Private vs. public expenditure

by Dirk Van Damme
Division Head, Innovation and Measuring Progress (IMEP) and Head of Centre for Educational Research and Innovation (CERI)

Tertiary education institutions such as colleges and universities raise an increasing share of their funding from private sources. As the latest issue of the OECD’s Education Indicators in Focus details, the major part comes from households via tuition fees and other forms of household expenditure, but institutions also raise more contributions from private companies. Private expenditure now accounts for 30% of expenditure in tertiary education. As the latest issue of the OECD brief series Education Indicators in Focus details, the increase in private expenditure between 2000 and 2009 in OECD countries is remarkable. On average across OECD countries it more than doubled, but countries like Austria, Portugal and the Slovak Republic had growth indexes exceeding 500 points. In 2000, the United Kingdom already drew 32.3% of its expenditure on tertiary education from private sources and further increased it to 70.4% in 2009. The United States, usually seen as a country with the highest level of private expenditure, has seen a decrease from 68.9% in 2000 to 61.9% in 2009.

A simplistic interpretation might suggest that countries have substituted public funding with private resources. On the contrary the evidence shows that the increase in private expenditure did not occur at the expense of public funding. In addition, public funding for tertiary education increased in the same period from an index of 100 in 2000 to an index of 138 points in 2009 across the OECD. Countries such as the Czech Republic, Korea and Poland have seen increases for public funding to more than 180 index points.

The growth rates of public and private expenditure to tertiary education institutions are quite different across countries. Some countries combine high growth rates for both public and private expenditure, such as Austria, the Czech Republic, Mexico and the Slovak Republic. In other countries public and private expenditure have dissimilar growth patterns: Denmark, Portugal and the United Kingdom combined a higher than average growth index for private expenditure with a lower than average growth index for public expenditure for tertiary education.

With different growth rates, both public and private expenditure on tertiary education institutions increased between 2000 and 2009. However, the variation between countries in the relative proportion of private expenditure remains very high, from the Nordic countries with 10% or less private expenditure, to the United States and the United Kingdom with around 60% and 70%, respectively. Private resources have added to public expenditure, and at the country level, a higher level of private expenditure in tertiary education is not associated with lower chances for students from disadvantaged backgrounds to access tertiary education.

For more information
On this topic, visit:
Education Indicators in Focus: www.oecd.org/education/indicators 
On the OECD’s education indicators, visit:
Education at a Glance 2012: OECD Indicators: www.oecd.org/edu/eag2012 
On the OECD’s Indicators of Education Systems (INES) programme, visit:
INES Programme overview brochure
Chart source: Education at a Glance 2012: Indicator B3 (www.oecd/edu/eag2012)

It's high time to fight corruption in education

by Mihaylo Milovanovitch
Policy Analyst, Non-Member Economies, Directorate for Education

A modern day Bulgarian proverb says “What money can’t buy, a lot of money can”. Sadly, the truth of this popular wisdom holds well beyond the country it comes from. Sadly too, it seems to work well in schools and universities. Year by year Transparency International (TI), an international anti-corruption NGO, publishes data on the perceptions and experience of people from around the globe with corruption and in 2011 it reported that 35% of the world population considered education in their respective countries to be extremely corrupt.

There is no lack of individual examples. A media outlet in Serbia, a country in which more than quarter of the population this year is officially without a job, recently reported that getting one as a teacher would cost you 7000 EUR - the equivalent of around 22 average salaries. Students are ready to pay too. To succeed in school in Kyrgyzstan, they better be ready (and able) to pay their teachers. In 2006 (the last year for which there is data), 64% of all secondary students in the country were regularly paying for one-on-one private tutoring to teachers from their own schools.

Numbers are important. If you are a student or parent, however, would it really make a difference if in your country 10%, 25% or 30% of the education institutions are corrupt? Probably not. Even one corrupt school, and one fake doctor, engineer or teacher is just one too many.

Indeed, no matter how much of it there is, corruption is always a problem and corruption in education is particularly destructive. Corrupt schools and universities replicate tolerance for malpractice, undermine public trust, waste the human potential of nations and raise the cost of education (which is as an already costly sector anyway).

But, what can be done? What is it that corrupts education institutions and makes them do the opposite of the very mission they were founded to fulfil – to instil values, promote knowledge, and serve the society and its citizens? What makes parents and students initiate or agree to corruption? What policies work in preventing and eradicating corruption in education and how can they be replicated beyond national borders for the benefit of all interested countries and their students, teachers and education stakeholders? Finally, how to inform policies on preventing a problem which the ones involved have all reasons to hide?

In the course of the past year, the OECD Directorate for Education initiated the Integrity of Education Systems (INTES) project to find answers to these questions and use them in a novel approach to the problem. At its core is a focus on the causes of corruption in education – on identifying what gives individuals and education institutions the possibility, the motives and the reasons to engage in malpractice, and on how policy decisions influence corruption risk. The project is driven also by the genuine concern of countries-members of the OECD Anti-Corruption Network for Eastern Europe and Central Asia for the integrity and efficiency of their education systems and by their request for policy support
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The INTES project already bears promising fruits. The first INTES country report – on Serbia – was released some days ago. It uses the new methodology to provide an assessment of the integrity of the Serbian education system, supplies evidence on its shortcomings and strengths, formulates forecasts of corruption incidence, points out areas in need of attention, and identifies solutions for closing the gaps.

Even the best of reports and the most reliable of evidence are useless without national follow-up and without ownership for subsequent policy decisions, by all sides concerned. This is particularly true for highly sensitive topics such as the one at hand. In Serbia, the report triggered considerable policy response already in its drafting phase, and led to action by the national Parliament which amended the laws on primary and on secondary education to address some of the preliminary findings, in particular those related to recruitment procedures for teachers.

It can only be hoped that further countries - OECD members and non-Members alike - will follow the Serbian example and open up their national education to an integrity “health check” and afterwards invest in a meaningful follow-up. Their students, families and education professionals deserve nothing less.

Links:
Strengthening Integrity and Fighting Corruption in Education: Serbia
Anti-Corruption Network for Eastern Europe and Central Asia
Public Sector Integrity Reviews
Bribery in international business
Photo credit: Shutterstock/iofoto