There is need for increased investment in the education sector if government plans of meeting the Millennium Development Goals (MDGs) are to be achieved. There is also a clear recognition that the deficit in human resources, unemployment and poverty can be solved through quality and quantity basic education. In recent years access to education has improved at all levels. With reference to the MDGs, net enrolment rate in primary schools has now reached 92 percent, while girl pupils are over 50 percent. Important anti-poor measures have been introduced, a move that is increasing the number of children attaining primary education. However, the costs of schooling are still too high for most households, and the percentage of children who actually complete a full cycle of primary school is below the sub-Sahara African average. Challenges to reducing school drop-outs, increasing the completion rate at primary school and improving girls’ examination performance still pose a threat. There is evidence of ‘access shock’ and declining quality. Investment in teachers, textbooks, and classrooms has not matched demand. Higher education and technical and vocational education and training are only partially meeting the needs of the local labour market. Since 2002 there has been improvement in the education sector beginning with the framework of the Education Sector Strategic Plan (ESSP), first presented in 2003. The ESSP is based on the long-term strategy and financial framework (LTSFF) for meeting the education Millennium Development Goals and Rwanda’s Vision 2020. The ESSP and LTSFF enable Rwanda to make informed decisions on the level of investment needed across the sector to meet national targets. It (ESSP) has been revised to include new priorities, including nine-year basic education, science and technology, with special focus on ICT. The plan anticipates a steady rise in government funding proportional to an increase in donor funding. Mobilising the required resources to meet the needs of ESSP will be a major challenge. The sector has developed a sector budget support modality, and pooled funds for capacity building to enable donors to fully align external financing where possible and make it operational. There will also be a role for communities, NGOs, faith-based organisations, and private partnerships. Efforts will therefore need to be made to ensure that the financing gap is bridged. If the anticipated financing gap cannot be met, the sector will need to scale down its level of ambition. There has been a steady improvement in linkages between the ESSP, the medium term expenditure frame work (MTEF), the budget, and budget outturns from 2003 to 2005. Budget sub-programme performance has also improved, although some cross-cutting issues like girls’ education and HIV/Aids remain poorly executed and some areas such as ICT have been overspending compared to the allocated budget. A major challenge is to strengthen the relationship between input, output, and educational results. Improved monitoring and evaluation, and strengthening capacity at all levels will help to secure better performance in terms of implementation. The introduction of fee primary education in 2003, plus the direct transfer of capitation grant funds to primary schools, has enabled greater access to primary school, and relieved part (but not all) of the financial burden previously borne by poor families. However, it is rather too early to assess evidence of the poverty reduction impact of these measures (improved health, wealth, agricultural yield) anticipated in the Poverty Reduction Strategy Paper (PRSP). More effort needs to be introduced to help monitor such impact. Education data which also relies on population statistics needs to become more robust in order to do this, with disaggregated data for gender, poverty quintile, and region. The newly planned education management information system will give opportunities soon. Tracking of capitation grant could be enhanced by ascertaining its usage at and also by monitoring linkages to education quality improvement and the impact of education to the poor. Costs also remain a key barrier to attaining secondary level education. Greater emphasis needs to be placed on the ‘forgotten majority’ of children and youth who fall out of the education system and have few opportunities to develop even basic literacy and numeric skills. The Citizen Report Card survey suggests that the reasons for dropping out may need to be studied more systematically, and the EICV II will give a new source of data for this. The education sector is characterised by strong partnerships including development partners and representatives from civil society, NGOs, and faith-based organisations. The sector has held four joint reviews since 2003, held each year in April. The reviews highlighted that there should be strategies to benefit the poor in the country, and these include: Capitation Grant, Fee-Free Education, School Feeding Programme and Community Development Fund (CDF). It also gives suggestions about decentralization, Parents-Teachers Associations (PTA), Ecoles Secondaire Interior (ESI), construction of secondary schools nearer to communities and Transparency in the National Examination Council. Recommendations of the review It requests for feedback on ‘reaching the poor’ to be used as the starting point of the review of education strategies for poverty reduction as part of the EDPRS (this feedback has been incorporated into the self evaluation). Monitoring systems be improved to track the impact of education on poverty and that the 2005 Household Living Conditions Survey be analysed for education and poverty implications. A programme for studies should be developed in the education sector, prioritising the development of a child profile system in order to trace and track out-of-school children and primary leavers/drop-outs. Science and technology, vocational and technical training and priority areas in higher education are also to be recognised. The roles they are to play in economic growth and poverty reduction are to be outlined.Ends