Indonesia: Technical Assistance for Preparing the Decentralized Senior Secondary Education Project (Financed by the Asian Development Bank)

Transcription

1 Technical Assistance Consultant s Report Project Number: November 2006 Indonesia: Technical Assistance for Preparing the Decentralized Senior Secondary Education Project (Financed by the Asian Development Bank) Prepared by British Council For Asian Development Bank This consultant s report does not necessarily reflect the views of ADB or the Government concerned, and ADB and the Government cannot be held liable for its contents. (For project preparatory technical assistance: All the views expressed herein may not be incorporated into the proposed project s design.

2

3 Table of Contents I. THE PROPOSAL 1 II. RATIONALE: SECTOR PERFORMANCE, PROBLEMS AND OPPORTUNITIES 1 A. Performance Indicators 1 B. Sector Overview 3 C. Analysis of Senior Secondary Sub-Sector 5 D. Policy Directions for Senior Secondary Education 7 E. Lessons Learned 8 III. THE PROJECT 8 A. Objectives 8 B. Outputs Output 1: Improved Student Learning Outcomes Output 2: Improved School Management and Quality Assurance Output 3: Increased Equity and Provision of Special Services Output 4: Foundation for Enhanced Policy and Strategy Established 22 C. Special Features 22 D. Cost Estimates 23 E. Financing Plan 23 F. Program Coordination, Management and Implementation Arrangements Project Coordination and Management Implementation Procedures Implementation Period Procurement Consulting Services Advanced Action Use of Counterpart Funds Disbursements and Reporting Accounting, Auditing and Reporting Program Performance Management System Project Review 27 IV. PROJECT BENEFITS, IMPACTS AND RISKS 28 A. Project Benefits 28 B. Impacts 29 C. Financial and Economic Impact 30 D. Institutional Impact 30 E. Environmental Aspects 30 F. Project Risks 31 V. ASSURANCES 32 A. Specific Assurances 32 B. Conditions for Loan Negotiations 34 C. Conditions for Loan Effectiveness 34

4 APPENDIXES 1. Project Design and Monitoring Framework Problem Analysis Sub-sector Analysis Indonesia Education Structure and System Overview Lessons Learned External Assistance List of Candidate National Reference Schools TA Grant Project Evaluation and SSE Policy and Strategy Development Cost Estimates and Financing Plan Management Capability and Project Organization School State of Readiness and Characteristics of International Standards Project Implementation Schedule Terms of Reference for International Tendered Consulting Services Compliance Monitoring Framework Beneficiaries of Staff Development Program and Overseas Fellowships Poverty Strategy and Social Analysis School Trust Account Management Environment and Resettlement Assessment (via Fact Finding Mission) Sustainability Analysis Financial Analysis Economic Analysis LIST OF ANNEXES (Published as Separate Report) A. Senior Secondary Education Sub-Sector Review B. Teacher Resource Center Concept and Indicative Costing C. Digital Clearinghouse Concept and Indicative Costing D. Career Planning and Employability Skills Concept and Indicative Costing E. Student Resource Center Concept and Indicative Costing F. International Twinning Program for SMK G. National Service Providers and National Education Technical Advisors (NETA) H. National Reference Schools Admissions and Student Support Framework I. Detailed Economic Analysis

5 SUPPLEMENTARY TECHNICAL GUIDELINES AND SELECTED PROGRM TERMS OF REFERENCE (Available on Request) Technical Guidelines for Loan Activities Development of SMK School Development Plan and Investment Proposal (Indonesian) Development of SMA School Development Plan and Investment Proposal (Indonesian) School Management Information and Reporting Installation/User Guide MIRS (Indonesian) School Accounting and Finance Information Installation/User Guide - AFIS (Indonesian) School Finance and Project Finance System (Indonesian) Trust Account Management Guideline (Indonesian) Preventive Maintenance (Indonesian) Compliance Monitoring Evaluation and Research (some overlap with Appendix 8, ADB TA grant option) Complaint Resolution Mechanism Staff Professional Development Matrix Association of National Reference Schools Listing of Policy Directions for Core Goal Categories for SMKs Terms of Reference for Selected Programs School Continuous Quality Assurance Program School Project Management Training School Personnel Management System School Principal and Licensing Program Provincial Professional Development Team for Secondary School Improvement Networking and Dissemination Program Science Laboratory Technician Training ICT Laboratory Technician Training School Committee Capacity Development School Committee Training Modules (Indonesian) Librarian Training SUPPLEMENTARY REPORTS (Available on Request) ICT Strategy Report, May 2005 Integration of ICT into Senior Secondary Schools (Indonesian), May 2005 School Leadership and Management Program Outline and Course 1 Syllabus, May 2005 Fraud and Anti-Corruption Report, October 2004 Sub-Sector Overview, October 2004 Public Expenditure Review, October 2004 Gender Analysis, October 2004 Poverty and Social Analysis, October 2004 Education Planning and Management, October 2004 School-based Management Information System: Issues and Strategies, October 2004

6 MAP OF INDONESIA Republic of Indonesia Second Senior Secondary Education: Project Provinces NORTH SUMATERA EAST KALIMANTAN NORTH SULAWESI RIAU WEST KALIMANTAN WEST SUMATERA JAMBI BANGKA BELITUNG SOUTH SUMATERA SOUTH KALIMANTAN LAMPUNG SOUTH SULAWESI DKI JAKARTA Project Provinces BANTEN WEST JAVA CENTRAL JAVA YOGYAKARTA EAST JAVA BALI NTB Non Project Provinces PAPUA

7 1 I. THE PROPOSAL 1. I submit for your approval the following report and recommendations on the proposed loan to the Republic of Indonesia for the Second Senior Secondary Education Project and for a grant to conduct project evaluation and research and to prepare a comprehensive sub-sector analysis. II. RATIONALE: SECTOR PERFORMANCE, PROBLEMS AND OPPORTUNITIES 2. In February 2004, the Asian Development Bank (ADB) approved a project preparatory technical assistance (PPTA) to support the senior secondary education system. 1 The TA commenced in May 2004 and completed in December The Government, represented by the Directorate General for the Management of Primary and Secondary Education (DGMPSE) in the Ministry of National Education (MONE), agreed to an investment project consistent with Indonesia s Education Law 20/2003 to improve the quality of senior secondary education (SSE). The Ministry of National Education Strategic Plan 2 ( ) identifies international standard human resources as the key to the national mission of achieving global competitiveness. 3. This project is designed to assist the Government create and sustain international standard education at the SSE level within the national education system. The project will implement and evaluate policy, system mechanisms and school improvement practices to raise quality standards. Through this experience, MONE will establish more precise definitions of quality standards, a proven domestic support network plus the capacity to disseminate improvement approaches for the broader development of the sub-sector. The project will achieve this through concentrated assistance to a limited number of schools that are already recognized for relatively higher levels of performance and also demonstrate capacity to increase effectiveness. 3 A. Performance Indicators 4. Development problem: Indonesia requires accessible international standard SSE. The key to making high quality SSE available is the existence of policies, institutions, support networks and resources which allow existing schools to improve and sustain improvements. The existing private sector SSE schools that do provide international standards are: (i) very expensive and, therefore, cater only to an elite segment of the population; (ii) do not provide significant backward, forward and horizontal linkages 4 into other parts of the national education system; (iii) profitable for graduates but the limited number of graduates do not create the critical mass of qualified labour required for improving national productivity levels (see para 9); (iv) geographically limited due to the lack of qualified teachers and managers (principals); and (v) connected to international support networks, bypassing the domestic national education system. 5. Indonesia has now reached the point where basic and tertiary education has a substantive momentum underway. Government support to establish standards, create opportunity, and institute support networks is enabling positive changes. On the other hand, the same support has not been directed to SSE. This sub-sector needs to be more responsive to ADB Technical Assistance to the Government of Indonesia for the Decentralized Senior Secondary Education Project (TA 4239-INO, for $1,000,000 extended in December 2004 to $1,400,000). Officially titled Strategic Plan for National Education, November Also referred to as Renstra Depdiknas. The Project design framework is in Appendix 1 and Problem Analysis in Appendix 2. Backward linkages are linkages to the JSE level; forward linkages are linkages to the tertiary level; horizontal linkages are linkages to other SSE level schools.

8 2 the emerging demand and the standard of education provided needs to be raised so that it is comparable with the top schools within the country and internationally. Priority must be directed to improved quality along with the parallel policy, mechanisms, and supporting systems so the national system can provide equal opportunity for the majority rather than being dependent on private sector enterprises that cater to the few. 6. Education Law 20/2003 requires that the central and/or regional governments provide at least one educational institution at an international standard.(para 50). The Education Law recognizes that international standards are an issue of education management 5 rather than narrow questions of curriculum, teaching methods, etc. The GOI long-term (25 year) development plan stresses the need to address globalization and international competitive pressures in all sectors, including education. The current Government s Five-Year Plan emphasizes security and democracy, with education treated as a key mechanism to upgrade human resources for improved social welfare. The basic goal stated for education is to improve access to better quality education. The Plan s program for SSE commits the Government to consider international standards in the development of curriculum, materials and teachinglearning methods with specific reference to international competency standards. The Plan requires the establishment of international standard schools in phases. The actual policy, systems and procedures, institutions and activities necessary to achieve these goals are not stated explicitly. 7. The MONE Strategic Plan assigns distinct tasks to the different levels of education. Improving access and equity in access is the major task of the basic education sector, composed of primary and JSE, assisted by early childhood education. In 2005, these activities receive 45.29% of the total central government education budget. 6 The main policy for achieving improved and more equitable access is compulsory universal 9-year basic education, which receives 43.08% of the total central education budget. 8. The various plans implicitly recognize that education at the SSE level is qualitatively different from basic education, in terms of its developmental impact and implications. It is widely recognized that basic education is a key to successful long term development and has direct poverty reduction impact. GOI has accepted both the Millennium Development Goals (MDGs) and Education For All (EFA) programs for universal basic education as part of the national development policy. SSE enrolment is much lower among the poorest households (18%) than among the most affluent households (62%). 7 Therefore, increasing the supply of SSE places will have limited impact on poor children many of whom have not been able to graduate from the JSE level. Education for poverty alleviation among these children must be focused on a package of interventions which will ensure the achievement of GOI s goal of universal 9-year basic education. Such programming is well established within existing Government budget commitments. 9. Impacts of the problem. The Indonesian labor force is not internationally competitive. The average educational level is only 6.21 years. Twenty-six percent (26%) of large Indonesian firms report that worker education and skill levels present severe obstacles to their enterprises compared to 18% of firms in the Philippines and 13% in India. 8 Indonesia also ranks in the lowest one-third (66 percentile) on the World Economic Forum 2003 Growth Competitiveness 5 Para 50 is the first paragraph in Chapter XIV Education Management in Education Law 20/ This percentage is calculated on the education function budget, see para 13 below. Data from 2005 budget (2 nd revision). It includes 3 programs: early childhood education, basic education and non-formal education. 7 Poorest and most affluent refer to income quintiles Q1 and Q5. Re-calculated from the World Bank Education Sector Review 2004, using data from Statistics and factual labor force and SSE data are summarized in Sub-Sector Analysis, Appendix 3.

9 3 Index, compared to Thailand and Malaysia which ranked in the top one-third. Foreign domestic investment has not moved Indonesia to higher technology production. The industrial structure is concentrated in low technology and assembly-type industries. Unemployment rates in Indonesia are high (9.5% in 2003) compared with regional neighbors and competitors such as Korea (3.7%), Thailand (1.5%) and Malaysia (3.4%). In addition, it is estimated that 30 million people, mainly in rural areas, are underemployed. 10. Uneducated and under-educated workers generally do less complex jobs. Productivity is higher in complex jobs therefore the return to education is higher. The basis of the demand for SSE-level education is that it serves as preparation for tertiary-level education and employment. As preparation for direct entry into the labor force, SSE allows workers to capture substantial wage premiums given broader knowledge and skills, particularly those relative to technology applications. It also enables future workers to reap the greater benefits from a tertiary-level education. The existence of a large cadre of SSE-level labor allows firms to invest in the higherproductivity technology, pay higher wages and still make profits. The lack of a competitive labor force also affects the capability to build international quality services. The maintenance and expansion of this overall dynamic needs a continuous improvement in the quality of SSE graduates who can keep up with the technology available to producers on the globalized open market. High quality, market-relevant SSE can make an important contribution. 11. Indonesia s economy is growing at 4% - 5% annually, primarily due to domestic consumption. The economy has to undergo dramatic change if it is to keep pace with other regional economies. Current growth is not creating new jobs. In 2003 Indonesia lost almost 900,000 jobs, with more than half of those in the industrial sector. The only sector creating significant numbers of new jobs is unpaid agricultural labor. This pattern of low quality growth has many disadvantages. It is not sustainable political and social stability require that the economy produce enough new jobs to absorb the growth in the labor force. Furthermore, poverty alleviation requires that the new jobs provide sufficient income to raise the workers out of poverty. The economy needs modern sector jobs with wages and salaries that reflect the workers improved productivity. Low quality growth does not produce the domestic savings needed to accelerate domestic capital formation, which is the only sustainable engine for long run development. 12. Root cause of the problem. The quality of a labor force is a complex combination of formal education and skills-based training, and informal characteristics such as motivation, discipline, problem and decision making skills, inter-personal relations, English capability, willingness to learn and teachability (learning skills). Not all of these are taught in school, but the institutional culture of the school helps to engender these attitudes and values. Creating the culture and values of international standard schools in Indonesian SSE will contribute to these intangible qualities of an internationally competitive labor force. Higher levels of education and overall competence are already critical in a globalized world and Indonesia will have to compete increasingly on the basis of its skilled workforce (see Appendix 2, Problem Analysis). B. Sector Overview 13. The Indonesian educational system is a complex network of sub-systems. Law 20/2003 concerning the National Education System mandates a unified system but historical development and current politics make this difficult. 9 The system consists of programs offered by both government and private schools under both MONE and the Ministry of Religious Affairs 9 Indonesia Education Structure and System Overview, Appendix 4.

10 4 (MORA). 10 The government issues graduation certificates to students from all types of formal schools based on passing a national exit examination. 14. Under the Law, the only difference between government and private schools is ownership and financing: private schools are required to fulfill all the same rules, regulations and quality requirements as government schools. Government schools are owned by the Government and financed through government (central and regional) budget allocations. Private schools are owned by private-sector legal entities and are responsible for covering their own capital and operating costs. The central government provides a significant amount of assistance to private schools in the form of civil service teachers 11 and various other interventions (construction, books and equipment, etc.) funded through various channels. District and Provincial Legislatures may also provide funding to private schools through their own budgets but this is limited. 15. The Law requires the Government (central and/or regional) to provide free basic education to all students. GOI has responded to this mandate through the School Operation Funds Program (BOS) that ensures funding by the central government to all primary and JSE schools both government 12 and private. The allocations are calculated on a per capita formula which is intended to provide sufficient funding for provision of minimum required educational services. Parents and schools who desire higher quality educational services have the option of topping up the BOS with fees and contributions directly to the school. 16. During the period of high foreign investment in Indonesia, international schools were created to provide internationally certified educational programs for their children of expatriate families. Many of these offer the International Baccalaureate Program (IB) in addition to the core curriculum in their country of origin. Most of these schools are located in affluent urban areas. Recent changes in government regulations now allow these schools to accept non-expatriate Indonesian students. More recently, the private sector has expanded by introducing schools with linkages forged with international institutions aimed at higher output standards. 13 An increasing number of students are enrolling in these high cost private schools that are linked with international certification and accrediting agencies. 14 Typically, these focus on bilingual or English-only instruction. Such schools are primarily non-vocational, expensive, and also located in large urban centers. School fees are considerably higher than those for regular private SSE schools and in some cases similar to those at the international schools. They are, however, producing graduates who have education qualifications that are more comparable with schools outside of Indonesia and also better suited to labor force demands. Current government policy intends to enable higher quality SSE throughout the country that is accessible to the general public. 17. The gross enrolment ratio for primary school is 114%, with about half of the 14% surplus coming from under-aged children who are already enrolled in primary school and the remainder from over-aged children who have not yet graduated. The net enrolment ratio (NER) for primary is 99% and for junior secondary education (JSE) is 78%. The really crucial issue in enrolment is the low rate of primary-jse transition: only about 70% of primary graduates transition to JSE. Transition from JSE-SSE is higher (83%), which means that students who survive to JSE level 10 Another type of school is a pesantren - a Muslim boarding school offering only religious studies. 68% of registered pesantrens offer a type of formal education. Many have MONE or MORA schools on campus. 11 GOI pays teacher s civil service salary to the school but teacher salaries are determined by the school. 12 For government schools, BOS is additional to their annual budgets which are funded by the District. 13 In a few cases government has formed linkages with international organizations to improve the quality of vocational/technical secondary education. Some general secondary schools also have international links. 14 These schools have formed an association under the rubric of National Plus schools.

11 5 tend to continue through SSE for an NER of 51%. The Government s highest priority for education is now the 9-Year Compulsory Basic Education campaign (Wajar), which is intended to raise NER for JSE to 100%. More recently, they have recognized the importance of SSE as the key gatekeeper to increasing overall human resource capacity (MONE Strategic Plan ). 18. Poverty is a predictor of enrolment and the effect is more pronounced at higher levels of education. But, research shows that income, not poverty per se, is the force driving enrolment. Using District-level data, a 10% increase in average per capita income is associated with a 23% increase in primary enrolment, a 119% increase in JSE enrolment and a 210% increase in SSE enrolment. Gender discrepancies are not a major problem in Indonesia given that females account for 49% of primary school, 49% of JSE, 47% of SSE and 50% of tertiary enrolments. The only concerns are in SMK schools, where females are 42% of total enrolment. C. Analysis of Senior Secondary Sub-Sector 19. The SSE sub-sector itself is also divided into two streams: general SSE (SMA) and vocational SSE (SMK). SMA students account for 60% of total SSE enrolment. The SMA curriculum is divided into 3 programs: natural science, social science and languages. Natural science accounts for 37% of total enrolment; social science for 59%; and languages for the remaining 4%. Private SSE schools tend to have somewhat higher enrolments in social science programs and substantially lower enrolments in language programs than government schools. A single SSE school may offer all three programs, charging the same tuition and fees for all students. 20. SMK curriculum is divided into 6 programs: agriculture and forestry, technology and industry, business and management, community welfare (previously household skills), tourism and art and handicraft. Technology and industry together with business and management account for 89% of total enrolment, with tourism at 5%, agriculture and forestry 3%, community welfare and art and handicraft at 1.5% each. Private SMKs have substantially higher enrolments in technology and industry programs than government SMK and marginally higher enrolments in business and management programs. SMK graduates enjoy a 3% wage premium over SMA graduates who also directly enter the labor force. There are approximately 179,000 graduates annually from government SMK and 415,300 graduates from private SMK. In SMA, there are approximately 551,650 graduates annually from public SMA and 383,485 graduates from private SMA. 21. Basic education creates the educated citizenry necessary for democracy, but cannot create an internationally competitive labor force. Furthermore children who leave school at the age of 12 (primary) or 15 (JSE) do not usually proceed directly into the paid labour force. Instead they help at home or as unpaid labor in family enterprises, moving into the paid labor force later as jobs open up and they become older. 22. Senior secondary education graduates, on the other hand, are old enough to move directly into the labor force and approximately one third do so. The remaining 66% make the transition to tertiary education, with 17% going into diploma programs and 49% going into full university undergraduate programs. These people become the professionals and top managers in the labor force where currently many positions are held by foreign workers. Improved quality of SSE graduates will impact this scenario and, correspondingly, those who make the transition to tertiary education in local institutions or to technology oriented employment will push for higher quality standards.

12 6 23. An indicator of the quality of SSE is final national examination scores. In the school year, on a 10 point scale, the national average was only 4.62 for JSE and 4.48 for SSE. 15 There are a number of factors contributing to poor quality in Indonesian education, which relate directly to insufficient funds allocated to the sector and the consequent impact on recruiting and retaining high quality teachers; the provision of good facilities, teaching aids, textbooks and technology access, and a student-focused teaching-learning process. This situation, when combined with the need for improved management, compounds the problem to be addressed. 24. Although Indonesia has been successful in providing access to education, research indicates that much remains to be accomplished in achieving high quality education in SSE and in the feeder JSE schools. In the latest study by the International Association for the Evaluation of Educational Achievement (IEA) of mathematics and science using internationally standardized tests for 14-year-old students (Class 2 of JSE), Indonesian students ranked 35th out of 39 countries in mathematics. This represents an average score equal to 83% of the average for all countries but only 66% of the highest-scoring country, Singapore. In science, Indonesian students ranked 33rd out of 39 countries participating in the examination, with an average score equal to 90% of the average for all countries and 75% of the highest-scoring country, Taiwan. 25. The 2003 Organization for Economic Cooperation and Development (OECD) study surveyed reading, mathematics and science of 15-year-olds (SSE Class 1). Indonesian students ranked 39th out of 41 countries in reading, with an average score equal to 74% of the OECD average but only 66% of the highest-scoring country, Finland. In mathematics, Indonesian students ranked 39th out of 41 countries participating in the examination, with an average score equal to 73% of the OECD average and 66% of the highest-scoring country, Hong Kong. In science, Indonesian students ranked 38th out of 41 countries participating in the examination, with an average score equal to 79% of the OECD average and 71% of the highest-scoring country, Korea. 26. The pattern of distribution for the surveys indicates that Indonesia is caught at the lower end of a group of countries with roughly similar quality of education. Marginal improvements in Indonesian education will only push Indonesia up from the lower end into the middle of this group. It will not provide a competitive edge. Creating a globally competitive labor force will require that Indonesia leapfrog others by providing SSE graduates with a standard of education comparable with more developed countries. 27. The OECD study provides detailed information about the quality of Indonesian SSE. Although the average score on reading is close to 75% of the OECD average, almost one-third of Indonesian students (31%) score below level 1 on the reading scale. This indicates serious deficiencies in their ability to use reading literacy as a tool for the acquisition of knowledge and skills in other areas. This lack of reading ability seems to be linked to particularly poor performance on the specific skills of retrieving information from written texts and interpreting texts, where Indonesian students ranked 40th out of 42 countries, with mean scores at 70% of the OECD average and 62% of the highest-scoring country, Finland. Indonesian students did only slightly better on the evaluation of texts, ranking 39th out of 42 countries, with a mean at 75% of the OECD average. 28. Although there is improved access to SSE, the success of the international and National Plus schools suggests that there is further demand and willingness to pay for international standard quality SSE. The constraints appear to be on the supply side: teachers who can teach 15 Starting in , national end-of-cycle exams were modified. National exams are only administered for Bahasa Indonesia, English and Math, while exams for other courses are school exams with national standards. The passing grade has been raised to 4 from 3 as a step to improve quality.

13 7 at international standards and principals who can manage international standard schools. The existing National Plus schools have indicated a desire to expand, particularly to affluent urban areas outside Jakarta, however they are unable to find the supporting resources they require, at any price. D. Policy Directions for Senior Secondary Education 29. The regional autonomy laws implemented in 2001 gave the responsibility for education to District Governments. Subsequent laws have given Provincial Governments responsibility for coordination and supervision. Districts and Provinces have their own autonomous budgets passed by their respective Legislative Assemblies. Budget revenues come from central transfers as well as the District or Province s own tax base. The regional Legislatures (DPRD) have full authority for regional budgets but are required to pay the salaries of district civil servants, including teachers. 30. The GOI 2005 budget has three key strategies: pro-growth, pro-employment and propoor including support for areas affected by natural disasters. The 2005 central government budget allocates 8.1% of total spending on central government agencies to MONE and 9.7% of the central budget is allocated to the education function. 16 Of this funding, 33% is for basic education and an additional 30% for tertiary education. SSE receives 13%, as does the program for improving quality of educational personnel. 31. The 2005 Government s Annual Work Plan 17 emphasizes the need for greater investment, financial restructuring, reduced interest and inflation rates and improved export trends. It also focuses on the fact that the globalization of world trade reconfirms the requirement for a deeper understanding of science and technology in production and also the need to implement international standards in production and trade. It stresses the need for: (i) a climate conducive to improved business-labor management, (ii) citizens with greater sense and commitment to good governance, and (iii) the need to develop an internationally competitive human resource base (labor force). 32. The Plan s solution strategies emphasize the need to increase SSE standards relative to improved quality of graduates, the system, and school management. Management of the education system.is not yet completely effective and efficient which is shown by, among others,..[that] Indonesia is not yet capable of raising the competitiveness of educational institutions to face the era of global education Government policy has stressed universal basic education. Although transition rates from JSE to SSE remain relatively poor in some areas, there is an increase in demand in all areas. Demographics indicate a degree of urgency in the need to attend to SSE. In the next 15 years there will be more graduates who continue on from JSE to SSE given improvements in basic education. However, this is not matched by increases in basic education enrolments. Therefore, the actual number of SSE candidates will start to decline dramatically before This suggests that by investing now, the cost benefit ratio will be greater. Such a strategy will provide for a better system for the future and also the potential investment returns based on forecasted graduations will be greater. 16 Beginning in 2005, GOI changed its budget format. Previous budgets had been organized into routine and development spending categories. The new format follows international (UNDP) best practice. The budget is now presented in 3 formats: organized by type of expenditure item (personnel, goods and services, capital goods, interest and debt repayment, subsidies); by Ministry/Department; and by function. Education is one of 11 functions. 17 The Work Plan is the legal basis for the budget request to Parliament. 18 See 2005 Annual Work Plan, Volume 8, page 3 and also page 8.

14 8 34. MONE s vision statement stresses that education is to produce a society which is peaceful, democratic, of good character, expert (knowledge), competitive, progressive and prosperous. 19 The MONE Strategic Plan provides a foundation for improved quality and higher performance SSE schools. It includes the number of schools at international standards as an indicator of quality, relevance and competitiveness. 20 Current MONE initiatives are funding an increased number of SSE SMA and SMK schools, either through direct government school construction or via support for private sector initiatives. Much of this investment is directed to rural areas. Included is the introduction of 100 integrated SSE schools ( achievement), particularly in rural communities, whereby students can benefit from both academic and vocational curriculum in the same school. In addition, SSE is being provided through classrooms built as attachments to junior secondary schools. Each of these options focus on the Government s commitment to accessibility. Extensive scholarship funds are also available for poor students. At the same time, MONE recognizes the need to improve the quality SSE opportunities. E. Lessons Learned 35. Appendix 5 provides a list of lessons learned and how they have been incorporated into the project design. Experience from a range of projects, 21 plus feedback from MONE officials, indicates the need to address lessons in several key areas: issues on program content and substance; numbers of schools and interventions and the extent of school self-determination for priority inputs; and, project management. 36. Program content concerns deal with the need to ensure the new Curriculum 2004 is supported while at the same time capitalizing on existing materials and syllabus from Indonesia based international and National Plus schools, as well as from domestic and overseas twinning arrangements. MONE does not want to involve too many schools as this could dilute the potential project contribution due to insufficient funds. Therefore, attention must be directed to creating sufficient momentum within each target school to ensure substantive and long lasting change occurs. Investments must be staged and based on school priorities that have been formulated via a participative local planning process. Project management has to be streamlined to reduce centrally managed interventions and increase school determined and managed change initiatives. All fiscal management is to occur within the context of strict public disclosure and good governance practices. III. THE PROJECT A. Objectives 37. The intended project impact is a globally competitive labor force. Indonesia s workforce has relatively lower ratios of educated employees and lower labor productivity rates than other countries. One reason is the lack of high quality education. Recent Government policy and strategic plans emphasizes SSE system improvements to produce higher quality graduates from both general secondary (SMA) and vocational secondary (SMK). The requirement that each district 22 is to have schools performing to international standards 23 is integral to this process. The private sector has responded to public demand for better schooling by establishing 19 See Education Law 22/2003, Section See Table 6.1, Indicators of Monitoring and Evaluation of National Education, MONE Strategic Plan, October See Appendix 6, External Assistance 22 There are 33 provinces and 443 districts in Indonesia, November Education Law 20/2003

15 9 the National Plus Schools; however, the overall public system which caters to those who can better afford an education has not made the same progress in achieving more internationally comparable graduate standards. 38. The outcome of the project is to increase the number of SSE students graduating with improved qualifications, skills and attributes of greater relevance to the global market place and as more educated citizens. The most cost effective and efficient strategy to achieve this is to concentrate on developing the policy infrastructure, implementation mechanisms, school improvement practices, and system support structures that will assist the Government and districts to comply with the Law. The project will focus on relatively few already recognized schools that demonstrate the greatest potential to improve and also the greater opportunity to help trigger parallel improvements in the junior secondary feeder system, other senior secondary schools, and in the overall system. These schools will help to establish standards that are appropriate for Indonesia as well as to assist in creating the domestic support systems required to sustain a secondary education development program. Also, given that these schools represent different stages of development, the project will help identify effective school improvement approaches that can be replicated. 39. There will be three streams of project schools, each with different input intensity levels and each commencing at different times in the project. Commencing in the first year, 160 out of an eventual target of 500 project schools will comprise the first stream. These are in 21 out of the 33 Indonesian provinces and involve 85 districts (Appendix 7). Inputs will be based on the school s bid for project investment submitted as part of project preparation. This requires a participative school-based planning process and, given differential awards, provides a foundation for competition that rewards sound planning and good performance. These schools are referred to as candidate national reference schools. 40. A second stream of 160 candidate national reference schools (100 SMA and 60 SMK) will prepare school plans in the first year of the project while at the same time being supported by some inputs to enable them to achieve a greater state of readiness for project involvement. Longer-term inputs in these schools will be more limited and with lower investment than the first stream. This strategy will provide the opportunity to stage, control and evaluate the inputs, and the required implementation conditions, in order to identify high cost-benefit systems and procedures that enable quality improvement. Both streams will have to demonstrate progress as a stepping stone to further annual investments. The third stream is for 100 SMA and 80 SMK schools, some of which will be in the same provinces as earlier streams, but at least two schools will be in each of the remaining provinces. These schools will prepare school development plans in the second year; therefore, will be involved in the project for fewer years and benefit from much lower investment. The inclusion of Streams 2 and 3 schools will result in every province having at least one SMA and one SMK candidate national reference school, consistent with the MONE concept of this project being a key national initiative in support of application of Education Law 20/ The first 160 schools have been selected based on their high national achievement standings, known teaching and leadership capacity, comprehensive plans, and projected community and local government commitment to sustainability. 24 As potential National Reference Schools (NRS), these schools will provide models and services for other schools. Although the project will affect only about 5% of the total number of SSE schools, the dissemination of project interventions from the first stream 160 to the additional 340 candidate NRS will provide a blueprint for MONE s commitment to a broader national school improvement program. All 500 schools (300 SMA and 200 SMK) will progress to higher standards. Those 24 See Appendix 7 for list of schools by province and district (Candidate National Reference Schools).

16 10 demonstrating greater commitment and success will be the beneficiaries of greater investment support. 42. The project will focus primarily on instituting quality improvements in the teachinglearning process and on school management consistent with MONE s mandate to establish international standard schools. Although SMA and SMK school needs and objectives vary, a single project is warranted because there are sufficient common areas of required improvement. These include access to generic staff development courses, common school improvement programs, and parallel policy initiatives and implementation mechanisms. to develop international standard quality control and possible certification. Both SSE school types cater to broad social sectors, but SMK s greater responsiveness to lower income groups ensures issues of increased equity will be addressed as part of the project design. Project schools will be required to admit students on the basis of merit; therefore, issues of equity will be stressed. 43. The project seeks to achieve four results (outputs): (i) improved learning outcomes of senior secondary graduates; (ii) improved senior secondary management and continuous quality assurance; (iii) increased equity for qualified students; and (iv) established foundation for enhanced policy and planning and independent project evaluation. The latter output is to be accomplished through a parallel ADB funded technical assistance grant. The project design and monitoring framework is in Appendix 1 and problem analysis in Appendix 2. B. Outputs 44. The project features interventions that will establish and help to institutionalize high performance educational standards designed to improve the quality of senior secondary education. Interventions are targeted primarily at schools although some aspects of district, provincial and national government operations will also benefit from project involvement. 1. Output 1: Improved Student Learning Outcomes 45. Four interventions aim to improve student outcomes: (a) strengthen standards for learning environment, curriculum and student assessment; (b) improve performance of teachers and instructional support personnel; (c) provide and upgrade teaching materials, equipment and facilities; (d) improve career planning, job readiness and placement services. a. Strengthen Standards, Curriculum and Student Assessment 46. In order to raise the global competitiveness of graduates entering the workplace Indonesian students must be furnished with new skills, attributes and knowledge. A key measure of project success will be the performance of graduates from project schools in tests sponsored by internationally recognized education institutions and education research organizations. For this intervention, the project will: (i) strengthen educational standards; (ii) upgrade and enrich the current curriculum; and (iii) introduce an international examination and certification option for some SSE graduates. 47. Educational standards. The project will assist GOI to identify and establish internationally recognized standards for senior secondary schools by supporting linkages between Indonesian organizations (private or public) and international organizations or individual experts. These linkages will provide indicative international standards for: current teaching methodologies; graduate outputs; facilities, equipment, teaching materials; student, faculty and staff competencies; and classroom management procedures. In addition, they will provide expertise and potential student education or job placements. International and national education advisors will define quality standards (as part of their input in other areas) that can serve as input to project schools and potentially to employers, professional organizations, higher education

17 11 institutes, the National Standardization Board and the School Accreditation Boards. The project will finance technical assistance (24 months of national consultant) workshops, training and block grants to education service providers to establish twinning arrangements or support existing linkages. 48. The extent to which schools adopt the standards identified, nurture existing or pursue new twinning arrangements will vary. Some schools will opt to achieve a full range of services and courses including certification and perhaps accreditation. Others will use the experience to improve the process of achieving national graduate output standards without necessarily pursuing international certification. Most will explore one or more mutually beneficial links with other education organizations. 49. Current curriculum improvement. The project will enable schools to enrich the current national curriculum with improved instructional support materials and expanded curriculum topics. Teams comprised of NRS teachers supported by international and national education advisors will review all curriculum in all SSE grade levels and provide teaching-learning support materials. Differences between national and international curriculum topics will be highlighted and lesson plans and materials developed by these teams. 50. The project will provide a foundation for curriculum content and delivery that is comparable with international standards. Each school will choose the extent to which they decide to use such curriculum. For some schools, the ultimate aim would be the provision of international standard curriculum in all regular programs. SMA schools will give priority to enriching existing national curriculum through improved lesson planning, improved availability of teaching resources, and greater student-centered learning. But this does not necessarily mean integrating overseas courseware in order to secure international certification. SMK schools intend to pursue curriculum enrichment options but with the firm objective of offering certified international curriculum. Both SMAs and SMKs will maintain national priorities for the teaching of religion, Indonesian civics and also English, science, mathematics and ICT. A parallel aim is to provide MONE with experience to enable them to establish policies on international standard curriculum. The project will finance international travel, fellowships, technical assistance (36 international and 80 national advisors (teacher) person months for both SMA and SMK, campus-based training (in-service training), school-based advice and guidance (on-service training); pilot studies, workshops, and annual regional forums for three subject specialties to review and share enrichment initiatives (e.g. embryo for three National Reference School Professional Forums for Mathematics Teachers; for English Teachers; and for Physics Teachers). 51. International student certification. Achieving individual student international certification for selected courses, or an entire program, is a recognized target for all SMK and some SMA schools. Schools may fund their students to take these exams pending approval of the school s project investment proposal. SMKs will rely on twinning arrangements as the means to provide certification. Some SMAs may pursue twinning as a link with an overseas organization. However, the majority of schools presently intend to arrange for student access to overseas exams (rather than formal twinning). The project will finance the cost of test invigilation and exam scoring and special student services to prepare students (as individuals or as classes of students). b. Improve Performance of Teachers and Instructional Support Staff 52. Many teachers have little knowledge of interactive and student-focused learning and use teaching and assessment methods geared to rote memorization rather than to creative thinking. In part, this is a response to examination assessments which emphasize factual recall over

18 12 problem solving. Many suffer low motivation and limited creativity because of the lack of experience, incentives, poor facilities and teaching, and the lack access to a comprehensive and easily accessible professional development program. Project contributions include: (i) provide intensive training for teachers and vocational-technical assessors (certificate program); (ii) provide short-term training for instructional support staff through a series of individual courses (not certificate); (iii) increase teacher and staff access to international standard resources; and (iv) substitute teacher replacement personnel. MONE will formally recognize these and other project certificate programs as part of its overall articulation with the National Standards Bureau (Badan Standard Nasional Pendidikan). 53. Teacher professional development certification program. The project will aim to design and provide a recognized program of studies that is available for all teachers in project schools. 25 Course content will be focused on enabling instructional performance at high standards (International Standards Teaching Certificate). Teachers from either SMA or SMK will be able to take a 250-day certificate program which will require over a year to complete given the need for formal instruction, in-school application and, for SMK, industry placements. The project-based certificate will consist of three streams teaching methodologies in contentspecific subject matter areas (100 days); contextualized English and ICT (115 days); and specialized short skills-based courses (35 days). All streams will be offered using interactive, creative thinking and problem solving techniques. There are 25 subject areas (10 in SMA and 15 in SMK). Each will have certificate content developed through coordination by a MONE unit responsible for in-service training. The education service providers for SMK will include the Vocational Training Centers (Vocational P3G) and for SMA, the Academic Training Centers (Academic P3G). In addition, both directorates will use other education service providers (ESP) such as universities, NGOs, etc. depending on the area of study. Each designated education service provider will rely on existing or expanded formal twinning arrangements and independently hired national and international advisors. SMA teacher development teams will be supported by 36 person months of international experts (teachers) and 80 person months of national advisor inputs. SMK inputs will vary between the 6 clusters but there will be a total of 36 international and 80 person months of National expert (teacher) input. The project will also fund teachers to gain experience by participating in international fellowship placements. 54. The first teacher certificate stream is based on the teacher s field of study with an emphasis on student-focused learning, greater use of science and technology and industry applications (for SMK) in teaching. Courses will combine content upgrading with teachinglearning and student assessment methodology. New syllabi, lesson plans and instructional guides developed through the training will be integrated with the curriculum enrichment program (para 50) and selected materials will be posted via project supported networking and dissemination initiatives (see para 58). Internships in industry will be included for SMKs. Some teachers will also benefit from invitations to shadow teachers in Indonesian international standard schools. 26 Some will have the benefit of overseas placements. The second stream (parallel) consists of courses in ICT and English to enable school personnel to make the best use of new international class materials and resources developed or made accessible through the project. These second stream courses will be offered and certified by project authorized existing Indonesian organizations, ideally located close to the project schools (e.g. recognized computer schools, English instruction centers, etc.). The project will determine the competency 25 MONE commits to give formal recognition to this Certificate Program (and also the School Leadership Program) through DG Mutendik. MONE also commits to explore the link between this project certificated and other MONE initiatives to articulate in-service achievements with higher education (see Assurances). 26 Discussions with International and National Plus school representatives indicated support for the opportunity for a few NRS teachers to complete internships as part of their program.

19 13 levels for these courses in conjunction with the international and national advisors. The third stream is comprised of a range of 5-day courses, e.g. leadership, entrepreneurship, speed reading/comprehension, research methods, scientific writing, etc. which will be designed by national advisors (12 person months). Teachers will be required to complete 5 of these courses as part of the certificate program (delivered via authorized education service providers chosen for either the SMA or the SMK programs). 55. The education service providers will assist MONE to coordinate the in-country placement of international teachers (advisors) and to assist with the design and delivery of the certificate program, the in-school teacher guidance, and also the curriculum enrichment program. Individual schools may choose to hire additional locally-based part-time international teachers through their block grant allocations (e.g. local native speaker of English). Substitute teachers will be contracted through the project to allow school personnel to engage in the program. Funds will be provided for international advisors, education service provider coordination and delivery of courses, equipment deemed essential for the training but not presently available, overseas fellowships for teacher certificate designers, and internships in industry and international standard schools. School personnel will register for courses using their school s project funds with payment made to authorized education service providers (e.g. to P3Gs, or English or ICT Training Centers). 56. Instructional support staff in-service courses. The project aims to improve staff support to the teaching-learning and testing processes. Four categories of personnel have been identified: (i) SMK vocational workstation technicians (6 program areas); (ii) vocational specialization assessors in 6 program areas (offered as a certificate program), (ii) SMA/SMK science technicians (3 subject areas) and (iii) SMA/SMK librarians, (iv) SMA/SMK ICT technician. For these 17 different positions a series of 3 campus-based 10-day modules will be designed. Similar to the teacher certificate program these shorter courses include applied inschool assignments which will require more than 6 months for program completion. The project will provide funds to hire national consultants (total 42 person months) who will form 5-member course resource teams (17 teams) to design, pilot test and conduct train-the-trainer activities. Each team will be assisted by 5 practicing teachers, seconded by the project for 1 month. Funds will be allocated in school block grants to enable schools to register staff for these courses. Indonesian-based education service providers will be given block grants to offer the courses designed by the course resource teams. 57. Teacher access to reference materials and peer sharing opportunities. Teachers and instructional support staff lack access to up-to-date instructional materials and have limited opportunities to share experiences through subject matter teacher discussion groups (MGMP). The project aims to provide the option for securing the means to gain increased access to international standard resources and materials by establishing and equipping a square meter dedicated teacher resource center (TRC) in NRS. This will provide a local access point for both in the NRS and local colleagues. The center will enable teachers to obtain information through the internet and school intranet (6 desktop computer stations connected to internet/intranet, laptops, printer, LCD, and photocopying/scanning facilities) and also access materials (printed, CD Rom, Video, etc) supplied through partnerships and from fellow teachers. The project will finance technical assistance (36 months national consultant) to assist schools to design and build/rehabilitate, furnish and equip a TRC. It will finance the costs of internet access and Contract Education Staff to assist in each center s operation. It will also fund the design and delivery of short courses to empower teachers with skills to benefit from this in-school resource. 58. Networks and dissemination mechanisms. The project aims to provide a foundation for NRS teachers to organize as professional colleagues, locally, regionally and nationally. The project will pilot test the development and maintenance of National Reference School

20 14 Professionals Associations (NRSPA) for three subject areas (English, Mathematics and Physics for SMA and SMK). Commencing in the 3rd year, these NRSPA groups will hold local meetings to form professional learning communities to disseminate materials, project interventions and to provide direct liaison among NRS (and other) teachers. In readiness for this, the project will establish (before end of 2nd year) and maintain a centrally managed web portal as a Digital Clearinghouse through which educators can share experiences and resources. The project will finance international and national consultants (6 person months each) to design the Clearinghouse, to procure equipment, develop software, and to hire central web maintenance staff (Contract Education Staff equal to 180 person months). It will also train MONE staff to operate and maintain the web-based system which will be hyperlinked with existing MONE websites. In support of this pilot initiative, funds will be provided for the NRSPA national forums. Funds will be provided to pay for teacher preparation time for on-line modules (also reference books). c. Upgrade Instructional Materials, Equipment and Facilities 59. Project schools lack the necessary materials, equipment and facilities to implement international standard curriculum and secure recognized certification. The project will assist schools to assess their needs and to procure as required in the following areas: 60. Instructional materials and textbooks. The project aims to assist schools to procure materials required by new or enhanced curriculum introduced by project schools - textbooks, student and teacher references, teaching aids and supplies. Project schools currently have limited or no quality instructional materials due to the lack of funds or unavailability. The project will enable assessments through comparisons with lists of standards and specifications provided by local and overseas international schools and twinning partners. The international linkages will also be a source to locate and to purchase the best materials. The project will help to coordinate such procurement and ensure consistency with both ADB and Government regulations. 61. Equipment and software. In accordance with approved development plans, schools will be provided with block grants to secure equipment to support an education that emphasizes applied skill experience (vocational workstations), student discovery (demonstration science labs), self-learning and research (libraries and ICT access). The project will finance 72 person months of national technical assistance to help schools to plan and arrange procurement of their equipment and software needs (and instructional materials) consistent with international standards. Procurement will include the installation, operations training and maintenance agreements. 62. Instructional facilities - rehabilitation or construction. Schools will be assisted to build or rehabilitate facilities suitable for new equipment and different teaching-learning methods, furniture, and materials. This includes installation/improvement of: air conditioning in ICT labs and libraries to protect against heat and humidity; plumbing and hazardous waste disposal in science labs and vocational workshops, SMK testing centers, SMK workstations; and toilets, electric and water services. The project will finance 72 person months of national consultant expertise to assist and verify school needs relative to international target standards. Schools will procure local supervision services as well as actual construction through block grants. Courses will include training on how to integrate the effective use of these facilities into the upgraded curriculum.