Sri Lanka: Skills Sector Enhancement Program

Sovereign Project | 42251-018

Summary

The government s development vision up to 2020, Mahinda Chintana, and the National Human Resource Development and Employment Policy (2012) stress the importance of, and the government s commitment to TVET sector expansion and improvement. To operationalize such commitment, the Skills Sector Development Program (SSDP) has been developed, coordinated by the National Planning Department of MOFP in 2013. The Plan aims to improve (i) policies, systems, and structures; (ii) quality; (iii) relevance; (iii) access; and (iv) recognition of vocational education. ADB s TVET Sector Development Program will focus on key results areas of the government s SSDP, using disbursement-linked indicators and build the government s capacity to transform and align its TVET system to meet the skills needs of industry. The program is fully aligned with ADB s Country Partnership Strategy 2012-2016 and is included in the Sri Lanka COBP for 2013-2015.

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Consulting Notices

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Procurement Documents

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Project Name Skills Sector Enhancement Program
Project Number 42251-018
Country Sri Lanka
Project Status Approved
Project Type / Modality of Assistance Loan
Source of Funding / Amount
Grant: Skills Sector Enhancement Program
Germany US$ 15.40 million
Loan 3119-SRI: Skills Sector Enhancement Program
Ordinary capital resources US$ 50.00 million
Loan 3120-SRI: Skills Sector Enhancement Program
Asian Development Fund US$ 50.00 million
Loan: Skills Sector Enhancement Program
Export-Import Bank of Korea US$ 26.00 million
World Bank US$ 100.00 million
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Knowledge solutions
Partnerships
Private sector development
Sector / Subsector Education - Technical and vocational education and training
Gender Equity and Mainstreaming Effective gender mainstreaming
Description

The government s development vision up to 2020, Mahinda Chintana, and the National Human Resource Development and Employment Policy (2012) stress the importance of, and the government s commitment to TVET sector expansion and improvement. To operationalize such commitment, the Skills Sector Development Program (SSDP) has been developed, coordinated by the National Planning Department of MOFP in 2013. The Plan aims to improve (i) policies, systems, and structures; (ii) quality; (iii) relevance; (iii) access; and (iv) recognition of vocational education. ADB s TVET Sector Development Program will focus on key results areas of the government s SSDP, using disbursement-linked indicators and build the government s capacity to transform and align its TVET system to meet the skills needs of industry. The program is fully aligned with ADB s Country Partnership Strategy 2012-2016 and is included in the Sri Lanka COBP for 2013-2015. The program design will incorporate the lessons learned from ADB s earlier engagement. During the program processing, a more sector wide approach among development partners will be explored.

The impact of the program will be increased employability of the Sri Lankan workforce, particularly the youth. The outcome will be a market responsive, inclusive, and quality TVET system operational.

(i) Output 1. Improved quality of TVET provision.

(ii) Output 2. Enhanced industry partnership for TVET planning and provision.

(iii) Output 3. Increased participation and improved equity in TVET.

(iv) Output 4. Improved sector management to implement policy, institutional and operational reforms.

Project Rationale and Linkage to Country/Regional Strategy

The Government of Sri Lanka's development vision up to 2020, Mahinda Chintana, and the National Human Resource Development and Employment Policy (2012) stress the importance of, and the government s commitment to TVET sector expansion and improvement. To operationalize such commitment, the SSDP has been developed, coordinated by the National Planning Department of MOFP in 2013. The Plan aims to improve (i) policies, systems, and structures; (ii) quality; (iii) relevance; (iii) access; and (iv) recognition of vocational education. ADB s TVET Sector Development Program will focus on key results areas of the government s SSDP, using disbursement-linked indicators and build the government s capacity to transform and align its TVET system to meet the skills needs of industry. The program is fully aligned with ADB s Country Partnership Strategy 2012-2016 and is included in the Sri Lanka COBP for 2013-2015. The program design will incorporate the lessons learned from ADB s earlier engagement. During the program processing, a more sector wide approach among development partners will be explored.

Sri Lanka is a low middle income country with a per capita income of $2,837 in 2012, and it aims to achieve $4,000 by 2016. Despite the long-standing secessionist conflict, the economy grew 5.1% on average between 1980 and 2008, and it grew by an impressive rate of 8.0% in 2010 and 8.2% in 2011 reflecting fast recovery. In 2012, however, it slowed down to 6.4% due to global economic downturn. In terms of development stage, Sri Lanka is now transitioning from the factor-driven to the efficiency driven stage where human capital development to create value addition to its natural and human resources is an imperative to set the economy on a high growth trajectory, avoiding the middle income trap.

Sri Lanka s workforce is better educated than those of other countries in the region. However, the education outcome is not translated to competitiveness of the economy. While Sri Lanka is ranked 62 out of 148 countries in terms of quality higher education and training, it is ranked 135 in terms of labor market efficiency with 35% of skills identified as a problem factor and constraint for trade. The World Bank also notes that inadequately educated labor was identified as a key constraint to improved growth by firms surveyed indicating that skills is the third most important constraint behind electricity and government regulation (including taxation).

Unlike its neighboring countries, the window for demographic dividend for Sri Lanka is narrow as its labor force will grow only marginally at 0.3% in 2008 2020. Sri Lanka has relatively low unemployment rate, at 4.6% in Q1 2013 though youth unemployment rate is significantly higher at 20.1% and 7.5% (for age groups 15 24 and 25 29). In 2012, of the almost 8.8 million workers, 57.4% were engaged in elementary occupations, craft and related areas, and agricultural and fishery, where productivity is low and jobs are mostly in informal sector. In 2012, 1.9 million workers found jobs overseas of which about 70% were housemaids and unskilled workers. Considering high vacancy for skilled and semiskilled jobs, there is a large opportunity for Sri Lankan workers to access better paying jobs.

Impact Increased employability of the Sri Lankan workforce, particularly youth
Project Outcome
Description of Outcome A market-responsive and inclusive TVET system
Progress Toward Outcome Progress to be assessed based on the TVET graduates' employment outcome from 2016.
Implementation Progress
Description of Project Outputs

1. Improved quality of TVET provision

2. Enhanced industry partnership for TVET planning and provision

3. Increased participation and improved equity in TVET

4. Improved TVET sector management to implement policy, institutional, and operational reforms

Status of Implementation Progress (Outputs, Activities, and Issues)

1.1 Revised QMS for training providers developed and around 5% of training providers are going through the process to establish center level QMS since mid-2014.

1.2 Several review and consultations workshops on the NVQ with TVET sector experts, public, private training providers, and industry representatives conducted in 2014

1.3 By 2013, 68.6% of TVET enrollees graduated (male: 71.1%, female: 65.8%) in comparison to the baseline of 71.3% in 2012 (male 70.8% and female 71.9%)

1.4 HRD policy and detailed HRD plan were approved by Secretary on 10 Oct 2014 for implementation.

2.1 Skills gap analyses for four priority sectors commissioned for completion by March 2015.

2.2 Employment linked training program manual and bidding documents developed and approved by MYASD in October 2014. The first RFP for 1,500 trainees in construction technology is ready as of Feb 2015.

2.3 Three university colleges have been established for NVQ 5, 6 level training as of December 2014.

3.1 In 2013, 156,262 trainees (46.6% women) enrolled in public and private TVET institutions (in comparison to 148,131 in 2012, with 45.3% women)

3.2 By October 2014, 2,124 persons certified under RPL program and 1,300 persons completed pre-assessment.

3.3 mechanism Mechanism for stipend still to be developed.

4.1 National Skills Sector Development Plan was approved in 2014.

4.2 Annual plan for 2015 prepared. Monitoring report to be developed by mid- 2015.

4.3 Surveys of public and private TVET providers ongoing for completion by March 2015. The survey will help SSDD develop rationalization plan.

4.4 2014 expenditures to be assessed once the interim financial statements become available in mid mid-2015.

4.5 Draft performance partnership agreements were ready by end of 2014, waiting for finalization when the final budget estimates for 2015 become available.

4.6 Business planning guidelines approved by MYASD in October 2014 and around 90 TVET centers developed business plans for further consideration of pilot implementation for 2015.

4.7 Ministry wide gender and social equity framework to be developed. A gender specialist (consultant) began working with SSDD in February 2015.

Geographical Location
Safeguard Categories
Environment B
Involuntary Resettlement C
Indigenous Peoples C
Summary of Environmental and Social Aspects
Environmental Aspects The program is classified as environment category B according to ADB's Safeguard Policy Statement (2009). Construction activities will be limited to refurbishment, extension, renovation of existing structures and new buildings within the existing TVET center premises or government owned land. No significant environmental impacts are envisaged from the proposed works. Any work inviting higher category of environment classification (category A) shall not be included in the project.
Involuntary Resettlement The program is classified as category C for involuntary resettlement according to ADB s Safeguard Policy Statement (2009). The safeguard requirements 2 will not apply as there will be no land acquisition and involuntary resettlement. Mostly minor civil works will be carried out for refurbishment of existing buildings and facilities. New buildings will be constructed either within the existing TVET institute premises or on government owned land.
Indigenous Peoples The project is classified category C for indigenous peoples according to ADB s Safeguard Policy Statement (2009). Implementation of program components neither directly nor indirectly affects the dignity, human rights, livelihood systems, or culture of indigenous people. Hence, the safeguard requirements 3 will not trigger.
Stakeholder Communication, Participation, and Consultation
During Project Design

Throughout the design phase there were regular meetings with stakeholders to assess sectoral issues and discuss the program design. Key issues discussed were quality, relevance, staff training, working with industry, and increasing participation rates. There were regular briefings with the heads of the MYASD TVET agencies, agencies higher level officials and with representatives of development partners. Special meetings were held to present the findings and recommendations of the design team to relevant officials and management in MYASD TVET agencies for their feedback. Organizations consulted include Foreign Employment Bureau, ministries of education, higher education, and others, Senior Ministers Secretariat, the Board of Investment, the Information and Communication Technology Agency, Tourism Development Authority, Institute of Construction Training and Development, and Institute of Tourism and Hotel Management, development partners, and industry representatives such as the Employers Federation, National Construction Association, Chambers of Commerce and Industries, Chambers of Small and Medium Enterprises, Chamber of Construction Industries, Association of Software and Service Companies, and Hotels Association.

About 15 private and public training institutes were visited to review the status of training delivery, QA measures and the operation of career guidance and counseling units and to assess the existing institutional arrangements and capacity, including accessibility for under-represented groups. Around 125 interviews were conducted with stakeholders (students and teachers) in Colombo in Western Province, Galle in Southern Province, Kandy in Central Province, Anuradhapura in North Central Province and Vavuniya and Killinochchi in Northern Provinces.

During Project Implementation

The program will strengthen the engagement of the employers organizations and professional bodies in TVET planning and delivery through (i) industry working groups to validate skills gap analysis, training plans, competency standards, and curricula; and (ii) introduction of purchasing model where employer can deliver training to bridge the skills gaps. A student tracking system will be established to ensure feedback from students and graduates can inform the TVET system improvement. The program will also introduce a targeted stipend program to encourage the participation of disadvantaged groups including women in TVET.

In addition to the engagement of employers organizations and professional bodies, civil society organizations providing TVET will also benefit from the program through access to curricula, assessment, quality management systems, as well as opportunities for public-private partnerships.

Business Opportunities
Consulting Services As results-based lending, the procurement of consulting services will follow the country system.
Procurement As results-based lending, the procurement will follow the country system.
Responsible ADB Officer Gi Soon Song
Responsible ADB Department South Asia Department
Responsible ADB Division Human and Social Development Division, SARD
Executing Agencies
Ministry of Youth Affairs and Skills DevelopmentSEC@YOUTHSKILLSMIN.GOV.LKNipunatha Piyasa,
No.354/2, Elvitigala Mawatha,
Colombo 05, Sri Lanka
Timetable
Concept Clearance 29 Jan 2014
Fact Finding 02 Dec 2013 to 13 Dec 2013
MRM 31 Jan 2014
Approval 28 Mar 2014
Last Review Mission -
Last PDS Update 25 Feb 2015

Loan

Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 326.40 Cumulative Contract Awards
ADB 0.00 - 0.00 0.00 %
Counterpart 185.00 Cumulative Disbursements
Cofinancing 141.40 - 0.00 0.00 %

Loan 3119-SRI

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
28 Mar 2014 27 May 2014 30 May 2014 30 Jun 2017 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 361.00 Cumulative Contract Awards
ADB 50.00 28 Mar 2014 20.00 0.00 40%
Counterpart 185.00 Cumulative Disbursements
Cofinancing 126.00 28 Mar 2014 18.00 0.00 36%

Loan 3120-SRI

Milestones
Approval Signing Date Effectivity Date Closing
Original Revised Actual
28 Mar 2014 27 May 2014 30 May 2014 30 Jun 2017 - -
Financing Plan Loan Utilization
Total (Amount in US$ million) Date ADB Others Net Percentage
Project Cost 50.00 Cumulative Contract Awards
ADB 50.00 28 Mar 2014 19.57 0.00 42%
Counterpart 0.00 Cumulative Disbursements
Cofinancing 0.00 28 Mar 2014 17.67 0.00 38%
Title Document Type Document Date
Loan Agreement for Skills Sector Enhancement Program - Results-Based Lending Loan Agreement (Ordinary Resources) May 2014
Loan Agreement (Special Operations) for Skills Sector Enhancement Program - Results-Based Lending Loan Agreement (Special Operations) May 2014
Skills Sector Enhancement Program Reports and Recommendations of the President Mar 2014
Technical Education and Vocational Training Sector Development Project Initial Poverty and Social Analysis Aug 2010

Safeguard Documents

See also: Safeguards
Title Document Type Document Date
Skills Sector Enhancement Program: Environmental and Social Management Framework (Draft) Environmental and Social Management System Frameworks Mar 2014
Skills Sector Enhancement Program: Program Safeguard Systems Assessment Program Safeguard Systems Assessments Jan 2014

Evaluation Documents

See also: Independent Evaluation

No documents found.


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