Jandhyala Tilak National University of Educational Planning & Administration, New Delhi, India

1. Global Financial Crisis and the Financing of Education in Asia: National & International Trends and Strategies Jandhyala Tilak National University of Educational Planning & Administration, New Delhi, India E-mail: jtilak@nuepa.org

2. Asia is heterogeneous • Asia: 2, 3 or 4 Asias • Central Asia • East Asia & Pacific • East Asia • South-East Asia • Pacific • South & West Asia • South Asia • West Asia • Inter-regional and inter-country variations are very high

3. Agreed Premises • Education is • a public good – pure public good, a global public good • A basic need • An economic investment • Human development • A Human right/fundamental right

4. Agreed Premises … • Education is equitable and efficient • Quantity, quality, and equity in education are inseparable dimensions • Primary, secondary and higher education are inter-linked • Need to go ‘beyond the basics’

5. Macro Context in Asia • Post-Jomtien period • Rapid growth in primary education • Enrolments, Gross/net enrolment ratios, gender parity • Dropout rates, out of school children, illiterates • Transition rates to secondary education • Growth in Secondary Education

6. Net Enrolment Ratios in Primary Education in Asia (%)

7. Growth in Secondary Education

8. Macro Context in Asia • Despite improvements problems persist • High dropout rates • Low levels of learning • Asia accounts for • 65% of World’s illiterates • 38% of out of school children

9. Macro Context in Asia • Growth in Primary education demand for secondary/higher education • Building knowledge societies • Governments are ‘making’ plans for • Reaching EFA goals • Expansion of secondary education • Development of higher education • Some shifts in emphasis are already noted

10. Macro Context in Asia • Global Financial crisis: Adverse effects on • fiscal capacity of the governments • Trade, FDI, remittances, aid to • Employment levels, economic capacity of households • Projected growth rates are much below the recently experienced growth rates; yet they are reasonably high above 5%

11. Global Financial Crisis: Predicted Fall in Growth rates

12. Macro Context in Asia • The adverse impact of the crisis on education is widely feared; but no hard data are available so far…. • Likely effects quite uneven • Some countries are less affected by the crisis than others

13. Global Financial Crisis • Public expenditure on education • % of GNP, % of Budget Expenditure • Intra-sectoral allocations • Investments in quality and equity in education • Household expenditure • External Aid • Questions on education as a public good • Question on the importance of free education

14. National Priority for Education • In a larger number of countries the priority accorded to education declined • % of GNP • % of Budget Expenditure • May be due to • declining fiscal capacity • Lack of political will

15. Public Expenditure on Education (% of GNP)

16. Public Expenditure on Education (% of Total Budget

17. National Priority for Education • No relationship between education priority and economic conditions during normal period • But a +ve relationship during the periods of financial crisis

18. Relative Priorities • Total spending on education as % of GNP and spending on primary education as % of GNP are not related. Edn Primary • Lao 3.6 0.5 • Philippines 2.3 1.2 • Bhutan 5.8 1.0

19. Shifts in Priority within education • Decline in share of expenditure on primary education • Marginal increase in the share of secondary education

20. Changing Priorities: Allocation to Primary Education

21. Priority Shift towards Secondary Education (% of total Edn Expr)

22. Growth in private schools • Private not for profit /state supported • Private for profit • Enrolments in private schools • No disaggregated data

24. Other Developments • Increase in efforts to mobilise more resources • Education cess in India • surcharges in China • Decentralisation • Rising household expenditure on education • Not willingness to spend • But compulsion to spend • Questions on ‘Free’ Education • Legal Status of Free Education vs Practice • Legislations on Free Primary Education (e.g., India, China, Thailand..)

25. External Aid • Asia accounted for 32% of total aid for education • Unsteady flow of external aid (1999/2000-2006/7) • Flow of aid has not been steady (government funding is relatively steady) • Share of Education in total ODA has declined in Asia except in South & West Asia

26. Change in the Share of Education in ODA(1999/2000-2006/7)

27. Declined India Philippines PNG Malaysia Lao Increased China Pakistan Afghanistan Indonesia Bangladesh Vietnam Nepal Mongolia Sri Lanka Cambodia Trends in Aid for Education • Education Aid (absolute amounts) • declined in 12 countries; Increased in 19 countries

28. Uneven Distribution of Education Aid in Asia, 2007

29. Largest Aid Recipient Countries 9 countries received more than US$ 100 million in 2007 25 countries received below US$ 50 million each.

30. External Aid • Aid forms a small proportion of total expenditure on education in developing countries: domestic funding accounts for the most. • India: aid 2-3% of total expenditure on education • Exception: Nepal 53% • FTI is not attractive to many in Asia (except Vietnam)

31. Basic education still forms a large part of the total education aid in many countries, though some are marginally shifting towards secondary education • Aid organisations may have to adhere to their commitments, and • Go beyond and offer more aid to take care of the effects of the crisis

32. % Share of Basic Education in Total Education Aid

33. Funding Issues in Post-Primary Education • Low Levels of Government Funding • Increasing reliance on cost recovery measures • Student fees • Student Loans • Private Education – growing • PPP • Aid – unclear trends and priorities • Questions: Equity, Quality ??? • Search for innovative methods of financing….

34. Thank you