BOS Knowledge Improvement for Transparency and Accountability

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The objective of the School Operational Assistance (BOS) Knowledge Improvement for Transparency and Accountability Project (KITA) for Indonesia is to improve access to quality education for all children of ages 7 to 15 by strengthening school based management and community participation, improving existing fiduciary arrangements for greater transparency and accountability of the BOS program and, consequently, bringing about better utilization of BOS funds. The rising price of basic commodities has increased the financial burden on families that send their children to school. The overall cost of education borne by families has been rising. School fees are a significant barrier to access to education for the poor: in a survey 34 percent of households in the poorest quintile with children enrolled in school reported difficulties in financing school fees at the primary school level and 44 percent reported difficulties at the junior secondary level. The BOS program, which was initiated in 2005, disburses block grants to all schools throughout Indonesia based on a per-student formula. It is Indonesia's most significant policy reform in education financing in two important aspects: (i) block grants to schools are based on a per-pupil formula, which provides incentives for headmasters and teachers to focus on maintaining and increasing enrollment; and (ii) funds are directly channeled to the schools, which empowers school managers by allowing them to choose how to best allocate the BOS grants. BOS-KITA provides an opportunity to initiate a broader sector-wide program (SISWA), which is expected to be one cornerstone of the country partnership strategy (CPS). This is an important step towards supporting institutions in Indonesia. BOS-KITA represents a new type of support that will be key to revitalizing the Bank's investment lending portfolio in Indonesia and is a new way of working, starting with an existing, effective, government-owned program.