Privatising education - PowerPoint PPT Presentation

1 / 49
About This Presentation
Title:

Privatising education

Description:

Dominican Republic. 0.61. 1.64. 0.69. Colombia ... Arizona allows taxpayers to contribute up to $500 to a 'tuition organisation' ... – PowerPoint PPT presentation

Number of Views:1620
Avg rating:3.0/5.0
Slides: 50
Provided by: professorj7
Category:

less

Transcript and Presenter's Notes

Title: Privatising education


1
Privatising education
  • James Tooley, PhD
  • Professor of Education Policy
  • University of Newcastle
  • ? James Tooley 2001

2
Three parts
  • Why privatisation of education?
  • Negative and positive reasons
  • Two approaches
  • Public-private partnerships
  • Extending access to private education
  • Implications for Lithuania

3
Why privatisation?
  • What do I mean by privatisation?
  • Increasing role for private sector in educational
  • provision
  • funding and/or
  • regulation

4
Why privatisation?
  • Negative reasons
  • failures of state education
  • inequity of state provision
  • Positive reasons
  • Efficiency and cost-effectiveness
  • Investment
  • Innovation
  • Self-help and community self-help
  • Freedom/liberty

5
Why privatisation? Efficiency and
cost-effectiveness
  • World Bank studies show the proportional gain in
    achievement score if a randomly selected student,
    with the characteristics of an average public
    school student, attends a private rather than a
    public school, holding constant that students
    background
  • Jimenez, Emmanuel, Lockheed, Marlaine E., and
    Paqueo, Vicente, (1991) The Relative Efficiency
    of Private and Public Schools in Developing
    Countries, World Bank Research Observer, Vol. 6,
    no. 2 (July), pp. 205-218
  • Jimenez, Emmanuel,, Lockheed, Marlaine,
    Wattanawaha, Nongnuch, (1988) The Relative
    Efficency of Private and Public Schools the Case
    of Thailand, The World Bank Economic Review, Vol.
    2, no. 2, pp. 139-164).

6
Why privatisation? Efficiency
7
Why privatisation cost-effectiveness
8
Kingdon Cost per achievement (Rs)
9
Kingdons conclusion
  • PUA schools are unambiguously and substantially
    more cost-effective and internally efficient than
    G and PA schools

10
Why privatisation? Innovation and investment
  • Education companies are emerging, with chains of
    schools and universities, which
  • benefit from economies of scale can find
    finance from financial institutions can fund
    student loan programmes
  • invest in research and development implications
    for financial efficiency and educational
    effectiveness
  • Potential to solve the information problem
    through brand names Solve information asymmetry
    problem

11
Why privatisation? Innovation and investment
  • Entrepreneurs in developed and developing
    countries have created educational opportunities
    which are
  • Profitable
  • Financed entirely from student fee income
  • Cater for mass markets, not just the elite

12
Cases
  • Objetivo/UNIP, Brazil, was founded in 1962 with
    20 students and is
  • probably the largest chain of private schools in
    the world?
  • Over 500,000 students in about 500 campuses
  • Many franchised

13
Educor, South Africa
  • 1943 - founded as a cramming college
  • 1952 - developed distance learning materials
  • 1996 - IPO on the Johannesburg Stock Exchange
  • Now 300,000 students on 127 campuses

14
(No Transcript)
15
NIIT, India
  • 1979 computer training company
  • Now has 1,000 franchised centres in India and has
    expanded into 25 countries worldwide
  • Emphasis on RD and quality control
  • Student loan scheme with Citibank

16
NIIT RD
  • The hole in the wall programme
  • Challenges the notion of what a teacher is
  • Is it commercially viable?

17
Key questions
  • Can the virtues of private education be
    replicated in the state sector?
  • Can access to the virtues of private education be
    extended to those currently within the state
    sector?

18
Hence two approaches to privatisation
  • Public-private partnerships (PPP)
  • Contracting out of (failing) state schools
  • Charter schools
  • Vouchers (state)
  • Extending access to private education
  • Private schools for the poor
  • Private vouchers
  • Tax credits and scholarships

19
Contracting out
  • Founded 1992
  • First four schools in 1995
  • Now more than 57,000 students in 108 schools

20
Inclusive schools
  • Largest group of students is African-American
  • 65 of students on free-school meals

21
Attracting investment
  • Since taking over first schools, by 1998 raised
    120 million for RD and investing in schools
  • On Nov 11 1999, launched on Nasdaq, raising
    122.4 million
  • Share price steady

22
Inputs and outputs
  • Takes only 90 of state funding
  • Invests 1 million in each school
  • Pays teachers more
  • Share options for all staff, from janitors to
    principals
  • 84 of classes have statistically significant
    gains
  • High parental satisfaction
  • Waiting lists in all schools
  • edisonschools.com

23
Edison versus government schools - of school
budget
24
Vouchers
  • Government coupons or checks
  • Programmes in USA, Colombia, Chile, Sweden, etc.
  • USA examples
  • Vermont
  • Maine
  • Milwaukee
  • Cleveland
  • Florida

25
The Voucher Tree
Limited fixed-value uniform fees
Unlimited supplementable uniform fees
Unlimited supplementable cost-fees
transport included
Unlimited supplementable cost-fees
transport included income-related restricted
Unlimited supplementable cost-fees
transport included income-related unrestricted
(Blaug 1984)
26
Chile vouchers
  • Vouchers usable at any private or municipal
    school
  • Subsidised private schools are more efficient
    than the municipal schools employing fewer
    teachers per pupil and having lower unit costs.
  • Achieve higher test results in mathematics and
    Spanish.
  • Larrañaga, Oswaldo, (1997) Chile A Hybrid
    Approach, in Zuckerman, Elaine and de Kadt,
    Emanuel (eds) The Public-private Mix in Social
    Services Health care and education in Chile,
    Costa Rica and Venezuela, Washington DC
    Inter-American Development Bank.

27
USA Vouchers
  • Vermont (1869)
  • Parents who live in districts without public
    schools are reimbursed for costs of sending
    children to private school.
  • About 400 students per year
  • Maine (1954)
  • Parents who live in districts without public
    schools are reimbursed for costs of sending
    children to private school.
  • About 5,300 students per year

28
USA vouchers
  • Milwaukee Parental Choice Program (1989)
  • Government gives vouchers to select number of
    parents, to pay for tuition at private schools.
  • 8,000 students (1999), given 5,000 to attend 91
    private schools
  • No more than 15 of total children

29
USA vouchers
  • Cleveland Pilot Scholarship Program (1995)
  • Government gives vouchers to select number of
    parents, to pay for tuition at private schools.
  • 3,500 students (1999) given 2,250 to attend 59
    schools
  • 5 of children in grades 3 to 8

30
USA vouchers
  • Florida A Plan (1999)
  • Schools are graded A-F based on standardised test
    scores
  • Students in schools graded F for two out of four
    years are given 4,000 vouchers to attend private
    schools
  • A school accountability plan with teeth.
  • 1999 134 families offered scholarships
  • 2000 as many as 50 schools would qualify.
  • Superintendent of one Tampa district said that
    all top administrators would take 5 pay cut if
    any school was given an F.
  • State judge struck down law on March 14, 2000

31
USA vouchers evidence
  • Cleveland study (1999, Dr Kim Metcalf, Indiana
    University)
  • Found small but statistically significant
    improvement in language and science achievement
    scores
  • Programme serves the population intended
  • Most children who enrol would not otherwise have
    attended a private school
  • Scholarship parent satisfaction with childs
    school substantially higher

32
USA vouchers
  • Very small scale only about 25,000 students or
    less than 1 of total nationally
  • Heavily constrained and politicised
  • Implications for Lithuania?

33
USA vouchers evidence
  • Milwaukee Dr John Witte (official evaluator of
    program).
  • The Market Approach to Education An analysis of
    Americas First Voucher Program (2000)
  • Vouchers are a useful tool to aid low-income
    families

34
Recap of first approach public-private
partnerships
  • Contracting out
  • Charter schools
  • Vouchers

35
Second approach Extending access to private
education
  • Private schools for the poor (budget private
    schools)
  • Private vouchers
  • Tax credits and scholarships

36
Private schools for the poor in India
  • Dramatic growth of private schools for the poor
  • School fees of about 20 per year
  • Scholarships for poorest 15-20 of student
    places

37
Why? Breakdown in public schools
  • plain negligence cases of teachers keeping a
    school closed for months at a time a school
    where the headteacher was drunk, a headteacher
    who comes to school once a week
  • this pattern is not confined to a minority of
    irresponsible teachers it has become a way of
    life in the profession.

38
If India can
  • Why cant we?

39
Extending access to private schools
  • Private vouchers
  • Tax credits

40
Private voucher scheme USA
  • Childrens Scholarship Fund (CSF) in USA, 100
    million foundation, underwritten by Ted Forstmann
    and John Walton.
  • Awarded 40,000 four-year partial scholarships to
    low income students to attend private schools
  • CSF received 1,250,000 applications 30 times
    the number of scholarships available from low
    income families, all prepared to pay 1,000 per
    year.

41
Private vouchers in the USA the Golden Rule
  • J. Patrick Rooney, Chief Executive Officer of the
    Golden Rule Insurance Company
  • Golden Rule model embodied four principles
  • Vouchers would be for half of the private school
    tuition fee (thus ensuring parents became
    financial stakeholders in their childrens
    education).
  • Only low-income families would be eligible (but
    low-income families who had already made the
    sacrifice and commitment necessary to get their
    children into private schools would not be
    penalised).
  • Vouchers would be eligible for use at any
    private school of the parents choice
  • Low-income families would be granted vouchers on
    a first-come, first-served basis  

42
Tax credits
  • Dollar for dollar reduction in taxes owed for use
    on schooling
  • Includes school fees, textbooks, transport,
    extracurricular fees
  • In USA, four states
  • Arizona
  • Iowa
  • Minnesota
  • Illinois

43
Tax credits - USA
  • Arizona allows taxpayers to contribute up to
    500 to a tuition organisation which gives
    scholarships for poor people to attend private
    schools
  • In 1999, 30,000 people contributed nearly 14
    million to 31 clearinghouses, helping nearly
    7,000 low income students

44
Tax credits - USA
  • Iowa
  • Tax credit of 250 on the first 1,000 of tuition
    expenses at private school.
  • No income ceiling.
  • Minnesota
  • Families with incomes up to 33,500 can claim a
    maximum tax credit of 1,000 per student or
    2,000 per family.
  • Refundable I.e., those families who dont pay
    taxes can still receive it.
  • Tax deduction for school expenses from 1,625 to
    2,500 per year

45
Tax Credits Cato proposal
  • 500 nonrefundable education credit against the
    federal income tax.
  • Estimate that states would save 14 billion on
    public education costs, and allow 2.3 million
    students escape failing public schools
  • Two components
  • Parental choice credit dollar for dollar
    reduction up to 500 per child
  • Scholarship credit any taxpayer can receive
    reduction of up to 500 per taxpayer for
    scholarship clearing house

46
Implications for Lithuania? private schools
47
Implications for Lithuania? private school
students
48
Implications for Lithuania?
  • Leading the way with a workable voucher scheme?
  • Easing regulations for private alternatives ?
  • Exploring contracting out to international
    companies?
  • Other ideas?

49
For further information
  • www.katallaxia.org
Write a Comment
User Comments (0)
About PowerShow.com