The World Bank Moldova Education Reform Project () REPORT NO.: RES38294 DOCUMENT OF THE WORLD BANK RESTRUCTURING PAPER ON A PROPOSED PROJECT RESTRUCTURING OF MOLDOVA EDUCATION REFORM PROJECT APPROVED ON JANUARY 24, 2013 TO MINISTRY OF FINANCE EDUCATION EUROPE AND CENTRAL ASIA Regional Vice President: Cyril E Muller Country Director: Satu Kristiina J. Kahkonen Regional Director: Jaime Saavedra Chanduvi Practice Manager/Manager: Harry Anthony Patrinos Task Team Leader: Janssen Edelweiss Nunes Teixeira, Lucia Casap The World Bank Moldova Education Reform Project () I. BASIC DATA Product Information Project ID Financing Instrument Investment Project Financing Original EA Category Current EA Category Partial Assessment (B) Approval Date Current Closing Date 24-Jan-2013 30-Jun-2020 Organizations Borrower Responsible Agency Ministry of Education, Culture and Research,Moldova Ministry of Finance Social Investment Fund (MSIF) Project Development Objective (PDO) Original PDO The Project Development Objective (PDO) is to strengthen the quality of education while supporting the efficiency reforms being implemented in the education sector. Current PDO The Project Development Objective is to improve learning conditions in targeted schools and strengthen the Recipient's education monitoring systems, while promoting efficiency reforms in the education sector. Summary Status of Financing Net Ln/Cr/Tf Approval Signing Effectiveness Closing Commitment Disbursed Undisbursed IDA-61810 16-Feb-2018 12-Mar-2018 19-Jul-2018 30-Jun-2020 10.00 .22 9.56 IDA-51960 24-Jan-2013 07-Feb-2013 01-Jul-2013 30-Jun-2020 40.00 27.23 9.64 The World Bank Moldova Education Reform Project () Policy Waiver(s) Does this restructuring trigger the need for any policy waiver(s)? No I. SUMMARY OF PROJECT STATUS AND PROPOSED CHANGES This restructuring responds to a request from the Government of Moldova, through the Ministry of Finance, to extend the Moldova Education Reform Project (MERP)'s Closing Date by 22 months (i.e. from June 30, 2020 to April 30, 2022). This request is dated June 27, 2019. Other than this extension of the Project Closing Date, no other change is proposed under this restructuring. The overall project implementation progress is deemed moderately satisfactory, given the shortcomings observed in each component, as described below. Given an issue with the timeline for the completion of civil works for the renovation of 17 schools, the achievement of the Project Development Objective by the current Closing Date is unfeasible, which is the main reason for this restructuring. MERP is supported by two Credits: (i) the original Credit of SDR 26.1 million (USD 40 million equivalent) approved for the Republic of Moldova in 2013, and (ii) a Credit (an Additional Financing) in the amount of SDR 7.1 million (USD 10 million equivalent) that became effective on July 19, 2018. MERP supports the Government of Moldova (GoM)'s reform program by financing activities aimed at strengthening the quality of education and leading to a more efficient education sector. The Project was restructured in 2017, by shifting from a results-based financing approach (utilization of Disbursement- Linked Indicators - DLIs) to an inputs-based financing. The funds attached to three DLIs were reallocated to the rehabilitation of 15 receiving schools under the responsibility of the Moldova Social Investment Fund (MSIF). With the Additional Financing, the remaining DLI was restructured as well, and its respective funds moved to the rehabilitation of additional two receiving schools. Component 1 - Strengthening the Quality of Education. During the supervision support visit of May 2019, the teams of the World Bank, Ministry of Education, Culture and Research (MoECR) and MSIF discussed about and agreed upon a realistic timeline for the completion of consulting services and civil works for the rehabilitation of the 17 receiving schools that are financed by MERP. This discussion showed the need of extending MERP’s Closing Date by 22 months. There are delays with the services for the preparation of designs for 2 schools, as well as with the works for some schools already under rehabilitation. This extension would allow for the completion of services and works related to the rehabilitation of receiving schools by MSIF. Moreover, the supervision support visit conducted from September 9 to 13, 2019 showed that this extension would also give the MoECR more time for completing other activities funded through this component such as the: (i) training of teachers, principals and psycho-pedagogues, (ii) improvement of student’s assessment system, (iii) improvement of the Education Management Information System, and (iv) provision of schools with equipment for science laboratories and equipment for students with disabilities. Component 2 – Improving the Efficiency of the Education Sector. The implementation of this component is mostly on track, except for the development and piloting of a new financing mechanism for preschool education. While the development of a per capita financing formula for preschool education is expected to be completed by December The World Bank Moldova Education Reform Project () 2019, its piloting in two rayons would last longer than currently planned, because of the national budgeting process, so it will also benefit from this restructuring. Component 3 - Improving the Ministry's Capacity to Monitor the Reform. Since September 2018, there has been limited progress with the launch of relevant activities supported by this component such as surveys with project beneficiaries and development of a platform/system for the grievance redress mechanism. To address this shortcoming, the MoECR shall prioritize the selection of individual consultants to assist its Departments responsible for the implementation of these activities. Disbursement. The total amount of project funds disbursed so far is US$27.5 million (around 55 percent of the total). The MoECR estimates that US$29 million (cumulative amount; 58 percent of the total) will be disbursed by December 31, 2019. Project Audits. The project audit for 2018 is underway. The Court of Accounts informed the MoECR that it will complete the Project Audit Report for 2018 by September 30, 2019. The World Bank was informed on this delay by the Court of Accounts through a letter dated July 12, 2019. The reason for this delay is a two-month certification program undertaken by all public auditors. It is important to mention that the project financial management arrangements are satisfactory and there are no major issues in this area. The project financial reports have been timely submitted to the World Bank and found acceptable. II. DETAILED CHANGES LOAN CLOSING DATE(S) Original Revised Proposed Proposed Deadline Ln/Cr/Tf Status Closing Closing(s) Closing for Withdrawal Applications 28-Jun-2019, 30-Jun- IDA-51960 Effective 31-Aug-2018 30-Apr-2022 30-Aug-2022 2020 IDA-61810 Effective 30-Jun-2020 30-Apr-2022 30-Aug-2022