The Education Service Contracting (ESC) Program of the Philippines

1. The Education Service Contracting (ESC) Program of the Philippines Michael M. Alba De La Salle University  Manila

2. The ESC program in a nutshell • provides a fixed tuition subsidy to graduates of public elementary schools who opt to enroll in participating private high schools. • effectively, contracts private schools to provide secondary education to students who otherwise would have attended public schools.

3. Program Features • Beneficiaries • graduates of public elementary schools • who opt to enroll in participating private high schools • Grantees pay school fees and expenses in excess of the tuition subsidy. • who are accepted by the participating private high schools • A school committee processes applications and screens grant applicants.

4. Program Features • Benefits • a fixed annual tuition subsidy through 4 years of high school • Value of the grant since SY 2008-2009: PhP10,000 per year in NCR and PhP5,000 elsewhere in the country. • Requirements • Grantees must pass all academic requirements in each year level. • Grantees cannot take a leave from schooling except due to force majeure or illness.

5. Program Features • Service Providers • Private high schools • who apply to DepEd to participate in the program • who pass an annual certification process for quality of delivery.

6. How the ESC Program came to be • Education policy makers (in government and the private sector) wanted to make use of excess resources in private schools to address congestion and poor quality in public schools • Legal bases • RA 6728 of 1989: Government Assistance to Students and Teachers in Private Education (GASTPE) • RA 8545 of 1998: Expanded GASTPE

7. Program Objectives • Make quality secondary education more accessible to poor Filipino students • Enhance the complementary roles of public and private education sectors • Maximize the use of existing resources in the private education sector • Realize savings for the government • Ease the need for constructing new classrooms and hiring new teachers

8. What has been achieved? (1) • National Coverage as of SY 2008-2009 • 476,776 grantees • 9.3 percent of 5.1 million students in public high schools • 35.8 percent of 1.3 million students in private high schools • 2,033 participating private high schools • 39.8 percent of 5,110 public high schools • On average, 4 private high schools handle the enrollment spillovers or congestion problems of 10 public high schools • 46.3 percent of 4,392 private high schools • 234.5 grantees per school, on average • 58.6 grantees per year level per school, on average

9. What has been achieved? (2) • The ESC program provides a lower cost alternative to direct public provision of education • Cost of a public high school student: PhP9,048 • Cost of an ESC grantee: PhP5,344

10. What has been achieved? (3a) • On average, a participating school receives PhP1.18 million per year from DepEd due to the ESC program • But, in general, school fees exceed the ESC grant. • The average support value of the ESC program is 0.67 • sv = ESC grant ÷ school fees

11. ESC grants generate P4.43 billion in revenues for ESC schools ESC grantees shoulder P2.0 billion of the P4.43 billion.

12. What has been achieved? (3b) • In effect, the ESC program generates resources for participating schools, in excess of government transfers, since grantees make significant co-payments. More resources are thus generated for basic education.

13. Challenges • Can the ESC program be expanded without increasing costs and lowering the quality of private school education? • What is the cost structure of the program? • What is the optimal mix of delivery? Will private schools themselves become congested or suffer in quality? • Can the ESC program be better targeted to improve the overall accessibility and quality of secondary education? • How can the ESC program be used to improve public high schools?