This year's SLC results said it all: 80 percent of students from government schools failed their exams.

It wasn't just the students that failed, the government failed too in managing the school system. Now, the success of public schools that have been handed over to local communities is a beacon of hope.

The rot set in with the nationalisation of locally-managed schools in 1971. It was an experiment that failed miserably and brought down the quality of instruction. Now, goaded by donors, the government is poised to hand them back.

Just as with community forestry, community radio and community health care, it looks like the way to go is to decentralise the management of schools. This way, teachers are more accountable and show greater responsibility. And because the schools are locally-managed, the Maoists don't interfere as much.

Some 2,200 schools have now been handed over to local communities and in a few years 27,000 more schools nationwide will be transferred, making Nepal a unique education model in the developing world.

"In the past, the government appointed all teachers," explains Rajendra Joshi of the World Bank in Kathmandu, "but once the community took over it started weeding out bad teachers."

The initiative is spearheaded by the Ministry of Education with support from the World Bank and UNICEF under the Community School Support Program (CSSP) which gives grants of Rs 100,000 to schools that used to have a budget of only Rs 10,000 a year.

"In the schools where it has been tried, it has already brought a lot of hope to achieve Nepal's education goals," says UNICEF's Sanphe Lhalungpa who is especially happy to see the high dropout rate reducing in the new locally-run schools.

Retention of students especially at the primary level has always posed a big challenge in Nepal and this has to do with poor motivation of teachers, lack of books and dingy classrooms. Even before the conflict, 70 percent of children between six to 10 dropped out of school, one of the highest rates in the world.

"You cannot blame the conflict for crisis in education," says Helen Sherpa of the World Education group, "but the conflict has made it worse." Government education offices have been constantly under Maoist threat and last week the rebels blew up the District Education Office in Khotang. Government teachers have been extorted mercilessly by the Maoists, paying upto 20 percent of their salaries as 'revolutionary tax'.

Educationists admit that just giving away grants to schools will not solve the problem, they think community management can be a quality control factor. They admit that some communities are not cohesive and dedicated but say if decentralisation works with forest conservation there is no reason it won't work to revamp education.

"This is not about undertaking technical responsibilities but knowing who is a good or bad teacher," says Joshi. Experience with existing community-managed schools is that the Maoists also leave them alone.

At the National Planning Commission there is excitement in the air after a lot of gloom and doom about meeting the UN's Millennium Development Goal to achieve universal literacy by 2015. "Community management of schools gives us the best chance of achieving that target," says Shankar Sharma but adds cautiously, "it all depends now on whether the conflict intensifies."