Teachers are, in effect, encouraging procrastination when they fail to enforce rules governing the time allowed to students for completion of their assignment.
What is the meaning of “in effect”?
I think that it means something like “in fact” or “in reality.”
If teachers tell the students that they have 30 minutes to finish the test, but they always let students take 45 or even 60 minutes, then the students know that the teachers are not serious. So they ignore the teachers’ warnings as just a bunch of hot air. The teachers’ ACTIONS are “saying”: Go ahead and take all the time that you want. We are not serious about the rules.