Sri Lanka made school reform payable only when schools changed

Sri Lanka wanted secondary schools to produce students with more employable skills. The ordinary project answer would have been to fund buildings, equipment and teacher training, then hope the school system converted those inputs into different course offerings.

The Education Sector Development Program used a cleaner operating contract. ADB's independent evaluation page says the program was ADB's first education operation financed under results-based lending, linking disbursements to achievements in secondary education.

The clever part was the unit of payment. Money followed visible system changes: a science stream in 1,000 rural secondary schools and a new technology stream. The evaluation validation rated the project Successful.

Pay for school system outputs

Disbursement-linked results made the finance ministry care about classroom-level operating changes.

The target was observable enough to audit, unlike a vague promise to modernize education.

The mechanism let ADB support a government program without micromanaging every input.

When a reform can vanish inside procurement, make the lender's payment event the operating result, not the spending receipt.

ADB's Independent Evaluation Department validated the completion report in 2020 and gave the program an overall Successful assessment. The broader pattern is useful beyond education: when implementation agencies are tempted to deliver inputs, attach funding to the changed operating state customers actually experience.