Public Disclosure Authorized Table of Contents 5 How should PNG prioritize education resources to improve student learning outcomes? 20225.1Prioritizeinvestmentsineducationqualityandfocusonaddressingtheimpedimentstolearningoutcomesidentifiedthroughlearningassessmentsurveys.5.2Increaseequityandefficiencyofeducationspendingtopromotesectoroutcomes. Table of Figure Acknowledgements The2025budgetbriefwaspreparedbyKaoriShirakawaandJainHolsheimerundertheoverallsupervisionofLarsM.Sondergaard.ItispartofaregularseriesofeducationbudgetanalysesinPapuaNewGuineathatstartedin2023.TheworkwascarriedoutundertheguidanceofCristianAedo,StephenN.NdegwaandKhwimaNthara. ThebriefbenefitedgreatlyfromcommentsprovidedbyKebedeFeda,aswellasSamerAl-SamarraiandIgorKheyfets.TheteamalsowantstothankJoyWongandSharlyneErifortheirgreatsupportduringthepreparationofthisbrief.Thecontentof SpecialthanksgoouttotheNationalDepartmentofEducation’sFinanceDivisionfortheircontributionsandfortheleadership Executive Summary Too many children in Papua New Guinea (PNG) are missing out on education, limiting the country’s ability to develop itshuman capital and achieve sustained economic growth.Nearlyoneinfourchildrenofprimaryorsecondaryschoolageisnotattendingschool.Amongthosewhoareenrolled,manydonotacquirethefoundationalskillsnecessarytoprogressthroughtheeducationsystem.Accordingtothe2021PacificIslandsLiteracyandNumeracyAssessment(PILNA),onein Student learning assessments and surveys have shed light on the key impediments to learning outcomes in PNG.Onesignificantbarriertostudentlearningisthatmanychildrenenterschoolunprepared.Thislackofschoolreadinessisprimarilydrivenbyhighlevelsofchronicmalnutritionandlimitedaccesstoearlychildhoodeducation(ECE).Inaddition,pooraccesstotextbooksandinadequateschoolinfrastructurefurtherconstrainlearning.Teacherpreparednessisalsoamajorchallenge. The PNG education sector budget totals K4.8 billion (US$1.3 billion) in 2025, representing a 13 percent increase (K487million or US$136 million) over 2024.Thesector’sshareofthetotalgovernmentbudgethasrisenfrom15.5percentin2024to17.0percentin2025.Ninety-threepercentofthisbudgetisfinancedthroughdomesticrevenue,withtheremainder Most of the additional funding has been allocated to teacher salaries, which helps reduce the risk of budget overrunsand, thereby, improving budget credibility.Overthepastdecade,actualspendingonteachercompensationexceededtheapprovedbudgetbyanaverageof23percent.Althoughsalaryoverrunsareexpectedtocontinuein2025,thegapbetweenbudgetedandactualspendingisprojectedtonarrow.Additionalresourceshavealsobeenallocatedtopublicinvestment The 2025 budget for school grants (GTFS) does not fully meet the estimated program cost, creating uncertainty forschool operations and risking negative impacts on student learning.Wagescontinuetodominatetheeducationbudget,thoughtheshareallocatedtocapitalinvestmenthasslightlyincreasedin2025.Morethanhalfofthebudgetisallocatedto Some program components, addressing the barriers to student learning, are critically underfunded in the 2025 educationsector budget.Investinginteacherprofessionaldevelopment(TPD)isessentialforimprovinglearningoutcomes,especiallyasmanyteachersdonotmeettheminimumqualificationstandards.However,theprogramremainscriticallyunderfunded. Key Recommendations: •First, prioritize investments in education quality by addressing the core barriers to learning.TPD–specificallyprovidingtrainingtoteachersintheuseofstructuredlessonplans-hasproventobeahighlycost-effectiveinterventioninavarietyofcontexts,includinginPNG.AcomprehensiveTPDprogramisestimatedtocostK277million(US$77million)annually–K261million(US$73million)morethancurrentlyallocatedin2025.Inaddition,morefundingisrequiredforstudentlearningmaterials,particularlytextbooks.AnadditionalK192million(US$53.6million)peryearisneededtoensureallstudents(grades1to12)haveaccesstotextbooks.Moreover,fundingisrequiredforcriticalinfrastructuremaintenanceandsanitationupgradingneeds,whichwillimprovelearning •Second, while increasing education funding is crucial for improving learning outcomes, both spending equityand efficiency must also be strengthened.EducationfundingisnotequitablydistributedacrossPNG’sprovinces,withper-studentspendingbeinglowerinpoorerprovinces.Amoreequitabledistributionofteacherscouldsignificantlyimproveeducationalequity,butadeeperanalysisoftheunderlyingcausesofthesedisparitiesis •Third, strengthen wage bill spending controls and align future teacher compensation with qualifications,effort, and performance.WhileteachersalariesinPNGarerelativelycompetitive,unconditionalpayincreaseshavenotproventobeacost-effectivestrategyforimprovingstudentlearningoutcomes.Evidence •And fourth, leverage modern technologies to improve data systems.KeyfunctionsinPNG’seducationsystemarestillperformedpaper-basedandsufferfrompoorcomplianceandresponserates.Lackofreliabledataoftenresultsinbudgetingoversightsandneglectoftheschools’physicalconditions.Bymodernizingdata 1. What are the challeng