World Bank Supports Scale-up of Successful Education Program

Contacts:

In Jakarta:Randy Salim

Tel: + (62 21) 5299-3259

rsalim1@worldbank.org

In Washington: Mohamad Al-Arief

(202) 458-5964

malarief@worldbank.org

WashingtonDC, October 7, 2008 – The World Bank’s Board of Executive Directors today approved a project designed to build on the success of a Government of Indonesia program that provided free basic education for Indonesian children.

BOS-KITA (School Operational Assistance – Knowledge Improvement for Transparency and Accountability) builds on the success of BOS – the Government’s program to improve access to quality education for all children aged 7 to 15. BOS-KITA is designed to strengthen school-based management and community participation and, as a result, to further improve the quality of education spending in Indonesia.

“BOS is a perfect example of how government-led efforts to improve public expenditures and promote institutional change in a dynamic middle-income country like Indonesia can lead to success,” says Joachim von Amsberg, Indonesia Country Director, World Bank. “With BOS-KITA, the World Bank reinforces this success by helping to fund activities that enhance educational quality such as training for teachers and more teaching materials. This investment illustrates a new approach of the World Bank: instead of financing free-standing projects, our aim is to co-finance existing priority government programs and help to improve their quality.”

Over the next two years, BOS-KITA will finance up to US$600 million of the Government’s more than US$2 billion BOS program. BOS-KITA will also be used to reimburse a portion of the Government’s BOS grants made to public and private primary and junior secondary schools through the Ministry of National Education. The program supports the Government’s commitment to school-based management by strengthening school committees, particularly in the planning and monitoring of BOS expenditures.

“A key element to the success of BOS-KITA is transparency: annual plans for the use of BOS funds and quarterly expenditure reports will be publicly displayed on school notice boards,” says Mr. von Amsberg. “The program replicates one of the most important lessons learned from the community development mechanism ─ namely that social pressure from informed local communities can be a positive influence on reducing corruption and the misuse of funds.”

BOS-KITA also lays the ground work for a sector-wide approach in education. Working with the European Commission and Netherlands Government, the Bank aims to develop capacity in financial and information systems management at the district and school levels in 50 districts to strengthen the decentralized education system. The Bank is also supporting the Government to prepare a program of basic education reforms called Systems Improvement through Sector Wide Approach (SISWA), which will provide performance-based grants to districts.

To learn more about the World Bank’s support for Indonesia visit: www.worldbank.org/id

About the BOS Program

The BOS program is a demonstration of the Government’s commitment to the constitutional obligation of providing free basic education of adequate quality for students. The Indonesian Constitution and the Law on the National Education System both emphasize that all Indonesian citizens have the right to education (Constitution 1945 Amendment III, Article 31:2) and the Government has an obligation to finance basic education without charging fees (Law No. 20/2003, Article 34). The BOS program, which provides funding to schools for non-salary operational expenditures, aims to reduce schools fees, as well as support quality-enhancing spending for all public and private primary and junior secondary schools in Indonesia. Prior to the BOS program, schools had virtually no funds to spend on operational expenses.

The BOS program covers around 40 million students or about 98 percent of national primary and junior secondary students in 2007.  The program distributed 73 percent of its funds to the primary level and the remaining 27 percent to the junior secondary level. The per-pupil BOS allocation has increased from Rp 235,000 to Rp 276,000 per primary student and from Rp 324,500 to Rp 376,000 per junior secondary student per year since 2007.

In 2007, the BOS program spent US$1.3 billion (Rp 11.8 trillion), which represents about 9 percent of total education spending in Indonesia (and 23 percent of central government education spending). This includes a new BOS sub-program that specifically covers school books. The BOS allocation doubled from US$560 million in 2005 to US$1.13 billion in 2006. Since 2006, the allocation for BOS has increased in nominal terms and remained relatively constant as a share of total education spending.