government and IDA.

C. Monitoring and evaluation of outcomes/results 42. The project will support the establishment of a Monitoring and Evaluation system in Lagos to monitor the project’s performance and ensure project accountability. The system will also provide continuous feedback to improve performance as the project rolls out over the four-year period. To achieve these objectives, SMoE will continue to strengthen the existing M&E system in order to address the data and monitoring and evaluation requirements. The system will be required to include both public and private education data as available to ensure

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comprehensive coverage of the education sector. In order to include private education information, the SMoE will work closely with LASGEMs. Results based monitoring will be employed under the project with most of the data coming from the EMIS, school surveys, school assessments, project progress reports and school exam data. Collection of school data will be facilitated by the ZOPAs. An oversight function by the DPAC will help make sure the funds are used in the most effective way to achieve the school’s objective of improving student learning outcomes. M&E officers at the district level will consolidate school data and provide district-wide reporting. These reports would be submitted to the PSU for further consolidation and linkage with the state level M&E system. The Results Framework in Annex 3 details the expected outcomes to be achieved through this project, and the agreed key performance indicators. 43. The project will support the SMoE to implement the M&E system with adequate training, computerization, and on-the-job support. ESSPIN is expected to provide long and short term technical assistance to strengthen the EMIS and results-based monitoring system. 44. To determine how schools actually use the discretionary funds to improve learning outcomes and test scores of their students, a rigorous impact evaluation will be conducted using randomized evaluation techniques. Some schools may opt to improve learning outcomes by providing more incentives to teachers, or by buying more learning materials, or some may simply improve the classroom environment by providing improved blackboards, or better furniture. The grants are provided as discretionary funds to schools, and thus, they have the authority to spend according to their school needs. The randomized impact evaluation, which will be conducted in the second and third year of the project, will help in preparing future guidelines to schools on how best to use these funds to achieve higher impacts on learning outcomes in the State. It will be critical for the project to measure the success or lack of success of chosen interventions in order to scale up activities in the future. 45. A school grants technical review also will be conducted annually to better understand how the grants are being used, review the management of the grants, and give real-time feedback to the schools on what strategies are working and the successes achieved by other schools.

D. Sustainability 46. Both the Federal and Lagos State governments are committed to education reforms, including the achievement of the MDGs and universal basic education, and have finalized long-term education sector plans which will be the basis for future interventions in the education sector. Lagos has requested the Bank’s support for implementing several priority areas of their ESP. There is strong demand for quality education in Nigeria, evidenced by the high gross enrollment rates in Lagos State, for example. The willingness of low income parents to send their children to private school is equally telling. Ownership of the program at the district and school level, particularly for the SDG, is crucial to the long-term sustainability of the project. 47. The activities initiated by the project are likely to generate additional post-project costs, including continuation of grants, maintenance and operation costs for EMIS and the costs of designing, validating and delivering the standardized achievement tests. Post-project sustainability will depend on sufficient allocations from the State budget for operational costs, retention of qualified staff and school-level allocations for performance based grants. On the assumption that 75 percent of the total project costs would continue beyond the fourth year of project execution, it is estimated that the recurrent costs would amount to about 6 percent of the

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Lagos education budget, and roughly less than 1 percent of the projected total state expenditures for 2014 and beyond. This indicates that the incremental recurrent costs and the counterpart funding would not impose a significant fiscal burden to Lagos State. More reassuring is the recent rise in State Government revenues resulting from its expenditure policies and better revenue mobilization mechanisms, which means that the share of incremental costs to the total state budget is going to remain small and within its fiscal capacity. Most importantly, this project presents a paradigm shift in budgeting. If this system works and the project achieves results, then the government is likely to continue to allocate education resources in this decentralized manner. The decentralization of resources will likely reduce unit costs for inputs and transaction costs. The emphasis on efficiently using existing resources, such as retraining and conversion of existing teachers, teacher mentoring, etc., further ensures that the system remains viable. 48. The project will strengthen the capacity of the SMoE, districts, and schools to plan, manage and monitor service delivery. The SMoE and Districts will have stronger capacity to monitor and support quality improvements and schools will have greater autonomy and capacity to meet the demands and expectations of their students. The project will also provide schools with greater financial flexibility to continue those activities which increase learning outcomes.

E. Critical risks and possible controversial aspects 49. Nigeria’s record in human development indicates a high-risk and high-benefit program.

Potential Risks Risk Rating

Risk Mitigation/Minimization Measures Residual Risk Rating

Inadequate technical capacity at the Ministry, Districts, and school levels to implement the project.

S MoE has put together an experienced Project Preparation Team and hired consultants through PHRD and PPF funding.

The project will prepare a clear implementation plan with an emphasis on training/capacity building.

Guidelines and procedures will be developed for school administrators, Districts, LGAs and the SMoE to clearly and simply detail their responsibilities in school level activities.

M

Implementation delays in school development grants

M Ensure wide participation of community, design communications strategy and public information system and establish bottom up monitoring arrangements at the school level.

Develop simple implementation guidelines and train/sensitize State, District, LGA and school personnel prior to effectiveness.

M

Weak M & E system and poor quality of existing data

H M&E system will measure progress and whether the development objectives have been met. Support from ESSPIN technical assistance for M&E and EMIS.

The project will focus on collection of test data and school-level information to support improvement of real-time data collection.

ZOPAs have been identified to facilitate this activity.

S

Commitment to reform agenda

S Maintain high-level policy dialogue and hold regular consultations with key stakeholders to increase ownership of the reform program.

Develop and report on project implementation and achievements. Strong communication strategy to raise awareness about results.

L

Exam malpractice S The project will provide state of the art examinations equipment to ensure computerized grading and reporting of test scores.

Random sample reviews will be conducted to monitor exams.

M

(6) Unpredictable and poor budget execution

S The Lagos government will design and implement public finance management reform including in financial modeling and MTESS for state revenue and expenditures.

M

(7) Delays in launching S Federal component to encourage engagement by the FMoE. M

19

Potential Risks Risk Rating

Risk Mitigation/Minimization Measures Residual Risk Rating

project because of approval procedures at Federal level.

All legal documents such as the Subsidiary Financing Agreement will be finalized prior to effectiveness.

(8) Weak financial management may weaken accountability for use of funds.

S Practical, simple and sound financial procedures manual and training provided to the FM team.

Strong and robust systems and controls including institution of independent and effective internal audit function.

Risk-based supervision and external audit.

M

(9) Insufficient experience with Bank procurement may cause implementation delays

S Procurement and implementation training will be provided to key staff during project implementation.

Procurement Manual will be provided to specify all procedures. Intensive supervision by the World Bank Procurement Specialist.

M

Overall Risk Rating S With mitigation M

50. Due to the minor civil works that may be associated with the rehabilitation of schools under the school grants, OP 4.01 policy will be triggered. An Environmental and Social Management Framework (ESMF) has been prepared and was disclosed in-country and at InfoShop on December 15, 2008.

F. Loan/credit conditions and covenants 51. Standard Conditions of Effectiveness

(i) Subsidiary Financing Agreement signed between the Federal MoF and Lagos State. (ii) Ratification and Legal Opinion.

52. Other Key Covenants

(i) Carry-out the project in accordance with the Financing Agreement and PIM and shall not amend, suspend, abrogate, repeal or waive any provision of the PIM without prior approval of the Bank.

(ii) Maintain PFMU with sufficient staff and resources acceptable to the Bank. (iii) Ensure monitoring of agreed project performance indicators and progress benchmarks. (iv) During the implementation of the project, provide the Bank for its review, a quarterly

report on the progress achieved in the carrying out of the Project no later than 45 days after the end of the period covered by such report, as set forth in the PIM.

(v) Jointly undertake with the Bank a review of the project activities based on the report referred to in subparagraph (iv) above.

(vi) Financial covenants are the standard ones as stated in the Financing Agreement Schedule 2, Section II (B) on Financial Management, Financial Reports and Audits and Section 4.09 of the General Conditions.

IV. APPRAISAL SUMMARY

A. Economic and financial analyses 53. The Lagos Eko Project will enhance the capacity of Lagos state to contribute significantly to the non-oil economic growth of Nigeria. Given the visible role of Lagos’ economic growth, it is expected that worker skills arising from effective secondary schools will

20

boost the economic performance of the country. A large number of studies suggest that secondary education is associated with an acceleration of economic growth, can make a significant contribution to national economic performance, and has human-capital threshold effects that help attract foreign direct investment. But there are two important provisos. First, the quality of secondary education, especially in math and science, is more important than the number of years of schooling. Second, equitable access for poor students and especially girls, is an additional factor enhancing economic growth performance. Sustained economic growth will require a threshold level of “education stock” in the work force and continuous -often ambitious- investment in the improvement of human capital. (SEIA synthesis report, World Bank, 2007). 54. Economic Rates of Return of Lagos Eko Program Is High and Positive. A cost-benefit analysis based on the project targets of the Lagos Eko Project shows an economic rate of return (ERR) estimated at 14.5 percent based on private costs and 19 percent based on public and private costs. These represent a lower bound estimate as externalities from the improving secondary education are not taken into account. Given the primacy of Lagos in the growth of the non-oil sector in Nigeria, it is expected that this program will contribute positively to the future economic performance of the country. The key assumptions in the cost-benefit analysis are (a) 50 percent labor force participation by secondary school graduates; and (b) unemployment rate of 10 percent and maintenance costs of 3 percent per year. Economic rates of return would still exceed 10 percent, and be economically justifiable, even where the labor force participation rate by secondary students is increased by 50 percent. 55. Fiscal Sustainability of Lagos Eko Investments: The project is expected to create incremental recurrent expenditure items in the budget of N 2.3 billion (US$16 million) every year beyond 2014. This amount is about 6 percent of the total Lagos education sector budget in 2008, and about 0.004 percent of the overall state budget. In the medium term, such levels of recurrent expenditure are likely to be within the fiscal capacity of the State--given its small relative share in the budget. The paradigm shift in decentralizing implementation to schools and districts is expected to improve efficiencies by reducing unit costs in school expenditures. Thus, in the long term, this new system would not necessarily increase the total cost of sustaining the sector. In recent years, the States’ strong non-oil economy and its much improved revenue mobilization mechanisms increased its public resources and enabled it to more than treble State expenditures between 2001 and 2008. These internally generated revenues rose significantly and allowed the State to spend more on infrastructure, school construction, and purchase of textbooks and learning materials. With the World Bank supported LMDGP, the government is spending US$25 million on classroom construction--which helps to increase access to education. Likewise, it is expected that federal UBEC Intervention Funds, which are sizeable but not yet fully tapped by the state, will help junior secondary school expenditures.

B. Technical 56. The technical design of the project is based on the reform priorities of the Lagos ESP, with a focus on improving the quality of public secondary education. Districts and schools will play a key role in the quality improvement reform process by effectively utilizing existing and new resources to increase learning outcomes of students. The project will focus on learning results and ensure that schools and education officials can accurately and uniformly measure progress at the school level on an annual basis. By focusing on learning outcomes and strengthening the capacity of key implementers to track the performance of their students, the project aims to devolve greater responsibility and accountability to school management for enhancing the skills of public secondary students. The performance tracking will gradually

21

evolve through a phased approach to applying the examination criteria to ensure that the systems are well established and uniform in their application. 57. The design of the project builds on the government’s positive experience with self-help school grants under previous development projects (PEP, UBE), but also introduces innovations that have been practiced in other countries throughout Latin America and Asia. The School Development Grant component additionally was based on lessons learned under SESP and STEPB, the former of which focuses on quality inputs at the school level and the latter of which encourages building private-public partnerships for science and technical education. The performance grants and TVET partnerships are innovations based on experience in such countries as Chile, Pakistan, and Brazil. Standardized student assessments will support allocation of performance grants and more broadly how the schools, Districts and MoE measure the quality of education services and address the evident deficits. One of these deficits is the skills development of the teaching force. Therefore, the project will complement school grants with support to professional in-service courses that are critical to improving the quality of teaching. 58. The design of the project was developed on the basis of a set of project preparation studies completed by the Lagos Government with a team of national and international consultants, which resulted in consultations among key stakeholders and beneficiaries. Annex 4 explains the technical design of the project, which is focused on supporting school-level priority investments while also strengthening the capacity of school communities, districts and ministry staff to monitor the performance of their public secondary schools. The project will support supply-side (teacher training, standardized exams) and demand-side interventions (school improvement plans, grants), which will empower school communities to focus on quality improvements that impact learning outcomes. 59. The following main principles guided the technical design of the project: (i) provide targeted and catalytic support for public secondary schools; (ii) use discretionary resources (grants) to experiment with different methods for raising performance; (iii) reward progress by introducing performance grants to capitalize on these gains; (iv) institute an objective and standardized assessment system to track improvements and provide feedback; and (v) professional development for teachers and principals.

C. Fiduciary 60. The project will build on the experiences of Bank-assisted education projects in Nigeria, and in Lagos State. Overall, procurement and financial management capacity in Lagos is adequate. Procurement and financial management capacity of the implementing units have been assessed and risks and action plans are detailed in Annexes 7 and 8. Financial Management 61. A review of the implementation of CFAA (2000) recommendations in January 2005, further supported by a recent Public Expenditure Management and Financial Accountability Review (PEMFAR), showed that the Federal Government has made significant efforts to advance the reform of the Public Financial Management (PFM) system since 2003. Major achievements include: (i) the adoption of an oil-based fiscal rule that has improved the quality of macroeconomic management; (ii) significant steps toward increased transparency of the budget process; (iii) more efficient cash management; (iv) procurement reforms; (v) updating the legal framework for PFM; (vi) reallocation of budget resources in support of MDG-related

22

government functions; (vii) strengthening monitoring and evaluation; and (viii) introducing a longer term focus in budget management. These have clearly helped to reduce waste of public resources, particularly on the capital budget and payroll sides. There is, nevertheless, much more to be done and PFM initiatives and reforms are articulated in the Government’s NEEDS, supported under the CPS, specifically through three Bank-assisted projects, Economic Management and Capacity Project (EMCAP), Economic Reform and Governance Project (ERGP), and State Governance and Capacity Building Project (SGCBP), as well as funding from other donors and the government. Following the 2004 Lagos State Financial Accountability Assessment (LSFAA), the LMDGP takes on key recommendations such as support for budget preparation, expenditure management reform, and expenditure tracking in specific sectors. 62. Financial management services to the Federal and State level units responsible for the implementation of the project will be provided by the Accounts Unit of the Project of the PMU (AU/PMU) in the FMoE and the Project Financial Management Unit (PFMU) for Lagos State. Experienced and relevantly qualified internal auditors will be engaged. Additional professionally qualified project accountants and internal auditors may be recruited as needed, for the duration of the project. The FM arrangements for this Project are designed to ensure: (i) that funds are used only for the intended purposes; (ii) the production of timely information for project management and government oversight; and (iii) compliance with IDA fiduciary requirements. The Lagos PFMU is a robust multi-donor and multi-project FM platform, which was established in 2003. The PFMU features include: (i) all the key elements of FM, including: budgeting, funds flow, accounting, internal control, reporting and audit; (ii) computerized system and robust FM procedures manual; (iii) relevantly qualified staff that are well-trained in Bank procedures and requirements, including procurement; (iv) segregation of functions/duties that is not possible in any individual project; (v) a strong control environment, which mitigates fiduciary risks; (vi) highly independent and well-trained internal auditors – appointed by the State Accountant General; and (vii) full alignment with the government’s own FM system but with some important enhancements and controls. The PFMU and AU/PMU are already in place, staffed by qualified accountants and support accounting technicians and the Bank’s assessment showed that the FM arrangements in these Units are satisfactory. These arrangements will be reviewed periodically as part of regular project supervision missions. 63. Experienced and well-qualified external auditors will be appointed to audit project accounts, financial statements, and transactions. The overall FM risk for the Project is assessed as Substantial and various measures to mitigate these risks are detailed in Annex 7. With these measures, the residual FM risk is Moderate. Furthermore, the existing Project Financial Management Manual details an adequate internal control framework and risk management strategy that will apply to the Project. The internal audit unit will be trained in risk based audit techniques. Regular reporting arrangements and supervision plans will also ensure that the Project is closely monitored and that appropriate remedial actions are taken expeditiously. The FM risks will be reviewed during project implementation and updated as appropriate. Procurement 64. Since fiscal year 2001, Nigeria has been implementing a procurement reform program based on the recommendations of the 2000 Country Procurement Assessment Review (CPAR). The 2007 PEMFAR, shows that implementation of procurement reform has brought about substantial improvements in obtaining value for money in public sector expenditure. This has further introduced some level of transparency into the country procurement process. Some of the actions taken by Government to advance the procurement reform in Nigeria include: (a) the

23

establishment of the procurement professionals cadre at the Federal level in 2006; (b) the passage of the Procurement Bill in June 2007 to further sanitize the public procurement system, which has often been the subject of abuse and corruption; and (c) the establishment of a functional regulatory body, the Bureau of Public Procurement (BPP) to speed up implementation of recommendations. The BPP has organized a series of sensitization workshops at the Federal and State levels. The National Bidding documents have also been produced by BPP. The recent PEMFAR report indicated that contract prices were reduced substantially. A Cash Management Team chaired by the Minister of Finance, of which the BPP is a member, ensures that payments are made only when certified by the Bureau, enhancing transparency of the procurement system. Currently, the Government Procurement Reform Program is being supported by IDA through ERGP. There are three IDF Grants, supporting the Federal and two State Governments to address weak public procurement capacity and to build partnerships with the private sector. 65. Procurement reform work in Lagos State is also making gradual progress. Lagos is the only state in Nigeria where a review of the procurement system was conducted in November 2003. The implementation of the recommendations of Lagos State Procurement Assessment Review is ongoing and is being supported by an IDF grant. The draft Procurement Bill has been prepared and is being deliberated upon by the House of Assembly and is expected to be passed before the end of 2009. The PSU will be responsible for the coordination of State activities of the project, including all major procurement of Goods and Services for PSU, District and Technical Colleges. The PMU for STEP B will be responsible for procurement under the federal component. Additional support will be established at the district level where implementation of the school development grants will be coordinated and supervised. All procurement will be carried out in accordance with the World Bank’s "Guidelines: Procurement under IBRD Loans and IDA Credits" dated May 2004, revised October 2006; and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated May 2004, revised October 2006. 66. The Procurement Officer (PO) of the PSU will be responsible for procurement implementation of the State procurement activities while the existing Procurement Officer of STEP B PMU will be responsible for implementation of the procurement activities of the Federal Component. The PO of Lagos Eko holds an HND (Engineering) with 23 years experience including Bank procurement procedures under the UBE project that closed in 2006. A local procurement consultant may be engaged to assist the PO when the need arises and when the volume of procurement activities is high. Additional support will be established at the district level where implementation of the school development grants will be coordinated and supervised. The PO will receive procurement training on Bank financed procurement procedures from relevant training institutions, (e.g., Lagos Business School, Ghana Institute for Management and Public Administration (GIMPA), ESAMI). The project will need to assign a Procurement Assistant and Stores Officer who will also attend relevant training as needed. 67. Although Lagos has substantial experience implementing Bank-financed projects dating back to 1974 (6 ongoing Bank projects), there remain identified areas of weak procurement capacity in the education sector. These include insufficient capacity, lack of effective and efficient storage, faulty distribution systems (i.e., textbooks), and lack of appropriate MIS for tracking or storing procurement records. Annex 8 outlines the action plan and procurement arrangements to address the risks including the following: (i) decentralization of procurement functions to the various implementing agencies as much as practical; (ii) assigning a qualified Procurement Officer to the PSU; (iii) minimizing undue interference in procurement processes by adapting the Generic Procurement Manual developed for IDA-financed projects in Nigeria and the Bank’s Standard Bidding Documents, pending finalization of the National Procurement

24

Manual and the Bank’s Standard Bidding Documents; and (iv) computerization of stored records and training of Project officers in contract and electronic information management.

D. Social 68. A social assessment was conducted in July 2008, based on a review of relevant literature and consultations with stakeholders. The main social challenges are the: (i) poverty impact on access, completion and out-of-school children; (ii) limited availability and low quality of public education; and (iii) insufficient data to inform stakeholders/policy makers on education reforms. 69. Gender. Available data on school enrolment in Lagos reveals that there is no major gender difference in school enrolment or completion rates. In fact, the available enrollment indicators demonstrate a slightly higher rate in favor of girls. The 2007 primary and junior secondary school statistics give the enrolment figure for public JSS at 324,444 with 159,263 males and 165,181 females for the 2006/07 academic year. The one area where girls are under-represented is at the technical colleges where they make up only 18 percent of enrolment. And the overall gender parity indicators mask some differences at the LGA level. 70. Poverty. The very poor are less likely to complete the schooling cycle than the rich. According to the World Bank (2007) Education Expenditure Review, there are large income differences in school enrolments. Children in the richest 20 percent of the population are about 2.7, and 3 times more likely to be enrolled in junior and senior secondary school respectively than children in the poorest 20 percent of the population. There are large differences in school completion across household expenditure levels and even across gender. While almost all the young people living in the 20 percent richest households complete primary school and about 70 percent complete junior secondary school; only three fifths of those living in the 20 percent of poorest households finish primary school and only one third complete junior secondary. 71. Street Children. Another issue is the estimated high number of out of school children that are not accounted for since accurate and updated population figures are currently unavailable in the State EMIS. Current government estimates put the figure between 1 to 3 million out of school. Without population figures and since the data does not accurately capture the full enrollment in private schools, the exact figure is not available. Empirical evidence (number of children hawking, begging, street children, etc.), however, indicates that this is a problem in Lagos and the most vulnerable children are likely to be out of school. These include children from poor families, rural remote areas, orphans, the disabled or children with special needs, and teens who drop out after primary education. More research will be required to better understand this issue. DFID plans to look into this issue under ESSPIN.

72. Access. The demand for education is high in Lagos. The increasing population of primary and JSS students is creating enormous pressure on the limited secondary schools. The influx of private school graduates after primary education is also putting strain on the underfunded secondary public education system. With only 637 public secondary schools currently available, the system would need significant expansion to provide places for all children to attend JSS and SSS. The location of schools is paramount, since it is very difficult to travel even short distances in Lagos given the traffic congestion and lack of adequate transportation. Accessibility to public school is further hampered by the dilapidated and poorly maintained school facilities. The education budget provides less than 10 percent for capital expenditures (about 90 percent is for teachers’ salaries). The direct cost for books, fees, levies, transportation, feeding and even for pencils may also affect the poor. Surveys reveal that parents

25

spend between 50 to 75 percent of their income on education related matters. Parents often require the labor of their children/wards for economic survival. A quick survey of 40 randomly selected schools revealed that 78 percent of parents in the sample earned between 10,000 and 100,000 Naira per year, 8 percent earned below ten thousand and 3 percent of parents earned about 500,000 Naira per year. As a result, costs may cause parents to withdraw their wards and children from school particularly to benefit from their labor since 83 percent of the parents were cited as running their own private business (Social Assessment Survey, 2008).

73. Quality. Under the UBE Act, it is illegal to collect any type of school levies and yet the government has been unable to provide the infrastructure and equipment for a proper teaching and learning environment. Capital expenditures and overhead are inadequate to make available minimum requirements for basic standards of education. Since 90 percent of total public expenditures are spent on salaries of teachers and support staff, a very small share is available for either capital expenditure and/or operating costs. As a result, the current conditions of public secondary schools in Lagos are severely inadequate. Pupil textbook ratio is 35:1 in SS, classrooms are overcrowded and dilapidated, with minimal furniture, laboratories are poorly equipped, and water supply and toilets are often non-existent. The last sizeable classroom construction program in the State was nearly 30 years ago. Until this year, when the State initiated a large textbook procurement, no state funding had been provided for textbooks in senior secondary schools. Teachers are often poorly motivated because of the work environment, low status, and inadequate funding for professional development. 74. Poor information management has made it difficult for stakeholders to fully participate and benefit from the reforms taking place in the education sector. The lack of accurate information has made it challenging for parents to make informed education choices for their children. Surveys indicate that most parents prefer to pay for private schooling rather than enroll their children in free public schools. The inability of the State to adequately monitor and regulate the private education sector means that parents often pay for poor quality education. Information is not available on private schools, nor is accurate information available on the quality of public schools. Lagos is not using data to constructively impact policymaking and stakeholders’ use. The current contracting of a private data collector, LASGEMS, would support data collection, but the government will need to ensure proprietary access as well as routine analysis of data to monitor and supervise the public and private school systems.

E. Environment 75. The project has been classified as category B since it is not expected to generate any major adverse environmental and/or social impacts. The main activities that triggered the Environmental Assessment Policy (OP/PB/4.01) are related to component one which provides discretionary resources to Lagos public secondary schools to improve the quality of student learning (School Development Grants). These improvements may entail rehabilitation and some limited refurbishment of existing public secondary schools which may contribute to soil erosion, pollution or loss of vegetation. There is also the additional need for proper handling of the debris to be generated by such renovation and rehabilitation activities as well as the sundry limited civil works that may be needed. To address potential negative impact consistent with the requirements of the triggered safeguard policy, the Government has prepared an ESMF. The framework is consistent with national laws as well as the Bank’s safeguard policy on Environmental Assessment. The ESMF has been approved and disclosed in-country and at the World Bank Info-Shop on December 15, 2008, prior to appraisal.

26

76. The ESMF contains a screening mechanism that the project would use to identify adverse impacts from any proposed construction activities. The ESMF also contains an Environmental and Social Management Plan (ESMP) with responsibilities for mitigation and monitoring, costs, duration, and institutional capacity building to implement the ESMF. Lagos has considerable experience in World Bank Safeguard Policies and the PSU shall designate a staff to be responsible for following up environmental and social safeguards issues. The designated Project Staff charged with implementing safeguards instruments will be given more in-depth training in environmental management. He/She will be supported by a consultant, who will be hired on an as-needed basis. Project desk officers at Lagos State Environmental Protection Agency shall provide oversight functions. Furthermore, the World Bank General Environmental Management Conditions for Construction Contracts shall be inserted in bidding documents and contracts that involve rehabilitation of existing buildings and other minor civil works. Contractors will be given general orientation and sensitization on safeguards issues. Environmental Engineers on the contractors’ team will ensure compliance through on-site project supervision. Guidance also will be provided by the safeguard member of the project team during supervision missions.

F. Safeguard policies

Safeguard Policies Triggered by the Project Yes No Environmental Assessment (OP/BP 4.01) [X] [ ] Natural Habitats (OP/BP 4.04) [ ] [X] Pest Management (OP 4.09) [ ] [X] Physical Cultural Resources (OP/BP 4.11) [ ] [X] Involuntary Resettlement (OP/BP 4.12) [ ] [X] Indigenous Peoples (OP/BP 4.10) [ ] [X] Forests (OP/BP 4.36) [ ] [X] Safety of Dams (OP/BP 4.37) [ ] [X] Projects in Disputed Areas (OP/BP 7.60)* [ ] [X] Projects on International Waterways (OP/BP 7.50) [ ] [X]

Monitoring and Evaluation of the Mitigation Plan 77. The monitoring of the implementation of the mitigation measures will be a continuous process. The day to day supervision at project sites will be carried out by environmental engineers at construction/renovation sites. Periodic supervision will be conducted by officials of Lagos State environmental protection agency, federal ministry of environment, housing and urban development which will also continuously take stock of all safeguards issues. Project progress reports will include progress in mitigation of environmental and social safeguards measures. Lessons learned from existing Bank projects indicate that Lagos state has the staffing and resource capacity to monitor safeguards issues.

G. Policy Exceptions and Readiness 78. The Project is entirely consistent with Bank Policy and requires no exceptions. The project meets the regional criteria for readiness for implementation. Preparation activities undertaken with support from PHRD and PPA financing include training, background studies and mobilization of implementers at the State, District and school levels.

* By supporting the proposed project, the Bank does not intend to prejudice the final determination of the parties' claims

on the disputed areas

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Annex 1: Country and Sector Background

FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project Country and Macroeconomic Background 1. Nigeria is Africa’s most populous (140 million) nation, and with a GDP of US$167 billion (2007), its economy is the second largest in sub-Saharan Africa and the largest in West Africa. Nigeria has a decentralized government structure. There are 36 States and the FCT and 774 local government areas (LGAs). Despite being the 6th largest exporter of oil, Nigeria is one of the poorest countries in the world with per capita income of US$920 and high inequality--approximately 54 percent of the population is estimated to be poor.10 Nigeria’s oil revenues grew from an annual average of about US$15 billion between 2000 and 2003 to about US$36 billion annually between 2005 and 2008. On the macroeconomic front, the non-oil economy is estimated to have grown by 9 percent per year in 2005-08, in contrast to the 3.5 percent annual average growth rate between 1997 and 2000. Inflation rates of 40 percent per year in the 1990s declined to a range of 14 to 18 percent during 2001-2005 and to single digits in 2007; and in spite of recent sharp increases in food and energy prices, inflation was under 15 percent in 2008. In addition, with the most recent fall in oil prices in the second half of 2008, Government has reacted speedily and appropriately by re-working their budget.

Table 1: Key Economic Indicators 1997-2000 2003-05 2006-08 Average annual percent

GDP growth** 2.9 9.1 6.1 GDP non-oil growth 3.5 9.2 9.3 Agriculture 4.2 6.8 7.2 Manufacturing 0.1 9.1 9.2 Services 3.2 13.8 13.1 Fiscal balance/GDP -0.7 4.5 4.5 Inflation 8.0 15.6 8.5

i. Statistical break in national accounts distorts growth rates for 2002. 2001 and 2002 data are therefore excluded from this table.

ii. 2007 is provisional; 2008 is estimate.

2. The last decade has been the first period of continuous democracy in Nigeria. Since independence, Nigeria has experienced a series of military regimes, a devastating civil war and several democratically elected governments unable to complete their terms in office, until the election of President Obasanjo in 1999. President Obasanjo was re-elected in 2003 and in 2007, with the election of President Yar Adua, one democratically elected government handed power over to another democratically elected government for the first time in Nigeria’s history. Recent violence over local elections point to continued tensions, in some areas of the country.

3. From macro-management to sector reforms, the Government began an ambitious reform agenda. The most fundamental and far-reaching reforms were in fiscal management, when the government introduced in 2004 a system of basing the budget on a conservative reference price for oil, with excesses saved in a special account, and expenditures were de-linked from oil receipts. The largest debt relief in the history of the Paris Club was secured for Nigeria in 2005, providing fiscal space to increase social

10 World Bank (2007) Nigeria: Poverty Assessment.

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expenditures. Ambitious initiatives were launched to increase transparency and reduce corruption in the management of public finance, and civil service reform was begun, although progress has been mixed.

Lagos State Macro-Economic Situation 4. Lagos is a predominantly urban state, with an estimated population of 9 million that is expected to grow to over 17 million by 2015.11 Lagos has a land mass of about 3,577 sq km (the smallest in Nigeria). It is a mega-city of dominant economic importance not only for Nigeria but in West Africa. It is the premier manufacturing and port city in the region with the largest concentration of multinationals and financial institutions in the country. Lagos is the second largest contributor to the GDP of the nation (12 percent). The state accounts for about 80 percent manufacturing value-added in Nigeria and over 65 percent of its commercial and industrial activities. Lagos has over 2000 industries and over 250 financial and allied institutions with the most active stock exchange in the country. Despite its dominant economic status in Nigeria’s non-oil economy, Lagos is a poor city with poor social indicators and it also has one of the highest rates of poverty and inequality in the country. Although its annual budget dramatically improved in the last three years, its annual budget is small relative to the resources necessary for adequate service delivery and infrastructure. According to the NLS survey, 67 percent of the population of Lagos lives on less than one dollar a day and, as such, are considered to be poor. The poverty ranking of the state is 23rd out of the 36 states in the Federation. Lagos has one of the highest incidences of poverty and inequality in the country. Overall, Lagos ranks 11th in terms of poverty incidence and 1st in terms of inequality. Almost 70 percent of the Lagos population lives in slums in extremely poor environmental conditions.

Table 2: Poverty Data in Selected Nigerian States

State Total Population* Poverty

Headcount (%) Population living

in Poverty Poverty Gap Gini Index (%)

Enugu 3,257,298 36.8 1,198,686 12.0 44

Jigawa 4,348,649 90.9 3,952,922 47.3 44

Lagos* 9,013,534 67.0 6,039,068 35.6 64

Kaduna 6,066,562 40.9 2,481,224 12.7 42

Kano 9,383,682 49.7 4,663,689 18.0 43

Sources: Provisional Results of the 2006 Nigeria Census by State & Nigeria Poverty Assessment (2007, draft). * Population data from the 2006 Census are contested. Many argue that the population of Lagos is likely to

be closer to 17 million. This would give the population living in poverty in Lagos as 11.39 million. Progress Toward Education MDGs in Nigeria 5. Overall, Nigeria is currently off-track to achieving most of the MDGs. Nigeria aims to achieve universal primary education and gender equality at the primary level by 2015, but the challenge is large. Primary school enrollment increased rapidly from 17.9 million in 1999 to 26.0 million in 2006, although over 7 million primary age children still have no access to schooling. Secondary enrollment rates are growing fast, especially by private providers, and it is possible that Nigeria may attain the MDG goal of 100 percent literacy for the 15-24 age group by 2015. Table 3 shows Nigeria’s current status on the MDGs and likelihood of attaining the 2015 goals.

11 Authorities in Lagos have disputed the 9 million figure, which is cited by the 2006 Nigerian census. According to the

Lagos Central Bureau of Statistics, the population is closer to 17.5 million (2008) with annual population growth of roughly 4% over the last 10 years. World Urbanization Prospects (2003) estimated the population as 11 million.

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Table 3: Progress toward the MDGs in Nigeria

MDG MDG target

2015 Current Status

Likelihood of attainment

1. Poverty and Hunger - Halve percentage of people living in poverty

31

54

Not likely

- Eliminate hunger (percent of children under 5) 18 28.7 Not likely 2. Achieve universal primary education - increase net enrolment rate in primary education

100

90

Attainable

- increase primary school completion rate 100 70 Not likely - increase literacy rate of 15-24 years old 100 84 Attainable 3. Promote gender equality

- Raise ratio of girls/boys in primary and secondary schools to 100 percent

100

85

Attainable

4. Reduce under 5 child mortality - Reduce infant mortality rate by two-thirds - Reduce child mortality in children under 5 by two-thirds

30 64

110 201

Not likely Not likely

5. Improve maternal health - Reduce the rate of maternal mortality (per 100,000) by three-fourths

75

828

Not likely

6. Combat HIV/AIDS, malaria & other diseases - HIV prevalence in female population, age 15-49

XX

4.4

Attainable

7. Sustainable access to basic needs - Double proportion of population with access to safe drinking

water - Double proportion of population with access to improved

sanitation - Proportion of land area covered by forests

85 80

20

60 38

12.6

Not likely Not likely

?

6. Delivery of social services and improvement in social indicators remain key challenges. Poverty and inequality remain high. Despite improvements in primary school enrollment rates, the educational system suffers from poor quality at both the primary and secondary levels. In health, routine immunization has improved and the incidence of HIV/AIDS has come down in recent years, but the quality of health care services is poor and infant, child, and maternal mortality rates are high compared to Regional and other low-income countries.

Education and Nigeria’s Reform Agenda 7. In 2003, the Government prepared the National Economic, Empowerment and Development Strategy (NEEDS), a major multi-sectoral reform program that sees educational reforms as central to socio-economic empowerment. In June 2005, a National Committee was inaugurated to monitor and allocate additional funds from the debt relief funds for the achievements of the MDGs. The Federal Government launched a major education reform program in 2006 which stresses the importance of institutional reforms to improve the efficiency and effectiveness of service delivery at all levels of education. Similarly, Nigerian States have also developed individual State Empowerment and Economic Development Strategies (SEEDS) which prioritize education provision at the state level.

Education in Lagos Government Reform Agenda 8. The Lagos State economic and empowerment development strategy (LASEEDs) was developed in 2007, recognizing that enhancing the Lagos State citizens’ access to education can help reduce extreme poverty and provide empowerment. The Education Sector Plan was subsequently presented in October 2008 and aims to provide accessible, equitable, quantitative and qualitative education for all, fostering self-reliance and socioeconomic development in Lagos and Nigeria. The ESP broadly lays out guidelines for strengthening and expanding educational opportunities at all levels from ECCD to Tertiary. Although the plan is yet to be fully costed and prioritized, this process included a review of the State’s blueprint on

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education, the SEEDS and EFA plans. More recently, the Ten Points Agenda (TPA), also referred to as the Lagos Economic Advancement Program (LEAP) sets out the main strategies for achieving efficient and adequate social services and infrastructure to stimulate and create gainful employment through such educational policies as the construction of millennium schools, curriculum review, rehabilitation of all schools and libraries, scholarships, provision of school furniture and equipment, self-sustaining tertiary education, and teachers welfare enhancement. LEAP is one of the high level policy initiatives of the Government which contain strategies for transforming the state into a Model City through the actualization of poverty alleviation and sustainable economic growth. The TPA is also consistent with the overall policy thrust of LASEEDS.

9. In addition, the Lagos education strategy is guided by key policies/legislation including the Lagos Post-Primary Teaching Service Law (2005); the Lagos State Compulsory Free Universal Basic Education Law (2005); and Lagos State Government Education Management System Law (2007).

The Lagos Medium-Term Education Sector Strategy (MTESS) 10. Lagos State prepared its Medium-Term Education Sector Strategy to cover the period 2009-2011. The MTESS which is the framework for actions and activities in the State Ministry of Education has six strategic goals and 39 objectives and sets out costed initiatives and expenditure plans through which the Ministry will achieve its Education Sector Plan (ESP) and contribute to the attainment of the development priorities as stated in the Lagos State Economic Empowerment and Development Strategy (LASEEDS). The document outlines the following as the major challenges facing the education sector: low literacy rate; inadequate and inappropriate staffing; unqualified staff; inadequate and dilapidated infrastructure at all levels; wide disparities in educational standard of learning achievement; the system emphasizes theoretical knowledge at the expense of technical, vocational and entrepreneurial education; inadequate funding; truancy and exam malpractice; inadequate effective monitoring to ensure quality in the private schools; and total dependence on the State Government for funding (Draft MTESS October, 2008).

11. To address the various challenges, the MTESS outlines the State Government’s commitments to: providing tuition free education at all levels; expanding education through the establishment of new schools and the provision of new facilities; massive rehabilitation of existing facilities; improve the quality of the workforce through massive training and re-training of teachers; bursary awards for Lagos State indigenes; and the expansion of vocational education (Draft MTESS 2008). As a part of its management responsibilities, Lagos enacted a law to provide for the establishment of the Lagos State Government Education Management Systems (LASGEMS) and for the establishment of private schools.

Overview of Nigeria’s and Lagos’s Education Sector

12. Nigeria’s education system comprises 9 years of basic education (6 years of primary and 3 years of junior secondary), 3 years of senior secondary, and 4 years of tertiary education. The provision of education is a concurrent responsibility of the federal, state and local governments12, with a fast growing private education sector also active at all levels of the education system. The Federal Government plays a dominant role in the provision of post secondary education, while state and local governments have principal responsibility for the provision of secondary and primary education. Primary education is under the control of local governments. Secondary schools fall under the jurisdiction of the state governments

12 In 2001, it was estimated that the Federal Government accounted for about 20 percent of total education expenditures,

while state and local governments accounted for approximately 80 percent. The few recent studies that have examined the financing of education in Nigeria suggest that public funding for education increased from about 2.8 to 6.2 percent of the Gross Domestic Product (GDP) spent between 1999 and 2002, as opposed to the SSA country average of 4.7 – 5 percent. These figures suggest that Nigeria spends roughly about the same amount, or more, on education relative to other countries in the region. Data are not available to examine public spending as a share of GDP.

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except for the “Unity Schools” which are administered by the federal government. Higher education is administered by both federal and state governments. The Federal Government also provides additional direct funding for education at the state and local government levels through the Universal Basic Education Commission (UBEC) for the implementation of the universal basic education program (UBE), the ETF, which is mainly for physical infrastructure, and the virtual poverty fund from the debt relief initiative, for the achievement of the Millennium Development Goals (MDGs).

13. Education provision in Lagos has a number of distinctive features. The State government provides limited funding for HEIs. Secondary schools are not permitted to charge school fees and class teaching (as opposed to specialist subject teachers) is the norm in primary schools. Lagos State offers tuition-free education for basic and senior secondary education.

Access to Education 14. Gross enrollment in Lagos is nearly 100 percent for 6-14 year old children but declines to 65 percent by age 17 years or at senior secondary period and is appreciably lower at around 40 percent for the lowest income quintiles. The progression of students from primary to junior secondary school is automatic. Completion rates in secondary schools are considerably lower, reflecting the inadequacies of the learning environment (poor infrastructure, overcrowding, limited learning materials, etc.), availability of schools (both public and private), and indirect costs. Although the state has a free education policy, parents are often required to buy textbooks and teaching materials. Until recently, core textbooks and other essential learning materials had been in chronically short supply in most public secondary schools, where the student-textbook ratios had been 4:1 in JSS and 35:1 in SSS. The recent procurement of core subject textbooks by the Lagos government would go a long way towards increasing the availability of textbooks. Transportation issues (traffic congestion, distance to nearest school, urban expansion) further exacerbate children’s access to education. The low quality of education combined with the high opportunity costs at the secondary level contribute to the decline in enrollment in junior and senior secondary. Furthermore, the low employment rate of secondary school graduates acts as an additional deterrence. The schools are characterized by overcrowding and inadequate infrastructure. It should be noted that almost no gender disparities exist in attendance rates and in fact more girls are completing primary school than boys.

15. Dissatisfaction with the public education system is leading to the expansion of private schools with a consequential exodus of influential stakeholders in the state sector. The non availability of classrooms and infrastructure and land in urban, rural and riverine areas affect enrolment and access. There is evidence of significant overcrowding in secondary schools. The situation in the JSS, where 318,664 students struggled to sit in 3886 classrooms means that about 82 students are expected to sit in one classroom. The situation is worse at the SSS level - 265,233 students housed in 1349 classrooms. This translates to one classroom to 197 students, although the national policy on education recommends a maximum of 40 in a class. Therefore, there is a need for more classrooms and schools to improve access. Increased investments by Lagos State on infrastructure since 2006 has begun to alleviate the problem (see below). Other Bank projects such as LMDGP are addressing the supply of education by financing the construction of new schools throughout Lagos.

Enrollment Trends in Lagos State

16. As of 2008, Lagos has 11,387 schools (public and private) and enrolled an estimated 2.3 million students. Of these schools, 1,030 are public primary, 319 public junior secondary and 318 public senior secondary schools. Total number of students enrolled in public schools at all levels by 2008 is 1.04 million and total enrolled at secondary school level by 2008 was 583,897. The Ministry of Education reports 7,511 private primary schools, 1,172 private junior secondary and 1,037 private senior secondary

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schools, although officials agree that these figures are substantially underestimated since the number of private schools is difficult to capture given that many are unregistered. For tertiary education, the state also has 5 public technical colleges, 5 universities (2 public and 3 private), 2 polytechnics, 1 monotechnic and 4 Colleges of Education. The high demand for education, combined with the ever-growing population has spawned a dramatic growth of private schools over the last two decades, especially at the primary level. The majority of lower income groups in Lagos enroll their children in public schools, particularly at the secondary level, whereas the majority of the middle and high income groups send their children to private schools. For example, most civil servants in Lagos send their children to private schools. Only 57 percent in the poorest quintile attend secondary school, compared to 94 percent in the highest income quintile (CWIQ 2005). Out of school youth (roughly 2 million13) remains a considerable challenge in Lagos where the opportunity costs of attending secondary school are high and the availability of quality public secondary education is constrained by the enrolment ”bulge” from the high completion rates in primary education and fast increasing population. The Lagos household survey showed that the State has a high adult literacy level (93 percent).

Table 4: Public and Private Schools and Enrollment in Lagos State (2007/08)

Number of Schools Enrolment

Public Primary 1,030 454,808

JSS 319 318,664 SS 318 265,233

Total 1,667 1,038,705 Private

Primary 7,511 907,767 JSS 1,172 182,218 SS 1,037 168,841

Total 9,720 1,258,826 Total Public and Private

Primary 8,541 1,362,575 JSS 1,491 500,882 SS 1,355 434,074

Total 11,387 2,297,531 Source: SUBEB and Ministry of Education, 2007/2008 EMIS (includes 5 public technical senior secondary

colleges).

13 The EFA Action Plan from 2004 estimated 2.5 million out of school children, although the most recent EMIS data

suggests 1.3 million not enrolled in school between 6-14 years of age. The lack of data on private schools and inaccurate population figures makes it difficult to estimate.

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Table 5: Lagos State: Public Schools and Enrollment 2008, By School District

Primary, Junior Secondary, Senior Secondary

Primary Junior Secondary Senior Secondary

District and LGA No. of

Schools Enrollment No. of

Schools Enrollment No. of

Schools Enrollment District 1 - Agege 54 26,857 6 17,848 8 13,249 - Alimosho 62 37,747 19 37,320 20 25,842 - Ifako-Ijaiye 19 12,891 7 14,152 7 16,982 District 2 - Ikorudo 57 35,017 26 26,457 27 24,967 - Kosofe 49 25,916 13 20,605 13 17,127 - Somolu 51 23,984 10 15,989 10 9,882 District 3 - Epe 82 21,535 24 9,723 24 6,677 - Eti Osa 37 16,040 19 10,516 16 7,876 - Lagos Island 38 14,835 10 5,826 10 5,778 - Ibeju-Lekki 36 11,457 9 3,218 9 2,039 District 4 - Apapa 26 13,973 6 6,821 6 6,440 - Lagos Mainland 61 25,597 14 12,657 10 7,512 - Surulere 69 26,004 30 25,370 30 20,247 District 5 - Ajeromi/Ifelodun 74 34,213 19 19,576 20 16,674 - Amuwo/Odofin 39 13,240 19 10,345 18 8,456 - Badagry 54 20,598 13 13,167 13 10,125 - Ojo 43 24,264 15 19,413 15 14,020 District 6 - Ikeja 31 13,594 13 12,478 11 11,619 - Mushin 88 30,199 18 16,435 18 14,675 - Oshodi-Isolo 60 26,847 29 20,748 28 19465 Sub-Total 1,030 454,808 319 318,664 313 259,652 Technical Colleges 0 0 0 0 5 5,571 Total 1,030 454,808 319 318,664 318 265,223

Source: State Ministry of Education (2009).

Secondary Education in Lagos 17. Enrollment in public schools across the six education districts, in the 20 LGAs of Lagos in 2008 is given in Table 4. Enrollment in private secondary schools across these LGAs for academic year 2006/07 are given for junior secondary in Table 6 and in Table 7 for senior secondary school. Secondary education follows primary education and precedes tertiary education. The broad aims of secondary education within Nigeria’s overall national objectives are preparation of students for useful living within society and for higher education. The main purpose of secondary school is to prepare students for life and work in a dynamic, developing democratic society. It is expected that senior secondary schools will prepare students for higher education and work by giving them a choice of subjects, interactive instruction, and a balanced curriculum aligned to the needs of the work place.

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Junior Secondary Education. This program is given for a length of 3 years, and typically for ages 12 to 15 years, and graduates are awarded a Junior Secondary School Certificate. Students automatically pass on to senior secondary school in Lagos.

Senior Secondary Education. This type of school is provided for a period of 3 years, typically for ages 15 to 18 year olds, and graduates are provided with a Senior Secondary School Certificate.

Technical Education. This type of schooling is provided in technical secondary schools or technical colleges for a period of up to 3 years, typically to 15 to 18 year olds, and graduates are awarded with a Technical College Certificate (NABTEC).

18. Education Outcomes: Transition and Drop-out Rates. Even with the overwhelming demand for public secondary education in Lagos, as evidenced by a high transition rate from primary to junior high school, dropout rates are worrying. In the first year of junior secondary school, 9 percent leave school. Although 96 percent of junior secondary school graduates continue to senior secondary school, drop-out rates during the first year of senior secondary is over 16 percent, and in the final year 25 percent. The poor quality of education offered at public secondary schools as well as poverty have been identified as key reasons for leaving school. Poor quality is also evident in student performance on examinations.

Table 6: Enrollment in Private Junior Secondary Schools in Lagos, Academic Year 2006/7

S/N Local Government Area

Number of Junior Secondary Schools

Enrollment

1 Agege 63 6,295 2 Alimosho 335 49,621 3 Apapa 7 1,901 4 Ajeromi-ifelodun 56 8,836 5 Amuwo-Odofin 9,276 6 Badagry 31 3,603 7 Epe 6 1,105 8 Eti-Osa 21 3,693 9 Ifako- Ijaiye 74 5,727 10 Ikorodu 18 7,196 11 Ibeju-Lekki 1 321 12 Ikeja 49 4,543 13 Kosofe 64 6,368 14 Lagos-Island 7 546 15 Lagos-Mainland 27 4,605 16 Mushin 49 5,557 17 Ojo 169 10,043 18 Oshodi-Isolo 63 6,193 19 Somolu 31 42,384 20 Surulere 44 9,203 Total 1,172 182,218

Source: Ministry of Education EMIS 2006/7.

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Table 7: Enrollment in Private Senior Secondary Schools: Lagos Academic Year 2006/7

S/N LGA No. of Schools Enrollment 1 Agege 49 5,851 2 Alimosho 294 24,882 3 Apapa 5 1,055 4 Ajeromi-ifelodun 39 6,219 5 Amuwo-Odofin 47 9,148 6 Badagry 18 1,429 7 Epe 7 1,159 8 Eti-Osa 18 2,662 9 Ifako- Ijaiye 66 8,236 10 Ikorodu 56 4,097 11 Ibeju-Lekki 1 201 12 Ikeja 45 4,429 13 Kosofe 48 62,115 14 Lagos-Island 4 185 15 Lagos-Mainland 27 4,094 16 Mushin 44 4,712 17 Ojo 137 9,826 18 Oshodi-Isolo 62 6,574 19 Somolu 31 3,805 20 Surulere 39 8,162 Total 1,037 168,841

Source: Ministry of Education EMIS 2006/7. Technical and Vocational Education and Training

19. Lagos State has five government technical colleges established between 1984 and 1986. There is a college located in all but one district, as follows: (i) Ado-Soba; (ii) Agidingbi, Lagos; (iii) Odomola, Epe; (iv) Ikorodu; and (v) Ikotun. They enroll 5,374 students, and their class sizes are small (Table 8).

Table 8: Enrollments and Teachers at Technical Colleges

College 2007 2008 Teachers

M F Total M F Total No. S / T

Ado Soba 1,116 235 1,351 1,257 246 1,503 42 36

Adingbi, Lagos 476 128 604 580 182 762 51 15

Odomola, Epe 294 38 332 284 23 307 23 13

Ikorodu 1,123 236 1,359 1,177 237 1,414 56 25

Ik6otun 1,012 271 1,283 1,127 261 1,388 70 20

Total 4,021 908 4,929 24,425 949 5,374 242 22S / T = Student-teacher ratio.

Source: Ministry of Education, 2008.

20. The colleges offer general courses of study in English, mathematics, economics, biology, physics, and technical drawing. In technical courses of study, the colleges have diverse offerings (Table 9):

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Table 9: Courses Offered in the Government Technical Colleges of Lagos State

COURSE ADO SOBA

AGIDINGBI Lagos

EPE Odomola

IKORODU IKOTUN

Agricultural Mechanics Architectural Draftsmanship Block-Laying & Concreting Business Studies Catering Craft Practice Electrical Installation Fabrication & Welding Footwear & Leather Craft Furniture Craft Graphic Arts Instrument Mechanic Work Garment Making Mechanical Engineering Motor Vehicle Mechanic Work Painting & Decoration Plumbing & Pipe-Fitting Printing Radio & Television Repair Refrigeration & Air conditioning Vehicle Repair & Body Works

21. The low instructional quality at the technical colleges can be inferred from the number of course offerings which are accredited in relation to the total number of course offerings at each of the colleges (Table 10).

Table 10: Accredited Courses at the Technical Colleges, SY 2008/09

College No. of Courses at the College

Offered Accredited

Ado Soba 12 6

Adingbi, Lagos 9 1

Odomola, Epe 9 0

Ikorodu 15 2

Ikotun 14 6

Source: Information provided by Technical College Principals, 21 August 2008.

22. The negative perception of technical education as a refuge for dropouts and failures from academic junior secondary education has made the technical colleges unattractive for many potential students. This perception is reinforced by the following: (i) limited investment in the technical colleges; (ii) lack of basic tools and equipment; (iii) poor condition of infrastructure; (iv) poor quality of teaching and creativity; (v) limited opportunity to partner with industries and the private sector; and (vi) limited opportunities for the students at the end of their course of study. Parents therefore, would prefer to send their children or wards to study more “prestigious” courses such as medicine and law. However, as JAMB as WAEC results show, over the years, only a very small fraction of these students gain entrance

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into universities. Many students who could have benefited from good quality technical education to fill the required low and middle skills gaps in the state become unskilled and unproductive.

23. Though the National Plan for Technical and Vocational Education (2000) advocates competency-based training, the traditional program structure lacks the flexibility to accommodate the rapidly changing demand for new skills in Lagos State. Neither does it include the participation of various types of trainers and training institutions - formal and informal, public, private and community-based - who could otherwise facilitate greater relevance and access. The Lagos Eko project would introduce an innovation in technical and vocational education in Nigeria. The good practices generated by this project would be shared with relevant federal agencies and other states intending to improve the quality of their technical education.

Quality of Education in Lagos: Results of Student Test Scores

24. Secondary school students sit in two public examinations, namely the qualifying examination at the end of JS3 and the senior school certificate of education (SSCE) at the end of SS3. There are two examination boards at the senior secondary school level – the West African Examination Council (WAEC), and National Examination Council (NECO). Examination results at the end of the senior secondary cycle are disappointing.

25. Between 2000-2004, across the Federation, the percentage of students who achieved 5 credits including English and Mathematics in the school leaving examinations was 23 percent. Between 2000-2006 a comparative analysis of the results of the best 100 schools compared with the results from the Federal Government Colleges in the NECO examinations showed that the average success rate (5 credits including English and Mathematics) was 38 percent for Federal Government Colleges and 78 percent for pupils at other schools.

Student Performance in Public Junior Secondary Schools

26. Table 11 below shows that very few of the students who sat for the examinations in Lagos failed each of the four core subjects (English Language, Mathematics, Integrated Science and Social Studies) and at the same time not many of them are in the distinction level. The bulk of students oscillates between credits and passes levels. The trend of performance in each of the four subjects at distinction, credit pass and fail is similar.

Table 11: Performance at Critical Points in Public Schools: JSS 3 - 2006/2007

Source: Adapted from the Lagos State Exams Board (2008).

Subject

No. of boys

who sat for the Exam

No. of girls who

sat for the

Exam

Distinction Credits Pass Fail

Male Female Male Female Male Female Male Female

English 38,549 38,804 1,051 1,138 14,358 14,621 22,355 22,294 785 751Mathematics 38,549 38,804 2,393 2,616 13,053 12,992 22,353 22,454 750 742Integrated Science 38,549 38,804 2,389 2,646 13,046 13,157 21,903 21,896 1,212 1,104 Social Studies 38,549 38,804 2,352 2,608 12,974 12,951 21,907 22,062 1,268 1,132

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27. Unlike the students in public junior secondary where the distribution of the students’ performance stagnate at pass level, the performance of the private junior secondary school students obtain between distinction and credit with many of them at the credit level. The students with distinction are more than those who had ‘pass’ and ‘fail’ put together as shown in Table 12.

Table 12: Performance at Critical Points For Private Schools: JSS 3 - 2006/2007

Source: Adapted from the Lagos State Exams Board (2008). Student Performance in Public Senior Secondary Schools 28. In the 2008 WASSCE senior secondary examinations only 8 percent of the candidates obtained 5 credits including English and Mathematics. This poor performance is one of the main concerns of government, and is one reason for the growing provision of private education in the State as households demand more options for their children. A summary of the WASSCE 2008 results with both credit and passes for English, Mathematics and Biology are given in Tables 13, 14 and 15, respectively. These results also indicate the poor performance of senior secondary graduates in this exam. In biology, for example, only one-third of students obtain credit and passes in the 2008 examinations. It is also important to note that while 60 percent of children in School District 1 (Agege, Alimosho, Ifako-Ijaiye) obtained credit and passes in English, only 26 percent of children obtain credit and passes in English in School District VI (Mushin, Ikeja, Oshodi-Isolo) indicating the large variations in scores across LGAs.

Table 13: Results of the 2008 WAEC Examinations: Public Senior Secondary Schools, in English

School District

ENGLISH

Number of Students Who Took Exam

Number of Students With Credit and Passes

% of Students With Credit and Passes

District I 8,713 5,239 60.1%

District II 8,196 4,169 50.8%

District III 8,157 4,880 59.8%

District IV 7,716 3,407 44.1%

District V 11,700 4,724 40.3%

District VI 11,207 2,943 26.2%

Lagos State Average 55,689 25,362 45.4%

Source: MOE, School District Administration (2009).

Subject

No. of boys

who sat for the Exam

No. of girls

who sat for the Exam

Distinction Credits Pass Fail

Male Female Male Female Male Female Male Female

English 29,713 29,658 5,713 6,059 20,834 20,659 2,941 2,747 225 193 Mathematics 29,713 29,658 10,752 10,803 15,880 15,809 2,848 2,846 234 200 Integrated Science 29,713 29,658 10,759 10,933 15,866 15,671 2,853 2,871 231 183 Social Studies 29,713 29,658 10,558 10,782 15,936 15,773 2,964 2,889 240 185

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Table 14: Results of the 2008 WAEC Examinations: Public Senior Secondary Schools, in Math

School District

MATH

Number of Students Who Took Exam

Number of Students With Credit and Passes

% of Students With Credit and Passes

District I 8,659 4,116 47.5%

District II 8,129 3,567 43.8%

District III 8,128 5,769 70.9%

District IV 7,506 3,310 44%

District V 11,700 5,064 43.2%

District VI 11,207 3,264 29.1%

Lagos State Average 55,329.00 25,090.00 45.35%

Source: MOE, School District Administration (2009).

Table 15: Results of the 2008 WAEC Examinations: Public Senior Secondary Schools, in Biology

School District

BIOLOGY

Number of Students Who Took Exam

Number of Students With Credit and Passes

% of Students With Credit and Passes

District I 8,610 1,690 19.6%

District II 8,138 2,733 33.5%

District III 7,327 3,839 52.3%

District IV 7,344 2,069 28.1%

District V 11,700 3,591 30.6%

District VI 11,207 3,706 33.0%

Lagos State Average 54,326 17,628 32.4%

Source: MOE, School District Administration (2009).

Examinations and Student Assessment Processes in Lagos State

29. Student achievement in Lagos secondary schools is tested and measured at different levels, by various bodies, and in diverse ways. Some of these tests are standardized, others are non-standardized.

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30. Non-standardized tests. In primary education (grades 1-6), there is a general examination at the end of grade 6 administered by the Lagos State Board of Examinations. In junior secondary education (grades 7-9) and senior secondary education (grades 10-12), the school year is divided into three sessions, called terms. During the second and third terms in the first and second years of junior secondary education (JSS1, JSS2) and the first and second years of senior secondary education (SS1, SS2), unified examinations are organized, conducted, and administered by the Basic Education Service (BES). Originally school-based, the tests have been “unified,” that is, a single set of examinations compiled centrally at BES is administered by schools. A student's individual scores in the unified examinations are added to his or her continuous assessment results, and the corresponding averages become the student's final or end-of-year scores.

31. Funded by the state, unified examinations were introduced in 2000, intended to ensure: (i) that uniform standards are maintained in the conduct of the exams at the various grade levels; and (ii) that teachers cover the syllabus and teach until the end of term. The process for developing and administering the unified examinations involves the following steps: (i) determination of the number of students studying specific subjects to derive the printing order for question papers to be made with the Lagos State Printing Corporation; (ii) writing, revision, and editing of up to three sets of items for each subject area and grade level to be tested; (iii) selection of one set of test questions per class per subject and preparation of marking scheme; (iv) presswork: typesetting at the printing press and proofreading; (v) distribution of questions and marking guides to the education districts the day before the scheduled examinations; papers picked up by school principals on the day of the examinations (monitored by BES officers); (vi) monitoring visits to examination schools by inspectors and BES officers; (vii) district conference among schools on examination marking of scripts (supervised by district officers); (viii) marking of examinations; and (ix) reporting of examination results to the school.

32. In the years that they have been in use, the unified examinations administered at the end of JSS1, JSS2, SS1, and SS2 have undergone improvements, largely through contributions in test items solicited from teachers. However, as they are not standardized, their results do not provide a reliable comparison of achievement across students or schools and cannot be used as a basis for determining progress in learning outcomes of a student or a school.

33. Standardized tests are those administered and scored in a predetermined manner, with students taking the same test in the same conditions at the same time, if possible. The development of standardized tests at the Lagos State Examinations Board accords with accepted educational evaluation processes and involves curriculum analysis, item writing and testing, determination of levels of difficulty, and compilation of test questions in sets or “item banks.” Testing is conducted rigorously, and test response cards are optically read by computers in a secure environment. Individual student identifiers are maintained in the Exams Board's electronic archives. As the tests measure a pupil’s level of knowledge in a particular grade level and specific subject, they also provide a basis for comparability of student achievement scores across Nigeria.

34. For primary grade 6 students seeking admission to “model” or “upgraded” secondary schools, special selection examinations are administered by the Exams Board. This examination is standardized, but the student scores are only one factor among a number of factors (continuous assessment scores, participation in school activities, residence) used for determining admission to the desired model or upgraded junior secondary schools.

35. At the end of JSS3, there is also an examination which is standardized and administered by the Lagos State Examinations Board. At the end of SS3, there is a standardized examination set, coordinated, and administered by a regional body, the West African Examinations Council (WAEC). Other

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standardized examinations, such as NECO and General Certificate of Education (GCE) may also be taken at this stage by students as an option.

Quality of Education Inputs in Lagos: Classrooms, Curriculum and Textbooks, and Teachers

School Infrastructure: Classroom Environment

36. The quality of teaching and learning in Lagos is generally poor due to the inadequate and poorly constructed infrastructure which has suffered serious deterioration (including roofs, toilets, and water supply). Desks are inadequate given the numbers of students as is staff room furniture. Laboratory facilities are poorly equipped. Computers are rarely used in secondary schools. This directly impacts learning outcomes which are low in Lagos secondary schools.

Table 16: Infrastructure and Teaching and Learning Inputs for Public Schools in Lagos (2007)

Indicator Junior Secondary Senior Secondary Pupil Classroom Ratio 61: 1 53: 1 Pupil Textbook Ratio 37: 1 40: 1 Numbers of Classrooms 4,439 4,946 Number of Schools 319 318

Source: SUBEB and Federal Ministry of Education, (2008).

37. For many years, students were required either to bring their own school furniture from home or pay to use what was available at school. Although there has been some improvement in recent years, most classrooms are still chronically short of desks and benches. Many schools have no libraries and other essential facilities (toilets, laboratories, staff room) are seriously sub-standard or non-existent. SUBEB is making concerted efforts to monitor the supply of new furniture and the quality of new structures. Even so, the quality of new classrooms and furniture leaves a lot to be desired.

38. Classrooms and other facilities are generally much better at private schools mainly as a result of competition between schools and some limited monitoring of facilities by the ministry of education. PTAs are also active in raising funds for all types of school improvements whereas, with the policy of free education for all, this is no longer the case at most public schools.

39. There has been no significant construction project for public secondary schools in Lagos in nearly 30 years, and the lack of maintenance and repair has led to general decay in school infrastructure. In school year 2004/5, head teachers assessments in the Annual School Census (ASC) reported that up to 39 percent of secondary classrooms needed major repair, up to 31 percent needed minor repair, and only 30-35 percent were in good condition. The state of disrepair exacerbates the serious overcrowding in secondary schools. Furthermore, furniture and science equipment were nearly non-existent in most schools.

40. Lagos State has been making significant investments in infrastructure in recent years. Capital expenditures have risen from N 2.6 billion in 2001 to N 4.9 billion in 2006 (Table 16), averaging N 3.2 billion annually over the period. In the last two years (2007-08), the government's record of expenditures in school infrastructure, furniture, and equipment shows continuing attention paid to this need.

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Table 17: School Infrastructure Program: Lagos, 2007-2011

Infrastructure Item 2007 2008 2009–11 (Est.)

Construction – Classrooms Cost (Naira ‘000)

46 244,800

1,535 5,534,000

5,000 21,000,000

Rehabilitation – Classrooms Cost (Naira ‘000)

669 500,000

1,241 2,048,000

3,200 9,525,000

Furniture – Pieces Cost (Naira ‘000)

14,500 153,000

42,700 602,000

124,800 1,452,000

Science Equipment – Schools Cost (Naira ‘000)

58 390,000

70 580,000

480 4,200,000

Source: Ministry of Education, 2008.

41. The government's projected requirements in school infrastructure would address the long-standing need in Lagos for adequate physical facilities conducive to learning. A three-year horizon for meeting those requirements is realistic, as the incremental increase from the expenditures of 2008 would be moderate, both in terms of expected outputs (classrooms constructed or rehabilitated, furniture installed, science equipment delivered) and estimated costs. Schools are also being constructed and/or rehabilitated under the Bank financed Lagos Metropolitan Development Growth Project (US$25 million for school infrastructure).

Curriculum Development and Textbook Provision 42. The official curriculum for junior secondary education aims to provide a broad-based education for life and work and the opportunity to acquire knowledge and skills and to cultivate work habits for further education and self development. The curriculum for senior secondary education aims to train the individual for the scientific and technological world, increase his or her competitiveness in the labor market and in a global environment, and prepare him/her for employment.

43. In 2005, the National Council on Education directed the Nigerian Educational Research and Development Council (NERDC) to develop a school curriculum for the effective implementation of the Universal Basic Education (UBE) Program. By 2007, a new structure for primary and secondary education emerged, providing for a continuous nine-year program comprising lower basic primary grades 1-3, middle basic primary grades 4-6, and upper basic primary grades 7-10 (junior secondary education). The curriculum is being developed and implemented in phases starting with primary grade 1 and JSS1 in school year 2007/08, with the expectation of completing the introduction by 2015/16.

44. Textbooks and learning materials have been absent from secondary school classrooms in Lagos for some time. A sample of schools surveyed for textbook availability in 2008 revealed that (i) the textbook in the subject being taught was unavailable for 42 percent of the sample; (ii) one textbook was available for 33 percent; (iii) one textbook was available for every two students for 11 percent; and (iv) one textbook was available per student for only 14 percent. In response to this need, Lagos procured and distributed textbooks in 2008, with the objective of achieving a pupil/textbook ration of 1:1 in the core subjects of English, math, science and social studies.

45. Meeting labor market demands. The Ed Tap Survey conducted by the Federal Ministry of Education in 2007 revealed that as many as 60 percent of graduates are unemployable primarily because they do not have sufficient skills to adapt to the needs of the ever changing dynamic business environment. Lagos State’s business community is increasingly concerned with the State’s low

43

performance in WASSCE and NECO exams, occurring during a period in which students are required to have more substantial knowledge, in an increasingly dynamic workplace.

Quality of Teachers

46. Statistics on teacher employment in Lagos State are not consistent, and the most accurate source is the payroll records of SUBEB and the SMoE.

Table 18: Number of Teachers by Type of School in Lagos State, 2005/2006

Government Private Total

Female Male Total Female Male Total Female Male Total

Primary

JSS

SSS

N/A

N/A

10,596

N/A

N/A

6,292

15,796

8,125

16,888

28,968

*

2,835

6,973

*

3,502

35,941

0

6,337

N/A

N/A

N/A

N/A

N/A

N/A

51,737

8,125

23,225

Total N/A N/A 40,809 31,803 10,475 42,278 N/A N/A 83,087

Note: * For the private sector, the figures for primary include kindergarten and nursery while JSS and SSS are combined.

Sources: SMOE and SUBEB, Lagos State, 2008.

Table 19: Teachers and Non-Academic Staff Supply (2007)

Junior Secondary Senior Secondary

Number of Teachers 8,168 8,321 Male 2,447 3,891 Female 5,721 4,430 Competence Qualified 7,540 7,011 Unqualified 628 1,310 Teacher Pupil Ratio 1:40 1:31 Gender Parity Index 2.337 1.139

Source: SUBEB (2008).

47. Teachers Qualifications and Experience. The qualification and experience profiles of teachers are the most commonly used indicators of teacher competence. According to the Annual School Census, most teachers at secondary schools have the prescribed minimum teaching qualifications, the student-qualified teacher ratio is 25:1 for primary schools, and 72:1 and 55:1 at junior and senior secondary schools respectively. This ratio is over 100 for junior secondary schools in five LGAs and four LGAs for senior secondary

48. The National Union of Teachers (NUT) officials stated that, given the paucity of attractive employment opportunities outside of the education sector, many graduate secondary school teachers are studying for masters degrees, particularly in education. Also, many graduate teachers who do not have teaching qualifications are enrolled in education degree programs since pay and promotion prospects are appreciably better for qualified teachers.

49. As elsewhere in the country, there are pervasive concerns about the quality of teacher training courses at both NCE and degree levels. Complaints about the competence of newly appointed teachers are commonplace. Nearly half of primary school teachers have less than 10 years of experience compared with around 30 percent among secondary school teachers. Most teachers who do not have the

44

NCE only have a few years left before retirement and so there has not been any real pressure on them to upgrade their qualifications.

50. The latest data in three sample LGAs in Lagos indicates that teachers’ qualifications in junior secondary schools in three LGAS is quite high, with 91 percent having the requisite degree qualifications.

Table 20: Junior Secondary Schools Teachers’ Qualification* (Academic Year 2007/08)

Male Female Total

NCE 129 271 400

HND 33 7 40

1st degree with teaching qualification 185 347 532

1st degree without teaching qualification 43 28 71

Higher degree with teaching qualification 5 34 39

Higher degree without teaching qualification 3 4 7

Others 6 1 7

Total 404 692 1,096 * In only three LGAs Source: Lagos Eko Survey 2008. 51. For senior secondary education teachers, roughly 80 percent of all teachers have qualifications of NCE holder or better. Since the National Policy on Education is silent on the suitability of NCE holders to teach at senior secondary school, NCE holders were categorized as qualified teachers to teach at the senior secondary school level.

Table 21: Senior Secondary Schools Teachers’ Qualification* (2007/08 Session)

Male Female Total

NCE 108 105 213

HND 38 27 65

1st degree with teaching qualification 250 377 627

1st degree without teaching qualification 98 49 147

Higher degree with teaching qualification 24 49 73

Higher degree without teaching qualification 6 7 13

Others 3 2 5 * In only three LGAs Source: Lagos Eko Survey 2008.

52. More Female Teachers in Lagos. Females account for nearly two-thirds of teachers at public junior and senior secondary schools. More female teachers (63 percent) are working in junior secondary schools than males (36 percent). The ratio is similar in senior secondary school.

45

Teacher Motivation

53. The overall level of commitment of teachers to their work is the outcome of the complex interplay of a variety of factors. These factors include personal emoluments; particularly take home pay, and the regularity of the pay, meeting of personal basic needs and that of the family, and the work environment. As civil servants, both primary and secondary school teachers receive the same salary package and other conditions of service as other government workers. Given qualification and experience profiles, the average take-home pay of the majority of public school teachers in Lagos State is around N 20,000 per month (or 2.4 times the Nigerian per capita income). Principals with 30 years or more experience can earn up to N 55,000 per month. A new graduate takes one-third of that amount as the starting point. There is also one step difference between a graduate with education qualification and others.

54. The inadequacy of teacher pay to meet basic needs adversely affects teacher efficiency and effectiveness. Teachers feel that their salary is low and many seek to earn secondary incomes (‘moonlighting’). Private tuition on school premises after normal school hours is widespread at both public and private primary and secondary schools. Parents generally welcome this arrangement, particularly those who return home late from work and among the many who believe that keeping their children in school for longer hours than scheduled is desirable.

55. One of the consequences of the long running ‘face off’ between the federal and state government is that the payment of teacher salaries has become irregular, which has seriously dampened morale. For example, the Federal Government has decided to withhold statutory allocations to Lagos because of the creation of additional local governments by the State. High levels of teacher absenteeism are one of the most serious consequences of poor teacher motivation. However, ASC data indicates that this is not the case in Lagos State.

56. Opportunities for promotion are rare and highly competitive. There are many teaching and support staff with qualifications above their present grade level and teacher turnover is low because alternative employment opportunities are so limited. Decentralization of more authority to schools has, however, helped to speed up promotions. As noted earlier, secondary schools have recently been reorganized into six districts, each of which is headed by a permanent secretary. The creation of junior and secondary schools with principal officers for each tier has also had a positive impact.

Teacher Professional Development: In-Service Education and Training

57. The main challenge is the out-of-date methods being used for instruction and the adequacy and quality of in-service training. Teacher training and development at both pre-service and in-service levels is inappropriate in its approach. The survey conducted for the project shows that almost half of the teachers are not exposed to training on improvisation of instructional materials. This is likely to affect their teaching negatively. A majority of the teachers (61 percent) are not exposed to computer training. Moreover, a majority of the teachers are not exposed to guidance counselor training, classroom management and library training as shown in the following table.

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Table 22: Types of Teacher Training

S/N Description Yes

(% in parenthesis) No

(% in parenthesis) 1 Improvisation of instructional

materials 205 (47.2%)

227 (52.8%)

2 Computer training 166 (38.2%)

268 (61.8%)

3 Teaching method 238 54.8

196 (45.2)

4 Library training 40 (9.2%)

394 (90.8%)

5 Classroom management 82 (18.9%)

352 (81.1%)

6 Guidance counseling 16 (5.1%)

418 (94.9%)

Source: Lagos Eko Survey, 2008.

58. The main problems adversely affecting school performance are: (i) weak school management resulting in high rates of student and teacher absenteeism; (ii) poor quality teaching resulting from low teacher morale and weak professional support; (iii) limited teaching and learning resources combined with low competency levels of teachers; (iv) inadequate advisory and supervisory services from local education authorities; and (v) limited community involvement in operation and development of schools.

59. Generally, training courses are designed without considering the needs of the classroom teachers and principals in secondary schools. Training courses are not designed to bring about change. There is also a problem of identifying what teachers' training needs are, how individual teachers’ deficiencies can be effectively addressed, and where to find information on training, course content, and quality that can be made available to schools and education district offices.

Teachers’ Training Providers

60. There are at least 19 active education provider institutions in Lagos State. At least 12 offer qualifying teacher training courses leading to the National Certificate of Education and the Bachelor of Education. At least three offer educational development services designed primarily for post qualification training for teachers. One of these institutions, the Lagos State Public Service Staff Development Centre (LSPSSDC), was set up mainly for this purpose. The others, Centre for Management Development (CMD) and Teachers Establishment and Pensions Office (TEPO) offer teacher training continued education courses as part of a larger management curriculum. Two of the providers are publishers of educational resources who undertake periodic training for core subject teachers on instructional approaches in that particular subject especially when new textbooks are published.

61. The University of Lagos (UNILAG) offers a post-graduate diploma in education and some education management courses. Not many courses have been developed by the UNILAG or Lagos State University (LASU) in particular for pedagogy training although the respondents to the questionnaire from UNILAG were keen on collaborating with Lagos State government to develop such specific public sector courses.

47

62. The Lagos State Public Service Staff Development Centre14 and the Centre for Management Development offer post qualification development courses specifically tailored to meet some needs for skills acquisition in active learning and pedagogy.

63. The Teachers’ Establishment and Pension’s Office (TEPO) trains teachers who are at grade level 13 and above. Teachers below level 13 are trained by LSPSSDC at Magodo. The six education districts also train teachers. Approvals are given by TEPO to teachers who are willing to pursue further professional development in their relevant fields as well as to attend staff vacation courses. It is also worthy to note that TEPO provides subject-based training to teachers in close collaboration with the West African Examinations Council (WAEC). TEPO also undertakes training programs for staff in collaboration with private sector trainers. For example a three-day course for teachers was organized by TEPO at the CMD, a performance improvement workshop in mathematics and biology for about 150 teachers at grade level 13 and above. TEPO had also organized two-week training on management for 1,200 teachers.

64. Although the above-cited institutions provide some training to teachers, regular in-service training is not widely and regularly available due to budget constraints and minimal capacity of the training institutions, considering the number of teachers in service. There are teachers for whom the last training attended was at least five years ago.

65. If instructional quality is to be raised and adequately measured, then the training needs of teachers and school leaders must be continually identified, the availability of programs that would address those needs should be assured, and an effective link between the demand for training and the appropriate supply of training services should be established.

Management and Governance of Education in Lagos 66. The State Ministry of Education has the responsibility for managing education services in Lagos State and also making policies. The Ministry is headed by a Commissioner who is normally a political appointee and a Permanent Secretary who is a career administrator. There are eight departments headed by Directors who report to the Permanent Secretary. Each of the eight departments has between three to five divisions headed by Deputy Directors. In addition to the 8 departments, the Ministry has 2 Boards (SUBEB and EXAMS) and 6 Education Districts covering the 20 LGAs by geographic sub-divisions. SUBEB and the 6 Districts report directly to the Commissioner of Education who is currently the Deputy Governor of Lagos State as well.

67. Schools are not well managed, and are not operating as effective education service deliverers. Governance and management structures are over-bureaucratic, too centralized and lead to duplication, ineffectiveness and a lack of decisive action. Quality assurance mechanisms are weak despite a plethora of inspection services at all levels of the system. This contributes to the failure of many pupils to reach critical minimum standards.

68. Education Districts. Lagos State established six Education Districts for the effective administration of Secondary Schools, Teachers’ and Technical Colleges and Schools of Basic Studies in the State. Each of the districts has three to four Local Government Areas and each District is independent and autonomous of the other but subject to the direction of the Commissioner. They are all headed by a Tutor General/Permanent Secretary who is appointed by the Governor on the recommendation of the Commissioner. The Education Districts have five departments to help the Tutor General/Permanent

14 www.lspssdc.com.

48

Secretary in ensuring effective administration and Management of the schools as follows: a) Co-curricular Science and Technology; b) Inspectorate; c) Personnel; d) Finance; and e) Schools Administration.

69. To ensure effective participation by stakeholders in the administration of schools at the district level, five committees are established for (i) Personnel Management Board (Junior and Senior Management); (ii) District Funds Allocation and Management; (iii) Community Relations; (iv) Coordination and Monitoring; and (v) District Tenders Board. The extent to which these committees have been contributing to the actual management and administration of schools at the district level is not yet evident. Similar committees are also established at the school level to strengthen participation at that level. School Based Management Committees have been established for all school clusters to provide a fundraising, community outreach and oversight role while supporting school planning and development.

70. Education Management Information System (EMIS). Planning, management and monitoring are made ineffective through weak systems of data collection, analysis and dissemination. Although Lagos has embarked on an ambitious plan to computerize all student data through a contract with a private company, the LASGEMs system has suffered some setbacks as differences have arisen over the proprietary nature of the data and how the data is accessed. The lack of monitoring of the private education sector further hinders the EMIS system from reporting completely on the education system in Lagos.

49

Annex 2: Major Related Projects Financed by the Bank and/or other Agencies

FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project

Financier Project ISR or IEG ratings (WB) Completed Outcome Sustainability World Bank Primary Education Project Satisfactory Likely World Bank Universal Basic Education Unsatisfactory Unlikely Ongoing Projects

Implementation Progress

Development Objective

World Bank State Education Sector Project (SESP): US$65 million, support to Kaduna, Kano and Kwara states to enhance the quality of basic education, through the provision of key inputs such as textbooks, teacher training and school rehabilitation/upgrading, school grants, as well as capacity building for key education agencies and institutions.

Satisfactory Satisfactory

World Bank STEP B: US$180 million produce more and better Science & Technology graduates, higher quality and more relevant research at the post-basic science and technical level through partnership and collaboration with private sector, international institutions and professional associations.

Moderately Satisfactory

Moderately Satisfactory

World Bank Lagos Metropolitan Development Governance Project (US$200 million): supporting the construction of model schools throughout urban Lagos.

Moderately Satisfactory

Moderately Satisfactory

World Bank Second National FADAMA Development Project (US$100 million): To sustainably increase the incomes of fadama users.

Satisfactory Satisfactory

DFID Education Sector Support Programme in Nigeria (ESSPIN) (GB £106 million 2008-2014): To improve the planning, financing and delivery of sustainable basic education services, in terms of access, equity and quality, at Federal level and in up to six States. The first five States to be selected are Kano, Kaduna, Kwara, Jigawa and Lagos. One more will be selected in 2009.

JICA Strengthening Mathematics and Science Education Project (SMASE Nigeria): To upgrade capability of Nigerian primary school pupils in mathematics and science; and teaching skills of primary school teachers in mathematics and science Construction of Additional Primary School Classrooms (JFY2005-07)

AfDB Skills Training and Vocational Education Project in 10 Federal institutions (includes Lagos)

USAID Community Participation for Action in the Social Sectors (COMPASS) in Lagos, Nasarawa, and Kano

UNESCO National Education Support Strategy; Comprehensive Education Sector Response to HIV/AIDS Challenges in Nigeria

UNICEF Basic Education Project (national)

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Annex 3: Results Framework and Monitoring

FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project

Project Development Objective PDO Indicators Use of Project Outcome Information

Improved quality of public junior and senior secondary education in Lagos State

Increase in the percentage of public junior secondary students obtaining results “at or above credit” in JSCE (junior secondary certificate exam) in English, Math and Integrated Science by one percentage point per year; Increase in the percentage of public senior secondary students obtaining “pass grade” results in the WASSCE (West African senior secondary certificate exam) in English, Math and Biology by one percentage point per year.

Identify uses of grants for optimum learning gains. Refine outcome targets of ESP/SEOP and MTESS of the sector.

Intermediate Outcomes by Component

Intermediate Result Indicators Use of Intermediate Outcome Information

Component 1: Secondary School Effectiveness 1.1: Education outcomes raised as a result of the effective use of discretionary resources provided to the school.

Number of school principals trained on development and management of annual school performance improvement plans and on grant operations.

Number of district-level staff trained on information-

gathering and monitoring of project inputs and outputs. Percentage of JSS and SSS receiving their development

grant within 60 days of school opening. Targeted # schools reporting above 80% teachers’

attendance during the school year.

Assess effectiveness of training programs on school improvement and on monitoring of grant operations. Enhance ease of use of school-based planning instruments and grant proposal forms. Improve efficiency of grant administration. Gauge effectiveness of school-level performance improvement plans. Measure impact of grants.

51

Project Development Objective PDO Indicators Use of Project Outcome Information

Improved quality of public junior and senior secondary education in Lagos State

Increase in the percentage of public junior secondary students obtaining results “at or above credit” in JSCE (junior secondary certificate exam) in English, Math and Integrated Science by one percentage point per year; Increase in the percentage of public senior secondary students obtaining “pass grade” results in the WASSCE (West African senior secondary certificate exam) in English, Math and Biology by one percentage point per year.

Identify uses of grants for optimum learning gains. Refine outcome targets of ESP/SEOP and MTESS of the sector.

Intermediate Outcomes by Component

Intermediate Result Indicators Use of Intermediate Outcome Information

1.2: Education outcomes sustained.

% schools demonstrating improvement in learning outcomes.

Publicize ranking of schools and test scores in subjects tested. Recognition of schools which significantly increase number of well-performing students.

1.3: Improved quality of technical education, relevant to employment and entrepreneurship.

Number of partnership agreements established between technical colleges and entrepreneurs, industrial, commercial, retail firms and associations.

Percentage of activities proposed in plans of technical

college completed successfully and on time.

Basis for establishment of institutional scanning and tracer studies of graduates. Evaluation and revision of PPP grant scheme. Basis for revision of state-level policies on technical-vocational education and training.

Component 2: Quality Assurance for Junior and Senior Secondary Schools 2.1: Standardized system for measuring learning achievement established and supporting the grants scheme.

New and revised standardized tests developed and administered over life of the project for JSS and SSS English, mathematics, science.

State testing agencies release exam results within 2

months of administration.

Basis for project impact evaluation. Source of feedback for performance awards, school ranking, curriculum revision, teacher training programming. Basis for rolling out program over long term in Lagos State, possible introduction in other states.

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Project Development Objective PDO Indicators Use of Project Outcome Information

Improved quality of public junior and senior secondary education in Lagos State

Increase in the percentage of public junior secondary students obtaining results “at or above credit” in JSCE (junior secondary certificate exam) in English, Math and Integrated Science by one percentage point per year; Increase in the percentage of public senior secondary students obtaining “pass grade” results in the WASSCE (West African senior secondary certificate exam) in English, Math and Biology by one percentage point per year.

Identify uses of grants for optimum learning gains. Refine outcome targets of ESP/SEOP and MTESS of the sector.

Intermediate Outcomes by Component

Intermediate Result Indicators Use of Intermediate Outcome Information

2.2: Training and capacity development of secondary school teachers and school leaders.

Number of teachers trained in leadership and/or core subject areas.

Number of teachers trained under school grants.

Assess delivery of core competency courses delivered by teaching institutions. Assess capacity of training institutions. Identify scope and cost of teacher support interventions.

Component 3: Project Coordination and Management

Required procurement, technical and financial monitoring reports provided in a satisfactory and timely manner.

Results Based Monitoring & Evaluation system

established and implemented continuously.

Assess institutional capacity for program management at school, district, and state levels. Identify further capacity development needs, opportunities.

Component 4: Strengthening Federal Post-Basic Education Strategy

Detailed program and annual plans developed, discussed, and agreed no later than December 31 of preceding year.

Number of State secondary education plans supported by the project.

Annual program outputs and reports disseminated in first quarter of succeeding year.

Aid to identification of federal level needs of secondary education. Advance development of sector programming and longer term support to education sector.

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Arrangements for Results Monitoring

Data Collection and Reporting Project Indicators Base-line

(2007/08) YR1 YR2 YR3 YR4 Frequency

of Reports Data Collection

Instruments Responsibility for Data

Collection Project Outcome Indicators

Percentage of public junior secondary students at and above credit for JSCE disaggregated by English, Math, Int. Science

E: 41% M: 41% IS: 41%

E: 42% M:42% IS:42%

E: 43% M:43% IS:43%

E: 44% M:44% IS:44%

E: 45% M:45% IS:45%

Annual

Annual JSCE

Examinations Board

Percentage of public senior secondary students with pass grade in WASSCE disaggregated by English, Math, Science (Biology)

E: 46% M:45% B: 33%

E: 47% M:46% B: 34%

E: 48% M:47% B: 35%

E: 49% M:48% B: 36%

E: 50% M:49% B: 37%

Annual Annual WASSCE Ministry of Education, EMIS

Intermediate Outcome Indicators

Component 1 School principals & vice principals trained on performance improvement and grant operations (cumulative)

0

1,327

1,516

1,611

1,706

Annual

MOE Certificates of Attendance

Office of the District TG/PS

District staff trained in project monitoring, admin & financial mgt. (cumulative)

0

492

563

598

693

Annual MOE Certificate of Attendance Office of the District TG/PS

Secondary schools receiving grants w/in 60 days of school opening

0

50%

60%

70%

80%

Annual

Report of PSU to PAC

Project Support Unit

% targeted schools demonstrating improvement in learning outcomes

0 0% 20% 30% 40% Annual Annual JSCE Annual WASSCE

Examinations Board

Targeted # schools reporting above 80% teachers attendance during the school year

0 20% 30% 40% 50% Annual School Report to TG/PS TG/PS

Partnerships between technical colleges and private sector

0 0 3 5 5 Annual Technical colleges' report to LASTVEB

LASTVEB

Technical college grant activities completed on time

0 0% 40% 50% 60% Annual Technical colleges' report to LASTVEB

LASTVEB

54

Data Collection and Reporting Project Indicators Base-line

(2007/08) YR1 YR2 YR3 YR4 Frequency

of Reports Data Collection

Instruments Responsibility for Data

Collection Component 2 New Standardized tests developed and administered

0 6 12 18 18 Annual Report to PAC Examinations Board

Testing agencies release exam results within 2 months of administration

N N Y Y Y Annual Report to PAC Exams Board

Number teachers trained on leadership and/or core subject areas (cumulative)

0 3,500

4,667

5,026

5,385

Annual Report to TG/PS PSU

Number of teachers trained under school grants (cumulative)

0 1,346

1,480

1,615

1,615

Annual Report Education Districts/Schools

Component 3 Required procurement, technical and financial monitoring reports are provided in a satisfactory and timely manner

0

50%

80%

90%

95%

Annual

Report to World Bank

Project Support Unit

Results Based Monitoring and Evaluation system established and implemented continuously

0 50% 80% 90% 95% Annual Reports to Commissioner of Education

Project Support Unit

Component 4 Detailed program and annual plans developed, discussed, and agreed with the Bank by December 31 of preceding year

0

100%

100%

100%

100%

Annual

Report of the Federal Ministry of Education

FMOE Coordinator - Abuja

Number State secondary education plans supported under project

0 1 2 3 5 Annual Report of the Federal Ministry of Education

FMOE Coordinator - Abuja

Annual program outputs and reports disseminated in first quarter of succeeding year

0 75% 80% 90% 100% Annual Report of the Federal Ministry of Education

FMOE Coordinator-Abuja

55

Arrangements for Results Monitoring Monitoring and Evaluation of Outcomes/Results 1. Monitoring and evaluation of outcomes and results of the Lagos interventions will be the responsibility of the Lagos Ministry of Education, in particular, the PSU located in the office of the Commissioner for Education. The Policy Planning Research & Statistics Dept (PPRS) of the Education Planning Department that houses the EMIS will work with the PSU to consolidate information provided by implementing departments and units. The reporting formats are specified in the PIM and a monitoring and evaluation specialist will be hired to support activities and help track progress towards the PDO. 2. Lagos capacity is challenged by the collection and quality of data. To address the capacity challenges, DFID will provide technical support to the State, through ESSPIN, to strengthen the EMIS. Currently, the core data is produced via an annual education census. Additional indicators such as teacher attendance, secondary student assessment will need to be collected to measure performance of the project. The project’s monitoring indicators will partly rely on indicators which already are or will be collected by the Ministry and partly data that will need to be collected through the various institutions supporting the components. The collection and facilitation of data will be supported by the newly created Zonal Project Administrators (ZOPAs) who have responsibility for overseeing the schools reporting, monitoring and implementation of grants. The project will support the integration of the data to enhance the existing EMIS system with accurate and timely data. Significant resources are also being provided to administrate standardized examinations, which would include the scoring, consolidation and analysis of school, district and State performance. The Examinations Board will report on the learning outcomes following administration of specified standardized tests. 3. The existing EMIS will provide baseline information against which quantitative and qualitative improvements will be measured. The PIM will provide detailed formats for monitoring reports and the different data to be collected. The Implementation Progress Reports (IPRs) and Financial Monitoring Reports (FMRs) will report on project performance as per the results matrix and monitoring plan. There will be an annual review of implementation progress against key performance indicators, to correspond with the State education sector review process. 4. Lagos will carry out special studies as needed. An annual review of the impact of school grants will be conducted to give critical real-time feedback on what activities are being implemented, whether they are successful and/or what is not working to raise learning outcomes. A study will be carried out to look at teacher training. For the public-private partnerships in technical education, labor market scans will be conducted to guide technical college proposals. 5. An impact evaluation using randomized evaluation techniques will be conducted in the second and third years of the project. The purpose is to rigorously examine the impact of various combinations of the use of school grants on learning outcomes. School grants can be used by schools in different combinations-some are used for purchasing learning materials and books for students, some for teacher training and capacity, while some for furniture and school supplies, etc. The evaluation will cover a sub-sample of schools where schools will be randomly assigned to groups according to the focus in the use of school grants (e.g., student-focused, teacher-focused, and a control). The result of this evaluation will help prepare future guidelines in the use of school grants, for schools to choose the inputs/activities that would give them the highest impact on learning outcomes.

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Annex 4: Detailed Project Description

FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project Project development objective: The development objective of the project is to improve the quality of public junior and senior secondary education in Lagos State. COMPONENT 1: PROMOTING SECONDARY SCHOOL EFFECTIVENESS THROUGH SCHOOL

DEVELOPMENT GRANTS (Estimated Base Cost: US$62.6 million) 1. The objective of component 1 is to raise education outcomes in public junior and senior secondary education by providing public secondary schools access to yearly discretionary resources with an explicit focus on improving the quality of education services as priority needs are defined at the school level. School progress will be rewarded through additional performance grants for the top 40 percent of schools. Grants based on private-sector partnerships also will be provided for the five technical colleges in Lagos. Sub-component 1.1: Secondary School Development Grants (Estimated Base Cost: US$45.6 million) 2. Grants will be provided annually to all public secondary schools in Lagos to augment schools’ non-salary expenditures to improve learning performance. The expected outcome of this sub-component is that over the life of the project (and beyond), average aggregate assessment scores of the secondary school increases from the school's own pre-project baseline (SY2007/08). The improvement in average performance on annual standardized testing in English, mathematics, and science examinations is a proxy indicator of school effectiveness. The outputs of this sub-component include: (i) 80 percent of schools receive their school development grant in the correct amount and within the first 60 days of the school year; and (ii) targeted number of schools reporting above 80 percent teachers’ attendance during the school year. These indicators are proxies of efficient program execution and quality improvement. 3. The principal project intervention in upgrading quality in secondary schools is the Secondary School Development Grant. The grant would be provided annually to all secondary schools to augment the school's budget for non-salary expenditures designed to improve learning performance of students. The amount of the grant would be between N 2 million and 3.5 million (US$13,000-23,000), determined by the size of the school. It is expected that the 632 junior and senior secondary schools and the five technical colleges would be eligible for the grant based on their school development plans which would include activities that impact student learning outcomes. Additional schools may be established during the life of the project given the demand for education and need for upgraded infrastructure. New beneficiary schools may be considered eligible for school grants subject to discussion with the Bank and availability of project resources. In Lagos, junior secondary schools have had experience in grant operations through the provision of monthly discretionary funds for operational expenditures from the State Ministry of Education and the provision of self-help funds from UBEC. This would be the first time that public senior secondary schools and technical colleges receive grant funding. Main Activities of Secondary School Development Grants 4. The annual activity cycle of this sub-component consists of school improvement planning at the school level, grant execution, and feedback-gathering. To prepare school leaders for management

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planning, training would be provided annually. To support schools during the school year of grant execution, technical assistance would also be provided. And to provide data for monitoring and evaluation, data would be gathered from schools on the process and impact of the school grants. 5. Training of school leaders in school improvement planning and grant operations. Prior to the start of grant operations, junior and secondary school principals, other school staff, district staff, inspectors, and ZOPAs would be provided training. The training would focus on organizing Project Implementation Committees (PICs) at each school and the preparation by the committee of annual school improvement plans for effecting improvements in student performance in the core subject areas targeted by the project (English, mathematics, science). The training would include a review of the characteristics of effective schools, the preparation of annual student performance improvement plans in a consultative manner, financial duties and responsibilities attendant to the management and execution of grant funds, and grant performance monitoring and reporting. In year one, the school improvement plan will be focused on immediate priorities for implementation over the course of the year. The project will provide technical assistance and training for the school communities to prepare and execute their school improvement plans. During the year, training will be continued in school improvement planning/budgeting to help the schools develop longer term plans for 3-5 years by the end of the project period. The School Development Grant Manual will provide detailed guidance and will be used in the trainings. About 9,400 principals, vice principals, PICs, inspectors, ZOPAs and other officials at the district and LGA, including the School-Based Management Committees (SBMCs) at the junior secondary clusters, are expected to be trained under the project. 6. Preparation of proposals. School principals and teachers, representatives from SBMC constituting the PIC, would prepare the school's improvement plan (SIP). Through discussions, the PIC would select the activities it considers most closely associated with improving achievement, the support for which could be provided from the grant. Activities that would be supported by the grant could include, but are not limited to the following: (a) instructional materials and other learning inputs; (b) training opportunities for teachers; (c) teacher development and support programs; (d) lab equipment; (e) academic competitions and prizes; (f) allowances for volunteer teachers; (g) remedial courses; (h) library books; (i) reading enrichment; (j) strategies for skill development programs/ICT to improve secondary teaching and learning; and (k) innovative activities (e.g., preparation of school-level educational management information systems). To simplify the grant application process, a form for filling out the school's improvement plan would be developed to prompt schools as to the available options eligible for grant support. The School Development Grant Manual will provide additional guidance on the positive and negative list of activities and a school could ask for assistance in preparing its proposal from their assigned Zonal Project Administrator (ZOPAs). 7. Annual review of proposals. The District Tutor-General/Permanent Secretary of Education (TG/PS), chairing the DPAC, would review and approve the annual proposals submitted by the public secondary schools. The requirements for acceptance of proposals include the following: (i) completeness of the entries in the school improvement plan; (ii) original signatures of the grant signatories; and (iii) copy of the minutes of the PIC deliberations on the school's improvement plan. The DPAC would also establish ad hoc committees such as the Technical Review Committee (TRC) on an as needed basis. The ZOPAs will be available to help schools and PICs to prepare their plans as well as play a key role in facilitating school grant implementation and management. 8. Electronic transfer of grant funds. After approval from the DAPC and endorsement from the SPAC, the Project Support Unit (PSU) would remit the grant funds directly to the bank account of the school. Banking arrangements at the School level will include two signatories with one each from Panels A and B. The bank signatories would be Panel A: Principal (Main) and Vice Principal Academic (Alternate); Panel B: Vice Principal Administration (Main) and a member of SBMC (Alternate). The

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principal would be accountable for the funds which would be subject to annual audits. The district offices would be responsible for supervising the use of grant funds, for which they would be provided technical and financial support through an imprest account. At the District level the bank signatories would be Panel A: TG/PS (Main) and Director School Services/ Admin (Alternate); Panel B: Head of Accounts (Main) and Deputy Head of Accounts (Alternate). 9. The amount of the grant to be transmitted to the public secondary school would correspond to school enrollment. For this project, schools are classified as follows:

Table 1: List of Schools by Category and District

JUNIOR SECONDARY SCHOOLS SENIOR SECONDARY SCHOOLS

SMALL MEDIUM LARGE VERY

LARGE T O T A L

SMALL MEDIUM LARGE VERY

LARGE T O T A L

GRAND TOTAL Less

than 1,000

1,000–2,000

2,001–3,000

More than 3,000

Less than 1,000

1,000–2,000

2,001–3,000

More than 3,000

DISTICT I Agege 0 0 4 2 6 2 3 3 0 8 14

Alimosho 2 9 5 3 19 7 11 2 0 20 39

Ifako / Ijaye 1 2 3 1 7 3 3 1 0 7 14

DISTICT II

Ikorodu 15 9 2 0 26 15 11 1 0 27 53

Kosofe 3 8 2 0 13 2 11 0 0 13 26

Shomolu 1 6 3 0 10 7 3 0 0 10 20

DISTICT III

Epe 22 2 0 0 24 24 0 0 0 24 48

Eti Osa 17 2 0 0 19 16 0 0 0 16 35

Ibeju-Lekki 9 0 0 0 9 9 0 0 0 9 18

Lagos Island 9 1 0 0 10 9 1 0 0 10 20

DISTICT IV

Apapa 2 3 1 0 6 3 2 1 0 6 12 Lagos Mainland 10 4 0 0 14 6 2 0 2 10 24

Surulere 20 8 2 0 30 25 5 0 0 30 60

DISTICT V Ajeromi Ifelodun 13 3 3 0 19 14 5 1 0 20 39 Amuwo Odofin 16 3 0 0 19 18 0 0 0 18 37

Badagry 6 7 0 0 13 8 5 0 0 13 26

Ojo 7 5 3 0 15 8 6 1 0 15 30

DISTICT VI

Ikeja 8 4 1 0 13 7 3 0 1 11 24

Mushin 9 9 0 0 18 11 7 0 0 18 36

Oshodi / Isolo 20 9 0 0 29 21 7 0 0 28 57

TOTAL 190 94 29 6 319 215 85 10 3 313 632 # Junior Secondary School 319 Sr. Sec 313 Tech. College 5 Total 637

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Table 2: Number of Schools by Category

Small Schools Medium Size

School Large School

Very Large Schools Total

Less than 1,000 Students

1,000-2000 Students

2,001-3,000 Students

More than 3,000 Students

Junior Secondary Schools (grades 7-9)

190 94 29 6 319

Senior Secondary Schools (grades 10-12) 215 85 10 3

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Technical Colleges 5 5

Total Secondary Schools 405 184 39 9 637

10. Operation of grant funds. A School Development Grant Manual for grant application, execution, and reporting has been prepared to guide implementation. In order to encourage the school to undertake interventions associated with improving learning, expenditures on building maintenance and minor repairs will be capped at 30 percent of the grant amount. (Investments in school infrastructure improvements are being planned under state budget with support from UBEC and ETF and are currently being provided under the Bank-financed LMDGP). 11. Each grant proposal will be evaluated against specific criteria including a positive and negative list of expenditures as specified in the SDG Manual. The following items will not be eligible to receive School Development Grant funding: infrastructure, vehicles, teacher salaries, firearms, and private or personal costs or transfers. 12. At the end of the school year, the school would be required to report on how the grant funds were used. The school would become eligible for the succeeding year's grant when: (i) the activities set out in their approved performance improvement plan have been carried out to a level of accomplishment equivalent to 80 percent; and (ii) the financial report retiring the grant has been submitted to the TG/PS. Schools that do not perform in accordance with the procedures and guidelines described in the SDG manual will not be allowed to participate in subsequent cycles. 13. School performance will be measured by standardized assessments of learning achievement administered to all levels of secondary education at the end of the school year as well as indicators such as teacher attendance, and SBMC participation. (Sub-component 2.1). The results of tests in English, mathematics, and science would be compiled and disclosed to the school as well as to the public. These results would be one of the criteria for determining if the school would merit an additional Secondary School Performance Award (Sub-component 1.2). 14. The School Development Grant would be released in two tranches to the schools (the weighting of the tranches will be a function of the cash flow and will be determined when the use to which the grant will be applied is finalized) and retirement of the grant would happen in the following manner. The first tranche shall be retired not later than March 30 of the related school year before the balance tranche is released to the schools. It is hoped that the schools would fully utilize the grant for a given school year within the same school year. When this is not accomplished, the unutilized balance is carried forward to the subsequent school year and based on the plan for the subsequent school year the first tranche would be released. However, schools that have unutilized balances carried forward into a subsequent year would only access the second tranche for the subsequent year upon the retirement of the carried forward balance together with the first tranche of the subsequent year. Essence of the carried forward balance is to allow

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the schools to complete their proposed activities while continuing to provide funding for the subsequent year so as to stay on schedule with annual planning and keep them eligible for receiving performance awards Implementation of Sub-component 1.1 15. The disbursement and accounting of grant funds would be undertaken by a Project Accountant assigned to the PSU by the Project Financial Management Unit (PFMU). 16. The grants would be the overall responsibility of the Tutor-General/Permanent Secretary (TG/PS) of the district. The TG/PS would chair a DPAC for reviewing and approving grant proposals and oversee the work of district officials, including inspectors and ZOPAs involved in assisting school PICs in the preparation of proposals for grant funding and in supervising grant operations. 17. The PIC will be responsible for overseeing implementation of the grant and local public scrutiny will be encouraged to ensure that schools do not misuse funding. Schools will be asked to post information about development grants on bulletin boards, for example. The accounting and reporting requirements for the grants will be described in detail in the SDGM. 18. Implementation schedule. The expected cycle of grant operations, from planning to feedback-gathering and liquidation of the grant account, is shown in the following table:

Table 3: Implementation Schedule for School Grants

Month Grant Activity Responsible

March Principals' workshop on management planning and grant operations.

Education Districts with support from PSU.

April-May Preparation of School Improvement Plan (SIP).

School Project Implementing Committee (PIC), with support from ZOPAs.

June Submission of SIP Education District office.

School principals.

July-August Review of SIP for grant eligibility. Technical Review Committees, formed from DPAC.

September Transfer of grant funds to schools. Baseline testing (for incoming Junior Secondary students).

PSU, through commercial Bank. Examinations Board.

October - May Grant execution. Project Implementation Committee.

May Achievement testing. Examinations Board.

June Retirement of grant account. Review of school performance.

School principals (Chairperson for PIC) PSU.

19. Management of funds. The funds for the grant program will be managed by the PSU and disbursed with approval of the State Project Advisory Committee (SPAC), after annual review of the project work plans. Financial controls will be maintained by the Project Accountant who is staff from the government's Project Financial Management Unit (PFMU) detailed to the PSU. 20. Monitoring. The execution of the grants in public secondary schools will be monitored by the PICs with support and oversight from the assigned ZOPA to ensure standards of reporting and

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accountability are upheld. The Districts would monitor grant operations throughout the school year in order to identify schools needing further assistance in the management or operation of their grants. An audit of the School Grants will be carried out annually as part of the audit of the project. The audit will cover administrative and financial aspects of grant implementation (using a sample of schools). In addition a qualitative audit will be conducted to provide more feedback on the kinds of activities schools are funding and how these are impacting learning. 21. Technical assistance. To develop capacity for grant administration and monitoring at the district level, technical assistance would be provided for up to 12 staff-months of national expert services. The technical assistance would be provided either as individual consultant contracts or as services provided by a consulting firm. Project Support 22. The project would finance the training of school principals, other education personnel, district staff, ZOPAs, PICs, and SBMCs on the development of annual school improvement plans and on grant operations; school grants; international and national technical assistance for establishing the grant account and monitoring and reporting systems; administrative costs associated with the operation of the DPAC; minor works and the procurement of goods (equipment, transportation allowances, furniture, and supplies) for grant management at the Offices of the District TG/PSs.

Sub-component 1.2: Secondary School Performance Awards (Estimated Base Cost: US$10.3 million)

23. The Secondary School Performance Awards are a follow-on to the Secondary School Development Grants. All public secondary schools would be eligible for the award (including the five technical colleges). Schools will be provided bonus payments of 2 million Naira (US$13,000) on the basis of average improvement in test scores (in Math, Science and English) among enrolled students, combined with proxy indicators for school leadership (participation of SBMC in meetings) and school effectiveness (teacher attendance). 24. This sub-component seeks to sustain the gains made in improving learning outcomes by providing additional performance-based resources to qualifying public secondary schools in Lagos State. The expected outcome of this sub-component is that principals and teachers make it a regular activity to maintain the level of achievement of their students and raise their expectations of their students further. The outputs of this sub-component are that in the second, third and fourth years of the project, at least 40 percent of secondary schools maintain learning gains made during earlier years of the project. Main Activities of Secondary School Performance Awards 25. Criteria for award. The awards would be given to schools that meet the following criteria: (i) improvement in scores at year-end testing, in all three tested core subject areas, measured from the baseline of the school; (ii) improvement in teacher attendance as compared with that of the preceding school year; and (iii) organization and demonstrated evidence of maintenance of a school-based management committee (SBMC). The announcement of secondary schools to receive performance awards would be made by the Commissioner for Education, following the sequence of activities briefly described below. The awards will require that the criteria be used in a phased approach until the student testing system is adequately up and running. Therefore, the award criteria to be used in the first year or two of the subcomponent implementation would include test scores for only JS1 & SS1, combined with indicators for teacher attendance and organization and participation of SBMCs. Subsequent years would include additional tests for JSS1&2 and SS1 & 2.

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26. Establishing the testing baseline. The baseline score for each junior and senior secondary school in every district would be established through standardized testing of students in the target subject areas early in the school year during the first year of implementation of the project. The examinations would be developed, administered, and corrected by the Examinations Board. Thereafter, a composite score for each subject area for the school would be established through standardized testing in the same subjects at the end of each school year. The baseline and subsequent composite score would be determined as follows:

(a) The individual student's score would be averaged with those of his or her class in an examination subject;

(b) The average score of the class would be averaged with those of the average scores of all the other classes in the grade level, to derive the average for the subject in that grade level; and

(c) The average score by subject in the grade level would be averaged with those of the other grade levels, to derive the average score for the subject.

27. The determination of the baseline score for each subject for the school would be made electronically at the Lagos State Board of Examinations. The baseline score would be uploaded to an appropriate page of the Internet website of the Lagos State Ministry of Education. 28. Year-end standardized testing. At the end of the year, students would be tested in the target subjects of English, mathematics, and science. The administration, correction, and processing of year-end standardized tests would follow the procedures described in Component 2 of the project. 29. Establishing the composite score of the school. At the conclusion of testing, the test scores would be collated and from them a determination of the composite score of the school would be made, following the methodology described above, for establishing the baseline test score of the school. This test score would be complemented by the school indicators for teacher attendance and participation of SBMCs in school grant implementation. The weighting of each indicator will be specified in the SDG manual. 30. Measuring progress. The end-of-year composite score for the school would be compared with the school's baseline and a percentage taken of the change that has occurred since the beginning of the year. For each of the six districts, a rank order would be established, one for junior secondary schools, another for senior secondary schools, listing all schools in the district, from the school with the highest percentage of change to the lowest. A rank order of test scores for all the Junior Secondary schools and rank order for all senior secondary schools in the State would also be established. Thereafter, the comparison would be made between the composite score of the year just ended with that of the previous year. As in the calculation for setting the baseline, this calculation would be carried out electronically at the Board of Examinations. 31. Rewarding best-performing schools. The information regarding progress of change would be sent to the State. The State would select the top-performing 40 percent in junior secondary education and the top-performing 40 percent in senior secondary education for their 2 million N awards. Implementation 32. The implementation arrangements for this sub-component are set out in the corresponding section of the preceding sub-component, Secondary School Development Grants.

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Project Support 33. The items to be supported with the performance award grants are the same quality inputs as those listed under the School Development Grants and as specified in the School Development Grants Manual.

Sub-component 1.3: Public-Private Partnership in Technical Education (Estimated Base Cost: US$6.6 million)

34. This sub-component seeks to improve the quality of teaching, research, and skills development at the technical colleges and make them more relevant to the demands of employment and entrepreneurship in Lagos State. The five technical colleges (enrolling 5,374 students) would receive additional funding in order to strengthen the linkages between the colleges and industry. 35. The expected outcome of this sub-component is that graduates of the technical college are either employed in commerce or industry in the private sector or are small business entrepreneurs in the informal sector of Lagos State. Other outcomes include increased numbers of students completing and achieving pass rates during their study program and, after the program, conducted by relevant examinations or technical professional bodies, and increased number of graduates who: (i) are admitted to post-secondary institutions, (ii) are employed, or (iii) start own businesses (tracer studies by the technical colleges would be supported under the project). 36. The specific outputs include: (i) at least five partnerships are established, featuring collaboration and cooperation between the technical colleges and entrepreneurs, commerce, and industry in the private sector; and (ii) institutional strengthening of the newly established LASTVEB. Main Activities of the Public-Private Partnership in Technical Education 37. To position the five technical colleges to respond effectively to the employment and entrepreneurship needs and opportunities in their environment, this sub-component will provide support through a proposal-based grant mechanism, based on a set of criteria addressing the quality of technical education and its relevance to the world of work. 38. Preparation of proposals. As with other secondary schools, the technical colleges would be provided their annual Secondary School Development Grant (under Sub-component 1.1) and would be eligible for performance awards based on their academic performance. The first year of the project will be devoted to capacity building to the technical colleges to develop their demand-driven PPP proposals. 39. The partnership grant of up to N 40 million (US$285,000) would be awarded upon successful preparation of a proposal made through partnership, collaboration, and cooperation with the private sector (formal and non-formal), post secondary institutions, or professional associations. The allocation of funds for grants to each of the technical colleges would be determined on the basis of criteria for quality improvement, relevance, and impact. 40. Proposal activities eligible for grant support are those planned, proposed, and undertaken jointly by the private sector and technical colleges. The activities are expected to strengthen the linkages between skills training at the technical colleges and the labor market and entrepreneurial environment in the formal and non-formal sectors in the Lagos State economy. Among those activities that the partnership grant would support are the following: teaching and learning opportunities related to identified skills and needs of the state, approaches to improve the quality of the programs of the college, maintenance and light rehabilitation of essential laboratories (construction of facilities is not eligible under the grant), procurement of technical tools, ICT facilities and technical equipment, capacity building for management

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and entrepreneurial skills, workshop and conferences, study tours, training and programs for raising awareness and attracting interest in science and technical subjects, promoting science and technical college education through public advocacy and campaigns. The activities could also include developing the capacity of the college to “scan” their position and role in their local or state or federal environment and to carry out tracer studies to obtain information on the life paths of their graduates. The technical college would be accountable for the grant funds and would be expected to actively supervise to its satisfaction the utilization of the funds, with support from the District and ZOPAs. 41. Selection of proposals. Grant awards would be made on the basis of agreed criteria, in an open and transparent manner. The proposal to be funded is one that evidences any of these criteria: (i) potential for creating on-going employment or business opportunity for the final year students; (ii) potential for improving the content capacity and instructional approach (pedagogy) of teachers to enhance quality of training; (iii) potential to form effective partnerships, which secures additional external funding for the college; (iv) long-term partnership possibility with one or more partners; (v) interest in conducting research; (vi) adequate capacity for implementation and monitoring (this includes procurement and financial management arrangements); and (vii) active promotion of increase in female enrollment in the college. 42. Review of proposals. The details of grant operations will be provided in the PIM which will include a Grants Proposal Preparation Guide. 43. The District Project Advisory Committee (DPAC) would be responsible for reviewing all the proposals submitted for support. Since the content of the proposals are likely to be technical, the DPAC is expected to set up a specialized Technical Review Committee with the expertise to review the PPPs. The TRC would review the grant proposals, recommend proposals for grant award and ensure high standard of probity in discharging its responsibilities, and perform other tasks as may be assigned to it by the DPAC. A TRC would consist of up to five national technical and science specialists, and may be maintained throughout the life of the project (appointed for two years in the first instance and reappointed, based on satisfactory performance.) Three candidates for the TRC could be drawn from a number of sources including professional associations, higher institutions and technically oriented private businesses. The other 2 members would be drawn from Lagos State Tech and Vocational Education Board (LASTVEB). When a submitted proposal is outside the area of competence of the TRC, additional expertise may be acquired by the TRC on an ad-hoc basis.

Implementation

44. This sub-component would be governed by LASTVEB when the legalism creating this regulatory agency is issued. Pending that event, the activities of the sub-component would be managed by a temporary Technical Project Committee. In carrying out this caretaker role, the TPC would seek the advice of the Senior Special Assistant to the Governor for Technical & Vocational Education. 45. Funds management. Grant funds would originate from the PSU, which would disburse to the technical college with endorsement of the SPAC, after the review and recommendation by the DPAC and/or TRC. 46. Monitoring. For purposes of monitoring the activities of this sub-component, reports and the minutes of DPAC meetings would be provided to the PSU. The PSU would prepare periodic reports of the administration and progress of the grant to the SPAC. 47. Technical assistance and training. To develop the capacity of LASTVEB and the technical colleges to develop their proposals, “scan” their environment to discern the demand for employment and

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entrepreneurship and to trace where graduates have gone in the world of work after leaving school, technical assistance would be provided, as follows: (i) six to twelve staff-months of international expert services; and (ii) up to 15 staff-months of national consultants' technical services. Furthermore, study tours would be arranged for technical education leaders to familiarize themselves with policy-making and program development in countries that have successfully developed their technical education subsector (e.g., Korea, India, Brazil). The technical assistance would be provided either as individual consultant contracts or as services provided by consulting firms. Project Support 48. The project would support grants under this component; the cost of international and national technical assistance for establishing the public-private partnership and the administrative costs incurred to the Districts, LASTVEB (including the procurement of some goods for conference room furniture, desktop computers, other office equipment) and the operation of the DPAC and/or TRC (meetings and conference expenses). COMPONENT 2: ENHANCING QUALITY ASSURANCE FOR JUNIOR AND SENIOR SECONDARY SCHOOLS

(ESTIMATED BASE COST: US$13.7 MILLION) 49. The objective of this component is to establish a standardized system for measuring student’s learning achievements in core subject areas and support teachers to develop the skills needed to better teach these areas. This component would support the improvement of the quality assurance systems in Lagos State to measure quality, identify deficits, provide feedback to service providers, and establish appropriate benchmarks/standards. This critical data will provide continuous assessment and impact evaluation of project and government interventions. Furthermore, it will measure the learning outcomes in project schools to give the government better information about its schools while holding all stakeholders accountable for delivering a quality education. This component also will support the strengthening of the teaching force by ensuring that teachers receive appropriate training and support. 50. There is a need for reliable evidence to validate learning gains. Standardized achievement testing would provide the needed evidence. Since the project's performance awards would be given yearly to schools on the basis of the school's collective performance, every grade would need to be tested in the above subject areas. Table 4 lists the examinations in Lagos State which would be useful for the purposes of the proposed project and notes which of the examinations are standardized.

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Table 4: Selected Secondary Education Examinations in Lagos State

Name of Test When Administered To Whom

Administered Remarks

JSS Qualification Examination

End of primary cycle (grade 6)

Applicants to model or upgraded junior secondary schools

Basic test standardized

Unified Examinations End of JSS1 (grade 7)

All JSS1 students Tests not standardized

Unified Examinations End of JSS2 (grade 8)

All JSS2 students Tests not standardized

Junior Secondary School Certificate Exams

End of JSS3 (grade 9)

Applicants to senior secondary schools

Standardized

Unified Examinations End of SS1 (grade 10)

All SS1 students Tests not standardized

Unified Examinations End of SS2 (grade 11)

All SS2 students Tests not standardized

WAEC End of SS3 (grade 12)

SS3 students applying for post-secondary education

Standardized

Sub-component 2.1: Standardized Testing for Secondary Schools (Estimated Base Cost: US$2.9 million)

51. The specific objective of this sub-component is to establish a standardized system for measuring students' learning achievement in the core subject areas (English, mathematics, science) in a credible manner, to support the development and performance grants scheme of the project. 52. By forming a complete series of examinations that is consistent and comparable, improvements in student learning outcomes can be better understood and managed. By obtaining reliable information about children's learning, teachers can help their students learn more and learn better, parents can assist their children to study better at home, principals and inspectors can set achievable benchmarks for improving instruction and learning, and education officials can plan for developing the curriculum and teaching and learning strategies. 53. The expected outcome in this sub-component is the regularized annual measurement of student achievement, for use in targeting improvements in learning, teaching, and supervision. The physical outputs are the number of standardized assessments developed and administered for the project's key learning areas (English, mathematics, science) and at the levels specified in Table 5; and the timely release of exam results within two months of administration by State testing agencies.

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Table 5: Standardized Tests to be Developed by the Project

Grade Level Subject Area for Testing

Junior Secondary 1 (grade 7) English, mathematics, integrated science

Junior Secondary 2 (grade 8) English, mathematics, integrated science

Senior Secondary 1 (grade 10) English, mathematics, biology

Senior Secondary 2 (grade 11) English, mathematics, biology

Main Activities

54. The following major activities would be undertaken under this sub-component: (i) baseline setting and revalidation of standardized tests; (ii) standardization of the unified examinations for secondary students, particularly for the core subject areas for JSS grades one and two and SS grades one and two; and (iii) institutional strengthening of the Lagos State Examinations Board. 55. Establishment of education baseline and revalidation of standardized tests. The JSS Qualification Examination would be revalidated, that is, the tests would be reviewed for suitability as the measure of primary completers' entry-level knowledge at junior secondary school and the baseline from which subsequent learning gains would be measured in the subject areas of English, mathematics, and the sciences. Where necessary, new test items as well as spare items would be written, subjected to reliability tests, and tested in the field. 56. The Junior Secondary School Certificate Examination (JSSCE) taken at the end of JSS3 would undergo a similar revalidation process, as it would be considered the assessment of the junior secondary school leaver's entry-level knowledge as he or she enters senior secondary school. The revalidation of the SS WAEC Examination would consist of a review to confirm the terminal knowledge that the senior secondary school leaver is expected to possess at the end of his or her SS3 (grade 12) school year. 57. The revalidation of the standardized examinations could also require the following: (i) short-term consulting services for test and evaluation, the writing, revision, and editing of test items; (ii) field-testing of revised tests, including the orientation of principals, teachers, SUBEB monitoring officers, inspectors (from MOE and district); and (iii) printing of new test questionnaires. 58. Standardizing the unified examinations. To provide a more accurate measure of the student's (and the school’s) academic performance and rate of improvement, the unified examinations for secondary students would be standardized. The examination would be subjected to the same process that standardized tests underwent: curriculum analysis of test items, field-testing, and item-banking. The examinations would be set in shuffled, multiple-choice formats. In the context of the proposed project, this measurement is needed specifically for the determination of project benefits that the school would merit to be eligible for performance awards under Component 1 of the project. 59. Standardizing the unified examinations would involve the following activities: (i) test revalidation and development of new test items; (ii) item moderation and editing; (iii) field testing; and (iv) developing the staff and procedures for test administration (proctoring, field supervision); (v) data processing; and (vi) dissemination of test results. 60. The task of standardization may also be contracted with universities, research organizations, or consulting firms in Lagos State and vicinity, such as UNILAG Consult of the University of Lagos,

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International Center for Educational Evaluation at the University of Ibadan; Lagos State University, the Lagos office of WAEC, the Adeniran Ogunsanya College of Education, or other institutions qualified to undertake the assignment. 61. Capacity development. Among the elements of institutional development at the Lagos State Examinations Board are the following: (i) study visits for policy and program level; (ii) training of staff at technical level; (iii) upgrading of equipment and provision of security-printed materials (OCR answer cards) and furniture; and (iv) minor works for security of data, protection of staff, equipment, and materials from excess heat and humidity, water damage, power interruptions, and voltage fluctuations. Implementation of Sub-component 2.1 62. This sub-component would be implemented by the Lagos State Examinations Board. The Director of the Examinations Board would be responsible for day-to-day activities and liaison with the PSU. Support for this sub-component will be allocated based on annual workplans submitted to the SPAC. 63. Monitoring and reporting would be the responsibility of the PSU. The reporting would be based on the information gathered from the Examinations Board, Basic Education Services, Office of the Inspectorate, and other agencies. 64. Technical assistance. To enhance the standardized test revalidation as well as development and administration capacity, technical assistance would be provided, as follows: (i) expert services by international consultants to provide services for 12 months each in research design and methodology; (ii) technical services by national consultants for durations of 12–36 months in curriculum analysis, standardized test development and application, and computer-assisted systems or program development. Project Support for Sub-component 2.1 65. The project would support the following: technical assistance in terms of long and short-term international or national consultants recruited by the examinations bodies for test development and evaluation design, programming design, and data handling and analysis; administrative costs for field testing the assessment instruments and administrating the exams; training and orientation of test administrators; short-term international technical assistance for the examinations bodies; possible contracting of test development with the preferred institutions; training in terms of study visits and short-term fellowship training for the management and staff of the examinations bodies; and minor works and goods (equipment, furniture, and software) for making the assessment processing area and confidential data safe and secure.

Sub-component 2.2: Strengthening Teachers Professional Development (Estimated Base Cost: US$10.8 million) 66. The specific objective of this sub-component is to establish a mechanism for identifying training and capacity development needs of secondary schools, develop the interventions to address those needs, and link the secondary school with institutions providing those interventions. Approximately 5,385 JSS and SS math, English and science teachers and 1,700 principals and vice-principals will receive support under this sub-component. 67. To help schools address the demands for high quality teaching in the core subject areas, this sub-component would support the development of teachers’ professional knowledge and skills by increasing the capacity of teacher training institutions to offer high-quality training courses in instruction in core-

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competency English, mathematics, and science. Current teaching methods and approaches (e.g., active learning) also would be offered to help teachers improve the learning outcomes of their students. 68. The expected outcomes of this sub-component are: (i) secondary school principals displaying improved school leadership and management skills, and teachers employing active instructional approaches in English, mathematics, and the natural sciences; and (ii) secondary school students achieving higher scores on tests of learning achievement. The outputs include the following: (i) report on capacity development needs analysis of teachers and school leaders; (ii) quality assessment of teacher training providers of the state; (iii) training courses (competitively contracted) developed and offered at teacher development institutions in core subject areas and school management; (iv) support for teacher subject conversion in math, science, and English; (v) strengthening subject associations and their outreach efforts into the schools; and (vi) the establishment and publication of a training information website.

Main Activities 69. This sub-component would support teacher training and strengthen the teacher training institutions to develop quality courses for in-service teacher professional development. All providers will be competitively selected based on their capacity and quality of proposed course offerings. Some existing agencies, such as the Teachers Education and Pensions Office (TEPO) will also receive some support to strengthen their capacity. The following areas of teacher training have been identified. 70. The first area will focus on core-subject training in English, Math, Science and school leadership. The participation of teachers in these in-service programs would be supported through two sources. The first is through their school development grants and the second is through the mandatory core subject competency training. The project will provide capacity building support to those institutions that are selected to train teachers and will establish an interactive website and bulletin board on quality training programs. School grants can provide additional funding for teachers to attend key trainings. 71. The project will provide funding to strengthen subject associations and their outreach efforts into the schools. These associations are expected to provide solid professional development mentoring, facilitation and encourage greater communication among subject teachers. 72. The project also would focus on making better use of existing teaching resources to fill deficits in core subject areas. The numbers of core subject teachers are inadequate for the student population. And in some other subject areas there are too many teachers. Therefore conversion courses are being introduced to support the urgent need for more math, science and English teachers, making the best use of existing teaching resources. 73. Determining the demand. To establish an empirical base for determining training needs, a diagnostic study would be conducted of junior and senior secondary school teachers. Using unobtrusive survey methods (with appropriate “rewards” to teachers for participating), the study would gauge secondary school teachers' content and pedagogical knowledge in the key subject areas of the project. Based on the findings of the study, a comprehensive capacity development strategy would be developed, and programs for delivering training that would narrow or close the gaps identified by the study would be devised. The study would be contracted with a qualified education research organization or institution of higher learning. 74. Ensuring the supply. Proposals would be solicited from training providers to design specialized training programs in core subject areas. The solicitation would be made among universities, colleges, research institutes, and training organizations. An assessment of the quality of the training courses currently offered by the teacher development institutions would be contracted by the project with a

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qualified university, research institute, or evaluation firm. The assessment would also include information on cost and frequency of training. A later assessment would also be made of the quality of training developed by teacher education institutions under contract with the project. 75. Linking training demand at school with training supply at training institutions. The available training courses offered by teacher development and other institutions would be identified and communicated to the school through a newsletter that would be periodically printed and sent in multiple copies to secondary schools and inspectorate offices, to provide training information to teachers and school administrators. Part of the school development, performance award, and partnerships in technical education would be used to pay training fees for teachers to attend other programs offered by training institutions. 76. Electronic pages for the newsletter and other training information would also be developed for the State Ministry of Education's Internet website. The course offerings from training institutions would be uploaded to the website for free access by teachers and administrators at schools or other locations with Internet connectivity. New training programs would also be announced through a periodic newsletter to be delivered to the district office inspectors, school principals, and school librarians. 77. Strengthen subject associations and their outreach efforts into the schools. The subject associations promote teaching and learning of specific subjects among teacher specialists in Nigeria. It is a forum for teachers to meet, discuss, learn, and contribute to issues relating to their subject area. Teachers in schools, colleges of education and universities meet at State and National levels. Tertiary educators often provide leadership to members. Subject Associations host workshops, seminars, training, and coaching. They also organize quiz events and fairs (e.g., the national science fair). Subject Associations are also affiliated with international bodies. Mobilizing teachers to attend the programs has been an issue. To attend participants must pay membership fees, pay for the workshops; seminars, tutorials, handouts, transportation etc. As many of the school teachers cannot afford these costs, they often miss out on a professional network that can enhance their skills. 78. The project will finance technical assistance for strengthening subject Teachers Associations in English, math, and science in each of the six Education Districts. Funding will also be provided for teachers to participate in organized events (but not membership fees). Subject Associations are expected to help teachers improve the use of lesson plans; use of equipment and visual aids to promote interactive learning; and encourage a mentoring system. TEPO will monitor progress and provide feedback and information on teacher participation. 79. Conversion Courses. Of the 16,497 secondary school teachers in the state, there is a shortage of qualified teachers in core subject areas (English math, science and ICT). For example SUBEB carried out a review of teachers in primary and junior secondary schools and found that there are about 4,000 social studies teachers that require retraining to other subject areas. One of the goals of this subcomponent is to increase the number of qualified core teachers in English, math and science. Conversion Courses offer the opportunity for teachers already in the system to be more productively engaged by encouraging some of them to transfer their teaching skills to core subject areas. With the support of TEPO and the Education Districts, interested teachers will be screened to determine suitability for conversion. The training would be contracted to an institution of higher learning that is able to develop quality conversion courses. Implementation of Sub-component 2.2 80. The PSU will be responsible for coordinating the activities of this sub-component. The day-to-day activities and coordination with key agencies like TEPO would be carried out by the education

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specialist attached to the PSU. For monitoring and reporting, the PSU would gather and disseminate periodic reports on the status of teacher professional development. Project Support for Sub-component 2.2 81. The project would finance the following: (i) technical assistance for contracting the needs assessment, quality assessment of training programs, and development of management training courses for school principals and vice principals and content and pedagogy of English, mathematics, and the sciences for secondary school teachers; (ii) technical assistance for conversion courses and strengthening of subject association networking; (iii) administrative costs for the contracting of training providers, publication of the training newsletter, office materials, and supplies, transportation, per-diems, and other costs; and (iv) technical assistance (coaching of teachers in service by retired teachers and inspectors) to augment the effectiveness of training. COMPONENT 3: PROJECT COORDINATION AND MANAGEMENT (Estimated Base Cost: US$4.6 million) 82. Effective implementation of the first two components of the project will depend upon efficient coordination mechanisms, proper financial management and procurement practices, timely implementation and effective monitoring and evaluation. To support the schools, management and oversight would be organized at the State level (SMOE in close coordination with the relevant parastatals) and District level (TG/PS, ZOPAs and LGEAs). This component will support overall project management, monitoring and evaluation and the design and implementation of a communication strategy for Lagos State. Technical support for the implementation of the project may include a team of short and long term consultants, specializing in project implementation (including project management, monitoring and evaluation, financial management and procurement) and financed under the Credit. These consultants would also provide support to the Districts as needed. 83. Project Coordination: The PSU will be responsible for project coordination of the State level components. The project will finance the investment and operating costs associated with the PSU including minor office repair; office equipment (generator, hardware), software, furniture, vehicles, short-term consultant fees, auditing services, external and in-country training and seminars related to project management and implementation, and a communication campaign. Over the four year period external & internal training and study tours would be provided for the Commissioner for Education; 6 Tutor General Permanent Secretaries; Permanent Secretary MOE; Permanent Secretary TEPO, Directors and other relevant staff in MOE & the Districts to build their leadership, policy, implementation skills and knowledge. PSU staff would also undergo appropriate training. The PSU will be responsible for overall project management and coordination of components one through three, reporting directly to the Commissioner of Education. 84. Monitoring and Evaluation: This component will support the establishment of a monitoring and evaluation system to track project outcomes and broader educational trends in secondary education in Lagos. The Results Framework, with clear performance indicators, will be used as an effective tool to monitor progress towards outcomes and integrate lessons learned into management decisions. The PSU will be responsible for the coordination of overall project monitoring and evaluation. Much of the data will come from internal mechanisms that have been built into the design of each component and sub-component (e.g., school reports collected by ZOPAs, teacher training website, etc.). Results-based monitoring will need to use these methods as well as data from EMIS, inspectorate reports and project evaluation and impact studies. An M&E officer has been assigned to coordinate and gather relevant data from all the implementing units and existing EMIS. Additional support from DFID through ESSPIN will strengthen the Lagos EMIS, support data analysis as well as dissemination of education publications.

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85. Project reports will include annual reviews, semi-annual implementation progress reports, quarterly FMRs, a midterm review and a project completion report. A school grants audit will be conducted yearly to capture the types of activities financed under this component and impact on learning. The PSU will also be responsible for managing the teacher-training website and bulletin. The PIM and School Development Grants Manual will provide more detail on the agreed reporting formats. 86. The project will finance (i) technical assistance for project management; (ii) training; (iii) operational expenditures for project implementation and supervision; (iii) goods (vehicles, computers for PSU); and (iv) monitoring and evaluation studies. COMPONENT 4: STRENGTHENING OF THE FEDERAL POST-BASIC EDUCATION STRATEGY (ESTIMATED

BASE COST OF US$5 MILLION) 87. The objective of this component is to provide capacity building and technical assistance to the Federal Ministry of Education to enhance the development of the national post-basic education strategy. This component will also strengthen capacity at the Federal level to better monitor donor projects and programs throughout the country. Activities are expected to include studies to support key reforms (e.g., examination system), national dialogue on post-basic education, support for policy forums, technical assistance for standard setting, and effective cooperation between federal and state agencies. Study tours and training may also be financed. This component would provide support for the federal coordination of State level education projects, through the Department of Basic and Secondary Education, including funds for the National Education Sector Steering Committee (NESSC). Pilots may be proposed to encourage innovative linkages for supporting other State post-basic strategies. Main Activities 88. Capacity Building for Ministry Staff and Other Stakeholders: The objective of this activity is to improve staff effectiveness and strengthen their leadership and monitoring skills. The trainings will support ministry staff professional development in managing secondary education systems. Issues to be addressed include management roles, feedback processes, communications development, web-based applications, partnerships with education institutions and strategies for improved education management. Study tours, training, and workshops will be funded for relevant ministry staff. 89. Post-Basic Education Strategy Development: The objective of this activity is to support the dialogue on post-basic education, enhance the strategic planning process and reinforce partnerships across the education levels to validate the post-basic strategy. Activities will include key technical studies in the following areas: (i) baseline survey to assess the status of science and technology education in Nigeria; (ii) labor market study to feed into curricula review; (iii) examination reform; (iv) policy studies on vocational and technical education and curricula reform; and (v) development of the National Secondary Education Sector Strategy. Support for national science and technology competitions, exhibitions, etc. will also be provided to promote this government priority area. The other major activity will be support for at least three States to develop their secondary education strategy plans. Technical assistance and funding would be provided to States to draft their post-basic strategies in a consultative manner with key partners and national institutions such as UBEC, MDG and ETF. 90. Monitoring and Evaluation. The objective of this activity is to support the Federal Ministry of Education to participate in the monitoring and evaluation of education projects in Nigeria. With several State level projects being implemented across the country, the FMoE would support aggregated reporting on implementation progress as well as reporting on State-level results. Participation in the National Education Sector Steering Committee as well as annual sector reviews would be funded.

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Implementation 91. This component will be implemented by the Department of Basic and Secondary Education in the Federal Ministry of Education. The Project Management Unit (PMU) is already established under the IDA supported STEP-B project, and a technical officer will be assigned in this unit to coordinate the federal level activities under the Lagos Eko project. The PMU is responsible for the implementation of this component and reports directly to the Permanent Secretary of Education and Federal Minister of Education. 92. Funds would be released to a special account opened with the STEP-B PMU which has extensive experience with World Bank procedures and guidelines on project, financial, and procurement management. An annual workplan will be prepared by the FMoE for accessing funding under the project. 93. Consultants (international and national) will be engaged to help conduct the studies, strengthen State proposals for post-basic education strategies, and to carry out key trainings and workshops. Project Support 94. The project will fund (i) capacity building for FMoE through training, workshops, and study tours; (ii) technical studies carried out by consultants; (iii) State proposals for post-basic strategies in at least 3 states; and (iv) operational costs for project management and participation in monitoring and evaluation activities.

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Annex 5: Project Costs

FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project

Project Cost By Component and/or Activity Total

US$ in ‘000s

Component 1: Secondary School Effectiveness 62,571

Secondary School Development Grants 45,626

Secondary School Performance Grants 10,330

Public-Private Partnership Grants 6,615 Component 2: Quality Assurance for Secondary Schools 13,687

Standardized Testing 2,903

Strengthening Teacher Professional Development 10,784 Component 3: Project Coordination and Management 4,597 Component 4: Federal Post-Basic Education Strategy 5,000 Total Baseline Cost 85,855

Physical Contingencies 3,507

Price Contingencies 5,638Total Project Costs1 95,000

Total Financing Required 95,000

The IDA project costs include taxes which are eligible for financing under Nigeria’s country financing parameters. The exchange rate used is 148 Naira to US$1.

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Annex 6: Implementation Arrangements

FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project

1. Implementation period. The project will be executed over a period of four years, from June 2009 to December 2013. 2. Recipient and Executive Agency. The Recipient is the Federal Government of Nigeria, represented by the Federal Ministry of Finance (FMOF) as it relates to the financial and legal obligations of the Government. The Lagos project will be mostly implemented at the state level by the Lagos Ministry of Education. The federal component will be implemented by the Federal Ministry of Education. 3. The Lagos Ministry of Education will integrate project implementation into the regular day to day management activities of its existing (or new units where identified) organizational units as associated with their respective mandates, under the direction of the Commissioner of Education. Partial implementation of the project will also be the responsibility of the local level stakeholders (e.g., district officers, head teachers, teachers and PICs), who will be involved in the implementation of the project. 4. The Lagos Eko project will be implemented in all public secondary schools (includes junior secondary schools and five technical and vocational colleges) in Lagos. To support implementation at the school level, capacity strengthening, management and oversight would be organized at the state and district levels. 5. A National Education Sector Steering Committee (NESSC), formerly the Federal Consultative Steering Committee (FCSC) under SESP, will be established to provide an annual forum where project performance and implementation issues can be discussed and knowledge shared at the State and Federal levels. The Committee would be managed and chaired by the FMoE or his/her representative and includes key stakeholders responsible for project monitoring and implementation. This is the main policy body for all state based education projects at the federal level. The NESSC will include Commissioners of Education, Permanent Secretaries, participating states, relevant directors of the federal ministry of education, Permanent Secretary, Federal Ministry of Finance, Director General of the Debt Management Office and National Planning Commission and additional members selected on the basis of their potential to add value to the work of the committee (such as head of federal agencies and professional association, private sector etc). The NESSC will hold regular meetings at least once a year to review implementation progress reports submitted by state project coordinators and produce a briefing to Government and IDA about progress of federal and state education IDA projects. The review would include a quantitative and qualitative report on performance indicators. Funding for the meetings and monitoring will be supported under the federal component. Lagos State participation in these meetings will be funded under the credit. 6. This forum replaces the defunct FCSC that never received adequate funding or attention under SESP. With the inclusion of a federal component (and commensurate funding), the NESSC is expected to be functioning by the end of the calendar year. A structure for the NESSC will be jointly agreed by FMoE, WB, DFID and other partners during the start-up phase of the project. The Federal office of the Director of Basic and Secondary Education of the FMOE will provide secretariat functions and have responsibility of meeting organization. The NESSC will be responsible for: (a) providing oversight and coordination of all donor education programs (e.g., Lagos Eko, SESP and ESSPIN); (b) ensuring compliance with ongoing federal reforms; (c) monitoring performance targets and timelines for activities and addressing cross-cutting issues; and (d) sharing of information among stakeholders about effective project implementation. Although the NESSC will not have any direct project implementation role since

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this function will be the primary responsibility of the SMOE, it will become a particularly important forum for knowledge sharing and monitoring and evaluation of the project especially in light of federal reforms. This forum will provide an important annual opportunity for discussions on overall project issues/budgets especially as additional States join the project in future rounds of financing. It will also provide advice, as needed, on the activities of related ministries, departments and organizations, public associations and project coordinators/working groups by recommending appropriate action to resolve problems as they arise; and recommending and supporting the dissemination of achievements/best practices. 7. The federal component of the project will be coordinated by the Federal Ministry of Education, Department of Basic and Secondary Education. A technical officer in the STEP-B Project Management Unit (PMU) would manage the implementation of this component. He/She will be supported by key lead persons from SUBEB, UBEC and other federal units as needed. The project coordinator will be responsible for day to day implementation of the project and will serve as the main link between the Federal Ministry of Education and the Bank. The coordinator would be responsible for monitoring and evaluation of project activities, disbursement, maintenance of the website, and preparing audit reports and submitting the required reports to the Bank. Consultants and specialists may be hired as needed to support the PMU. All procurement activities for the federal component will be undertaken by the existing procurement officer of the STEP-B PMU in compliance with World Bank Procurement and Consultant Guidelines. Any IDA resources used to support additional State activities (i.e., post-secondary strategies) would need to be proposal based. 8. At the state level, the project would be governed by a State Project Advisory Committee (SPAC). This policy and executive committee would be chaired by the Commissioner of Education. The SPAC will review progress reports, approve annual work programs and budgets, advise on key implementation issues, and ensure that the agreed performance targets and timelines for activities under the different components are met. The SPAC will oversee implementation more broadly of the education sector plan, MTESS and other donor-supported activities (e.g., ESSPIN). The SPAC will be assisted by a PSU which has been established to support the coordination, fiduciary management, and monitoring and evaluation of project activities (see below for the responsibilities and staffing of the PSU). The SPAC membership includes stakeholders responsible for the implementation of components and sub-components with the specific responsibility matrix and terms of reference for the committee detailed in the PIM. The SPAC members would include the following (five members present would constitute a committee quorum; the SPAC would meet at least four times per year):

(a) CHAIR: Commissioner of Education Lagos State (b) Permanent Secretary, State Ministry of Education-Vice Chair (c) Chair of SUBEB (the agency responsible for junior secondary education); (d) Six Tutors-General/Permanent Secretaries of Education (TG/PSEs), one from each education

district; (e) Permanent Secretary, Teachers Establishment and Pensions Office (f) Chair, House committee on Education (g) Chair, State Central PTA (h) Senior Special Assistant to the Governor on Technical-Vocational Education (SSA for

LASTVEB) (i) Two representatives, one from the community (SBMCs), the other from civil society

(NGOs); and (j) Project coordinator of the Project Support Unit (PSU) non-voting executive secretary of the

SPAC.

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9. At the district level, the project would be governed by the DPAC. This program management committee would be chaired by the TG/PSE of each district and would primarily oversee the implementation of component 1 by providing policy oversight, evaluating and approving school grant proposals and monitoring performance indicators. DPAC would also establish ad hoc committees such as Technical Review Committees (TRCs) on an as needed basis. The DPAC committee members would include the Directors for JSS and SS, representatives of SUBEB, TEPO, and SBMCs:

(a) District I – LGAs of Agege, Alimosho, Ifako/Ijaye. (b) District II – LGAs of Ikorodu, Kosofe, Somolu. (c) District III – Epe, Etiosa, Ibeju/Lekki, Lagos Island. (d) District IV – Apapa, Lagos Mainland, Surulere. (e) District V – Ajeromi Ojo/Ifelodun, Amuwo-Odofinn, Badagry. (f) District VI – Ikeja, Mushin, Oshodi/Isolo.

10. The Districts would be supported by Zonal Project Administrators (ZOPAs), senior education officers assigned to help a cluster of schools implement the school grants. Their role includes technical support to schools in general planning, implementation and grant management; collection and dissemination of key school data; liaison between the schools and district; and general troubleshooting to ensure issues are resolved in a timely manner. The ZOPAs will be a key player in the monitoring and evaluation system since they will be responsible for collecting school level data, verifying the data, and aggregating the data at the district level. 11. At the school level, the project would be governed by the Project Implementation Committee (PIC) which would be established in each public secondary school and would include the following membership: (i) School Principal as chairman; (ii) Vice Principal, Academic as Secretary; (iii) Vice Principal, Administrative as Treasurer; (iv) three classroom teachers, preferably core subject teachers; (v) representative from PTA; (vi) representative from SBMC. The PICs would receive requisite training for school grant implementation and school improvement planning. The PICs would be responsible for the following:

(a) Preparation of school improvement plan for impacting student performance in core subject areas.

(b) Support to ZOPA for collection of data. (c) Collaborates with local community members on monitoring and evaluation activities. (d) Manages grant procurement. (e) Mobilizes community support for the school. (f) Oversees financial management of grant implementation.

12. The Public Private Partnership grants for technical and vocational colleges will be governed by the newly established Lagos State Technical and Vocational Education Board (LASTVEB). LASTVEB will oversee the capacity building activities to help the colleges create their proposals and provide support to the DPAC for approving the PPPs. Although LASTVEB is expected to be legally established before effectiveness, in case of any delays, a Technical Project Committee has been established to assume these functions with support from the Senior Special Assistant to the Governor on Technical-Vocational Education. 13. Implementation oversight for the standardized testing and school ranking will be carried out by the Lagos State Examinations Board. And teacher development activities will be managed by the PSU with support from consultants and TEPO.

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14. The PSU will be established in the office of the Commissioner for Education to support the coordination and fiduciary management of activities of the implementing directorates/units and the reporting of project activities under the first three components. The PSU will be under the direct responsibility and supervision of the Commissioner of Education. The PSU will comprise the following staff: (i) a PSU coordinator; (ii) an education specialist (with expertise in teacher training); (iii) a procurement officer; (iv) a project accountant, internal auditor and other FM staff assigned by the Lagos PFMU unless otherwise determined; and (v) a monitoring and evaluation specialist. The TOR for the PSU and its key staff are outlined in the PIM. The Federal PMU implementing the STEP B project will undertake management of the federal activities under Component 4. 15. One of the key responsibilities of the PSU will be to interface meaningfully with the technical departments at the state, district and zonal levels to ensure efficient implementation. The PSU will have the basic capacity to provide technical support in procurement, financial management, and project monitoring and evaluation. The PSU will support the technical departments or other implementing units as facilitator of the flow of Credit funds and project resources, and act as the clearing house for securing Bank action on procurement and disbursement of funds on the activities, goods, works and services contracts financed from the IDA credit. The main functions of the PSU include the following: 16. Operational. The PSU will monitor and support all State activities under the project until their completion and help ensure that the departments responsible for the implementation of the various components execute their tasks satisfactorily and according to the planned schedules. In particular, the PSU will monitor project-related activities to:

(a) assist in the quick resolution of project-related issues and in facilitating project implementation; (b) provide comprehensive information concerning the progress and quality of the Lagos Eko

investments and the overall implementation situation of the Project, ascertain that all project-related outputs are delivered on time by the implementing technical departments including consultants, and that project operational performance indicators are satisfactorily met; and

(c) ensure that the selection of eligible schools for performance awards are conducted in a transparent manner and in accordance with agreed procedures under the project.

17. Procurement. The PSU will coordinate all IDA-financed procurement activities for Lagos and will ensure that all works, goods and services financed by the IDA Credit are procured in compliance with World Bank "Guidelines: Procurement under IBRD Loans and IDA Credits" dated May 2004, revised October 2006; and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated May 2004, revised October 2006. In order to maintain close fiduciary control over procurement processes, the PSU will prepare the procurement documentation to be issued for works, goods and services contracts, in close collaboration and consultation with the relevant technical departments. The PSU will conduct centrally all major procurement of works, goods and services contracts financed under the project. In collaboration with the implementing units the PSU will evaluate all bids for contracts financed by the Credit, recommend contract awards and prepare and sign contract agreements with contractors, suppliers and consultants. Procurement would be undertaken in close consultation with the Districts and schools, but procurement decisions on IDA Credit financed contracts will be taken at the State level. Minor procurement activities will be handled at the School level under the School Development Grant Scheme in line with the provision stated in the School Development Grant Manual. All procurement activities for the federal component will be undertaken by the existing procurement officer of the STEP-B PMU in compliance with the above mentioned World Bank Procurement and Consultant Guidelines.

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18. In consultation with the implementing Departments, the PSU will prepare, follow up and update, where necessary, annual Procurement Plans for the works, goods and services contracts that will comply with the procurement schedule and thresholds prescribed in the Financing Agreement (see Annex 8 for procurement arrangements). 19. Financial Management. The PSU will be accountable for financial management of Lagos State activities. The Accounts Unit of the PMU at the Federal Ministry of Education will provide the same services at the Federal level as described in detail below. The PSU will prepare a work plan and budget and will oversee its implementation. To assist with the discharging of its fiduciary accountability, the PSU will contract services of the Lagos PFMU to develop, implement, operate and maintain a financial management system. This will include systems for budgeting, internal controls, cash management, accounting, financial reporting and auditing that are properly documented and approved through a Financial Procedures Manual (FPM). The PSU and PFMU will ensure that the FPM is disseminated to staff and that adequate disciplinary measures exist to sanction non compliance with the FPM. The PFMU will have delegation from the PSU to:

(a) Operate the approved financial management system, as recorded in the FPM; (b) Process transactions as per the FPM and approved by the PSU; (c) Countersign all payment instructions on all bank accounts of the PSU, as further specified in

the FPM; (d) Ensure, on its behalf, that all PSU transactions will be eligible in terms of the said Financing

Agreement with IDA; (e) Appoint External Auditors for the audit required by IDA; (f) Attend all project management and staff meetings; and (g) Have full unlimited access to all project information, records and data, for internal and

external audit purposes.

20. The PFMU will provide the following services to the PSU:

(a) Develop and implement the required financial management system; (b) Operate and maintain such financial management system, for which purpose appropriately

qualified staff of the PFMU will be designated, deployed and located in Accountant General’s office;

(c) Assist the PSU to open bank accounts as agreed with IDA and to handle all related matters to access such funds;

(d) Establish effective expenditure commitment, payment, control and accounting procedures for transactions approved by the PSU to authorize transactions, in accordance with the policies, procedures, controls and standards as authorized in the FPM;

(e) Timely resubmit for processing by the PSU any transaction not processed or approved in terms of the FPM, and to keep log of such transactions to ensure timely rectification by the PSU;

(f) Timely prepare all the necessary monthly and quarterly Interim Financial Reports and Annual Financial Statements, for approval and circulation by the PSU as agreed with IDA; and

(g) Provide internal audit services and assist PSU management to manage project risks by identifying areas for improved control to: (i) carry out the project activities in an orderly and efficient manner; (ii) ensure adherence to policies and procedures; (iii) to safeguard the funds and assets of the project; and (iv) secure as far as possible the completeness and accuracy of financial and other records.

21. Liaison: The PSU will establish and maintain regular communications and liaison with the World Bank, SMOF/FMOF, ESSPIN and the relevant authorities in all matters concerning Project

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implementation and supervision, and issues that relate to compliance with the general provisions stipulated in the IDA Financing Agreement. The PSU will regularly consult with Districts on issues relevant to the implementation of the project. Likewise, the AU/PMU will maintain regular communications and liaison with the World Bank, MOF and ESSPIN to carry out project implementation and supervision. 22. Monitoring, Evaluation and Reporting. The PSU Coordinator will be responsible for the preparation and consolidation of all the required periodic Implementation Progress Reports (IPR), detailing the implementation status/progress, financial status, and management issues concerning the project, and submitting these regularly to the World Bank and relevant authorities as required. The STEP B AU/PMU will be responsible for reporting on federal component activities along the same guidelines described below. The PSU will prepare the following types of reports:

Implementation Progress Reports (IPR). The PSU will monitor the overall implementation performance of the Lagos Eko. The PSU will prepare IPRs every six months during the lifetime of the project, and send these reports to the World Bank and the SMOF/FMOF. The Reports should detail (a) the implementation progress/status including an analysis of Project achievements compared to original plans; (b) the status of the use of the IDA Credit; (c) the progress of the financing plan, including detailed financial tables on project expenditures and updated costs for each sub-project; and (d) project management details identifying issues arising during the project implementation and solutions proposed.

Annual Audit Reports. An independent financial audit of the project will be carried out each year. The cost of the annual audits is included in the project expenditures.

Implementation Completion Report (ICR). At the end of implementation, the PSU will prepare and submit to the World Bank a final ICR containing an appraisal of the project's economic, financial, social and environmental effects.

23. Project Implementation Manual (PIM). A detailed PIM to guide implementation of the Lagos Eko was received by the Bank prior to negotiations. The PIM sets forth all operational procedural steps regarding implementation, including reviews and approval, flow of information, detailed description of implementing units, procurement and financial management arrangements, standard formats for reports, and amendment procedures. 24. Project Procurement Management. A detailed 18-month procurement plan has been drafted and agreed with the Bank. 25. DFID plans to complement the IDA-financed support through its technical assistance program ESSPIN. ESSPIN’s primary objective is to support States in the development and implementation of their Education Sector Plans and Education Sector Operational Plans. This support is provided as a grant for TA, which is managed by a consortium, led by Cambridge Education. Key areas for potential support are detailed in Annex 15. 26. Project Implementation Matrix. The assignment of responsibilities and tasks for implementation of the Lagos Eko project and activities is summarized in the Project Implementation Manual. The organogram diagramming project implementation arrangements for Lagos is attached below.

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Lagos Eko Secondary Education Project Organogram

PIC & Schools

SPAC

DPAC

EDUCATION DISTRICT

Zo P A

TG/PS

DISTRICT DIRECTOR

TG/PS plus SUBEB, LGEA, SBMC, TEPO, Dist. Dir. and ZoPA

ZoPAs are officers from the ED and SUBEB LGEAs who report to District Directors.

The District Directors report to TG/PS.

The TG/PS is the chair of DPAC and a member of SPAC.

CLUSTER OF SCHOOLS

Director of Schools

Zonal Project Administrators reporting to District Directors

The management, administration, supervision and monitoring of the grant is done at the Education District, headed by the TG/PS.

PSU

Zo P A

Zo P A

Zo P A

CLUSTER OF SCHOOLS

CLUSTER OF SCHOOLS

CLUSTER OF SCHOOLS

Zo P A

Zo P A

Zo P A

PIC and School

Principals

PIC and School

Principals

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Annex 7: Financial Management and Disbursement Arrangements

FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project Introduction 1. The financial management assessment, in line with the Financial Management Practice Manual (November 2005) of the FM Board, has the objective of determining whether the implementing entities have acceptable financial management arrangements, which will ensure: (i) that funds are used only for the intended purposes in an efficient and economic way; (ii) the preparation of accurate, reliable and timely periodic financial reports; and (iii) safeguarding of the entity’s assets. The FM arrangements are based on the Accounts Unit of the Project Management Unit (AU/PMU) at the Federal level and PFMU in the State, the latter of which is a robust multi-donor and multi-project FM platform, established in the state in 2003 through the joint efforts of the Bank and the government. The PFMU features strong and robust systems and controls that are not possible in individual ring-fenced project FM. They were assessed by the Bank and found to be acceptable for the implementation of Bank-assisted projects. Because they are responsible for the FM arrangements of on-going projects, they are reviewed regularly and supported with training on an ongoing basis. Recent reviews showed that these arrangements are adequate for the implementation of this project. The overall FM risk of the project is assessed as substantial. This will be mitigated by the strong PFMU arrangement, (and a robust FM arrangement in the AU/PMU), implementation of the FM action plan (Table 2), inclusion of substantial follow-up, and implementation support. The rating is based on the updated assessment of the PFMU. Country Issues 2. A review of the implementation of the recommendations of the Country Financial Accountability Assessment (2000) in January 2005, and a 2006 PEMFAR for Nigeria, observed that the Federal Government of Nigeria has made a significant effort to advance reform of the PFM system since 2003. Major achievements so far have been: (i) the adoption of an oil-based fiscal rule that has greatly improved the quality of macroeconomic management; (ii) launching of significant steps toward increased transparency of the budget process; (iii) more efficient cash management; (iv) procurement reforms; (v) updating the legal framework for PFM; (vi) reallocation of budget resources in support of the MDG-related government functions; (vii) strengthening monitoring and evaluation; and (viii) introducing a more strategic long-term focus in budget management. These have clearly helped to reduce waste of public resources, particularly on the capital budget and payroll. The impact of these early measures is also evident in significantly improved fiscal and broader macroeconomic outcomes. There is, nevertheless, much more to do and PFM initiatives and reforms are articulated in the Government’s NEEDS, and further articulated in the 7-Point Agenda by the government which sets out policy priorities that will strengthen the reforms and build the economy so that the gains of reforms are felt widely. These are supported under the Country Partnership Strategy (jointly developed by IDA and the United Kingdom’s Department for International Development, DFID), which are supported under the CPS specifically through the three Bank-assisted projects (i.e., EMCAP closed December 2007, ERGP, and State Governance and Capacity Building Project-SGCBP). Apart from the Lagos State Financial Accountability Assessment (LSFAA) which was carried out in 2004 and assessed the overall risks to public funds as high, no other accountability assessment has been carried out for any other state in Nigeria. However, the SGCBP is assisting some states to address public financial management issues.

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Table 1: Risk Assessment and Mitigation for Lagos Eko Secondary Education Project

Risk Prelimina

ry Risk Rating

Risk Mitigating Measures incorporated in Project Design

Conditionality Residual Risk Rating

Country Level Funds may not be used in an efficient, accountable and transparent way

H The CPS that supports Nigeria’s NEEDS aims to achieve improved transparency and accountability for better governance which minimize opportunity for corrupt practices, This has translated into various projects at the federal and state levels respectively, focusing on improving accountability, good governance, transparency and fighting fraud and corruption. Reforms in budgeting, FM systems, procurement and auditing are supported.

Robust financial management arrangements established at the federal and state levels for the project and designed to mitigate the Country level risk.

None. S

Entity Level Federal/State: Weak institutional capacity to implement the project’s components, to effectively monitor progress, and embrace full accountability for results. Track record with Bank funded project (UBE).

H The federal component will be implemented by the FMoE.

Lagos will join the NESSC which provides strategic guidance and ensures effective project implementation.

The project will be implemented at the state level by Lagos SMoE through a multitude of public secondary schools. At the state level the project will be governed by a SPAC, at district level by DPAC and by a PIC at the school level.

Appoint a coordinator for the federal component. This will be captured as a living action to be fulfilled by the FMOE by Board.

S

Project level Prior Bank assisted project implementation experience by some of the staff in the

M Appointment of respected and reputable professional in leadership of PSU and of appropriately qualified and

Maintenance of key management and technical staff /leadership in PSU during

L

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project support unit (PSU) competent key management and technical staff. the project is a covenant.

Risk exposure and weak capacity to design and implement a credible prioritized risk management strategy in the administration of Grants to multiple public secondary schools

S Embracing of risk management practices by PSU under the guidance of SMOE and SPAC which in practice are to be applied by the SPAC and the PSU leadership. Effective project internal audit function using a risk based audit approach and supported by a Finance and Audit Committee, to be selected from among the SPAC.

None M

Sub-Overall Risk S M

2. Control Risk

Risk Preliminary Risk Rating

Risk Mitigating Measures Incorporated in Project Design

Conditionality Residual Risk Rating

Budgeting

Failure to properly prepare comprehensive and effectively monitor periodic budgets.

S Project budgeting to be synchronized carefully with the FMOE’s own budget timeline, taking into account the work plans from the post-basic institutions participating in the project.

Budget execution to be monitored through Interim Financial Reports (IFRs) prepared on calendar semester basis.

Interim financial reporting (IFR) arrangements and formats agreed at appraisal

M

Accounting

Misuse of and failure to account for project funds and provide full documentation

S Accounting and internal control procedures established and documented in Project Financial Management Manual (PFM).

Institution of independent and effective internal audit function that is focused on risk management approaches.

Project Financial Management Manual (PFM) is part and parcel of the PIM.

M

Accountability and reporting difficulties

S Robust FM arrangements at the federal and state levels, including the use of PFMU to manage project

M

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owing to the project’s multiple implementing institutions, 637 secondary schools that will receive project funding directly or indirectly.

funds. Use of technical assistance for support on need basis

to follow the institutions that become delinquent in their Grant accountability reporting obligation

Project reporting guidelines and timelines included in the PFM manual.

Implementation to be monitored by the SPAC and NESSC and status reports to be prepared by SPAC. The reports to be shared with FMOE, SMOE and World Bank, for monitoring and follow up.

Calendar semester interim financial reports to be used to monitor accountability

Weak management information systems.

M PSU and PMU have a functional duty to establish an integrated financial accounting system (computerized) in place of the excel spread sheets.

Project reporting guidelines and timelines included in the PFM manual

L

Internal Control

Internal Audit S Functionalizing of PMU and PSU’s independent and effective internal audit and risk management function. Internal auditor in PSU to liaise with ZOPAs in the Districts and in that collaboration, monitor the usage of project funds to give the SPAC through the Finance and Audit Committee assurance and comfort that project funds are being used for intended purposes.

None. However, the intention and the collaboration between the PSU internal auditor and the ZOPAs to be indicated up front in the schools grants manual.

M

Internal control policies and procedures-inadequate documentation of transactions including funds disbursed and non-retirement of school grants

M Project accounting and reporting guidelines included in the PFM manual.

None

L

Funds Flow

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Delayed funds flow of Grants to multiple implementing institutions spread across the 20 LGAs in the State

S Adequately qualified and competent FM staff available in the PFMU. Additional accountant and accounting technicians will be appointed on need basis. Grants for approved secondary schools will be through bank electronic transfer from PSU bank account in Naira to the schools bank accounts, on basis of information to be included in their school development plan and applications for funding. Participating schools to open project current accounts in Naira.

None

PFMU with a qualified accountant is already in place as a start.

M

Financial Reporting

Accountability and reporting difficulties as a result of the project’s complexity in view of multiple implementing institutions and the need to account for grants disbursed to them.

S Streamlining and coordination of financial statement reporting arrangements by the schools.

Project reporting guidelines and timelines included in (PFM) manuals.

Implementation to be monitored closely by the SPAC. The PSU will hire services of Technical Assistance when in need to help follow up institutions that are delinquent in submitting Grant accountability reports.

None M

Delayed finalization and submission of annual financial statements and IFRs

M Government financial reporting regulations and guidelines are consistent with IDA requirements and shall consistently be applied. PSU to identify delinquent institutions and use outside help (Technical Assistance) to pursue the institutions involved.

None L

Auditing

Delay in the submission of audit report and inadequate audit reports.

M Arrangements for reliance on internal audit work to ensure effective coverage of schools receiving project funds.

All institutions in receipt of project funds will be visited by the project external auditor at least once in

L

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the life of the project, to help the auditor verify the Grant fund use and form an opinion whether the funds have been used for the intended purpose.

AU/PMU and PFMU will appoint a private sector audit firm for the purpose of auditing the project. The auditor will be engaged within 90 days after project effectiveness.

Sub-overall Control Risk S M

Risk Preliminary Risk Rating

Risk Mitigating Measures Incorporated in Project Design

Conditionality Residual Risk Rating

Overall FM Risk Rating S The overall risk exposure is considered Substantial for this project. This will be mitigated substantially by implementing and adhering to the proposed risk management measures, reducing it to moderate rating. About 56% of Credit proceeds will be disbursed in the form of Grants to secondary schools across the 20 LGAs of the State. The PSU will be well trained in Bank procedures and have a good appreciation of the use of computers. A robust internal audit outfit that will apply risk based audit approach focus will be established and strengthened given the substantial risk rating of the project. Finally, a living practical, simple and sound FM manual of financial procedures will be in place at the PFMU and AU/PMU.

M

H-High S-Substantial M-Moderate L-Low

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Strengths 3. The use of the existing PFMU in the state is a significant FM strength in the Project. The PFMU is experienced in the implementation of Bank-assisted projects, the staff are trained in Bank fiduciary requirements, they are professionally qualified and the PFMU is equipped with computerized FM systems and FPM. The Federal PMU is at present implementing the Bank-assisted STEP-B project. These experienced units will be a benefit for the Lagos Eko project. Weakness and Action Plan 4. The table below indicates the actions to be taken for the project to further strengthen its financial management system:

Table 2: Financial Management Action Plan Action Date due by Responsible 1 Adoption of revised Project Financial

Management (PFM) manual update (Federal and State PFMs) acceptable to IDA.

August 31, 2009 PSU & PMU

2 Upgrade the financial management system at PFMU and STEP-B PMU to include chart of accounts and financial reports for new project.

August 31, 2009 PSU & PMU

3 Open Designated Dollar Account and, Current Draw-down account in Naira PSU and PMU and IDA advised of authorized bank signatories

Prior to disbursement of IDA credit proceeds

PSU & PMU

4 Extend/Expand Contract and TOR of external auditor to cover Lagos Eko Project.

Within 90 days after Effectiveness

PSU & PMU

5 Assign/Engage one relevantly qualified project internal auditor in the AU of PMU and at the PFMU. In addition to these key FM staff, a small number of supportive accounting technicians in accounting function would be provided.

August 31, 2009 PSU & PMU

Implementing Entities 5. The Federal component of the project would be managed by the STEP-B Project Management Unit (PMU) within the FMOE. A technical officer would be added to the PMU to coordinate the activities under this project. The Department of Basic and Secondary would be the coordinating department within the MOE.

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6. At the State level a State Project Advisory Committee (SPAC) will be established in the SMoE to coordinate the implementation of the project. This committee will review progress reports, approve/endorse annual work programs and budgets, advise on key implementation issues and ensure that agreed activities are met. The SPAC membership will include key stakeholders responsible for the implementation of project components and will comprise key departments in the SMoE, as well as external agencies/parastatals involved in implementation of the Lagos Eko project and other education projects. The Commissioner of Education in Lagos will have overall responsibility for the SPAC. The SPAC may establish, on an as needed basis, working groups/committees to provide technical assistance and expertise. 7. The SPAC will be assisted by a Project Support Unit (PSU) which has been established to support the coordination, procurement management and monitoring and evaluation of project activities. The PSU is located in the office of the Commissioner of Education. PSU staff will be selected based on agreed TOR and will receive sufficient training in Bank-financed project implementation prior to effectiveness. Furthermore, the PSU will receive support from consultants on an as needed basis. 8. At the District level, Tutor General/Permanent Secretary in each of the six districts, will have implementation oversight and will coordinate project activities in each district, with close coordination from SUBEB and SMoE. The Project Implementation Manual will provide greater detail on the roles and responsibilities of key officers who will be responsible for coordination and monitoring. The school grants will be the responsibility of the Tutor-General/Permanent Secretary of the district. They would chair a DPAC to provide policy oversight, evaluate and approve the school grant proposal and oversee project implementation. DPAC would also establish ad-hoc committees such as the Technical Review Committee (TRC) on an as needed basis. Zonal Project Administrators (ZOPAs) have been assigned in each district to help schools collect and maintain key data, strengthen their school improvement plans, prepare monitoring reports for the districts and provide overall implementation support as needed. They will play a key role in facilitating school grant implementation and management. The transfer of grant funds directly to the school account would be contracted through a commercial Bank. School Based Project Implementation Committees (PICs) will be responsible for monitoring how the grants are executed with support from the SBMCs, individual school PTAs, and ZOPAs. The head teacher/principal and the vice principal (Academics) would be the primary signatory of the school bank account. All schools receiving support under the project will be trained and well-versed in the School Development Grants Manual. At the district level, the project would be governed by the DPAC. This program management committee would be chaired by the TG/PS of the district. 9. To ensure that the project is implemented smoothly, the project will provide capacity building support for the PFMU and PMU on the financial management and disbursement procedures applicable to the Bank financed projects. Planning and Budgeting 10. Cash budget preparation will follow the state procedures. Financial projections or forecasts for the life of the Project (analyzed by year) will be prepared. On an annual basis, the project Accountant in PFMU and AU/PMU (in consultation with key members of the implementing unit) will prepare the cash budget for the coming period based on the work program. The cash budget should include the figures for the year, analyzed by quarter. The cash budget for each quarter will reflect the detailed specifications for project activities, schedules (including procurement plan), and expenditure on project activities scheduled respectively for the quarter. All annual cash budgets will be sent to the TTL at least two months before the beginning of the project fiscal year. 11. Detailed procedures for planning and budgeting will be documented in the FPM.

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Internal Control and Internal Auditing 12. Internal control comprises the whole systems of control, financial or otherwise, established by the PSU and PMU in order to: (i) carry out the project activities in an orderly, transparent and efficient manner; (ii) ensure adherence to policies and procedures; (iii) safeguard the assets of the project; and (iv) secure the completeness and accuracy of the financial and other records. 13. The key elements to ensure a sound internal control system will include:

Internal control environment;

Risk assessment;

Control activities;

Information and communication; and

Monitoring.

14. Project activities will also be periodically reviewed by the Internal Audit Unit (IAU) of the PFMU and AU/PMU. The Project Internal Auditor Unit in the PFMU and AU/PMU will each report to the Project Coordinator and at a minimum they will (i) carry out periodic reviews of project activities, records, accounts and systems; (ii) ensure effectiveness of financial and accounting policies and procedures, as well as compliance with internal control mechanisms; (iii) review SOEs; (iv) physically verify purchases and assets; and (v) carry out other functions as stated in the their approved charter. The internal auditors in the PFMU are accountants. They have undergone training in the Bank’ financial management and disbursement procedures, as well as training on risk-based auditing. Accounting 15. IDA Funds will be accounted for by the Project on a cash basis, augmented with appropriate records and procedures to track commitments and to safeguard assets. Accounting records will be maintained in dual currencies (i.e. Naira and $). 16. The Chart of Accounts will facilitate the preparation of relevant monthly, bi-annual and annual financial statements, including information on the following:

Total project expenditures; Total financial contribution from each financier;

Total expenditure on each project component/activity; and

Analysis of total expenditure into civil works, various categories of goods, training, consultants

and other procurement and disbursement categories. 17. Annual financial statements will be prepared in accordance with relevant International Public Sector Accounting Standards (IPSAS). 18. All accounting and control procedures are documented in the FPM and regularly updated by the Project Accountant and approved by the SPAC and shared with IDA and the Government.

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Financial Reporting 19. Within the PSU and PMU, the project coordinators will ensure that the Project Accountant prepares Interim unaudited Financial Reports (IFRs) i.e. monthly and bi-annually and Annual Financial Statements, on a timely basis to be submitted by the PSU and PMU. The monthly IFR will facilitate preparation of the semester IFRs, being the aggregate of six months figures. In compliance with government reporting requirements, monthly returns will be made to the State Accountants General for incorporation in the governments’ accounts, as described in the FPM. These reports and financial statements are outlined below. Bi-annual and annual reports are to be submitted respectively to: (i) PMU, PSU, SMOF and FMoF; and (ii) IDA - for the purpose of monitoring project implementation. 20. Monthly Reports: On a monthly basis, the PFMU and AU/PMU will prepare and submit the following reports to the Project Coordinator:

A Bank Reconciliation Statement for each bank account A Monthly Statement of Cash Position for project funds from all sources, taking into

consideration significant reconciling items

A Monthly Statement of Expenditures classified by project components, disbursement categories, and comparison with budgets, or a variance analysis; and

A Statement of Sources and Uses of funds (by Credit Category/ Components or Activity showing

IDA and Counterpart Funds separately). 21. Calendar Semester Reports: The following Interim unaudited financial reports will be prepared by the AU/PMU and PFMU on a calendar semester basis and submitted to IDA and the Project coordinators:

Financial Reports, which include a statement showing for the period and cumulatively (project life or year to date) inflows by sources and outflows by main expenditure classifications; opening and closing cash balances of the project; and supporting schedules comparing actual and budgeted expenditures. The reports will also include cash forecast for the following two quarters as well as analysis of disbursements against contracts.

SOE withdrawal schedule, listing individual withdrawal applications relating to disbursements by

the SOE method, by reference number, date and amount; and

Designated account statement reconciliation, showing aggregate PSU and PMU deposits and replenishments received, payments supported by withdrawal applications, interest earned on the account and the balance at the end of the reporting period.

22. Indicative formats for the reports are available in a Bank guideline called “Financial Monitoring Reports: Guidelines to Borrowers”. The format of the IFR was agreed during appraisal. 23. Annual Financial Statements: The annual Project Financial Statements, which will be prepared by the PFMU and AU/PMU, will include the following:

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A Statement of Sources and Uses of funds (by Credit Category and Component/Activity showing IDA and Parallel Funds separately);

A Statement of Cash Position for Project Funds from all sources;

Statements reconciling the balances on the various bank accounts (including IDA Designated

Account) to the bank balances shown on the Statement of Sources and Uses of Funds;

SOE Withdrawal Schedules listing individual withdrawal applications relating to disbursement by the SOE procedure, by reference number, date and amount;

Notes to the Financial Statements.

Auditing 24. The IDA Financing Agreement will require the submission of audited Annual Financial Statements for the project, within six months after year end. 25. Relevantly qualified, experienced and independent external auditors appointed for the Federal PMU and State PFMU will audit the project activities based on TOR acceptable to IDA. 26. The external auditors will express an opinion on the Annual Financial Statements in compliance with International Standards on Auditing (ISAs). In addition to the audit report, the external auditors will prepare a Management Letter giving observations and comments, and providing recommendations for improvements in the entire system, controls and compliance with financial covenants in the Financing Agreement. Financial Management Supervision Plan 27. The financial management arrangements will be reviewed periodically as part of project and/or PFMU and AU/PMU supervision missions. The first FM review will be carried out after 6 months of project implementation. This detailed review will cover all aspects of FM, internal control systems, reviewing the overall fiduciary control environment and tracing transactions from the bidding process to disbursements as well as review of transactions. The supervision intensity will be based on risk, initially on the PAD FM risk rating and subsequently on the updated FM risk rating during implementation. Reviews will be as follows: FM supervision visits based on risk; review of bi-annual unaudited IFRs; review of auditor’s report on the Annual Financial Statements and management letter. In addition, there will be timely monitoring follow up of issues arising from annual review of transactions which will be jointly done with the post audit review by the Bank’s procurement unit; participation in project supervision missions as appropriate; and updating the financial management rating in the Implementation Status Report (ISR). The World Bank’s project team will play a key role in monitoring the timely implementation of the action plan Fund Flows and Disbursement Arrangements Bank and IDA Accounts 28. Proceeds of the financing will follow the standard Bank procedures for Investment Lending, for use by the Borrower for eligible expenditures as defined in project financing agreements. Disbursement arrangements have been designed in consultation with the Borrower after taking into consideration the

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assessments of Borrower’s financial management and procurement arrangements, the procurement plan, cash flow needs of the operation and the Borrower’s prior disbursement experience. Additional instructions for disbursements have been provided in a Disbursement Letter issued for this project. IDA will disburse the credit through US$ Designated Accounts (DA) which will be managed by the Lagos PFMU and by the Federal AU/PMU. 29. Specific funding, banking and accounting arrangements are as follows:

Two US$ DAs to which the initial deposit and subsequent replenishments from IDA funds will be lodged;

A Current (US$) interest earning Account with a reputable commercial bank acceptable to IDA to

which interest accrued on the DA will be credited;

A Current (Draw-down) Account in N with a reputable commercial bank to which draw-downs from the DA will be credited once or twice per month in respect of incurred eligible expenditures, maintaining balances on this account as close to zero as possible after payments.

30. All bank accounts will be reconciled with bank statements on a monthly basis by the PFMU and AU/PMU. A copy of each bank reconciliation statement together with a copy of the relevant bank statement will be reviewed monthly by the Project Accountant who will expeditiously investigate identified differences. Detailed banking arrangements, including control procedures over all bank transactions (e.g., check signatories, transfers, etc.) will be documented in the FPM. 31. Additionally, the PFMU and AU/PMU will each maintain an IDA Ledger Loan Account in US Dollars/Naira/SDR to keep track of withdrawals from the IDA credit. The account will show (i) deposits made by IDA, (ii) direct payments and or Special Commitments by IDA, and (iii) opening and closing balances. 32. The PFMU and AU/PMU will each maintain a cumulative record of draw-downs from the IDA credit that will be reconciled monthly with the Disbursement Summary provided by the Bank. 33. The PFMU and AU/PMU will each be responsible for preparing and submitting to the Bank consolidated applications for withdrawal, as appropriate. Appropriate procedures and controls, which will be documented in the FPM, will be instituted to ensure disbursements and flow of funds are carried out in an efficient and effective manner. The PFMU, based on approved school grant proposals, will disburse in tranches, school grants to participating institutions by transfer directly to the school account. Participating schools would provide adequate supporting documents to retire the tranche payments. Technical assistance for support on an as needed basis will be used to follow the institutions that become delinquent in their Grant accountability reporting obligation.

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Funds Flow Diagram

IDA

Designated Account ($) PMU

Designated Account ($) PMU

Draw-Down (Zero Balance) Naira A/C

Draw-Down (Zero Balance) Naira A/C

PMU Expenditures PSU Expenditures

Disbursement Methods 34. This Credit will be disbursed through various disbursement methods, including i.e., Advances, direct payment, reimbursement, and special commitments. Advances will be disbursed into segregated Designated Accounts (DA), one each to be managed by the project management unit at the Federal Ministry of Education and the PFMU at Lagos State respectively. The Designated Accounts will be designated in US Dollars and will be segregated from other financing partners. Considering the cash flow requirements and project design, a flexible ceiling will be determined annually for the operation based on funding forecasts for 2 quarters as provided in Annual Work Plans and Budgets for the project. Ceilings will be separately determined for each of the 2 DAs. Direct payments are authorized only for all payments under contracts in excess of US$1 million. Minimum Value of Applications 35. The Minimum Value of Applications for reimbursement, direct payment and special commitment is US$ 75,000. Reporting on Use of Credit Proceeds 36. Supporting documentation will be requested along with withdrawal applications as specified in the disbursement letter. This will comprise summary reports, Statements of Expenditure, for payments made by Recipient from the Designated Accounts, and requests for reimbursements for eligible expenditure. Copies of original documents or records shall be requested only for certain categories of expenditures above financial thresholds specified in the Disbursement Letter. After project implementation begins, the semester consolidated Interim Financial Reports (IFRs) produced by the Project will be reviewed. Where the reports are found accurate and are produced on a timely basis, and the entire financial management system framework is considered satisfactory, the government may request conversion to report-based disbursement. An assessment of the system will be undertaken by the

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Bank project team to determine if the Project is eligible for report-based disbursement. Detailed disbursement procedures are documented in the FPM. All supporting documentation for SOEs will be retained by the PFMU and AU/PMU and must be available for review by periodic World Bank missions, internal and external auditors. Disbursements by category 37. The table below sets out the expenditure categories and percentages to be financed out of the Credit proceeds. Allocations to disbursement categories have been made based on the project's work plans. Disbursements will be based on the work plans agreed annually with the Bank. In order to provide maximum flexibility and disbursement based on implementation performance about 7.5 percent of project funds will remain in the unallocated category until the mid-term review when they can be allocated as needed to each category under the project.

Table 3: Disbursement Categories

Category Amount of the Credit

Allocated (expressed in SDR 000)

Amount of the Credit Allocated (expressed

in US$ 000)

% of Expenditures to be Financed

1. School Grants under

Component 1 100%

(a) SSDGs 25,700 38,405

(b) SSPAs 6,900 10,330

(c) PPPs 2,700 4,054 2. Goods, Training

Consultant Services under Component 1

5,100 7,559

100%

3. Goods, Training Consultant Services under Component 2

8,500 12,714

100%

4. Goods, Training, Consultant Services under Component 3

1,900 2,773 100%

5. Goods, Training, Consultant Services under Component 4

3,000 4,500

6. Operational costs 100%

(a) Lagos State 3,400 5,021

(b) Federal MoE 300 500

7. Refund of Project Preparation Advance

1,300 2,000

Amount payable pursuant to Section 2.07 of the General

Conditions 8. Unallocated 4,800 7,144

Total Amount 63,600 95,000 100%

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Conclusion: 38. The Financial Management Assessment conclusion is that subject to the recommended mitigation measures and the recommended action plan being implemented as per the agreed time frame, the project has a residual risk rating of Moderate and has met the minimum FM requirement in accordance with OP/BP 10.02. Further, this objective will be sustained by ensuring that strong financial management systems are maintained throughout the life of the project. Detailed Financial Management reviews will also be carried out regularly, either within the regular proposed supervision plan or a more frequent schedule if needed, to ensure that expenditures incurred by the project remain eligible.

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Annex 8: Procurement Arrangements

FEDERAL REPUBLIC NIGERIA: Lagos Eko Secondary Education Project

A. General Country Environment 1. Nigeria has been implementing a procurement reform program based on the recommendations of the 2000 Country Procurement Assessment Review (CPAR). A review of the progress made on the 2000 CPAR recommendations as reflected in the 2007 PEMFAR shows that implementation of the procurement reform program has brought about substantial improvements in obtaining value for money in public sector expenditure. This has further introduced some level of transparency into the country’s procurement process. In this regard, the CPAR of 2000 has been a positive catalyst, because it supported the agenda of financial sanitation. The PEMFAR report also indicates that contract prices were reduced substantially and have reportedly saved the Treasury significant amounts. Collaboration between procurement and financial management has been strengthened considerably. The Procurement professionals’ cadre was established at the Federal level in 2006. The Public Procurement Act was promulgated in Nigeria in June 2007 with a view to further sanitize the public procurement system, which has often been the subject of abuse and corruption. This has brought significant improvements in the existing public service procurement system and further enhanced transparency. The Act adheres to the principles of the UNCITRAL model law and outlines the principles of open competition, transparent procurement procedures, clear evaluation criteria, award of contract to the lowest evaluated tender, and contract signature. The legislative framework is applicable to all procurement categories (suppliers, contractors, consultants) and must be applied for all public funds regardless of value. The Act has provisions for exceptions to competitive tendering, which are the exception rather than the rule. Also, Government has already prepared relevant implementation Regulations, Standard Bidding Documents (SBD) and Manuals for the Procurement of Goods, Works and Consulting Services, which describes the minimum contents of the tender and proposal documents. The essential elements are in line with internationally acceptable procurement standards. The Procurement Act also provides for a complaints and appeals mechanism to be established to enhance accountability. 2. Procurement Risk at the Country level: Substantial progress towards procurement reform has recently been made at the Federal Government level. A Bureau of Public Procurement (BPP) has been established while a procurement professional Cadre has been established in the public service. The BPP has organized a series of trainings and awareness workshops to sensitize this cadre of professionals with the procurement processes. Currently, the Government Procurement Reform Program is being supported by an IDA Credit-ERGP with a substantial component focusing on procurement reforms. There are also three IDF Grants, to assist the Federal and two State Governments to address weak procurement capacity in the public sector and to build appropriate partnerships with the private sector. Government is also reforming the Customs practices to modernize and make it more effective, thereby enhancing private sector confidence in public procurement processes. 3. Procurement Risk in the Education Sector at Federal and Lagos State. The Education sector has had some history of implementing various Bank-financed projects (Primary Education I, Primary Education 2, National University Adjustment Project (NUAP), and Technical Education Project) and has recently implemented the Universal Basic Education project with components at the Federal level and in 16 states, including Lagos. From previous ICRs, IPRs and post procurement reports of these projects, weak procurement capacities were identified. Apart from the key issues and risks concerning

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procurement in Nigeria stated above, the different implementation approaches engaged (centralized and decentralized) by the Task teams and lack of continuity of key staff contributed to the poor procurement capacity in education. Additionally, insufficient procurement capacity at the state Ministry of Education, lack of effective and efficient storage, faulty distribution systems (distribution of textbooks and Journals under federal PEPS I and NUAP) and lack of appropriate MIS for tracking procurement records will impact the procurement process. Post-procurement reviews for previous projects have also identified non-adherence to procurement scheduling and contract management skills, due to the lack of capacity, inadequate storage facilities, and filing system. Lagos state, under the closed UBE project, experienced several set backs that affected procurement implementation. These included inadequate management and political interference with the procurement process. However, the Lagos Eko project will learn from these experiences, particularly the experience of the Bank supported UBE project in Lagos. 4. At the school level, where a substantial part of the Credit will be given as grants, a Project Implementation Committee (PIC) will be mandated to handle procurement in line with the provisions of the School Development Grant Manual, and keep appropriate records. The PIC will also be responsible for disclosing the amount of grant received and how it is implemented for accountability and anticorruption purposes. In addition, the PIC of each school will submit reports to the District TG/PS on a quarterly basis. 5. To ensure that the PIC performs its function adequately, the Committee members will be given training before the disbursement of the grant. The training will be on basic FM and procurement procedures and how to prepare and keep appropriate records. Training will also be provided to the relevant District officers, DPAC and Zonal Project Administrators. 6. The District procurement staff will frequently visit the schools to ensure that appropriate procedures are being used and records kept. The PSU Procurement Officer will, from time to time, visit the schools to ensure that funds are adequately and transparently disbursed. B. Implementation Arrangements 7. The main implementing agency for the Lagos Eko Education Project is the Lagos State Ministry of Education. The PSU established within the Lagos Ministry of Education (SMoE) will have the overall responsibility for project coordination and implementation at the State level. For the federal component, the STEP-B Project Management Unit will have the responsibility for managing federal activities, including procurement. The details regarding the implementation arrangements of the Lagos Eko project are presented in Annex 6. The Project Implementation Manual, which includes the School Development Grant Manual (SDGM), the Procurement Manual, and the Financial Management Manual, will all be reviewed and cleared by IDA. An administrative structure that will manage the day to day implementation of the project including procurement coordination functions will be housed inside the PSU of the SMoE and the STEP-B PMU. 8. The overall implementation and coordination of the project will rest largely with the PSU. Therefore, the PSU as the project executing agency will have responsibilities for coordinating all procurement functions for Lagos under the project. However, in the case of the School Grant and PPP where there are minor procurement activities, such procurement responsibilities shall be delegated to the relevant committees at the Schools/PPP level. The details on procurement activities at the School level are delineated in the School Development Grant Manual. The procurement activities for the federal component will be undertaken by the existing procurement officer of the STEP-B PMU.

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C. Guidelines 9. Procurement for the proposed project would be carried out in accordance with the World Bank’s "Guidelines: Procurement Under IBRD Loans and IDA Credits" dated May 2004 and revised October 2006; and "Guidelines: Selection and Employment of Consultants by World Bank Borrowers" dated May 2004 and revised October 2006; and the provisions stipulated in the Legal Agreements. The various items under different expenditure categories are described in general below. For each contract to be financed by the Loan/Credit, the different procurement methods or consultant selection methods, the need for pre-qualification, estimated costs, prior review requirements, and time frame are agreed between the Borrower and the Bank in the Procurement Plan. The Procurement Plan will be updated at least annually, or as required, to reflect the actual project implementation needs and improvements in institutional capacity. 10. Procurement of Works: Minor works procured under this project would include: small/minor rehabilitation to school infrastructure, etc. The procurement will be done by the various schools and the details are provided in the School Development Grant Manual. 11. Procurement of Goods: Goods procured under this project would include: computers, examination equipment, learning materials, project vehicles, office furniture and equipment etc. The procurement will be done using the Bank’s SBD for all National SBD agreed with or satisfactory to the Bank. 12. Procurement of non-consulting services: Non-consulting services may include internet provider services, library access services, bandwidth provision. These services may be locally provided. Smaller contracts may be concluded following prudent national shopping procedures as detailed in paragraph 3.5 o f the “Guidelines: Procurement under IBRD Loans and IDA Credits” May, 2004, revised October 2006 and June 9,2000 Memorandum “Guidance on Shopping” issued by IDA will be followed. 13. Trainings, Workshops, Seminars and Conferences. Training, workshops, seminars and conferences and study tours will be carried out on the basis of approved annual programs that will identify the general framework for training and similar activities for the year, including the nature of training/study tours/workshops, the number of participants, and cost estimates. The participants and beneficiaries of such programs will, in general, be required to file a report within a stipulated period upon resumption of duty. 14. Selection of Consultants: Consultancy services which include Technical Assistance, baseline surveys, Monitoring and Evaluation, technical support for implementation of the project, management, financial management and procurement, policy studies, external financial and Technical audits etc, will be selected using Request for Expressions of Interest, short-lists and the Bank’s Standard Requests for Proposal, where required by the Bank’s Guidelines. Short-lists of consultants for services estimated to cost less than US$200,000 equivalent per contract may be composed entirely of national consultants in accordance with the provisions of paragraphs 2.7 through 2.8 of the Consultant Guidelines. Research Institutes, public training institutions and NGOs may be hired to carry out specific research, training, distribution and monitoring services in accordance with paragraph 1.1 1 (b - d) and 3.16 of the Consultant Guidelines. 15. Operating Costs: The operating costs shall include staff travel expenditures and other travel related allowances with prior clearance from IDA; equipment rental and maintenance; vehicle operation, maintenance and repair; office rental and maintenance, materials and supplies; utilities and communication expenses; and bank charges. Operating Costs financed by the project will be procured using the implementing agency’s administrative procedures that shall be acceptable to the Bank.

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D. Assessment of the agency’s capacity to implement procurement 16. An assessment of the capacity of the Implementing Agencies to implement procurement actions for the project was carried out in accordance with Procurement Services Policy Group (OCSPR) guidelines dated August 11, 1998. The assessment reviewed the organizational structure for implementing the project and the roles of the key actors in project implementation. The detail assessment is in the project files. The assessment revealed that the Education Sector at both the Federal and Lagos State level has had some history of implementing various Bank-financed projects (Primary Education I, Primary Education 11, National University Adjustment Project (NUAP), Technical Education Project) and has recently implemented the Universal Basic Education project with components at the Federal level and in 16 states, including Lagos State. From previous ICRs, IPRs and post procurement reports of these projects, substantial weak procurement capacities were identified and have been outlined earlier in paragraph 3. Lagos state participated in the Universal Basic Education (UBE) project that closed in 2006 but problems with project coordination delayed procurement implementation between 2003 and 2006. The Procurement Officer who handled the procurement process of the UBE has been assigned as the Officer of this new project. The Procurement Officer holds an HND (Engineering) with 23 years experience including experience in Bank procurement procedures. Therefore, this project will build on the experience under the previous Bank supported education projects (UBE) in Lagos, addressing weaknesses identified above through training, clear guidelines in the PIM, and enhanced supervision as needed. The procurement arrangements at the federal level were found to be adequate given the ongoing experience of the procurement officer under the STEP-B project. 17. With the progress made in procurement reform in Nigeria and Lagos State and the presence of the Act at the Federal level which addresses the above risk issues, the procurement risk is considered Moderate. The corrective measures that will be put in place to address the issues and risks are reflected in Table 1 below.

Table 1: Procurement Action Plan

Action Responsibility Due Date Remarks

1 Strengthening of PSU capacity to manage and coordinate Bank financed projects.

Bank and Lagos Eko PSU

On a continuous basis

Experienced Procurement Specialist engaged to strengthen PSU

2 Procurement Plan for the first 18 months prepared and agreed with the Bank and posted on the web.

Lagos Eko PSU/STEP-B PMU

After Board approval

Plan Finalized and agreed during Negotiation.

3 Adoption of Project Implementation. Manual (PIM) including the Generic Procurement manual for Bank financed Projects in Nigeria.

Lagos Eko PSU and Bank

August 31, 2009 Draft submitted by May 31, 2009

4 Adoption of the Bank Standard Bidding Documents for use under NCB in lieu of lack of National Standard Bidding Document.

Lagos Eko PSU and Bank

August 31, 2009 First set of NCB bidding document to be prepared and reviewed by the Bank before Board.

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Action Responsibility Due Date Remarks

5 Training of PIC on managing grants contracting and monitoring arrangement to promote accountability and transparency.

Bank and Lagos Eko PSU

Not later than 3 months of project implementation

Training to be repeated periodically.

6 Establish a central complaint database/website/internet and or hotlines.

Lagos Eko PSU Not later than 3 months of project implementation

To reduce the risk of misuse of project funds

7 Establish proper procurement filling system and develop procurement tracking system.

Lagos Eko PSU Not later than 3 months of project implementation

To ensure easy retrieval of information/data

8 Publication of Contract awards and list of beneficiaries.

Lagos Eko PSU/ STEP-B PMU

On quarterly basis

On a continuous basis

9 Conduct Independent Technical Audit (separate from annual external financial audit).

Bank Annually To reduce the risk of misuse of project funds

10 Organize Contract Management training for Lagos project staff.

Lagos Eko PSU Not later than 3 months into project implementation

To improve project staff contract management skills

E. Procurement Plan 18. The Recipient has developed an 18 month procurement plan for project implementation which provides the basis for the procurement methods for each participating State. This plan has been discussed and agreed between the Recipient and the Project Team at appraisal and was made available at negotiations. It will also be available in the project’s database and on the Bank’s external website. The Procurement Plan will be updated in agreement with the Project Team annually or as required to reflect the actual project implementation needs and improvements in institutional capacity. F. Frequency of Procurement Supervision 19. In addition to the prior review supervision to be carried out from Bank offices, the capacity assessment of the Implementing Agency has recommended at least two supervision missions to visit the field to carry out post-procurement reviews every year. An Independent Procurement Audit will be conducted to contribute to the mid-term review exercise. G. Publication of Results and Debriefing. 20. On-line (DG Market, UN Development Business, and/or Client Connection) publication of contract awards will be required for all ICB, NCB, Direct Contracting and the Selection of Consultants for contracts exceeding a value of US$200,000. In addition, where prequalification has taken place, the list of pre-qualified bidders will be published. With regard to ICB, and large-value consulting contracts, the Recipient will be required to assure publication of contract awards as soon as IDA has issued its ‘no objection’ notice to the recommended award. With regard to Direct Contracting and NCB, publication of contract awards could be in aggregate form on a quarterly basis and in local newspapers. All consultants competing for an assignment involving the submission of separate technical and financial proposals, irrespective of its estimated contract value, should be informed of the result of the technical evaluation (number of points that each firm received), before the opening of the financial proposals. The PSU and/or

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PMU will be required to offer debriefings to unsuccessful bidders and consultants, should the individual firms request such a debriefing. H. Details of the Procurement Arrangements 21. Goods, Works, and Non Consulting Services (a) List of contract packages to be procured following ICB and direct contracting: None. 22. Consulting Services

(a) List of consulting assignments with short-list of international firms.

1 2 3 4 5 6

Ref. No.

Description of

Assignment

Estimated

Cost (US$)

SelectionMethod

Review by Bank (Prior / Post)

Expected Proposals

Submission Date

1 Consultancy for Reform of technical colleges/PPP.

1,500,000 QCBS Prior Dec. 09

2 Consultancy for test item development.

76,013 SSS Prior Feb. 2010

3. Consultancy for test item moderation.

40,540 SSS Prior Dec. 09

4

3 consultancy services to subject associations to strengthen the capacity of teachers in the relevant subject areas i.e. Mathematics, English Language and Science.

1,013,513 SSS Prior Feb. 2010

5

1 week Training of 1,500 teachers of Mathematics in performance improvement in teaching methods.

1,216,216 QCBS Prior Feb. 2010

6

1 week Training of 1,500 teachers of English Language in performance improvement in teaching methods.

1,013,513 QCBS Prior Feb. 2010

7

1 week Training of 1,500 teachers of Science in performance improvement in teaching methods.

1,216,216 QCBS Prior Feb. 2010

8 Conversion courses for teachers to fill deficit in core subject areas.

540,540 QCBS Sept. 2010

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(b) Consultancy services estimated to cost above $200,000 per contract and single source selection of consultants (firms) for All Values will be subject to prior review by the Bank. (c) Short lists composed entirely of national consultants: Short lists of consultants for services estimated to cost less than $200,000 equivalent per contract may be composed entirely of national consultants in accordance with the provisions of paragraph 2.7 of the Consultant Guidelines.

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Annex 9: Economic and Financial Analysis

FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project

1. This Annex presents (a) an economic analysis of the impact of the proposed investments in education in Lagos, and (b) financial analysis of the proposed investments including the fiscal impact on present and future recurrent expenditures. Economic costs and benefits arising from this investment will be estimated and the projected contributions of the Lagos’ secondary education sector in the economic performance of the non-oil sector in Nigeria will be presented. Summary of Benefits and Costs 2. Economic Rates of Return of Lagos Eko Program Is High and Positive. A cost-benefit analysis based on the project targets of the Lagos Eko Project shows an economic rate of return (ERR) estimated at 14.5 percent based on private costs and 19 percent based on public and private costs. These represent a lower bound estimate as externalities from the improving secondary education are not taken into account in the analysis. Given the primacy of Lagos in the growth of the non-oil sector in Nigeria, it is expected that this program will contribute positively to the future economic performance of the whole country. Lagos contributes to about 12 percent of the GDP of the country, and is the prime economic hub in Nigeria and West Africa. 3. Critical Assumptions and Sensitivity of Key Indicators. The key assumptions in the cost-benefit analysis are a (a) 50 percent labor force participation of the secondary school graduates; and (b) unemployment rate of 10 percent and maintenance costs of 3 percent per year. Economic rates of return would still exceed 10 percent, and thus be economically justifiable, even where labor force participation rate by secondary students is increased by 50 percent. 4. Fiscal Impact of Lagos Eko Investments: Low Fiscal Burden in the Medium and Long Term. On the assumption that 75 percent of the total project costs would continue beyond the fourth year of project execution, it is estimated that the recurrent costs would amount to N 2.3 billion (US$16 million), or about 0.004 percent of the projected total Lagos State Expenditures for 2014 and beyond. This indicates that the incremental recurrent costs and the counterpart funding would not impose a significant fiscal burden to the Lagos State Government. More reassuring is the recent dramatic rise in State Government revenues resulting from its expenditure policies with better revenue mobilization mechanisms, which means that the share of incremental costs to the total state budget is going to remain small and within its fiscal capacity. Secondary Education Sector: Investments and Returns in Lagos State 5. Demography, Economy and Skills: The Primacy of Lagos. Lagos State is a mega-city of over 9 million citizens (6th largest in the world) and accounts for 12 percent of Nigeria’s GDP, signifying its primacy in the Nigerian economy. About 65 percent of the country’s industries (about 2,000) are in Lagos, and two-thirds of the country’s commercial activities are carried out in this city-state. Despite its economic status and industrial base, Lagos is a poor city. According to the NLS 2006 survey, 67 percent of the population live on less than one dollar a day. Lagos is ranked 23rd in terms of poverty status among 36 states in the country. 6. The UN estimates that at its present growth rate Lagos State will be the third largest mega city in the world by 2015 after Tokyo in Japan and Bombay in India. The rate of population growth is about 600,000 per annum with a population of about 4,193 persons per sq km. (LASEEDS 2006). Lagos State

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has about 53 percent of the population falling within the age bracket of 0-18 years, with the enviable status of having the highest youth population in Nigeria. Fiscal Impact Analysis of the Lagos Eko Project: Beyond the Project Life

7. Education Finance in Lagos State. The three tiers of government in Nigeria have concurrent responsibilities for the operation and funding of education within the state. According to the constitutional provisions, the main responsibilities of the Federal Government are three-fold: (a) education policy formulation; (b) coordination and monitoring of standards; and (c) providing direct control at the tertiary level. In this federal system, the states, including Lagos, are responsible for the delivery of basic education services (primary and junior secondary), senior secondary school services, and state colleges.

8. According to the Lagos State Education Public Expenditure Review (May 2008), the share of the education sector in the total state budget was 25.4 percent in 2001, rising to 35.3 percent in 2002, and decreased steadily to 22.7 percent in 2005. The average spending of 27.4 percent on education over this period, represents a very high priority towards education in the State Government. Expenditure on secondary schools has doubled in five years, from N 8.8 billion in 2001 to N 16.6 billion in 2006.

Table 1: Lagos: State Public Expenditure on Education by Level (2006-2008)

In Billions N

Source: Lagos State Ministry of Education (Main Report, 2008).

9. In 2006, a high proportion of the state expenditure was allocated to the senior secondary schools accounting for about 53 percent of the entire education expenditure. Although this increased in the following two years, the proportion to the total budget declined to 34 percent, with the higher shares shifting to basic education and higher education. By 2008, the budget for senior secondary education rose to an all time high of N 17.2 billion, representing 32 percent of the budget. Between 2006 and 2008 the total budget for education in Lagos State more than trebled from 17.3 billion to 53.4 billion which indicates a large infusion of resources into the education sector. The budget increase between 2007 and 2008 was accounted for by the State Government’s massive education investments which delivered textbooks to students in public primary and secondary schools.

10. Secondary Education Expenditures. In current prices, the emoluments bill for secondary school teachers almost doubled between 2001 and 2006 – from N 5.9 billion to N 11.1 billion (see Table 9), but fell by 7.8 percent in real terms (based on the national 2006 CPI index). The overall public expenditure fell by 6.7 percent du ring this period and overheads expenditure remained below 5 percent of the total recurrent expenditure. There were three pay increases between 1999 and 2006. Recurrent expenditure accounted for 73 percent of total expenditure between 2010 and 2006. Total capital expenditure for public secondary schools was around 15 times higher than for primary schools between 2001 and 2005.

Sub-Sector 2006 2007 2008 Basic Education (Primary and JSS) 5.5 11.1 21.9 Senior Secondary (SSS) 9.1 11.6 17.2 Higher Education 2.5 9.9 12.8 Other 0.2 1.2 1.5

Total 17.3 33.7 53.4

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Table 2: Total Public Expenditure on Secondary Education: Lagos State, 2001–2006 In Million N

2001 2002 2003 2004 2005 2006

Emoluments Overheads Capital Total in nominal terms Total in real terms (CPI 2006)

5,966 235

2,597 8,798

17,824

7,882 45

3,760 11,687 21,056

7,893 96

2,600 10,589 15,003

9,497 120

2,768 12,385 15,196

10,028 157

2,826 13,011 14,675

11,140 606

4,880 16,626 16,626

Source: Lagos State: Ministry of Economic Planning and Budget, 2008. 11. While the bulk of funding for secondary education comes from the state budget, the federal government also provides direct funding to basic education (including junior secondary education) through its Universal Basic Education (UBE) intervention fund. This fund provides additional funds for the development of basic education, in particular, infrastructure, investment, textbooks, teaching aids and professional development of teachers. Access to 70 percent of UBE funds is conditional on state governments providing matching grants. ETF funds are used to provide additional support to all educational institutions for infrastructure, teaching materials and in service training for teachers. Funding is also provided by international donor agencies like DFID, UNICEF, and World Bank. Lagos State Revenues: Trends 2001-2005 12. The main sources of income for Lagos government between 2001 and 2005 are presented in Table 3. Total income increased by 75 percent - from N 46 billion in 2001 to N 81 billion in 2005. When it comes to analyzing the trend in real terms (based on the national CPI index), one can see that the total income in 2005 decreased by 2 percent since 2001, but increased by 20 percent since 2002. Lagos State is much less reliant on Federation Account funding than is the case for other states: in 2005, the share of federal allocation in Lagos income was 34 percent. Internally generated income was 50.6 percent of total revenue in 2005, up from 33 percent in 2001; on average, it accounted for 52.6 percent between 2001 and 2005. However, the SMOE itself generated only N 129 million (2005) in internal revenue over 60 percent of which was from private school registration fees.

Table 3: Income Sources for Lagos State Government, 2001-2005 (in million N)

Source 2001 2002 2003 2004 2005

Federation Account 13,307 12,468 13,474 17,000 27,381

Internally generated revenue 15,141 22,056 23,916 50,892 40,793

Value Added Tax 6,050 6,684 7,318 7,635 12,110

Grants and reimbursements 427 864 1,301 0 0

External loans 0 0 0 0 0

Internal loans 9,000 0 0 0 0

Others 2,050 0 0 0 395

Total in Nominal Terms 45,975 42,072 46,009 75,527 80,679

Total in Real Terms (2006 CPI) 93,161 75,805 65,196 92,671 90,998 Source: Lagos State Budget: Ministry of Economic Planning and Budget 2006.

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13. Lagos government remains the largest source of public funding for education in the State. The relative financial contributions in 2005 were N 17.83 billion from state government, and N 0.28 billion from the Federal Government through UBEC. It is to be noted that local governments did not receive any Federal Allocation and Lagos government has had to bail them out. 14. Including state subventions for higher education institutions and other education parastatals (which are under the purview of the Special Adviser on Education), the share of the education sector in the total state government budget was 25.4 percent in 2001, rising to 35.3 percent in 2002 but then declining steadily to reach 22.7 percent in 2005.

Table 4. Total Actual State Government Expenditure on Education and Total Lagos State Government Expenditure 2001-2005 (in million N)

2001 2002 2003 2004 2005 Education Recurrent 8,381 10,873 11,024 13,568 14,743 Capital 3,083 4,034 2,734 2,920 3,092 Total Education 11,464 14,907 13,758 16,488 17,835 Total State Recurrent 35,808 34,707 35,606 48,792 59,374 Capital 9,366 7,550 9,771 11,868 19,201 Total State in Nominal Terms 45,174 42,257 45,377 60,660 78,575 Total State in Real Terms (CPI 2006) 91,538 76,139 64,301 74,429 88,625 Sources: Ministry of Education and Ministry of Economic Planning and Budget, Lagos State. Notes: Excludes administrative costs of education related MDAs, which were not available. Table 5: Share of Recurrent, Capital and Overall State Expenditure Spent on the Education Sector,

2001-2005 (%)

2001 2002 2003 2004 2005 Recurrent Expenditure Share 23.4 31.3 31.0 27.8 24.8 Capital Expenditure Share 32.9 53.4 28.0 24.6 16.1 Overall Expenditure Share 25.4 35.3 30.3 27.2 22.7 Note: Actual expenditures. Source: Ministry of Finance and Economic Planning and Budget. Table 6: Share of Total State and Local Government Recurrent Expenditure Spent on Education,

2005, Selected States (%)

State State Local Government (salaries) Borno 15.3* 11.7 Cross River 19.3 24.6 Enugu 33.7 34.2 FCT 34.4** 34.6*** Jigawa 25.7** 14.7 Kaduna 16.9 27.4 Kano 27.4 18.7 Kwara 34.1* 27.2 Lagos 24.8 Na Note: * estimate using state income less capital expenditure as the denominator, ** combined recurrent and capital expenditures, *** 2006 data Source: Ministries of Finance, SUBEB 2006.

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Local Government Education Expenditures: Trends 15. It was only possible to get partial data on local government education expenditures. Table 7 shows the partial data of local government recurrent and capital expenditure primary education between 2001 and 2006, as provided by the State Ministry of Local Governments. The total actual expenditure on primary education, provided by the State Ministry of Education, is given in Table 8.

Table 7: Local Government Expenditure on Education, 2001-2006, Lagos State (in million N)

LGA 2001 2002 2003 2004 2005 2006Ajeromi-Ifelodun Recurrent** 362 405 489 532 537 543.05 Capital 7 4 10 3 0 12.04 Oshodi/Isolo Recurrent** 115 8 409 145 157 n.a Capital 8 8 6 4 22 n.a Apapa Recurrent** 9 5 10 3 4 6.23 Capital 3 0 0 0 0 4.35 Onigbongbo* Recurrent** n.a n.a n.a 48 48 50.02 Capital n.a n.a n.a 0 0 7.72 Apapa-Iganmu* Recurrent** n.a n.a 1 46 3 5.04 Capital n.a n.a 0 0 0 7.29 Somolu Recurrent** 348 355 1 1 2 5.51 Capital 9 0 0 0 0 7.08 Ojodu* Recurrent** n.a n.a n.a 1 1 1.98 Capital n.a n.a n.a 1 1 3.15 Agbado/Oke-Odo* Recurrent** n.a n.a 0 3 3 2.42 Capital n.a n.a n.a n.a. n.a. 2.45

* Local Council Area (LCA) which was carved out of a Local Government Area (LGA). ** Includes teachers' salary except in the case of LCA. Source: Ministry of Local Government, Lagos State. 2007.

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Table 8: Income sources for Lagos State Government, 2001-2005 (in million N)

Source 2001 2002 2003 2004 2005 Federation Account 13,307 12,468 13,474 17,000 27,381 Internally generated revenue 15,141 22,056 23,916 50,892 40,793 Value Added Tax 6,050 6,684 7,318 7,635 12,110 Grants and reimbursements 427 864 1,301 0 0 External loans 0 0 0 0 0 Internal loans 9,000 0 0 0 0 Others 2,050 0 0 0 395 Total in Nominal Terms 45,975 42,072 46,009 75,527 80,679 Total in Real Terms (2006 CPI) 93,161 75,805 65,196 92,671 90,998

Source: Lagos State Budget: Ministry of Economic Planning and Budget 2006. Federal Government: Education Expenditures 16. Up until 2005, the Education Trust Fund was the main source of direct funding of education by the Federal Government at the state level (excluding federally-funded higher education institutions and Unity secondary schools). Federal Government funding for education in Lagos State as a whole has been limited, fluctuating between N 72.1 million in 2001 and N 42.1 million in 2004. It is expected, however, that the Universal Basic Education Intervention Fund, which started in 2005, will result in a sizeable injection of funds for basic education. In accordance with the UBE Act of 2004, two percent of the federal-level Consolidated Revenue Fund is to be allocated to basic education through UBEC. 17. The distribution of the UBE Intervention Fund is based on a fixed, universal formula for all participating states; pre-primary is allocated 5 percent of disbursement, primary schooling 60 percent, and junior secondary 35 percent. Within these education sub-sectors, school construction absorbs 70 percent, and instructional materials and staff development 15 percent each. 18. The Fund is based on matching contributions from the state and federal governments. Disbursements, which are made on a quarterly basis, have been much slower than expected. The matching grants allocation for 2005 and 2006 (which is the same for all states regardless of population, poverty levels and educational provision) for Lagos amounted to N 1,036.4 million. As at April 2007, only 27 percent (N 281.8 million) had been disbursed, which is well below the national average of 53.7 percent. No disbursement has yet been released for any 2006 quarter. The three main reasons for delays in releasing UBEC matching funds are unacceptable quarterly action plans submitted by state governments, unsatisfactory utilisation of previous UBEC funding by SUBEB, and, most serious of all, delays by state governments in making available their counterpart funding in the prescribed manner. Analysis of Fiscal Sustainability 19. Fiscal Impact of Secondary Education Expenditures. The table below shows the historical and projected federal and state expenditures on junior secondary and senior secondary education in Lagos relative to total state expenditures and the GDP. The project is expected to create incremental recurrent expenditure items in the budget of about N 2.3 billion every year beyond 2014. This amount is about 5.8 percent of the total Lagos education sector budget in 2008, and about 0.004 percent of the overall state budget. In the medium term, such level of recurrent expenditures is likely to be within the fiscal capacity of the State--given its small relative share in the budget. In recent years, the States’ strong non-oil economy, and its much improved revenue mobilization mechanisms increased its public resources and enabled it to more than treble the State expenditures between 2001 and 2008. These internally generated

110

revenues rose significantly in recent years, and enabled the State to spend more on infrastructure, and school construction, and purchase of textbooks and learning materials. With the World Bank supported LMDGP Project, the government is spending US$25 million for classroom construction—which helps access to secondary education. Likewise, it is expected that federal UBEC Intervention Funds, which are sizeable but not yet fully tapped by the state, will help junior secondary school expenditures. 20. In the medium term, it is also expected that the share of private sector schools will increase enrolment, including enrolment for the poor, thus contributing to the overall education supply for secondary schools. That would reduce the pressure on the public sector’s budget in the longer term. The new interventions developed by this project to improve quality, would then continue to be financed by public resources. Together with the rise in internally generated funds, and tapping more UBEC Intervention Funds, these new expenditures are then likely to be fiscally sustainable. It is projected that these new expenditures will be roughly 0.004 percent of the states total expenditures. 21. Fiscal Sustainability through Efficiencies. The project’s methodology of decentralizing substantial resources to the school level represents a paradigm shift in budgeting. The decentralization of resources to the schools will likely reduce the unit costs of inputs and transaction costs as compared to current practices. If such a modality works and the project achieves results in improved learning, then the government is likely to continue to allocate resources in this decentralized manner. In the long-run these efficiencies would enable the State to achieve learning objectives without necessarily increasing the education budget overall. Furthermore, new modalities in teacher professional development and more efficient deployment of teachers within schools (retraining and conversion) would ensure that efficiency is achieved, and thus attain the student learning objectives without additional budgeting.

Table 9: Expenditures in Secondary Education as a Share of Lagos Expenditures and GDP

Fiscal Year

Lagos State Expenditures

Secondary Education

Total Lagos State

Expenditures

Share of Secondary Education to

Total Lagos State Expenditures

Lagos State GDP

Share of Secondary Education

Expenditures to Lagos GDP

N billion Real 2006 CPI

N billion Real 2006

CPI %

N billion Real

2006 CPI %

2001 17.8 91.5 19.5

2002 21.1 76.1 27.7

2003 15.0 64.3 23.3

2004 15.2 74.4 20.4

2005 14.7 88.6 16.5

2006 17.3 1,916 0.009

2007 14.5 2,040 0.007

2008 23.6 (Est.)

403 (Budget)

5.8 2,124 (Est.)

0.010

Source of Basic Data: Lagos Ministry of Finance and Budget, 2008.

111

Table 10: Lagos Eko Project Cost as a Share of Lagos State budget in Secondary Education, and as a Share of Lagos State GDP

In Billion N In %

Fiscal Year

Lagos Total State

Expenditures Est.

Lagos State GDP Est.

Lagos Eko Project Costs

Annual

Lagos Eko Project Cost as % of State Expenditures

Lagos Eko Project Cost as

% of GDP

2009 427.0 2,227 1.7 0.004 0.0007 2010 452.0 2,316 2.3 0.005 0.0009 2011 475.0 2,409 2.3 0.005 0.0009 2012 504.0 2,509 2.3 0.004 0.0009

2013 534.0 2,631 2.3

(Govt.) 0.004 0.0008

112

Annex 10: Safeguard Policy Issues

FEDERAL REPUBLIC NIGERIA: Lagos Eko Secondary Education Project Environmental Impact 1. The project has been classified as category B since it is not expected to generate any major adverse environmental or social impacts. The main activities that triggered the Environmental Assessment policy (OP/PB/4.01) are related to component one which provides discretionary resources to schools to improve the quality of student learning (School Development Grants). These improvements may entail rehabilitation and some limited refurbishment of existing public secondary schools which may contribute to soil erosion, pollution or loss of vegetation. There is also the additional need for proper handling of the debris to be generated by such renovation and rehabilitation activities as well as the sundry limited civil works that may be needed. To address potential negative impact consistent with the requirements of the triggered safeguard policy, the Government has prepared an Environmental Social Management Framework (ESMF). The framework is consistent with national laws as well as the Bank’s triggered safeguard policy, Environmental Assessment OP/BP 4.01. The ESMF contains a screening mechanism that the project would use to identify adverse impacts from any proposed construction activities. The ESMF also contains an Environmental and Social Management Plan (ESMP) with responsibilities for mitigation and monitoring, costs, duration, and institutional capacity building to implement the ESMF. Safeguard policies 2. This project triggered Environmental Assessment (EA) safeguards policy of the World Bank (OP/BP 4.01). The ESMF is the safeguards instrument developed by this project to mitigate the potential adverse impacts. This ESMF has been prepared, approved and disclosed in country and World Bank Info-Shop prior to appraisal. The date of disclosure at the Info Shop was December 15, 2008.

Safeguard Policies Triggered by the Project Yes No Environmental Assessment (OP/BP 4.01) [X] [ ] Natural Habitats (OP/BP 4.04) [ ] [X] Pest Management (OP 4.09) [ ] [X] Physical Cultural Resources (OP/BP 4.11) [ ] [X] Involuntary Resettlement (OP/BP 4.12) [ ] [X] Indigenous Peoples (OP/BP 4.10) [ ] [X] Forests (OP/BP 4.36) [ ] [X] Safety of Dams (OP/BP 4.37) [ ] [X] Projects in Disputed Areas (OP/BP 7.60)* [ ] [X] Projects on International Waterways (OP/BP 7.50) [ ] [X]

Long-term Adverse Safeguard Impacts: 3. This project is not expected to generate any long term negative impacts on the environment nor the population. The renovation and civil works are small in scope without any potential for adverse effects that are cumulative. Mitigation Plan Implementation

* By supporting the proposed project, the Bank does not intend to prejudice the final determination of the parties' claims

on the disputed areas

113

4. The mitigation measures proposed in the ESMF and EMP will address the potential adverse impacts identified. The EMP and Environmental clauses will be inserted in bidding documents and contracts of the contractors. Environmental Engineers on the contractors’ team will ensure compliance with safeguards policies through on-site project supervision. Day to day monitoring of the implementation plan will be the responsibility of the assigned project staff, with support from consultants as needed. World Bank Safeguard specialists in the project team will also complement these efforts during supervision missions. Participation/Consultations 5. During the development of the ESMF extensive consultations with stakeholders such as Federal Ministry of Environment, Housing and Urban Development, Lagos State Environmental protection Agency, and Lagos State Ministries of Education, Environment was carried out. The safeguards instrument has been disclosed in country and at the World Bank Info Shop. Furthermore, project stakeholders in local government areas and at the community level will be continuously consulted at various stages of the project cycle. In particular, public consultations were carried out throughout the project preparation phase to encourage participation and foster social inclusion. Consultations with local communities will be continuously organized during project implementation. Assessment of the Capacity of the Client to Address Safeguards Issues 6. The Project Implementing Entity, Lagos State, has considerable experience in World Bank Safeguard Policies and the PSU shall designate a staff to be responsible for following up environmental and social safeguards issues. The designated Project Staff charged with implementing safeguards instruments will be given more in-depth training in environmental management. He/She will be supported by a consultant, who will be hired on an as-needed basis. Project desk officers at Lagos State Environmental Protection Agency shall provide oversight function. Furthermore, the World Bank General Environmental Management Conditions for Construction Contracts shall be inserted in bidding documents and contracts that involve rehabilitation of existing buildings and other minor civil works. Contractors will be given general orientation and sensitization on safeguard issues. Environmental Engineers in the contractors’ team will ensure compliance with safeguards policies through on-site project supervision. Additional guidance, as required, will be provided by the safeguard members of the project team during supervision missions. Funding of Safeguards Mitigation Measures 7. The cost of implementing safeguards mitigation measures will be covered by the credit and Lagos State Government resources and will be incorporated into the bills of quantities of the civil works. The cost of supervision of the implementation of civil works contracts including ensuring that the contractors meet their safeguard obligations under these contracts, will be paid from the IDA credit. Monitoring and Evaluation of the Mitigation Plan 8. The monitoring of the implementation of the mitigation measures will be a continuous process. The day to day supervision at project sites will be carried out by environmental engineers at construction/renovation sites. Periodic supervision will be conducted by officials of Lagos State environmental protection agency, federal ministry of environment, housing and urban development which will also continuously take stock of all safeguards issues. Project progress reports will include progress in mitigation of environmental and social safeguards measures. Lessons learned from existing Bank projects indicate that Lagos state has the staffing and resource capacity to monitor safeguards issues.

114

Annex 11: Project Preparation and Supervision FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project

Planned Actual PCN Review: April 30, 2008 April 30, 2008 Initial PID to Infoshop: May 29, 2008 Initial ISDS to Infoshop: June 5, 2008 Appraisal: February 23, 2009 February 23-March 4, 2009Negotiations: April 28-29, 2009 April 28-29, 2009Board/RVP Approval: June 16, 2009 Planned Date of Effectiveness: September 15, 2009 Planned Date of Mid-Term Review: July 1, 2011 Planned Closing Date: December 31, 2013 Key institutions responsible for preparation of the project: Lagos State Ministry of Education, Ikeja, Lagos State and Federal Ministry of Education, STEP-B Project, Abuja Bank staff and consultants who worked on the project include: Name Title Unit Marito H. Garcia Lead Economist, Task Team Leader AFTH3 Olatunde Adekola Sr. Education Specialist AFTH3 Deborah N. Mikesell Sr. Operations Officer AFTH3 Peter Materu Senior Education Specialist AFTH3 Muna Meky Economist AFTRL Bayo Awosemusi Lead Procurement Specialist AFTPC Mary Asanato Procurement Specialist AFTPC T. Mpoy Kamulayi Lead Counsel LEGAF Amos Abu Sr. Environmental Specialist AFTEN Sunday Acheneje Procurement Specialist AFTPC Akinrinmola O. Akinyele Financial Management Specialist AFTFM John Nyaga Sr. Financial Management Specialist AFTFM Adewunmi Cosmas Adekoya Financial Management Specialist AFTFM Ngozi Malife Team Assistant AFC12 Josiane Luchmun Program Assistant AFTH3 Anne Anglio Senior Program Assistant AFTH3 Harry Patrinos Lead Education Economist (Peer Reviewer PCN, PAD) HDNED Emiliana Vegas Sr. Economist (Peer Reviewer PCN, PAD) HDNED Wendy Cunningham Children and Youth Specialist (Peer Reviewer PCN) HDN Felipe Berrera Senior Education Specialist HDNED Juliana Guaqueta Education Specialist HDNED Hongyu Yang Senior Operations Officer (QER Reviewer) HDNED Arun Joshi Senior Education Specialist (QER Reviewer) AFTH1 Marguerite Clark Senior Education Specialist (QER Reviewer) HDNED Aidan Mulkeen Senior Education Specialist (QER reviewer) AFTH1 Bank funds expended to date on project preparation:

1.Bank resources: US$339,690 2.Trust funds: US$ 0 Total: US$339,690

Estimated Approval and Supervision costs: US$150,000

115

Annex 12: Documents in the Project File

FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project A. Project Implementation Manual

1. Lagos State Ministry of Education: Draft Project Implementation Manual 2. Lagos State Ministry of Education: Draft School Development Grant Manual Bank Staff Assessments

3. World Bank (2008): Country Partnership Strategy II. Draft 4. World Bank (2005): Country Partnership Strategy. Report No. 32412. Washington, DC. 5. World Bank (2009) Lagos Partnership Strategy Draft 6. World Bank (2006) State Education Sector Project. Project Appraisal Document Washington,

DC 7. World Bank (2006) Science and Technology Education in Post-Basic Education Project. Project

Appraisal Document Washington, DC 8. World Bank (2003): Universal Basic Education Project. Project Appraisal Document.

Washington, DC. 9. World Bank (forthcoming): Nigeria: Poverty Assessment. Report No. Washington, DC. 10. World Bank. 2005: Implementation Completion Report for Second Primary Education Project.

Washington DC. 11. World Bank (2007): Implementation Completion and Results Report for Universal Basic

Education Project. Washington DC. 12. World Bank (2006): From Schooling Access to Learning Outcomes: and Unfinished Agenda: An

Evaluation of World Bank Support to Primary Education. Washington, DC. Other

13. Lagos State (2007): LASEEDS- Lagos State Economic and Empowerment Development Strategy 14. Lagos State Ministry of Education. (September 2008). Education Sector Plan and Education

Operational Plan. 15. PHRD Studies 16. DFID (2008): Education Sector Support Program in Nigeria (ESSPIN)

*Including electronic files.

116

Annex 13: Statement of Loans and Credits

FEDERAL REPUBLIC NIGERIA: Lagos Eko Secondary Education Project

Original Amount in US$ Millions

Difference between expected and actual

disbursements

Project ID FY Purpose IBRD IDA SF GEF Cancel. Undisb. Orig. Frm. Rev’d

P090644 2009 NG-Comm. Social Dev. (FY09) 0.00 200.00 0.00 0.00 0.00 179.83 8.00 0.00

P096572 2009 NG-Fadama Development-III SIL (FY08) 0.00 250.00 0.00 0.00 0.00 231.80 0.00 0.00

P096648 2009 NG-Commercial Agriculture Development 0.00 150.00 0.00 0.00 0.00 152.16 0.00 0.00

P090135 2008 NG-Federal Roads Development 0.00 330.00 0.00 0.00 0.00 307.99 7.50 0.00

P072644 2008 NG-Rural Access & Mobility - Ph. 1 0.00 60.00 0.00 0.00 0.00 56.11 3.75 0.00

P071340 2007 NG-Lagos Metropolitan Dev & Governance

0.00 200.00 0.00 0.00 0.00 171.65 28.31 0.00

P074132 2007 NG-S&T Educ in Post-Basic Ed (FY07) 0.00 180.00 0.00 0.00 0.00 145.83 64.82 0.00

P097921 2007 NG -Malaria Control Booster Project (07) 0.00 180.00 0.00 0.00 0.00 114.51 -14.42 0.00

P096151 2007 NG - State Edu Sector Project 0.00 65.00 0.00 0.00 0.00 54.30 19.25 0.00

P090104 2006 NG-Natl Energy Dev SIL (FY06) 0.00 172.00 0.00 0.00 0.00 105.98 97.80 -8.63

P100122 2006 Avian Influenza Emergency ERL (FY06) 0.00 50.00 0.00 0.00 0.00 9.57 6.86 0.00

P071391 2006 NG-Natl Urb Water Sec Ref SIM 2 (FY06) 0.00 200.00 0.00 0.00 0.00 153.13 51.78 0.00

P088150 2005 NG-Econ Reform & Govern SIL (FY05) 0.00 140.00 0.00 0.00 0.00 88.17 69.01 43.89

P086716 2005 NG-Min Res Sustain Mgmt (FY05) 0.00 120.00 0.00 0.00 0.00 65.64 43.85 0.00

P074447 2005 NG-State Governance & Cp Bldg TAL (FY05)

0.00 18.10 0.00 0.00 0.00 11.45 10.99 10.12

P063622 2004 NG-Fadama SIL 2 (FY04) 0.00 100.00 0.00 0.00 0.00 2.00 -2.29 0.00

P069892 2004 NG-Local Empowerment & Environmental Mgm

0.00 70.00 0.00 0.00 0.00 1.61 -12.71 -13.34

P071075 2004 NG-Urb Water Sec Reform 1 SIL (FY04) 0.00 120.00 0.00 0.00 0.00 55.24 49.18 0.00

P083082 2004 MSME 0.00 32.00 0.00 0.00 0.00 18.70 16.02 14.87

P074963 2003 NG-Lagos Urb Trans SIL (FY03) 0.00 150.00 0.00 0.00 0.00 39.45 -24.75 9.25

P080295 2003 NG-Polio Eradication (FY03) 0.00 130.40 0.00 0.00 0.00 47.86 -50.34 9.39

P070291 2002 NG-HIV/AIDS Prog Dev (FY02) 0.00 140.30 0.00 0.00 0.00 37.03 -27.48 6.60

P070290 2002 NG- Health System Dev. II (FY02) 0.00 217.00 0.00 0.00 0.00 87.75 -22.60 -22.60

P069901 2002 NG-Com Based Urb Dev (FY02) 0.00 110.00 0.00 0.00 0.00 67.52 44.95 44.96

P070293 2001 NG-Privatization Supt SIL (FY01) 0.00 114.29 0.00 0.00 0.00 43.80 24.82 24.87

Total: 0.00 3,499.09 0.00 0.00 0.00 2,249.08 392.30 119.38

117

NIGERIA: STATEMENT OF IFC’s Held and Disbursed Portfolio in US$ millions Committed Disbursed

IFC IFC

FY Approval Company Loan Equity Quasi Partic. Loan Equity Quasi Partic.

1999 AEF Global Fabri 0.32 0.00 0.00 0.00 0.32 0.00 0.00 0.00

1999 AEF Hercules 1.30 0.00 0.00 0.00 1.30 0.00 0.00 0.00

2000 AEF Oha Motors 0.84 0.00 0.00 0.00 0.84 0.00 0.00 0.00

2000 AEF SafetyCenter 0.41 0.00 0.00 0.00 0.41 0.00 0.00 0.00

1995 AEF Vinfesen 0.00 0.00 1.00 0.00 0.00 0.00 1.00 0.00

1994 Abuja Intl 1.75 0.00 0.00 0.00 1.75 0.00 0.00 0.00

2005 Accion Nigeria 0.00 1.89 0.00 0.00 0.00 0.57 0.00 0.00

2003 Adamac 25.00 0.00 0.00 15.00 11.56 0.00 0.00 6.94

2000 CAPE FUND 0.00 6.17 0.00 0.00 0.00 5.76 0.00 0.00

2001 Delta Contractor 0.00 0.00 15.00 0.00 0.00 0.00 0.20 0.00

2000 Diamond Bank 0.00 0.00 2.00 0.00 0.00 0.00 2.00 0.00

2005 Diamond Bank 0.00 0.00 30.00 0.00 0.00 0.00 30.00 0.00

2006 Diamond Bank 0.00 0.00 20.00 0.00 0.00 0.00 0.00 0.00

2000 FSB 5.25 0.00 3.75 0.00 5.25 0.00 3.75 0.00

1992 FSDH 0.00 0.86 0.00 0.00 0.00 0.86 0.00 0.00

2000 GTB 6.00 0.00 0.00 0.00 6.00 0.00 0.00 0.00

2004 GTB 20.00 0.00 0.00 0.00 20.00 0.00 0.00 0.00

2005 GTB 20.00 0.00 0.00 0.00 20.00 0.00 0.00 0.00

2006 GTB 30.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

GTFP Access Bank 33.58 0.00 0.00 0.00 33.54 0.00 0.00 0.00

2006 GTFP Access Bank 0.00 0.00 15.00 0.00 0.00 0.00 0.00 0.00

GTFP Diamond Bnk 30.28 0.00 0.00 0.00 29.38 0.00 0.00 0.00

GTFP GTB Nigeria 20.41 0.00 0.00 0.00 20.41 0.00 0.00 0.00

GTFP IBTC Plc. 5.03 0.00 0.00 0.00 4.69 0.00 0.00 0.00

GTFP Zenith 32.18 0.00 0.00 0.00 32.18 0.00 0.00 0.00

2000 IBTC 20.00 0.00 0.00 0.00 20.00 0.00 0.00 0.00

2006 IBTC 0.00 0.00 30.00 0.00 0.00 0.00 0.00 0.00

1981 Ikeja Hotel 0.00 0.06 0.00 0.00 0.00 0.06 0.00 0.00

1988 Ikeja Hotel 0.00 0.01 0.00 0.00 0.00 0.01 0.00 0.00

2002 MTNN 70.00 15.00 0.00 0.00 40.00 14.56 0.00 0.00

2002 NTEF 20.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

2005 OCC 75.00 0.00 0.00 0.00 59.12 0.00 0.00 0.00

2006 SOCKETWORKS 0.00 0.00 2.50 0.00 0.00 0.00 1.88 0.00

2004 UPDC Hotels Ltd. 10.62 0.00 0.00 0.00 4.82 0.00 0.00 0.00

Total portfolio: 427.97 23.99 119.25 15.00 311.57 21.82 38.83 6.94

Approvals Pending Commitment

FY Approval Company Loan Equity Quasi Partic.

2006 UBA/STB 0.03 0.00 0.05 0.00

2005 Zenith Bank 0.03 0.01 0.00 0.00

2007 Eleme Petrochem 0.06 0.00 0.02 0.08

Total pending commitment: 0.12 0.01 0.07 0.08

118

Annex 14: Country at a Glance FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project

Nigeria at a glance 9/24/08

Sub-POVERTY and SOCIAL Saharan Low-

Nigeria Africa income2007Population, mid-year (millions) 148.0 800 1,296GNI per capita (Atlas method, US$) 920 952 578GNI (Atlas method, US$ billions) 136.3 762 749

Average annual growth, 2001-07

Population (%) 2.4 2.5 2.2Labor force (%) 2.5 2.6 2.7

Most recent estimate (latest year available, 2001-07)

Poverty (% of population below national poverty line) .. .. ..Urban population (% of total population) 48 36 32Life expectancy at birth (years) 47 51 57Infant mortality (per 1,000 live births) 99 94 85Child malnutrition (% of children under 5) 27 27 29Access to an improved water source (% of population) 47 58 68Literacy (% of population age 15+) 69 59 61Gross primary enrollment (% of school-age population) 96 94 94 Male 105 99 100 Female 87 88 89

KEY ECONOMIC RATIOS and LONG-TERM TRENDS

1987 1997 2006 2007

GDP (US$ billions) 23.4 36.2 146.9 165.5

Gross capital formation/GDP .. .. .. ..Exports of goods and services/GDP 28.6 45.0 43.2 40.3Gross domestic savings/GDP .. .. .. ..Gross national savings/GDP .. .. .. ..

Current account balance/GDP -7.4 7.8 9.5 2.1Interest payments/GDP 2.6 1.5 0.2 ..Total debt/GDP 123.8 78.5 5.2 ..Total debt service/exports 14.1 8.9 10.6 ..Present value of debt/GDP .. .. 4.7 ..Present value of debt/exports .. .. 10.8 ..

1987-97 1997-07 2006 2007 2007-11(average annual growth)GDP 4.0 5.4 6.2 5.9 7.9GDP per capita 1.0 2.8 3.7 3.6 5.7Exports of goods and services .. .. .. .. ..

STRUCTURE of the ECONOMY

1987 1997 2006 2007(% of GDP)Agriculture .. .. 32.0 32.6Industry .. .. 41.9 39.3 Manufacturing .. .. 2.6 ..Services .. .. 26.1 28.1

Household final consumption expenditure .. .. .. ..General gov't final consumption expenditure .. .. .. ..Imports of goods and services 24.7 37.8 28.1 29.7

1987-97 1997-07 2006 2007(average annual growth)Agriculture .. 7.0 7.4 7.4Industry .. 3.8 -1.0 -2.9 Manufacturing .. .. .. ..Services .. 14.3 12.4 12.9

Household final consumption expenditure .. .. .. ..General gov't final consumption expenditure .. .. .. ..Gross capital formation .. .. .. ..Imports of goods and services .. .. .. ..

Note: 2007 data are preliminary estimates.

This table was produced from the Development Economics LDB database.

* The diamonds show four key indicators in the country (in bold) compared with its income-group average. If data are missing, the diamond will be incomplete.

0

5

10

15

02 03 04 05 06 07

GCF GDP

Growth of capital and GDP (%)

Nigeria

Low-income group

Development diamond*

Life expectancy

Access to improved water source

GNIpercapita

Grossprimary

enrollment

Nigeria

Low-income group

Economic ratios*

Trade

Indebtedness

Domesticsavings

Capital formation

119

Nigeria

PRICES and GOVERNMENT FINANCE1987 1997 2006 2007

Domestic prices(% change)Consumer prices 11.3 8.3 8.3 5.5Implicit GDP deflator 50.1 1.4 19.6 5.1

Government finance(% of GDP, includes current grants)Current revenue .. 20.0 34.1 29.2Current budget balance .. 11.6 13.5 8.4Overall surplus/deficit .. 1.0 7.7 1.4

TRADE1987 1997 2006 2007

(US$ millions)Total exports (fob) 7,532 15,539 59,113 64,047 Fuel 6,994 14,850 53,464 56,577 Liquified natural gas .. .. 4,602 6,110 Manufactures .. 40 .. ..Total imports (cif) 6,392 10,246 30,911 38,944 Food 671 1,219 .. .. Fuel and energy 27 143 .. .. Capital goods .. .. .. ..

Export price index (2000=100) 64 71 229 261Import price index (2000=100) 89 109 125 126Terms of trade (2000=100) 71 65 182 207

BALANCE of PAYMENTS1987 1997 2006 2007

(US$ millions)Exports of goods and services 7,757 15,661 62,613 67,225Imports of goods and services 6,689 12,448 40,766 49,641Resource balance 1,068 3,213 21,847 17,584

Net income -2,770 -2,215 -11,254 -17,531Net current transfers .. 1,841 3,400 3,414

Current account balance -1,727 2,840 13,994 3,467

Financing items (net) 1,649 221 -97 6,037Changes in net reserves 78 -3,061 -13,897 -9,503

Memo:Reserves including gold (US$ millions) .. .. 41,830 51,333Conversion rate (DEC, local/US$) 4.6 81.1 127.4 125.8

EXTERNAL DEBT and RESOURCE FLOWS1987 1997 2006 2007

(US$ millions)Total debt outstanding and disbursed 29,021 28,455 7,693 .. IBRD 2,939 2,373 534 381 IDA 32 410 1,541 1,929

Total debt service 1,106 1,416 6,805 .. IBRD 332 519 244 201 IDA 1 4 33 35

Composition of net resource flows Official grants 14 27 11,383 .. Official creditors 378 -267 -4,276 .. Private creditors 425 -258 -1,502 .. Foreign direct investment (net inflows) 611 1,539 5,445 .. Portfolio equity (net inflows) 0 0 0 ..

World Bank program Commitments 71 0 255 685 Disbursements 385 260 362 335 Principal repayments 125 339 230 196 Net flows 260 -79 132 139 Interest payments 209 183 47 41 Net transfers 52 -262 85 99

Note: This table was produced from the Development Economics LDB database. 9/24/08

-15

-10

-5

0

5

10

15

01 02 03 04 05 06 07

Current account balance to GDP (%)

0

20,000

40,000

60,000

80,000

01 02 03 04 05 06 07

Exports Imports

Export and import levels (US$ mill.)

0

10

20

30

40

02 03 04 05 06 07

GDP deflator CPI

Inflation (%)

G: 3,893

A: 534

D: 777

B: 1,541

F: 673

E: 275

A - IBRDB - IDA C - IMF

D - Other multilateralE - BilateralF - PrivateG - Short-term

Composition of 2006 debt (US$ mill.)

120

Annex 15: DFID ESSPIN

FEDERAL REPUBLIC OF NIGERIA: Lagos Eko Secondary Education Project 1. DFID will complement IDA support for the Lagos Eko project under their new Education Sector Support Program in Nigeria (ESSPIN) which will provide a comprehensive range of technical assistance to several States to support systemic reform in the delivery of basic education (beginning mid-2009). For Lagos, ESSPIN is working on an inception strategy to define a program of technical assistance and possibly some investment support over the next two years.

2. ESSPIN has been designed to work in a flexible and responsive way to support State Government priorities within the framework of a long-term Education Sector Plan and Medium Term Education Sector Strategy. (MTESS). The MTESS which is the framework for actions in the State Ministry of Education has six strategic goals and 39 objectives and sets out costed initiatives and expenditure plan through which the Ministry will achieve the Education Sector Plan and contribute to the attainment of the development priorities set out in the Lagos State Economic Empowerment and Development Strategy (LASEEDS). An early priority for ESSPIN will be to support Lagos State Government in the implementation, review and improvement of its MTESS.

3. ESSPIN’s overall goal is to support Government in the use of its own resources in delivering education services, building government capacity at the same time as it helps to strengthen public voice and accountability in the provision of services. It will seek to improve the overall environment in which education policy is formulated, financial provision is generated and controlled, and effective service delivery is managed. Currently, educational services at the state level are delivered within a governance environment with poor planning capacity, multiple agencies having overlapping roles and responsibilities, limited public finance management capacity, and poor accountability. These TA objectives are therefore highly complementary to the effort of program delivery of the Lagos Eko Project.

4. While the Lagos Eko Project concentrates on junior and senior secondary education support, ESSPIN is focused on basic education (primary and junior secondary). However, several of ESSPIN’s core activities will support the whole sector and nearly all complement the Lagos Eko activities, particularly in teacher management and school development.

5. Early priorities have been agreed with Lagos State Government and are being developed within the inception strategy. They are: (a) quality assurance and inspectorate reform; (b) teacher development policy, including deployment, training, career structure and incentives; (c) planning and budgeting capacity within the framework of a long-term Education Sector Plan and Medium Term Education Sector Strategy; (d) communications and knowledge management, in order to increase access to information, enable communities play a greater part in development of the school system, support advocacy and strengthen accountability; (e) policy towards the private sector, including quality assurance and the regulatory environment; and (f) improved education management information systems. ESSPIN will also seek opportunities to support Lagos State Government’s program of school infrastructure renewal, by addressing other issues critical to the provision of a high quality learning environment in primary and junior secondary schools. These include teacher capabilities, quality assurance, the role of head teachers and SBMC engagement in school governance.

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IBRD 36893

MAY 2009

Th is map was produced by the Map Des ign Uni t o f The Wor ld Bank. The boundar ies , co lo rs , denominat ions and any other in format ionshown on th is map do not imply, on the par t o f The Wor ld BankGroup, any judgment on the lega l s ta tus of any te r r i to r y, o r anyendorsement or acceptance of such boundar ies .

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