Sci more is not enough final report web pdf

More is Not Enough: Achieving Equity in Domestic Education Financing

Front cover image: Not all children have access to school. Girl in Cambodia looking into a classroom.

Photo credit: Hanne Bjugstad/Save the Children

Back cover image: A siginificant number of children in the northern part of Zimbabwe has a long way to walk to school.

Photo credit: Luca Kleve-Ruud/Save the Children

All photos in the report are from Save the Children’s archive and do not necessarily represent cases mentioned in the report.

Š The Research Base, 2014

The Research Base is a social research consultancy specialising in education and skills in international development.

The Research Base, 4th Floor, 9 Castle Square, Brighton BN1 1EG, United Kingdom

www.theresearchbase.com | info@theresearchbase.com

More is Not Enough Contents Preface

1. Introduction

2. Executive Summary

3. Allocating Public Education Expenditure 3.1 Public Expenditure

3.2 Other Expenditure

Acronyms 5

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13 13 13

4. Financing Mechanisms

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4.2 Needs-Based Financing

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4.1 Input-Based Financing

4.3 Resource-Based and Per-School Financing

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4.4 Outputs-Based Financing

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4.6 Resource Transfer Mechanisms

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4.5 Demand Side Financing

4.7 Challenges and Considerations

5. From Equity in Financing to Equity in Outcomes

6. Findings and Recommendations 6.1 Cross-Country Findings 6.2 Recommendations 6.3 Future Research

Appendices

A.1 Country Findings

A.2 Definitions, Measurement and Approach A.3 Key Education Indicators

A.4 Equity Gap (Years in Education) by Equity Dimension & Country

A.5 Structural Distribution of Education Financing

by Level & Country Endnotes

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18

21

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BIA

Benefit incidence analysis

EFA

Education for All

FTI

Fast Track Initiative

EQIP Education Quality Improvement Project EMIS

Education Management Information System

GDP

Gross Domestic Product

GNP

Gross National Product

GER GPE IIEP

Gross Enrolment Rate

Global Partnership for Education

International Institute for Educational Planning

MDG Development Goal NER

Net Enrolment Rate

NGO Non-governmental organisation

OECD Organisation for Economic and Co-operative Development PAP

UPE

Priority Action Program

Universal Primary Education

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26 27

29 29

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37 40 47

Worn blackboard still in use.

Credit: Save the Children

Young children living in Stung Bantey Sleuk in Phnom Penh in Cambodia.

Photo Credit: Karin Beate Nøsterud/Save the Children

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More is Not Enough Preface

Tove R.Wang CEO Save the Children Norway

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Despite repeated promises to ensure universal primary education from both national governments and international donors, the education sector is grossly underfunded. Not only are 57 million children still out of school; a disturbingly high number of enrolled children drop out or don’t learn the basics during the first three years. Today there are more children in school, not learning, than there are children out of school.

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The total funding gap to reach universal primary education by 2015 is estimated to $26 billion per year. However, more funding alone is not enough. The distribution and utilisation of resources is equally important.

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Sub Saharan Africa and South Asia are facing the biggest challenges in providing primary education for all. Save the Children therefore commissioned a multi-country study to better understand the mechanisms and policies needed to respond to the gaps in education opportunities between groups of children. We wanted to find out how equitably domestic education budgets are spent, and how education financing systems can be more targeted.

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The Research Base was given the task to answer these questions. We don’t pretend that this study is conclusive in terms of findings and recommendations. Rather it is a contribution to the ongoing discussion on how to finance and provide equitable education. One major obstacle to an accurate analysis is lack of updated data, both on household characteristics, learning outcomes, financial transfers and budget processes. Subsequently this report echoes the call for better data, more transparency and accountability from the existing literature in the field.

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Free, public primary education. Fees and household contributions to schools, whether public or private, is a barrier to access education, especially for the poorest children.

Increased tax bases to ensure national income to provide universal, free public education. This report doesn’t offer any analysis of national revenues or potential income.

Investments in data collection to inform policy decisions.

National governments, international donors, civil society and local communities alike have a huge interest in getting reliable information on access, completion, teachers’ qualifications, learning outcomes and needs.

The long term goal should be to invest in reliable information systems and better data so that funding can be allocated according to need.

Increased transparency to track budgets, prevent financial leakages, avoid corruption and hold the authorities accountable.

More support of civil society, as it is crucial in holding decision-makers accountable and monitoring budgets and expenditures.

Save the Children is both cooperating with – and challenging governments to fulfil the rights of children. Mobilizing civil society, parents and local communities to demand quality education is needed in order to hold the authorities accountable for their priorities. We hope that this report will help us get one step closer to develop tools and policies to address inequities in education.

If there isn’t sufficient political will to invest in education for the most marginalized groups of children, more information will not automatically translate into better education systems.

Save the Children calls for:

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A greater share of the investments to the poorest and most marginalized to reduce the gaps between the most and least privileged children. One of the main findings in this report is that poverty is the major source of inequity in education. Children from poor households are less likely to get the necessary support from home and local communities in their education. Measures should therefore be taken to target these groups of children and compensate for their disadvantage vis-à-vis the more privileged population.

Finally we would like to thank Matilda Gosling and her team at the Research Base for their comprehensive work on this report.

Increased investments in primary education. National governments must increase their education budgets. But low income- and low middle income countries are not able to fill the financing gap alone, and international assistance is needed. Aid to education has dropped recently, and this trend must reverse.

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Children climbing trees in Nepal.

Photo Credit: Luca Kleve-Ruud/Save the Children

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More is Not Enough 1. Introduction

This project was commissioned by Save the Children Norway to evaluate equity in public education financing at primary level, with a view to identifying best practice for governments, but also NGOs and donor organisations. The research included analysis of the effectiveness of different methods of allocating and distributing public education financing.

together with recommendations on future areas for research.

This study provides a starting point and theoretical framework from which further work on rights-based education financing research can be developed. It is not intended to be comprehensive; further priority areas for research and background context are explored at the end of the study. The authors hope, however, that it will provide a tool from which country approaches to education financing can be analysed, and a call to action in terms of ensuring that domestic financing policy enables the poorest and most marginalised children to receive access to a good education.

The right to education is about access to education, quality of education and the environment in which children learn1.

We feel that it is critical to view the following discussion through the prism of a rights-based approach; education financing policy is not just about giving children access, but also ensuring that all children have access to a high quality education in an appropriate environment. More funding for education is needed, but this is not enough to ensure that the most marginalised children get their right to education fulfilled.

Key Messages •

The following eight countries were selected for light-touch analysis: Cambodia, Ethiopia, India, Nepal, Nigeria, Pakistan, Uganda and Zimbabwe. A literature review was conducted, providing an overview of equity in education financing for the eight countries of study; this provided a backdrop to the policy framework and education financing system in each country as well as an analysis of spending effectiveness and barriers to more equitable financing. A ‘scorecard’ was produced for each country using indicators on financing, pupil-teacher ratios and net enrolment ratios. Uganda and Cambodia were chosen as detailed case studies, from which some effective practice is already evident. This additional research provided evidence on the efficacy of education financing mechanisms, understanding of national policy relating to education financing and allocation, assessments of the impacts of funding initiatives and reports of best practice. Severe limitations were encountered in the research with respect to the quantity and quality of data that were available for the eight countries.

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Chapter 2 provides a summary of findings, together with study limitations. Chapter 3 offers some background to domestic financing in education and how it sits within the broader context of donor and household education expenditure. Chapter 4 outlines different mechanisms and funding formulae for allocating public expenditure on education, together with an assessment of their impact on equity. Chapter 5 looks at the link between equity in financing and equity in outcomes, and Chapter 6 makes recommendations for government, donors and NGOs,

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The largest equity gaps in education, measured as average years spent i education is between the richest and the poorest

More funding is needed, but increases in spending must be accompanied by a more equitable and targeted distribution

Of the countries studied, Pakistan has the highest equity gap (in terms of the difference between the length of time the poorest and richest fifth of young people have spent in education), followed in order by Nigeria, Ethiopia, India, Nepal, Uganda, Cambodia and Zimbabwe2.

Undifferentiated per-pupil funding can be highly regressive.

Good school-level information on pupil enrolments and socioeconomic background is needed in order to develop needs-based funding formulae.

The long term aim should be to build capacity in data collection, monitoring and reporting mechanisms in order to underpin the development of funding formulae weighted by need.

Research is needed into where the money should be spent, in addition to how it is allocated (e.g. teacher salaries, teacher training, classroom resources), according to different contexts; and also where spending decisions need to sit – at the school level, at the local government level or at the national level – in order to have the strongest impact on equity.

Ugandian child focusing in a classroom. An opportunity far too many children do not have.

Photo Credit: Save the Children

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More is Not Enough 2. Executive Summary

order to ensure equitable funding at finance and education ministry level, it is imperative to ensure that there is sufficient data on need, and the skills and capacity to ensure efficient allocation. At local and school levels, there is also the need to track spending and provide feedback on expenditure levels; transparency in reporting is also vital.

More fund is needed, but not enough. Increases in spending must be accompanied by more equitable and targeted funding. Educational attainment is affected by minimum spending levels: to ensure the best outcomes, teachers are needed, school building must be carried out and pupils require learning materials in schools. Children from the poorest households are particularly affected by underfunding in these areas, as wealthier parents can purchase learning materials or send their children to private schools. Research has, however, found a very weak correlation between direct spending on education and quality indicators, retention and learning outcomes for children from the poorest households; this suggests that instead of governments focusing purely on increasing resources for education, increases in spending must be accompanied by a more equitable and targeted distribution of funding.

Types of Financing

Donors and households are the other main contributors to education financing at a primary level in developing countries. There are challenges in determining the exact flow of donor funding, given that it can often bypass governments directly to local and international NGOs. Governments often rely heavily on donor funding, but it can have significant drawbacks, including the resources required to co-ordinate multiple donors and providers, and to manage funds. Donor aid, however, has a direct impact on educational attainment at primary level, as well as on gender equality in education.

Households may also contribute significantly to education funding, including resources and learning materials. The interactions between public, donor and household expenditure on education have an influence upon equity at the school level.

Accountability,Transparency and Targeting

Financing based on pupil numbers can increase the gap between the most and least advantaged children. Many countries still allocate funding using inputbased financing methods, which can include allocation on the basis of pupil numbers, without differentiating by socioeconomic background. The provision of equal levels of funding per individual student is often regressive: it increases the gap in achievement between the most and least advantaged students as it does not take into account the higher costs associated with achieving similar outcomes from individuals from less advantaged backgrounds. It also fails to take into account regional variations in purchasing power, a particular issue in large countries.

Better data, reporting and monitoring mechanisms are critical. While increased investments are essential, it requires political will to provide the poorest and most marginalised children with free and compulsory quality education. It also requires political will to generate the income base on which to enable such investments. In order to target this investment effectively, however, better data is needed; it is difficult to target funding according to pupil need when there is limited information on pupil characteristics, nor systems through which to collect that data. While lack of data is a significant barrier to targeting their education financing equitably, political will is needed to drive the collection and use of this data. The development of data collection, reporting and monitoring mechanisms must be a key ambition for financing equity, but this is a longer term ambition requiring resources and political support. In the meantime, increasing the budget share of allocations per school could, in the short term, target a greater funding share towards smaller schools in rural and more deprived regions. Using a proxy measure for allocating according to need would also be worth exploring.

Financing based on demand can increase attendance and reduce drop-outs. Demand-side financing is the provision of money directly to parents or students for specific educational use. Evidence suggests that this type of funding can have powerful effects: for example, the gender gap has been reduced in many areas by assisting families with the indirect costs and compensating for opportunity costs of girls attending school. Success has also been seen in the use of scholarships, stipends, and school health and nutrition programmes. Demand-side financing programmes have been shown, when implemented properly, to increase attendance and to reduce the numbers of children dropping out; they also have challenges in terms of data requirements, however, as need must be assessed.

Good governance is a prerequisite for equitable education financing. The need for transparency in terms of data and financing allocation information is reflected in the research findings relevant to national public expenditure systems. The quality of a country’s governance system can have a strong impact on the levels and allocation of education financing; corruption can lead to budget leakage and the misallocation of resources. Fiscal decentralisation can also have a negative impact on equity in education financing, particularly where central and local levels of governance are weak, and where central oversight mechanisms are not sufficiently effective. In

Needs-based school funding formulae allocate resources according to the needs of individual students. Funding which is allocated according to need was scarce in the countries studied as part of this report. Where it exists, it tends to form only a small proportion of total public education 9

More is Not Enough Per-pupil funding using a formula weighted according to need should be introduced in the longer term. The ambition should be a move towards needs-based financing using a differentiated per-pupil allocation, with weights for aspects such as household income, gender and location.

funding. Challenges in the development of needs-based funding formulae include how to assess the impact, and the requisite financial allocation, of factors such as income, gender and urbanisation, and performance improvements, which do not lead to increases in inequities.

Resource-based funding allocations are based upon the resource requirements of individual schools in terms of teachers, learning materials and equipment. There have been limited studies on the impact of teacher remuneration on equity as the process requires matching school surveys with household surveys. One study, which has attempted to do this in Zambia, found that education funding as measured by teacher remuneration is highly inequitable.

Teacher support, training and management need to be a central focus of education financing policy in order to ensure smaller class sizes and more highly trained staff in rural and deprived areas. Policies might include hardship allowances and the provision of accommodation for teachers working in challenging regions.

Recommendations for Donors/INGOs

In terms of resource transfer mechanisms, some countries pay schools directly and centrally through a bank transfer. The majority of the eight countries studied as part of this research allocate funding via regional or local government structures. While filtering funding through district authorities has the potential for funding to be allocated according to local need, allocating funding via local government structures can create funding inequities between regions; this effect is linked to the different powers of regions to raise resources. The benefits of direct payments of funds to schools include a swifter transfer of funds and a decreased likelihood that they are filtered out on transit through levels of bureaucracy. The potential negative impacts, however, of reducing the power of local government structures may be immense; analysis of this effect was outside the scope of this study.

Building capacity in data collection and reporting should be prioritised by multilateral and bilateral agencies, and by NGOs. Aid organisations urgently need to provide support in this area to ensure that mapping is conducted and that education budgets are reflective of the needs of children from different socio-economic backgrounds.

Transparent monitoring and quality assurance mechanisms should be introduced at local levels to ensure that schools do not have incentives to report false data in order to increase their funding allocation. Aid financing could, in part, be directed towards this kind of capacity building support, with donor funding made conditional on minimum levels of monitoring and evaluation reporting.

Study Limitations

Severe limitations were encountered in the research with respect to the quantity and quality of data that were available for the eight countries. Specific limitations include the following:

Recommendations

The following recommendations have been developed by the Research Base for different stakeholder groups.

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Recommendations for Governments

Governments need to be committed to equitable access to education for all and this should be reflected in education budgeting; this require both greater domestic resources and better targeting of funding.

Better information systems are needed to record, track and monitor funding allocations to enable better resource management and to allow schools to account for costs by term and year; delays in allocating promised funding also need to be urgently addressed.

Proxy measures should be used to target funding.

Improving data is likely to take time and to be costly. In the shorter term, governments should consider using some kind of proxy measure to target funding based on need.

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The share of per-school funding in suitable countries3 should be increased to allow smaller schools, which tend to cluster in rural and poorer areas, access to a greater proportional share of funding.

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Scarce data on education funding flows provides an incomplete picture of how education is financed, particularly at the sub-national level. This presents challenges in conducting a detailed analysis of equitable education financing and assessing how equitable domestic and donor funding is on both a national and local level. There is, for example, little data available in the countries of study regarding detailed education budget allocations over and above budget proportions allocated to pre-primary, primary and secondary-level education.

There is also little data showing private-sector contributions to education and approaches that privatesector organisations take to equity in education financing.

Data on education financing is limited to government expenditure as a share of GDP, expenditure at different school levels (primary, secondary and tertiary) and data showing the amount spent on capital versus recurrent costs (available from some countries only). There is, however, very little information available regarding levels of private and household expenditure on education and

More is Not Enough fees. This has led either to larger class sizes and more limited resources, or to charging parents in other ways (asking them for ‘voluntary’ contributions or food donations, for example).

Delays in receiving funding can also significantly affect the ability of schools to plan and spend their allocation. Where finances are allocated on a per-pupil basis, good information on enrolment numbers is needed. This can be challenging, particularly in schools in which there are high levels of dropouts, absenteeism and population movement.

Considerable resources are needed for data collection, which many schools (and public agencies) lack. In some countries, even schools and local officials lack information about budgetary allocations, which makes incorporating budgeting into school plan almost impossible.

allocations by region, district, and socioeconomic characteristics. UNESCO’s UIS sends questionnaires to governments annually; the response rate is, however, less than 50%. There are also challenges related to classification: how governments are defining data does not translate at an international level. The following surveys and data are needed in order that accurate expenditure data can be gathered4: • Household expenditure surveys linked to type of school and level.

• Household surveys cross-checked with data from schools.

• Off-budget donor spending.

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• School expenditure data: what they have received, from whom, and how this is spent.

Future Research

Schools reportedly have little capacity for accurate record keeping and many schools do not have accountants. Furthermore, schools often do not want to share information – for example, if they are charging illegal fees5. School population figures are often outdated and there is a lack of mapping of children from marginalised groups.

The data and research gaps around domestic financing of education are immense; many of these gaps require political will to complete, and it is likely that it will take many years before people working in the sector have the full information they need in order to support the development of equitable financing systems. We have highlighted some of the areas which could be a focus in the shorter term:

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Reference to budget allocations for education spending at primary and secondary level do not necessarily take account of the quality or sustainability of policies or interventions. Large budget allocations to teacher salaries and teacher training do not, for example, demonstrate the quality of teaching provided.

Access to education by marginalised groups tends to be context specific; for example where social and structural barriers exist preventing equal access to education by girls.

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This study focuses on domestic financing of education.

Private and donor financing of education, and in particular the level of household contributions, are key to discussions of equity in education financing. Scope and time constraints meant that study of this broader context was limited.

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Challenges in Education Financing

Challenges in education financing include underfunding, leakage and corruption; evidence from Uganda suggests that better dissemination of financial information reduces leakages of funds. As suggested above, allocating funds directly from the centre to schools rather than through local government can also help to reduce leakages. There is tension between redistributive financing mechanisms and fees: in many countries, schools have suffered a funding shortfall in the move to universal primary education due to grants being insufficient to meet the previous level of funding secured by

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Up-to-date benefit incidence analyses on the distribution of education financing across the study countries would help to fill the most immediate research gap6. We recognise the limitations of these types of studies, but feel that they are the only way currently to give an indication – however imperfect – of the groups of children that public education money is actually reaching.

An area that was out of scope for this study, but which could usefully add valuable context and background to the debate, is a study on education financing which focuses to a greater extent on the interaction between education financing policy and broader policy on teacher recruitment and development. This could look at teacher standards, professional development, pay scales, etc, and link it back to financing policy and forward to impact on outcomes.

Since this study was written, new data has been included in the World Inequality Dataset on Education on primary education outcomes. This data could usefully be analysed and then linked in to this and other studies Although studies have touched on the interaction between donor financing and domestic financing of education, we feel that this is an area which needs considerably more work. The nature of the relationship between both sets of financing remains unclear; it would be useful to understand, for example, the aspects of donor financing policy, if any, which have a direct impact on equity considerations among governments.

Mizaba primary school lies in the rural Chilga district of Northern Ethiopia on the main road from Gondar to the South Sudan border.

The school consists of a number of class room buildings of variable standard, including wood and clay and brick structures. Due to lack of capacity the 1.932 pupils in grades 1-4 and 5-8 attend half days of school, the youngest children in the morning and the older children in the afternoon.The school shares close ties to the local community and parents. Attendance levels in this area are close to 100 percent.

There is a high dropout rate.

Photo Credit: Save the Children

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More is Not Enough 3. Allocating Public Education Expenditure We consider the funding of education in developing countries as dividing into two areas: public expenditure (the focus of this study) and wider spending primarily by donors and household contributions. The latter, while particularly important, suffers from even greater data limitations than the former. Donor expenditure can sometimes be given onbudget (for example in Uganda until very recently) and then can be considered as part of public expenditure.

Downstream, there is a need to track spending and receive timely feedback on expenditure to be able to adjust disbursements. Transparency of these transactions also matters13. A range of budget instruments have been introduced to help allocate and track resource allocations14.

These include medium-term expenditure frameworks (MTEF) prepared as part of national strategic plans15.

Legacies from political instability or warfare have severe consequences for education financing. The destruction of the education system in Cambodia under the Khmer Rouge, for example, included not only damage to school infrastructure but also the death of 75% of the teaching workforce16.

Education financing priorities of successive governments have focused on the rebuilding of the education system in Cambodia, only recently introducing policies focusing on accessibility to education and quality education for all17.

3.1 Public Expenditure

Public expenditure on education in developing countries is determined by five factors7:

1.

2.

3.

4.

5.

Level of national income.

Overall size of state expenditure (and hence taxation).

Proportion of public expenditure assigned to education.

Extent of public finance decentralisation.

External aid.

3.2 Other Expenditure

In addition to the government, other stakeholders influence education spending decisions. This section briefly reviews donor influence and the role of private expenditure.

It is therefore clear that the quality of a country’s governance system can have a direct impact on both the levels and allocation of education financing8. For example, corruption can lead to budget leakage and the misallocation of resources9; so too, for example, can the need to appeal to particular political interests by region or ethnicity. Research suggests that fiscal decentralisation can have a negative impact on equity in education financing in countries experiencing high levels of inequality and weak governance at both central and local levels10, especially when central oversight mechanisms are weak or underdeveloped11.

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The capacity, and political agency, of finance and education ministries can have a direct impact on education outcomes.

Upstream, the will and ability to allocate funding equitably requires a range of skills, as well as data on need. Lack of capacity has a direct impact on how efficiently and equitably funds are allocated to and between regions, schools, and pupils, and therefore the extent to which the most disadvantaged children are targeted12.

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Donors: donors provide very large flows of finance for education, often bypassing government systems and utilising local or international NGOs. The extent to which these flows are accounted for in the data varies and was, in many places, hard to determine. While the scale of funding can often be significant – education financing is also heavily reliant upon donor contributions, up to almost 50% of available funding – it can also have drawbacks18. One such challenge is the significant time and resources required to co-ordinate multiple donors and providers, and to manage funds; in Cambodia, this has had the effect of weakening its institutional capacity19.

Research suggests that donor aid has a direct impact on educational attainment at the primary level, as well as on gender equality in education20.

More is Not Enough •

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Households: research conducted in 2012 on household spending on education in 15 African countries showed how large these contributions can be: on average, 1.7% of GDP (compared to 3.7% for public expenditure)21. The study found a significant difference in household spending on education by income quintile: the poorest 20% of households were found to spend an average of 2.6% of their outgoings on education22. The richest 20% were found to spend double this amount on education costs23.

However, these averages hide huge variations. Some studies have shown that low income families spend as much as 1/3 of their disposable income on private education. Non-monetary support such as school supplies, equipment, food and human resources are the main contributions made by households at primary level24 which makes accounting for contributions even more problematic25. Once again, research found differences in spending between rich and poorer households: the majority of private spending on education amongst poorer households was devoted to school supplies whereas the primary expenditure for richer households was found to be school fees26.

In Cambodia, household contributions have reached approximately 2.5% of GDP, matching government contributions27; these contributions are supplementing the cost of teaching resources and salaries28, enrolment, classroom materials and examinations29. Parents in Zimbabwe reportedly provide over 90% of school budgets30. In Ethiopia, contributions from communities and households are sometimes used to supplement funding that is delayed by ineffective distribution methods31. These fees are charged for enrolments, classroom resources and infrastructure32. Classroom resources in Nigeria are in part funded by parents because the basic education law only provides for textbooks in core subjects33. One Zambian study has found that private contributions to school funding exacerbate education funding inequalities34. Factoring in household contributions to the total education budget allocated reduced the total percentage of funding received by the poorest half of households from 40% to 34%35.

A child taking part in education in Zambia copying letters from the blackboard.

Photo Credit: Save the Children

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More is Not Enough 4. Financing Mechanisms

equitable way when targeted at more deprived areas, as has been seen in Ghana and Uganda:

Discussion of financing instruments, and their links to equity, is complicated by the differing degrees of spending autonomy afforded to schools. Autonomy carries the risk of corruption and tight regulation risks schools not being able to use their funds effectively. UNESCO describes this challenge as ‘finding the right degree of autonomy and regulation’36. Countries tend to approach financing using a number of different mechanisms. In Cambodia, for example, the Priority Action Program (PAP) for primary schools consists of a fixed sum of 700,000 riels per school ($175) combined with per pupil funding of 7,000 riels ($1.75)37.

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This section looks in detail at five types of funding mechanisms; it is intended to paint a picture of some of the allocation methods available and the potential impact that they have on considerations of equity, and therefore is not intended to be an exhaustive list. The types used are: (1) input based, (2) needs based, (3) resource based, (4) output based and (5) demand side funding. A challenge with allocating instruments into categories is that different terms are used in different contexts. There is, therefore, a degree of overlap in our use of these groups; it should also be noted that financing mechanisms can (and should) be used together in a manner that ensures greater benefit for children.

Following this, we discuss resource transfer mechanisms and offer some conclusions for this section.

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Ghana: the way capitation grants were used had a positive impact on equity. The pilot Capitation Grant Scheme aimed to get the 40 most deprived districts, of a total of 110, up to the standards of the rest. Districts were selected on the basis of input criteria including textbooks, seats and budget per pupil, percentage of qualified teachers and pupil-teacher ratio; achievement criteria was measured by success rate in basic English and mathematics examinations; and access criteria, was measured by GER and percentage of girls enrolled44.

Uganda: capitation grants were targeted towards areas of greater need: they were used to cover school costs, the provision of hardship allowances in remote areas, and to ensure an increase in the number of female teachers in rural areas45.

More recently, Uganda has combined per-pupil funding with a per-school funding formula (see section 6.3 below) in recognition that per-pupil financing alone can have regressive effects46; Cambodia has also combined per-pupil funding with per-school allocations47.

4.2 Needs-Based Financing

4.1 Input-Based Financing

Needs-based school funding formulae allocates resources according to the needs of individual students48. Definitions of needs commonly relate to educational needs based on pupils’ socioeconomic background49. Resource allocation may, for example, be based on the number of students defined as socio-economically disadvantaged, such as those living in rural areas, students with disabilities and learning difficulties, and individual learning needs of low-achieving students50 Specific levels of need according to these different categories do, of course, differ both between and within countries; children with the greatest needs may include a particular caste in one area, for example, whereas they may include children with disabilities in another.

Many countries still allocate funding on the basis of pupil numbers, without differentiating by socioeconomic background38. Fixed per-pupil funding enables schools to know exactly how much they will be allocated39. The simplicity of the formula means that it is also relatively transparent, allowing for greater influence by parents and other stakeholders40. Capitation grants are a form of inputsbased funding as they are allocated on the number of pupils enrolled. Input based funding is among the least equitable of funding mechanisms, however. The provision of equal levels of funding for individual students is often regressive: it increases the gap in achievement between the most and least advantaged students as it does not take into account the higher costs associated with achieving similar outcomes from individuals from less advantaged backgrounds41. It also fails to take into account regional variations in purchasing power, which is a particular issue in large countries. In Indonesia, for example, Aceh experienced inflation of around 20% in the mid 2000s, reducing the purchasing power of the per pupil funding allocation by the same amount compared to elsewhere in the country42. In Nepal, efforts have been made to use a per capita funding method, but this has led, in some cases, to the inflation of self-reported school populations43.

Cambodia

Schools in more remote or disadvantaged areas, according to respondents interviewed as part of this study, receive a higher allocation of funding than those in urban areas.

Funding which is allocated according to needs tends to form only a certain proportion of total public education funding.

Challenges in the development of needs-based funding formulae include how to assess the impact and the requisite

Despite being among the least equitable of funding mechanisms, input-based financing may be used in an

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More is Not Enough financial allocation; of factors such as income, gender and urbanisation51; and performance improvements which do not lead to increases in inequities52. Given insufficient levels of data, significant challenges also exist in identifying and prioritising needs in order to channel funding effectively towards improved access to and quality of education for marginalised groups of children.

Uganda

Policy makers in Uganda have recognised the potentially progressive effects of per-school financing formulae: according to one public official interviewed as part of this study, ‘we used to determine what we give to schools depending on enrolment. However, we realised that there are areas like Kalangala district where schools have small numbers so depending on enrolment would translate into very little money for such a school.’

BenDavid-Hadar and Ziderman (2010) have developed a resource allocation model that aims to ensure both horizontal and vertical equity53, as well as building in incentives for schools to maintain continuous improvement.

This model gives different weights according to a student’s mother’s education level, father’s education level, number of siblings, new immigrant status, area of residence and ethnicity. The performance element takes into account a school’s ability both to see performance improvements and to reduce the achievement gap between individual pupils.

This reduces the likelihood that introducing a performance incentive to schools leads to overall increases in the achievement gap54. This model has some useful elements but implementation would depend on significantly improved data availability and reporting mechanisms than are currently available in most of the countries of study.

Current policy allocates a fixed amount per school, in addition to the Universal Primary Education grant which is allocated on a per-pupil basis.

Examples of resource-based and per-school funding include:

•

An example of needs-based funding is visible in Sri Lanka.

The Education Quality Inputs Scheme, which allocates according to a ‘norm based unit cost resource allocation mechanism’ taking into account school needs and the greater per pupil funding needed by smaller and more rural schools, represents 2% of recurrent spending and 20% of capital spending of the total education budget55.

•

4.3 Resource-Based and Per-School Financing

Resource-based funding allocations are based upon the resource requirements of individual schools in terms of teachers, learning materials and equipment. There is some overlap with other categories: the number of teachers and their related salary requirements, for example, are usually calculated on the basis of the number of pupils per school (i.e. inputs-based funding allocation). Dimensions of equity can be incorporated into resource-based funding models, for example by allocating a higher per-pupil salary allocation to schools in disadvantaged areas.

Kenya: the Government implemented a new funding formula in 2010, which was designed to reduce the number of pupils sharing textbooks: schools that have a higher pupil-textbook ratio are allocated more money to buy books. Schools must submit their textbook-pupil ratios data to district and municipal education officers each term; they must purchase books from approved suppliers and education officers must monitor local schools to ensure ‘prudent use’57.

Zambia: funding takes the form of fixed grants per school58. Schools tend to fall into two clusters: low enrolment, poor and rural; and high enrolment, rich and urban. Resource-based funding, which constitutes 30% of total education funding in Zambia, has been shown to be progressive; the higher enrolment levels of richer, urban schools means that they receive less per pupil funding than their poorer, rural counterparts59. The pro-poor nature of this funding also remains when controlling for rural-urban differences. Schools whose children, on average, come from low-income households receive three times more funding than those with children from high-income households60.

It should be noted, however, that per-school financing can only have progressive effects on equity in countries in which schools cluster in the way outlined above; in Ethiopia, a high number of large schools in rural areas means that such a financing policy may have a regressive effect61.

There have been limited studies on the impact of teacher remuneration on equity as the process requires matching school surveys with household surveys. One study which has attempted to do this in Zambia found that education funding as measured by teacher remuneration is highly inequitable.

Salary payments per pupil are lower in rural schools than in urban ones, and in schools with children from poorer households than those with children from wealthier households. This is linked to rural and more deprived areas having more teacher trainees, who command lower salaries and larger class sizes56.

4.4 Outputs-Based Financing

Outputs-based allocations are based on performance criteria such as examination results. It appears to have limited application for primary education in developing countries in Africa and Asia, possibly due to inadequate reporting requirements. Where some elements of outputs-based funding allocation do exist, they tend to be related to school performance improvement plans.

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More is Not Enough 4.5 Demand Side Financing

structures. For example:

•

This is the provision of money directly to parents or students for specific educational use62. Evidence suggests that this type of funding can have powerful effects. For example, the gender gap has been positively affected by covering the indirect costs and compensating for opportunity costs of girls attending school. These costs can include direct and indirect fees, transport, clothing and opportunity costs in the form of reduced time available to spend on paid and unpaid work63. Success has also been seen in the use of scholarships, stipends, and school health and nutrition programmes64.

• •

Most demand-side financing programmes give cash payments to low income families, with payments contingent upon regular attendance and designed to offset some or all of the opportunity costs of sending children to school65. Demandside financing programmes have been shown, when implemented properly, to increase attendance and to reduce the numbers of children dropping out66. UNESCO’s International Institute for Educational Planning (IIEP) states that the best examples show subsidies tailored to children’s grades, as opportunity costs increase as children get older; and gender, as girls are more at risk than boys of dropping out in some countries67. According to the IIEP, ‘conditional cash transfer programmes in education may be best suited to settings where poverty is chronic and human capital outcomes continue to be low despite efforts to provide extensive and good quality services on the supply side’68. They are also particularly effective when implemented alongside intensive community awareness campaigns69.

•

•

•

Cambodia: funding is distributed in a number of strands, including capital and programme-based funds, to Provincial Education Offices (PEO)75. These bodies also have financial audit and monitoring responsibilities76.

Nepal: budget provisions are channelled through the Department of Education77, which ensures that funds are dispersed to the five Regional Education Directorates and 75 District Education Offices78.

Pakistan: education expenditure lies with finance and planning departments at the district level, with the federal Government channeling funds from the central level and acting as a coordinating body between provinces79.

Nigeria: the education financing system is governed at the level of the 36 states with oversight from the Federal Ministry of Education80. States and local governments are ultimately responsible for financing basic education81, respectively allocating 18% and 25% of their budgets to education; federal government contributions total 8.8%82.

The benefits of direct payments of funds to schools include a swifter transfer of funds and a decreased likelihood that they are filtered out on transit through layers of bureaucracy83; challenges in some countries include lack of appropriate banking systems at local levels84 (this may change with greater penetration of mobile banking options). Filtering funding through district authorities has the potential for funding to be allocated according to local need; other than Ethiopia, however – where woreda (districts) receive public funding in the form of a block grant, to be allocated at their discretion in line with national education policies85 – we found little evidence of funding being tailored in this way.

Examples of demand side funding include:

•

India: financing passes from the centre, to states and yet further down to block and village level74.

India: in Madyha Pradesh, where financial constraints and distance to school are two of the biggest barriers preventing girls from attending school, the Government has promoted girls’ enrolment through initiatives such as uniform scholarships, the provision of textbooks and the distribution of free bicycles70.

Evidence was found from several studies that allocating funding via local government structures increases funding inequities between regions. In the Philippines, for example, the poorest municipalities spend only 13% of the amount per pupil as the richest municipalities do86. This effect is linked to the different powers of regions to raise resources: according to an assessment of decentralisation of education financing in China, Cambodia and Indonesia, ‘local governments are far from equal in their ability to mobilise resources, and thus the gap in education expenditures per student between wealthier and poorer areas can only widen. Central governments clearly need to establish a mechanism for equalising education resources across municipalities and cities.’ 87

Brazil: The Government’s Bolsa Familia programme reaches approximately 11 million families, granting money directly to poor households based on conditions that parents will both keep their children in school and ensure that their children have regular medical checkups71. The programme’s success lies in a focus on reaching the most marginalised children in society, with 94% of funds reaching the poorest 40% of the population72.

4.6 Resource Transfer Mechanisms

Some countries pay schools directly and centrally through a bank transfer. Others transfer funds to districts or local authorities, which then transfer them onto the school73. The majority of the eight countries studied as part of this research allocate funding via regional or local government

The Zambian study mentioned above also shows that while discretionary funding is mildly progressive when disbursed from the provincial level to the district level, this effect disappears once it is disbursed to schools: it is income neutral, and possibly even regressive in rural areas, where

17

More is Not Enough funding tends to go to wealthier schools88. Where funds are raised by local governments instead of being directed through the centre, they are also likely to be distributed inequitably, as richer regions are able to raise – and distribute – greater resources89. This has also been the case in India, where the Sarva Shiksha Abhiyan financing scheme has required states to contribute a significant portion of the budget. The poorest states, in which children usually have the least access to education, are able to contribute significantly less funding than the wealthier ones90.

biggest barrier to achieving universal primary education95.

Evidence from Uganda suggests that better dissemination of financial information reduces leakage of funds96. As suggested above under Resource Transfer Mechanisms, allocating funds directly from the centre to schools rather than through local government can also help to reduce leakages.

Tension Between Redistributive Financing Mechanisms and Fees

In many countries, schools have suffered a funding shortfall in the move to universal primary education due to grants being insufficient to meet the previous level of funding secured by fees. This has been the case in Uganda, Kenya and Ghana97. It has led either to larger class sizes and more limited resources98, or to charging parents in other ways (asking them for ‘voluntary’ contributions or food donations, for example)99.

Needs-based funding distribution, combined with local resource allocation, can sometimes be negatively affected by local ownership over funding distribution. In South Africa, for example, funds are distributed to provinces according to a formula which incorporates socio-economic variables, but actual per pupil allocation is determined by the provinces themselves, with poorer provinces able to invest less than wealthier ones91 – leading to the entrenchment of inequities.

4.7 Challenges and Considerations

Uganda

Leakages

Barriers to equitable financing in Uganda outlined in our field research include a lack of transparency around funding mechanisms; underfunding of schools; the high costs of managing UPE at a school level; misuse of funds; and social barriers.

No matter what the spending intentions of governments, the level and distribution of finances which reach individual schools and pupils can be affected by corruption and leakage.

According to Transparency International, corruption risks in education are increased by the ‘high stakes of educational opportunity and the large sums allocated to fund it’92, making it – as a sector – particularly vulnerable to the mismanagement of funds. Corruption related to resource allocation can occur in procurement, the use of ‘shadow schools’ and ‘ghost teachers’ (through which financial claims are made for schools or teachers which do not exist), the misuse of school grants and the diversion of resources93.

In South Africa, this tension has led to a parallel system of schooling. During and after apartheid, the equity gap was immense. Most individuals and schools accepted the need to transfer resources from the rich to the poor. Former white schools were, in return, allowed to remain public but were obliged to determine additional compulsory fees. According to an assessment by Commonwealth Education Partnerships, ‘this allowed advantaged schools to continue on their former trajectory, albeit with largely private funds’100.

Cambodia

Prescriptiveness in budgetary allocations can make it challenging for schools to spend money on the areas which most need it.

Focus on Enrolment

Enrolment is often prioritised at the expense of retention by parents, the wider community, schools and government, as has been the case in Uganda101. This can leave schools without external incentives to target their spending on ensuring that children remain in school once they have been enrolled.

The Government of Cambodia has increased the number of budgeting lines in recent years, and according to one NGO respondent interviewed for the Cambodia case study which accompanies this report, ‘when you have nine or ten lines, [it] introduces much more inflexibility into the budget; the schools complain bitterly that there’s a lot of paperwork and that the budgets are much more inflexible.’

Challenges for Schools

The funding formula used by governments is often unclear to schools102. Delays in receiving funding can significantly affect the extent to which schools are able to plan, and therefore the ways in which they eventually spend their allocated money. In Uganda and Ghana, termly payments can often be up to a year late. According to Transparency International, payment delays and uncertainty over how much will actually arrive ‘makes planning a frustration rather than an opportunity’

Transparency International suggests that elites ‘tend to reproduce existing power relations through schooling, often resorting if necessary to corrupt practices. Corruption becomes endemic when people engage in corrupt behaviours because they see such behaviours as widespread, and feel that they cannot afford to be honest.’ 94 Corruption has been identified as the 18

More is Not Enough and leads to implementation being constrained103. In Cambodia, primary schools have often relied on community financing to fill the gap created partly by public underfunding and partly by the delay in payment of allocated funds104.

Among the 80% of schools which receive community contributions, the average contribution is larger than the funds received through its publicly funded Priority Action Program105. In Nepal, school funds also tend to reach schools late106.

Cambodia’s education financing system has also been affected by corruption111. Three-quarters of all teachers reportedly pay a ‘facilitation fee’ to receive their salary and 58% of teachers report that they do not always receive their salary in full112. Over two-thirds of school directors also report having to pay a facilitation fee to district education officials in return for the disbursement of education funds113.

Reports have also noted inconsistency between education spending patterns and stated policy priorities and targets114.

In many countries, there is a conflict between the financial systems used by public administrators and those used by schools; sometimes the systems used by public administrators also conflict with legal requirements115.

Improvements in financing mechanisms are also constrained by lack of impact evaluations116.

Other Challenges

Where finances are allocated on a per-pupil basis, good information on enrolment numbers is needed. This can be challenging, particularly in schools in which there are high levels of dropouts, absenteeism and population movement107.

Considerable resources are needed for data collection, which many schools (and public agencies) lack108. In Cambodia, social accountability mechanisms to monitor how schools spend their operational funds are highly ineffective, due mainly to the lack of publicly available information on schools’ financial management systems109. In some countries, even schools and local officials lack information about budgetary allocations, which makes incorporating budgeting into school plan almost impossible. In a multi-country study

by Transparency International, the researchers found it ‘impossible’ in some countries to identify the amount, type, source, purpose and use of school level funding110.

Considerations

An in-depth study in Zambia looking at education financing shows the importance of understanding the micro level in considerations of equity in funding. The study found that 9% of district funding variation is due to variation across provinces, compared to 90% which is due to variation within provinces. This is repeated at a school level117. Overall indicators can mask equitable transfer mechanisms. This is the case in Zambia, where the progressive effects of rulebased distribution are masked at a national level by inequities in discretionary funding118.

‘It is very difficult to solve the problem. In regions with difficult circumstances, poor families need to earn [by] living [and] working in the fields and they also migrate for jobs; it is not easy to get their children enrolled in school.’ Local government official, Cambodia

19

Teacher in Sway Teab Primary School in Kampong Cham province in Cambodia.

Photo Credit: Hanne Bjugstad/Save the Children Norway

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More is Not Enough 5. From Equity in Financing to Equity in Outcomes

Educational attainment is affected by minimum spending levels: to ensure the best outcomes teachers are needed, school building must be carried out and pupils require learning materials in schools119 Children from the poorest households are particularly affected by underfunding in these areas as wealthier parents can purchase learning materials or send their children to private schools120. Research has, however, found a very weak correlation between direct

spending on education and quality indicators, retention and learning outcomes for children from the poorest households; this suggests that instead of governments focusing purely on increasing resources for education, increases in spending must be accompanied by a more equitable and targeted distribution of funding121. Table 1, below, sets out the concepts and metrics for inputs, output and outcomes in education.

Table 1: Concepts of Equity in Education: Inputs, Outputs and Outcomes

Inputs

Labour

Student teacher ratios Teacher training levels

Capital

Outputs

Enrolment Attainment

Finance per student, school, district (Public/private/total)

Total years in school

Equipment & Facilities

Cognitive Performance

Textbooks IT Classrooms

Cognitive achievement data/distance travelled Test scores Literacy and numeracy

Outcomes

Earning Potential

Income levels Decent employment levels

Further Access to Education

Progression to further/higher education Household access to basic education

Improved Quality of Life Health Social capital

Research conducted by the Southern and Eastern Africa Consortium for Monitoring Educational Quality found that pupils studying in better resourced schools performed better in reading and mathematics126. Pupils at schools with a lower pupil-teacher ratio were found to achieve better scores in reading and mathematics127. It is important to note, however, that many other factors, including the pupil’s socioeconomic background, were also found to have an impact on pupil achievement128. School related factors found to have an impact on pupil outcomes were as follows129:

Research literature broadly agrees that additional school resources lead to improvements in educational attainment122.

Studies suggest that learning is positively impacted by the resources available to schools, for example by having textbooks and teaching materials in classrooms123. One study based on primary level test scores and spending found that scores improved by 0.4% by distributing textbooks to an additional 10% of students124. Pupils taught by teachers with better qualifications additionally increased pupil scores by an average of 10% (though at a much higher cost per student)125.

21

22

More is Not Enough Variable

Outcome for pupils were better when:

Pupil-teacher ratio

Schools had a lower pupil-teacher ratio

School resources School location

Teacher absenteeism

Head teacher experience

Resources were greater

In bigger towns and cities

Taught by teachers who were never or only rarely absent

School was led by teachers with many years of experience directed at the poorest children in society, such as the reduction of fees and conditional cash transfers, they do not necessarily lead to higher levels of achievement137. A review of literature conducted by the University of Minnesota found instead that ‘having a fully functioning school – one with better quality roofs, walls or floors, with desks, tables and chairs, and with a school library – appears conducive to student learning’138.

In addition, budgetary focus on school building and increasing teacher numbers over the last two decades has had a huge impact on the numbers of children enrolled at primary level130.

Although increased spending has been found to improve enrolment rates and pupil performance, high levels of inequality and poor learning outcomes can be found in countries with low, medium and high levels of education expenditure131. As suggested above, increased spending on education may not, therefore, directly have an impact on pupil learning outcomes132. Research conducted on 33 of the Global Partnership for Education’s developing country partners found that less than half of children reach grade four in school and achieve a minimum level of learning, despite continuous growth in the proportion of GDP spent on education since 2000133.

The global education sector is significantly underfunded.

While increased investments are essential, it requires political will to provide the poorest and most marginalised children with free and compulsory quality education. It also requires political will to generate the income base on which to enable such investments. In order to target this investment effectively, however, better data is needed; it is difficult to target funding according to pupil need when there is limited information on pupil characteristics, nor systems through which to collect that data. While lack of data is a significant barrier to targeting their education financing equitably, political will is also needed to drive the collection and use of this data.

Research for the 2009 EFA Global Monitoring Report found that for children from poor and marginalised backgrounds, ‘achieving a particular outcome in education is likely to entail higher costs than for children from social groups that are not disadvantaged’ 134. Certain countries have attempted to introduce more equitable formulas for allocating education funding, with higher allocations per student given to those children from disadvantaged groups or regions135. Resources in El Salvador, Guatemala and Nicaragua were, for example, directed disproportionately more to children from poorer backgrounds through textbook programmes136.

The development of data collection, reporting and monitoring mechanisms must be a key ambition for financing equity, but this is a longer term ambition requiring resources and political support. In the meantime, increasing the budget share of allocations per school would, in the short term, target a greater funding share towards smaller schools in rural and more deprived regions. Using a proxy measure for allocating according to need would also be worth exploring.

Research in recent years has, however, found that despite increased enrolment being recorded as a result of initiatives

23

Headmaster Samson at Ganganydma elementary school north in Zimbabwe takes his 2nd grade outside under the grand Baobab tree, where he teaches science. It is amazing to teach outside, here in the shadow, when the temperature is so high, says the Headmaster.

Photo Credit: Luca Kleve-Ruud/Save the Children 24

More is Not Enough 6. Findings and Recommendations

The following findings and recommendations were developed by the Research Base.

6.1 Cross-Country Findings

The largest equity gaps in educational outcomes are between the richest and poorest children. The wealth equity gap has been found to be considerable in all countries of study. Children from poorer households are severely disadvantaged in terms of access to education and spend considerably fewer years in education than those children from wealthier households. The difference in years spent in

education by wealth is considerably greater across countries than it is by gender, religion, sub-national region or level of urbanisation. The following table shows comparative years in education by wealth in the eight countries of study (note that this table gives a historical picture of policy outcomes, as most of the data was taken from young adults between 2010 and 2011139):

Average Years Spent in Education Country

Equity gap (%)

Richest Fifth of Households

Poorest Fifth of Households

Cambodia

94

9.2

4.7

Zimbabwe

43

11.9

Uganda

109

India

220

11.0

348

11.0

Nepal

Ethiopia Nigeria

Pakistan

120 276 350

9.2 9.7 8.3 9.6

8.4 4.4 4.4 3.4 2.2 2.5 2.1

Lack of reliable data Governments in most of the countries of study are unable to target their funding equitably due to a lack of reliable data at the school level on pupil characteristics and socio-economic background, which is a prerequisite for effective needs-based per pupil allocations; lack of data may sometimes be due to a lack of political will to collect and/or use this data.

Analysis by the Global Monitoring Report has further shown an interaction between different aspects of disadvantage, with girls from rural areas usually among the most marginalised when it comes to education140.

Achieving Equity in Education Financing

Efficiency, good governance and political will Financial efficiency and good governance have a major impact on equitable outcomes. Misallocation of resources and leakage of funds have a particular impact on outcomes for pupils. Tracking of budget execution is therefore vital to ensure funding reaches schools. There needs, finally, to be political will to address equity in education financing.

Governments need to be committed to equitable access to education for all and this should be reflected in education budgeting.

Equitable and targeted distribution of funding Educational attainment is affected by minimum spending levels: to ensure the best outcomes, teachers are needed, school building must be carried out and pupils require learning materials in schools. Children from the poorest households are particularly affected by underfunding in these areas as wealthier parents can purchase learning materials or send their children to private schools.

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More is Not Enough Undifferentiated per-pupil funding can be highly regressive Provision of equal levels of funding for individual students is often regressive. It increases the gap in achievement between the most and least advantaged students as it does not take account of the higher costs associated with getting similar outcomes from individuals from less advantaged backgrounds.

Corruption Corruption is one of the biggest barriers to achieving universal primary education and can affect equity in education financing through diversion of allocated funds, either by local authorities or by schools themselves.

Poor school management Capacity within schools is an important determining factor in development contexts. Many schools lack staff that are trained in finance and the systems with which to ensure that poorer and more disadvantaged students receive targeted assistance in achieving better education outcomes.

Needs-based funding formulae require significant improvements to data Challenges in the development of needs-based funding formulae include how to assess the impact, and the requisite financial allocation, of factors such as income, gender and level of urbanisation. Implementation of a successful model depends on significantly improved data availability and reporting mechanisms than are currently available in most of the countries of study.

Delays in receiving funding Delays in receiving funding can significantly affect the extent to which schools are able to plan, and therefore the ways in which they eventually spend their allocated money.

6.2 Recommendations

Demand-side financing can help to increase enrolment and retention in schools Education costs for families include direct and indirect fees, transport, clothing and opportunity costs, in the form of reduced time available to spend on paid and unpaid work.

Covering indirect costs and compensating for opportunity costs has also been shown to help increase enrolment and retention in schools through, for example, scholarships, stipends, and school health and nutrition programmes.

Accountability and Transparency

Building capacity in data collection and reporting Governments face challenges in allocating funding to disadvantaged groups due to the lack of data available on school and pupil characteristics. Aid organisations urgently need to provide support in this area to ensure that mapping is conducted and that education budgets are reflective of the needs of children from different socio-economic backgrounds. Schools will also need support in order that they are able to collect and report on pupil characteristics to their respective regional and/or national ministries of education.

Progress has been made in some countries In both case study countries, Cambodia and Uganda, examples were found of financing mechanisms which improve equity in educational outcomes, although in both countries, a lot more can be done.

Developing better information systems As noted in the limitations section, there is little data available in the countries of study on detailed education budget allocations over and above budget proportions allocated to pre-primary, primary and secondary-level education. Better information systems are needed to record, track and monitor government allocations and disbursements, and community contributions, to enable better resource management, and to allow schools to account for costs by term and year. Governments need capacity building support to help them to develop appropriate, accountable systems for funding allocations.

Data held by national governments on equity in education financing are limited. There is therefore an incomplete picture of how education is financed, particularly at the subnational level. This presents challenges in analysing how equitable domestic and donor funding is.

Where finances are allocated on a per-pupil basis, good information on enrolment numbers is needed. This can be challenging, particularly in schools in which there are high levels of dropouts, absenteeism and population movement.

Funding mechanisms which allocate according to socioeconomic background also depend on reliable data on pupil characteristics.

Introducing transparent monitoring and quality assurance mechanisms at local levels Monitoring and quality assurance mechanisms need to be introduced at the local level to ensure that schools do not have incentives to report false data in order to increase their funding allocation. Aid financing could, in part, be directed towards this kind of capacity building support, with donor funding made conditional on minimum levels of monitoring and evaluation reporting.

Challenges

Approaches to education financing differ according to whether the national priority is access, performance or a combination.

Approaches taken to education finance policy and administration depend on whether the ultimate goal is resource access (inputs), student performance (outputs and outcomes) or a combination of the two.

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More is Not Enough Giving schools certainty over funding mechanisms and amounts Lack of clarity over funding allocations and delays in receiving promised funding currently have a negative impact on the extent to which schools are able to plan effectively; this needs to be addressed urgently.

include hardship allowances and the provision of accommodation for teachers working in challenging regions.

6.3 Future Research

As already highlighted, the data and research gaps around domestic financing of education are immense; many of these gaps require political will to complete, and it is likely that it will take many years before people working in the sector have the full information they need in order to support the development of equitable financing systems. We have highlighted some of the areas which could be a focus in the shorter term:

More and better targeting of funding

Greater commitment is needed on behalf of governments to equitable access to education for all and this should be reflected in education budgeting.

Short-term usage of proxy measures to target funding Improving data is likely to take time and to be costly. In the shorter term, governments should consider using some kind of proxy measure to target funding based on need. The exact measure will depend on data availability in each country; one example which is likely to be replicable is to target a greater portion of funding at schools which are based in the poorest districts.

•

•

Increasing shares of per-school funding A short-term, relatively blunt tool for achieving greater equity in education financing is to increase the budget share of per-school allocations. This allows smaller schools, which tend to cluster in rural and poorer areas, to access a greater proportional share of funding. As noted above, caution should be exercised in analysing the countries in which this type of mechanism is likely to have a progressive effect. It is also likely to be heavily context-specific even within countries, for example through different patterns of urbanisation.

• •

Aiming towards per-pupil funding using a formula weighted according to need In the long-term, the ambition should be a move towards needs-based financing using a differentiated per-pupil allocation, with weights for aspects such as household income, gender and location. This will allow funding to be targeted equitably, with a greater share allocated towards groups who need additional funding to give them the same opportunities as other groups.

•

This type of funding relies on good data, reporting mechanisms and accountability structures, which is why short-term implementation may not be possible; as suggested above, this highlights the need for capacity building in data collection and reporting, and the development of stronger information systems.

•

Focusing on teacher support, training and management Regarding teacher pay, financing policy needs to be linked into policy on the recruitment, training and retention of teachers, in order to ensure smaller class sizes and more highly trained staff in rural and deprived areas. Policies might

27

Up-to-date benefit incidence analyses on the distribution of education financing across the study countries would help to fill the most immediate research gap. We recognise the limitations of these types of studies, but feel that they are the only way currently to give an indication – however imperfect – of the groups of children that public education money is actually reaching.

Although studies have touched on the interaction between donor financing and domestic financing of education, we feel that this is an area which needs considerably more work. The nature of the relationship between both sets of financing remains unclear; it would be useful to understand, for example, the aspects of donor financing policy, if any, which have a direct impact on equity considerations among governments.

Links between domestic expenditure on education and household contributions to education also needs to be explored in greater depth.

An area that was out of scope for this study, but which could usefully add valuable context and background to the debate, is a study on education financing which focuses to a greater extent on the interaction between education financing policy and broader policy on teacher recruitment and development. This could look at teacher standards, professional development, pay scales, etc, and link it back to financing policy and forward to impact on outcomes.

Since this study was written, new data has been included in the World Inequality Dataset on Education on primary education outcomes. This data could usefully be analysed and then linked in to this and other studies.

Research is needed into where the money should be spent, as opposed to how it is allocated (e.g. teacher salaries, teacher training, classroom resources), according to different contexts; and also where spending decisions need to sit – at the school level, at the local government level or at the national level – in order to have the strongest impact on equity.

Girl in Sway Teab Primary School in Kampong Cham province, Cambodia.

Photo Credit: Hanne Bjugstad/Save the Children

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More is Not Enough

Appendices

A.1 Country Findings Africa

Country

Key findings

Ethiopia

• • • • • • •

Nigeria

• • • • • • •

Alongside the introduction of rolling Education Sector Development Programmes, spending on education in Ethiopia has increased significantly over the last decade.

There are, however, significant disparities in access to education between children from the richest and poorest households in society. Young people from the poorest fifth of households, for example, spent an average of two years in education, compared to eight years by the richest fifth.

Distinct regional educational inequalities also exist in Ethiopia, with young people in certain regions having spent up to five years less in education than in other regions. Over a quarter of young people living in rural areas have never been to school, compared to less than a tenth of young people living in urban areas.

The Government of Ethiopia has made provision for increasing equity in educational access through the General Education Quality Improvement Program, which places particular focus on expanding access to education for children from marginalised groups, and rolling Education Sector Development Programmes, which have introduced initiatives specifically to address equitable access to education for all children.

Education financing itself has, however, been found to be highly inequitable, with tertiary education benefiting disproportionately from public funding.

Despite increases in budgets being allocated to education, the lack of administrative capacity has a direct impact upon communities. Delays in funding have at times obliged schools to charge fees in order to cover administration and running costs and schools continue to charge informal fees for school running costs.

This inevitably perpetuates inequality in access to education. Children from households who are unable to pay these charges are at risk of failing to enter or of dropping out of school.

There is a high primary drop out rate in Nigeria and large numbers of children who have never been to school, combined with a large proportion of funding directed at secondary education.

By the time children reach the transition point between primary and secondary education, 60% will no longer been in school, and they will have absorbed less than half the funding available for the group as a whole.

Retention at primary and secondary level is highly inequitable. Almost three quarters of children from the poorest fifth of households have not completed primary-level education, compared to less than one twentieth of those from the wealthiest fifth.

Access to education is, further, regionally inequitable. Over two thirds of young people in the North East region, for example, have not completed primary level education, compared to one twentieth in the South East region. Children living in rural areas are also at a significant disadvantage in accessing education compared to those living in urban areas.

Girls in Nigeria are severely disadvantaged in accessing education and remaining in school to complete a basic cycle of education. Over half of all young women have not completed primary level education, compared to less than a quarter of young men.

The four year Strategic Plan for the Development of the Education Sector (2011-15) specifically addressed the need to focus on children from marginalised groups. Groups to receive increased policy and budgetary focus include children from the Almajiri group, those with learning difficulties, from nomadic groups and from migrant fishing groups.

Initiatives include the mapping of children with learning difficulties to ascertain resource and infrastructure needs, surveys to increase knowledge of disadvantaged groups, and community sensitisation regarding education amongst minority groups and gender equality issues.

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More is Not Enough Country Uganda

Key findings

• • • • •

• Zimbabwe

• • • • •

Education policy and financing have enabled Uganda to achieve a high primary net enrolment rate in recent years. Significant levels of pupils dropping out from school, however, mean that half of all girls and boys do not complete primary-level education.

There is generally insufficient funding to meet the needs of universal primary education. There are also insufficient resources, including teachers and school materials. Parents are often obliged to contribute to school running costs which has a negative impact on educational access of children from the poorest households.

Historical data shows that wealth inequities are significant: the wealthiest fifth of young people in Uganda have spent 109% longer in education (9.2 years) than the poorest fifth (4.4 years).

Comparative regional inequity has been the most striking feature of educational outcomes in Uganda, with an historical regional equity gap of 243%.

Barriers to the achievement of equity in education financing include lack of transparency around funding mechanisms; underfunding; high costs of managing UPE funds at the school level; misuse of funds; social barriers; enrolment versus retention; poverty, both in terms of the impact on families and on schools; and lack of good data.

Primary school budgets for universal primary education are determined by a combination of perschool allocations and per-child allocations. Adding a per-school element allows education financing to be targeted more equitably in places in which smaller schools tend to cluster in more rural and/or poorer areas. This appears to have been an active recognition in Uganda’s financing policy.

Other equitable funding mechanisms include higher salary allocations for teachers working in more remote areas and the targeting of additional funds at hard-to-reach areas such as Karamoja.

A heavy reliance on undifferentiated per-pupil funding means that the system overall is likely to remain inequitable. This cannot be verified, however, without better data.

Findings show disparities in access to and retention in education by wealth. Over a fifth of young people from the poorest quintile of households in society have not completed primary-level education, compared to less than one twentieth of those young people from the wealthiest households.

Zimbabwe has made substantial progress in reducing gender inequalities, with gender parity in educational access having been achieved. Comparative gender inequity is very low in comparison with the other countries of study at 4% compared to, for example, 66% in Nigeria.

Comparative regional inequality in Zimbabwe is low compared to the other countries of study in the region.

Young people living in rural areas are at a disadvantage, spending on average two years less in education than those young people living in urban areas.

Children following traditional religions are at a disadvantage in terms of time spent in education.

Nearly a fifth of all young people from traditional religions do not complete primary-level education, compared to half of Protestant young people.

30

More is Not Enough Asia Country

Key findings

Cambodia

• • • • •

India

• • • •

Cambodia has made great progress in meeting Education for All (EFA) targets for enrolment in primary level education. The primary net enrolment rate rose from 74% in 2000 to 98% in 2012.

The Government of Cambodia has been successful in ensuring gender parity in primary level education. The net intake rate of girls in primary-level education was 94% compared to 96% for boys in 2012.

Retention and progression in primary and secondary education is inequitable due to the high cost of informal fees that parents are obliged to pay. Almost two thirds of young people living in the country’s poorest households have not completed primary level education, compared to just over one tenth of children living in the wealthiest households.

Educational outcomes are highly influenced by where a child lives and regional access to resources.

Children living in urban areas remain in education almost a third longer than those in rural areas.

Cambodia’s education financing system is affected by corruption, schools and teachers often being obliged to pay ‘facilitation fees’ to receive funding and salaries. Weak institutional capacity and delays in the disbursement of funds act as barriers to greater transparency and equity in education financing.

Large disparities by wealth render education financing highly inequitable. Over half of young people from the country’s poorest households have also never been to school, compared to less than one twentieth of young people from the richest households.

There are distinct regional disparities in primary enrolment and completion rates. Significant ruralurban disparities also exist: almost half of young people living in rural areas have not completed lower secondary-level education, compared to over a quarter of children living in urban areas.

More than half of India’s education budget is allocated to primary level education. However, a very low proportion of GDP, just 3%, is allocated to the education sector as a whole.

India has had great success in increasing the number of children enrolled at primary level. The net enrolment rate at primary level rose from 81% in 2000 to 94% in 2010. The Government had also had substantial success in achieving gender parity in gross enrolment rates at primary level. Girls are, however, disadvantaged in their ability to complete primary and secondary education.

31

More is Not Enough Country

Key findings

Nepal

• • • • • •

Pakistan

• • • • • •

Funding is highly inequitable at the lower levels of primary education due to high numbers of dropouts; this situation improves as children move towards secondary education. Funding is almost entirely equitable by the start of secondary education for those who remain in the system.

Considerable progress has been made in reaching education for all targets for net primary enrolment rates in Nepal. The net enrolment rate at primary level rose from 76% in 2000 to 97% in 2012.

Inequalities by wealth persist. Just under half of all young people from the poorest fifth of households have not completed primary-level education, compared to less than one twentieth of young people from the wealthiest fifth of households.

Nepal has the lowest comparative regional inequity of the present countries of study. That said, inequalities do exist: almost a third of young people from the Mountain region have not completed primary-level education, compared to less than a fifth from the Hill region.

Children belonging to certain religious and minority groups are highly disadvantaged in terms of access to education. Almost two thirds of Muslim young people have not completed primary level education, compared to less than one tenth of Kirat young people. Children belonging to Dalit communities are at a distinct disadvantage.

On average boys spend one and a half years longer in school than girls. Gender inequalities in Nepal are on par with India and Pakistan.

Education financing in Pakistan is highly inequitable at all levels of education. Excluding pre-primary, Pakistan spends almost a third of its education budget on tertiary education, which has only 5% of the total enrolled learners.

Young people from the poorest households spend significantly fewer years in education than those from the richest households. Almost three quarters of young people from the poorest households have not completed primary level education, compared to less than one tenth of young people from the wealthiest households.

A very high percentage (32%) of children are enrolled in private education institutions at primary level due to the poor quality of education offered in public schools. Public education institutions are said to suffer from inadequate facilities and a lack of trained teaching staff.

Children living in certain regions are disadvantaged in terms of access to education. Over half of young people living in Balochistan have not completed primary-level education, compared to less than a third of those in Punjab.

Almost half of all young people living in rural areas have not completed primary-level education, compared to less than a quarter of those in urban areas.

Girls in Pakistan are at an educational disadvantage. Almost a third of girls have never been to school, compared to less than a fifth of boys.

32

More is Not Enough A.2 Definitions, Measurement and Approach Definitions of Equity

Many discussions of equity in education financing make use of the concepts of horizontal and vertical equity.

Horizontal equity assumes that funding is equal where the costs of providing and accessing basic education are equal (for example, children come from similar socioeconomic backgrounds or similar school sizes); in other words, the ‘equal treatment of equals’141. Vertical equity assumes that areas which have higher costs to educate their children should receive greater funding; or the ‘unequal treatment of equals’142.

those from the poorest and most disadvantaged backgrounds. This approach is based on the premise that children from the most disadvantaged backgrounds need higher levels of financial support in order to have the same access to and opportunities from education as those from the most advantaged backgrounds152.

Measuring Education Financing Equity

The data held by national governments on equity in education financing are limited, particularly with regard to distribution of spending to specific groups. The data that do exist tend to be analysed in one of two ways: benefit incidence analyses (or household/school survey equivalents) and the Lorenz curve of structural distribution:

Different value judgements as to which type, or combination, of equity matters most leads to variance between definitions of equity143, for example:

•

Save the Children has a holistic concept of equity based on the ‘demand-side (or needs of the most disadvantaged) in addressing overlapping disparities’144.

• •

•

•

UNICEF considers spending equitable when ‘all children have an opportunity to survive, develop and reach their full potential, without discrimination, bias or favouritism’145.

OECD sees equity in education as encompassing fairness, or ensuring that personal and social circumstances are not an obstacle to achieving children’s potential, and inclusion – all children achieve a minimum basic standard of education146.

The majority of researchers use measures described originally by scholars Berne and Stiefel147 to measure vertical and horizontal equity148. They highlight a distinction between ex ante concepts of equity, which measure the way that financing formulae are calculated in order to ensure equity, and ex post concepts of equity, which measure outcomes149.

•

The approach taken to education finance policy and administration varies depending on whether the ultimate goal is resource access (inputs), student performance (outputs and outcomes)150, or a combination. While education inputs may be used as indicators of equity, Berne and Stiefel (1999) found that ‘the enormous literature on education production functions is not conclusive about which specific resources, under which particular circumstances, will affect outputs and outcomes’151.

This study takes a child rights-centred approach to equity in education financing. This does not mean an equal allocation of funds per pupil is necessarily equitable. Like Save the Children, we believe that allocations should be sensitive to need and greater per-pupil spending should therefore reach

33

Benefit Incidence Analysis (BIA)153: this is the more useful of the two approaches because it shows the proportion of funding which reaches individual groups, for example by sex or by household income levels. The data requirements for BIA are government expenditure on education; public utilisation of education; and the socioeconomic characteristics of pupils154. The first set of information typically comes from education or finance ministries. The second and third sets come from household surveys. BIA is limited, however, by the extent of available school and household surveys which can be matched (and it was not within the scope of this study to perform BIAs on available datasets).

Lorenz Curve of Structural Distribution: this approach measures the cumulative proportion of the population expected to reach a particular level of education against the cumulative proportion of education finance expected to be spent on each cohort.

Data is plotted to allow analysis of the extent to which people benefit from education funding (e.g. in country X, 73% of the population receive only 42% of the total education funding). The extent to which the curve produced differs from the line of ‘perfect equity’ (45 degrees) shows the extent of inequity in education financing in a particular country. While clearly a blunt tool, this is the best available method we found to enable cross-country comparison. This approach is further limited because it can only show the extent to which funds are equally distributed without taking into consideration different costs of provision or levels of need. It is also necessarily global in nature in that it does not separate populations by income, sex, urbanisation, religion, ethnicity or other factors.

More is Not Enough Study Approach

and rural-urban areas. The average number of years of education was selected as the main comparator indicator to provide an overall measure of access and equity.

The following eight countries were selected for detailed analysis: Cambodia, Ethiopia, India, Nepal, Nigeria, Pakistan, Uganda and Zimbabwe. We drew from literature from other countries in Asia and Africa to situate findings in a broader context and to compensate for data limitations.

In addition, Uganda and Cambodia were chosen as detailed case studies. This additional research provided evidence on the efficacy of education financing mechanisms, understanding of national policy relating to education financing and allocation, assessments of the impacts of funding initiatives and reports of best practice. Local researchers were contracted to conduct interviews with various education stakeholders and to collect locally available data:

A literature review was conducted, providing an overview of equity in education financing for the eight countries of study.

This provided a backdrop to the policy framework and education financing system in each country as well as an analysis of spending effectiveness and barriers to more equitable financing. Research was conducted using a variety of sources, including impact assessments and academic research.

•

A ‘scorecard’ was produced for each country using indicators on funding, and pupil-teacher and net enrolment ratios. Indicators from the World Inequality Database on Education were then used to investigate the equity of education outcomes by region, gender, religion, wealth status

•

34

Uganda: interviews were held with public officials from the Ministry of Education and Sports, district education officers, primary school head teachers, NGO representatives and representatives from the Uganda National Teachers’ Union (UNATU).

Cambodia: local officials and primary school directors across Cambodia were interviewed, as well as a range of local and international NGOs.

Time for rest: School children in Zimbabwe rest under a huge tree after finishing school. Many walk as much as 8 km each way to get to school, and the same way back home in the afternoon. Photo Credit: Luca Kleve-Ruud/Save the Children 35

More is Not Enough A.3 Key Education Indicators

155

Countries shown in red are doing comparatively better on the individual indicators.

Asia

Indicator

Cambodia

India

Nepal

Pakistan

EFA Development Index Score (rank of 120)

100

102

N/A

113

% Public Budget Spent on Education

19%

N/A

27%

9%

47

40

28

% GDP Spend on Education

% Education Budget Spent on Primary Pupil-Teacher Ratio, Primary

Net Enrolment Ratio, Primary

3%

42% 98

3%

5%

2%

25%

63%

N/A

93

97

72

40

% Trained Teachers, Primary

99%

N/A

93%

83%

School Life Expectancy,Years

10.5

10.9

8.9

17%

14%

7.5

32%

Ethiopia

Nigeria

Uganda

Zimbabwe

EFA Development Index Score (rank of 120)

116

108

104

N/A

% Public Budget Spent on Education

30%

N/A

31%

15%

36

48

37

% Out of School Children, Primary Proportion Enrolled Privately, Primary

2% 1%

1%

3%

28%

Africa Indicator % GDP Spend on Education

% Education Budget Spent on Primary Pupil-Teacher Ratio, Primary

3%

2.5%

N/A

54%

53% 98%

5%

N/A

65% 55

Net Enrolment Ratio, Primary

86%

58%

94%

% Out of School Children, Primary

13%

42%

6%

% Trained Teachers, Primary

School Life Expectancy,Years

48% 9.1

36

66%

95%

N/A

9.0

11.1

N/A

N/A

More is Not Enough A.4 Equity Gap (Years in Education) by Equity Dimension & Country Introduction

The limited data available on education financing equity in the study countries was not able to be linked clearly to current policy due to its age. Equally, the outcome data analysed below cannot be easily linked to current policy as it comes from survey data of 17-22 year olds, mostly surveyed in 2010. Those who only remained in education for five years, for example, and assuming an average school starting age of six, will have left the education system between 1998 and 2004 depending on their age. The data presented in this section is therefore indicative of historical challenges in each of the countries of study, rather than a reflection of current policy. The delivery of current school and household surveys in each of these countries would help to give a picture of the effects of current education financing policy.

In the following sections, comparative inequity has been calculated by comparing the most and least advantaged groups in terms of the average number of years they spend in education. The size of the equity gap is the proportion of additional time that the group with the most years of education spends in school compared to the group with the fewest years of education. Data has been calculated using the World Inequality Dataset on Education, from the most recently available year (accessed between August and September 2013).

Average years of education is one indicator of educational outcomes. It does not provide a detailed picture relating to grade repetition and equal progression through the school system, neither does it provide information regarding the quality of education received.

Equity Gap by Sub-National Region Comparative Regional Inequity in Asia156 Cambodia

74%

India

Nepal

Pakistan

105%

22%

31%

Comparative Regional Inequity in Africa157 Ethiopia

149%

Nigeria

221%

Uganda Zimbabwe

243% 28%

37

More is Not Enough Equity Gap by Gender Comparative Gender Inequity in Asia Cambodia

3%

India

25%

Nepal

22%

Pakistan

31%

Comparative Gender Inequity in Africa 21%

Ethiopia

66%

Nigeria Uganda

4%

Zimbabwe

4%

Equity Gap by Religion Comparative Religious Inequity in Asia

Cambodia

31%

India

105%

Nepal 139% Pakistan

Not available

Comparative Religious Inequity in Africa Ethiopia

122%

Nigeria

94%

Uganda

25%

Zimbabwe

26%

38

More is Not Enough Equity Gap by Wealth Comparative Wealth Inequity in Asia Cambodia

94%

220%

India

Nepal

120%

Pakistan

350%

Comparative Wealth Inequity in Africa 276%

Ethiopia Nigeria

348%

Uganda Zimbabwe

109%

43%

Equity Gap by Level of Urbanisation Comparative Rural-Urban Inequity in Asia: Average Years of Education Cambodia

India

Nepal

30%

42%

28%

Pakistan

66%

Comparative Rural-Urban Inequity in Africa Ethiopia

126%

Nigeria

67%

Uganda

Zimbabwe

48%

20%

39

More is Not Enough A.5 Structural Distribution of Education Financing by Level & Country

158

Data was not available for Zimbabwe.

Cambodia

Distribution of Public Education Funds by Expected Educational Attainment

100%

90% 91% of a cohort are expected to achieve the start of tertiary education or below. They absorb 80% of funds available for the group.

80% 70% 60% 50% 40% 30%

0%

Start of upper secondary n

68% of a cohort are expected to achieve the start of secondary education or below. They absorb 57% of funds available for the group.

Start of secondary r

22% of a cohort are expected to achieve the start of Start of grade de 6 grade 4 or below. They absorb 32% of funds Start of gradee 5 available for the group.

Start of grade 4 gr Start of o grade 3

20% 10%

Start of tertiary

86% of a cohort are expected to achieve the start of upper secondary education or below. They absorb 72% of funds available for the group.

Start St of grade d 2 Start of grade 1 10%

20%

30%

40%

50%

60%

70%

80%

90%

Cumulative % of the population expected to attain a given grade/level of education

40

100%

More is Not Enough India

Distribution of Public Education Funds by Expected Educational Attainment

100%

90% 81% of a cohort are expected to achieve the start of tertiary education or below. They absorb 80% of funds available for the group.

80%

Start of tertiary

70% 60% 50% 40%

64% of a cohort are expected to achieve the start of upper secondary education or below. They absorb 51% of funds available for the group.

Start of upperr seconda secondary

46% of a cohort are expected to achieve the start of secondary education or below.

They absorb 36% of funds available for the group.

Start of secondary ry

30%

Start of grade 5 g Start of grade 4

20% Start of grade 3 10%

Start of grade 2 Start of grade 1

0% 10%

20%

30%

40%

50%

60%

70%

80%

90%

Cumulative % of the population expected to attain a given grade/level of education

41

100%

More is Not Enough Nepal

Distribution of Public Education Funds by Expected Educational Attainment159 100%

90%

92% of a cohort are expected to achieve the start of tertiary education or below. They absorb 88% of funds available for the group.

89% of a cohort are expected to achieve the start of upper secondary education or below. They absorb 79% of funds available for the group.

S Start of t tertiary

80% 70%

Start r of upper e secondary o

63% of a cohort are expected to achieve the start of secondary education or below. They absorb 64% of funds available for the group.

Start of secondary

60%

Start of grade 5

50% 40%

st of 54% of a cohort are expected to achieve thee start nd grade 3 or below. They absorb 31% of funds available for the group.

30%

Start r of grade 4

Start off grade 3

20% Startt of gradee 2 10% Start of grade 1

0% 10%

20%

30%

40%

50%

60%

70%

80%

90%

Cumulative % of the population expected to attain a given grade/level of education

42

100%

More is Not Enough Pakistan

Distribution of Public Education Funds by Expected Educational Attainment160 100%

90% 80% 91% of a cohort are expected to achieve the start of tertiary education or below. They absorb 69% of funds available for the group.

Start of tertiary Start a of upper p secondary c

70% 60% 50%

88% of a cohort are expected to achieve the start of upper secondary education or below. They absorb 65% of funds available for the group.

65% of a cohort are expected to achieve the start of secondary education or below. They absorb 41% of funds available for the group.

Start of secondary

40%

Start of grade 5 30% Start of grade 4 20%

Start of grade 3

10%

Start of grade 2 Start of grade 1

0% 10%

20%

30%

40%

50%

60%

70%

80%

90%

Cumulative % of the population expected to attain a given grade/level of education

43

100%

More is Not Enough Ethiopia

Distribution of Public Education Funds by Expected Educational Attainment161 100%

90% 80% 98% of a cohort are expected to achieve the start of tertiary education or below. They absorb 68% of funds available for the group.

Start of tertiary

70% 60% 50%

Start of secondary r Start of gradee 6

82% of a cohort are expected to achieve the start of secondary education or below. They absorb 59% of funds available for the group.

Start of grade 5 40% Start of grade 4 30%

Start of grade 3

20% Start of grade 2 10% Start of grade 1

0% 10%

20%

30%

40%

50%

60%

70%

80%

90%

Cumulative % of the population expected to attain a given grade/level of education

44

100%

More is Not Enough Nigeria

Distribution of Public Education Funds by Expected Educational Attainment162 100%

90%

95% of a cohort are expected to achieve the start of tertiary education or below. They absorb 80% of funds available for the group.

80% 70%

Start a of tertiary r

62% of a cohort are expected to achieve the start of upper secondary education or below. They absorb 66% of funds available for the group.

Start of upper secondary Sta

60% 50% 40% 30%

60% of a cohort are expected to achieve the start of secondary education or below. They absorb 29% of funds available for the group.

S Start of secondary Start of grade r d 6 Start of gradee 5

20%

Start of grade 4

10%

Start of grade 3

0%

Start of grade 2 Start of grade 1

10%

20%

30%

40%

50%

60%

70%

80%

90%

Cumulative % of the population expected to attain a given grade/level of education

45

100%

More is Not Enough Uganda

Distribution of Public Education Funds by Expected Educational Attainment163 100%

90%

91% of a cohort are expected to achieve the start of tertiary education or below. They absorb 88% of funds available for the group.

Start of tertiary

80% 70%

76% of a cohort are expected to achieve the start of secondary education or below. They absorb 62% of funds available for the group.

60% 50% 40%

Start of secondary a

49% of a cohort are expected to achieve the start of grade 6 or below. They absorb 55% of funds available for the group.

Start art of grade 6 a 5 Start of grade

Start of grade 4

30% Start of grade 3

20% Start of grade 2

10% 0%

Start of grade 1

10%

20%

30%

40%

50%

60%

70%

80%

90%

Cumulative % of the population expected to attain a given grade/level of education

46

100%

More is Not Enough Endnotes 1

http://www.unicef.org/publications/files/A_Human_Rights_Based_Approach_to_Education_for_All.pdf

3

Circumstances in which this is likely to be less effective are explored later in the report.

2 4 5 6

Questions have been raised during the research about the quality of the data used in the Zimbabwe WIDE dataset.

Talk by Elise Legault, Education Finance Expert at UNESCO Institute of Statistics.

Talk by Elise Legault, Education Finance Expert at UNESCO Institute of Statistics.

See page 35 for benefit incidence analysis description

7

http://unesdoc.unesco.org/images/0017/001776/177683e.pdf

9

www.uis.unesco.org/Library/Documents/Finance_EN_web.pdf

8

http://unesdoc.unesco.org/images/0017/001776/177683e.pdf

10 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf 11 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf 12 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf 13 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf

14 http://www.uis.unesco.org/Library/Documents/Finance_EN_web.pdf 15 http://www.uis.unesco.org/Library/Documents/Finance_EN_web.pdf

16 http://www.vsointernational.org/Images/valuing-teachers-teachers-matter-cambodia-nov2011_tcm76-34593.pdf 17 http://ddp-ext.worldbank.org/EdStats/KHMwp08.pdf

18 http://planipolis.iiep.unesco.org/upload/Zimbabwe/Zimbabwe-Sector-Plan-Operational-Plan-2013.pdf 19 http://unesdoc.unesco.org/images/0021/002110/211049e.pdf 20 http://cerdi.org/uploads/ed/2010/2010.22.pdf

21 http://unesdoc.unesco.org/images/0021/002167/216719e.pdf 22 http://unesdoc.unesco.org/images/0021/002167/216719e.pdf 23 http://unesdoc.unesco.org/images/0021/002167/216719e.pdf 24 http://unesdoc.unesco.org/images/0021/002167/216719e.pdf

25 http://www.efc.co.uk/projects/documents/ti/Africa_Education_Watch_eng.pdf 26 http://unesdoc.unesco.org/images/0021/002167/216719e.pdf

27 www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/12/27/000356161_20111227224910/Rendered/PDF/616940ESW0P1130sclosed0Dec027020110.pdf 28 http://www.vsointernational.org/Images/valuing-teachers-teachers-matter-cambodia-nov2011_tcm76-34593.pdf 29 http://ddp-ext.worldbank.org/EdStats/KHMwp08.pdf

30 http://planipolis.iiep.unesco.org/upload/Zimbabwe/Zimbabwe-Sector-Plan-Operational-Plan-2013.pdf

31 The challenges of free primary education in Ethiopia, Jeilu Oumer http://unesdoc.unesco.org/images/0018/001825/182523e.pdf 32 http://www.unicef.org/publications/files/Aboloshing_School_Fees_in_Africa.pdf 33 http://ubeconline.com/faq2.html

34 http://siteresources.worldbank.org/AFRICAEXT/Resources/AFRHD62DasZambia022504FINAL.pdf 35 http://siteresources.worldbank.org/AFRICAEXT/Resources/AFRHD62DasZambia022504FINAL.pdf

36 http://www.iiep.unesco.org/fileadmin/user_upload/Research_Governance_and_Management/pdf/school_grants_synthesis_working-paper.pdf 37 http://ir.lib.hiroshima-u.ac.jp/metadb/up/kiyo/AA11625039/BullGradSchEduc-HiroshimaUniv-Part3_61_93.pdf

38 http://www.iiep.unesco.org/fileadmin/user_upload/Research_Governance_and_Management/pdf/school_grants_synthesis_working-paper.pdf

39 http://www.iiep.unesco.org/fileadmin/user_upload/Research_Governance_and_Management/pdf/school_grants_synthesis_working-paper.pdf

40 http://www.iiep.unesco.org/fileadmin/user_upload/Research_Governance_and_Management/pdf/school_grants_synthesis_working-paper.pdf 41 http://ftp.iza.org/dp4822.pdf

42 https://openknowledge.worldbank.org/bitstream/handle/10986/7280/wps4329.pdf?sequence=1 43 http://www.ridanepal.org/downloaded/financing%20education%20in%20federal%20nepal.pdf

44 http://www.iiep.unesco.org/fileadmin/user_upload/Research_Governance_and_Management/pdf/school_grants_synthesis_working-paper.pdf 45 http://www.globalpartnership.org/media/APPRAISAL%20REPORT%20-%20ESP%202010_2015%20Final.pdf 46 Field research in Uganda.

47 Field research in Cambodia.

47

More is Not Enough 48 http://ftp.iza.org/dp4822.pdf 49 http://ftp.iza.org/dp4822.pdf

50 http://unesdoc.unesco.org/images/0011/001184/118426eb.pdf

51 http://www.iiep.unesco.org/fileadmin/user_upload/Research_Governance_and_Management/pdf/school_grants_synthesis_working-paper.pdf 52 http://ftp.iza.org/dp4822.pdf

53 See section 3.1 for an explanation of horizontal and vertical equity.

54 http://ftp.iza.org/dp4822.pdf

55 http://www.ips.lk/news/newsarchive/2010/3_11_2010_edfa/presentation.pdf

56 http://siteresources.worldbank.org/AFRICAEXT/Resources/AFRHD62DasZambia022504FINAL.pdf

57 http://www.sacmeq.org/sites/default/files/sacmeq/reports/sacmeq-iii/policy-brief/ken_school_inputs_17nov2011_final.pdf 58 http://elibrary.worldbank.org/doi/pdf/10.1596/1813-9450-3249

59 http://siteresources.worldbank.org/AFRICAEXT/Resources/AFRHD62DasZambia022504FINAL.pdf 60 http://siteresources.worldbank.org/AFRICAEXT/Resources/AFRHD62DasZambia022504FINAL.pdf 61 Input from peer review discussion, Oslo, March 2014.

62 http://www.iiep.unesco.org/fileadmin/user_upload/Info_Services_Publications/pdf/2007/Edpol7.pdf 63 http://i.cfr.org/content/publications/attachments/Girls_Education_full.pdf 64 http://i.cfr.org/content/publications/attachments/Girls_Education_full.pdf

65 http://www.iiep.unesco.org/fileadmin/user_upload/Info_Services_Publications/pdf/2007/Edpol7.pdf 66 http://www.iiep.unesco.org/fileadmin/user_upload/Info_Services_Publications/pdf/2007/Edpol7.pdf 67 http://www.iiep.unesco.org/fileadmin/user_upload/Info_Services_Publications/pdf/2007/Edpol7.pdf 68 http://www.iiep.unesco.org/fileadmin/user_upload/Info_Services_Publications/pdf/2007/Edpol7.pdf

69 http://r4d.dfid.gov.uk/pdf/outputs/ORIE/W0704_Demand-Side-Barriers-Girls-Secondary-Education.pdf 70 http://r4d.dfid.gov.uk/pdf/outputs/ORIE/W0704_Demand-Side-Barriers-Girls-Secondary-Education.pdf

71 http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:21447054~pagePK:64257043~piPK:437376~theSitePK:4607,00.html 72 http://web.worldbank.org/WBSITE/EXTERNAL/NEWS/0,,contentMDK:21447054~pagePK:64257043~piPK:437376~theSitePK:4607,00.html

73 http://www.iiep.unesco.org/fileadmin/user_upload/Research_Governance_and_Management/pdf/school_grants_synthesis_working-paper.pdf 74 http://recoup.educ.cam.ac.uk/publications/WP18-ADfin.pdf 75 http://www.moeys.gov.kh 76 http://www.moeys.gov.kh

77 http://www.globalpartnership.org/media/library/Country_Documents/Nepal/SSRP-Vol-I_Final_16-June-2009-2.pdf 78 http://www.unescobkk.org/education/resources/country-profiles/nepal/basic-education/

79 http://planipolis.iiep.unesco.org/upload/Pakistan/Pakistan_National_plan_of_action_2013-2016.pdf

80 http://www.unesco.org/new/fileadmin/MULTIMEDIA/FIELD/Dakar/pdf/NigeriaEFAprofileoct2012.pdf 81 http://ubeconline.com/index.html

82 http://unesdoc.unesco.org/images/0018/001866/186622e.pdf

83 http://www.iiep.unesco.org/fileadmin/user_upload/Research_Governance_and_Management/pdf/school_grants_synthesis_working-paper.pdf 84 See, for example, the Cambodian case study which accompanies this report.

85 http://www.mofed.gov.et/m/Resources/Laypersons%20Guide%20(Regional%20and%20Woreda%20Level).pdf 86 http://www.eldis.org/vfile/upload/1/document/0708/DOC19581.pdf 87 http://www.eldis.org/vfile/upload/1/document/0708/DOC19581.pdf

88 http://siteresources.worldbank.org/AFRICAEXT/Resources/AFRHD62DasZambia022504FINAL.pdf 89 http://www.eldis.org/vfile/upload/1/document/0708/DOC19581.pdf

90 http://siteresources.worldbank.org/INTINDIA/2132853-1191444019328/21507645/SankarFinancingEducation.pdf 91 http://www.cedol.org/wp-content/uploads/2012/02/148-150-2007.pdf

92 http://files.transparency.org/content/download/675/2899/file/2013_GCR_Education_EN.pdf

93 http://files.transparency.org/content/download/675/2899/file/2013_GCR_Education_EN.pdf

94 http://files.transparency.org/content/download/675/2899/file/2013_GCR_Education_EN.pdf

95 http://files.transparency.org/content/download/675/2899/file/2013_GCR_Education_EN.pdf 96 http://www.efc.co.uk/projects/documents/ti/Africa_Education_Watch_eng.pdf

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More is Not Enough 97 http://home.hiroshima-u.ac.jp/cice/wp-content/uploads/publications/Journal12-1/12-1-10.pdf 98 http://home.hiroshima-u.ac.jp/cice/wp-content/uploads/publications/Journal12-1/12-1-10.pdf 99 Field research in Uganda, December 2013

100 http://www.cedol.org/wp-content/uploads/2012/02/148-150-2007.pdf 101 Local field research.

102 See, for example, the Ugandan case study which accompanies this report.

103 http://www.efc.co.uk/projects/documents/ti/Africa_Education_Watch_eng.pdf

104 http://ir.lib.hiroshima-u.ac.jp/metadb/up/kiyo/AA11625039/BullGradSchEduc-HiroshimaUniv-Part3_61_93.pdf 105 http://ir.lib.hiroshima-u.ac.jp/metadb/up/kiyo/AA11625039/BullGradSchEduc-HiroshimaUniv-Part3_61_93.pdf 106 http://www.ridanepal.org/downloaded/financing%20education%20in%20federal%20nepal.pdf 107 http://www.efc.co.uk/projects/documents/ti/Africa_Education_Watch_eng.pdf

108 http://www.iiep.unesco.org/fileadmin/user_upload/Research_Governance_and_Management/pdf/school_grants_synthesis_working-paper.pdf 109 http://unesdoc.unesco.org/images/0021/002110/211049e.pdf

110 http://www.efc.co.uk/projects/documents/ti/Africa_Education_Watch_eng.pdf 111 http://ddp-ext.worldbank.org/EdStats/KHMwp08.pdf 112 http://ddp-ext.worldbank.org/EdStats/KHMwp08.pdf

113 http://www.pactcambodia.org/Publications/Anti_Corruption/Local_Public_Services-Performance_and_Unofficial_Fees_ENG.pdf

114 http://www.unescobkk.org/fileadmin/user_upload/efa/EFA_MDA/National_EFA_MDA_Reports/CambodiaEFAMDA_FINAL_23Oct08.pdf 115 http://www.efc.co.uk/projects/documents/ti/Africa_Education_Watch_eng.pdf

116 http://www.iiep.unesco.org/fileadmin/user_upload/Info_Services_Publications/pdf/2007/Edpol7.pdf

117 http://siteresources.worldbank.org/AFRICAEXT/Resources/AFRHD62DasZambia022504FINAL.pdf 118 http://siteresources.worldbank.org/AFRICAEXT/Resources/AFRHD62DasZambia022504FINAL.pdf 119 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf 120 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf 121 http://r4d.dfid.gov.uk/PDF/Outputs/ForAll/paper57.pdf 122 http://ftp.iza.org/dp4822.pdf

123 http://www.uis.unesco.org/Library/Documents/Finance_EN_web.pdf 124 http://www.uis.unesco.org/Library/Documents/Finance_EN_web.pdf 125 http://www.uis.unesco.org/Library/Documents/Finance_EN_web.pdf

126 http://www.sacmeq.org/sites/default/files/sacmeq/publications/07_multivariate_final.pdf 127 http://www.sacmeq.org/sites/default/files/sacmeq/publications/07_multivariate_final.pdf 128 http://www.sacmeq.org/sites/default/files/sacmeq/publications/07_multivariate_final.pdf 129 http://www.sacmeq.org/sites/default/files/sacmeq/publications/07_multivariate_final.pdf 130 http://ageconsearch.umn.edu/bitstream/120033/2/WP12-1.pdf 131 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf

132 http://www.globalpartnership.org/media/docs/results-learning-report-2013/2013-11-GPE-Results-for-Learning-Report.pdf 133 http://www.globalpartnership.org/media/docs/results-learning-report-2013/2013-11-GPE-Results-for-Learning-Report.pdf 134 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf 135 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf 136 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf

137 http://ageconsearch.umn.edu/bitstream/120033/2/WP12-1.pdf 138 http://ageconsearch.umn.edu/bitstream/120033/2/WP12-1.pdf 139 See Appendix for further details.

140 http://unesdoc.unesco.org/images/0022/002256/225660e.pdf

141 http://www.iu.edu/~ceep/finance/PDF/PB007_alternative_approach_equity.pdf 142 http://www.iu.edu/~ceep/finance/PDF/PB007_alternative_approach_equity.pdf 143 www.nap.edu/openbook.php?record_id=6166&page=9

144 http://www.equityforchildren.org/approaches-to-equity-save-the-children/

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More is Not Enough 145 http://www.unicef.org/about/execboard/files/2013-21-UNICEF_Strategic_Plan-ODS-English.pdf 146 http://www.oecd.org/edu/school/39989494.pdf

147 Berne, R., & L. Stiefel, (1984). The measurement of equity in school finance. Baltimore, MD: Johns Hopkins University Press 148 http://www.iu.edu/~ceep/finance/PDF/PB007_alternative_approach_equity.pdf 149 http://www.nap.edu/openbook.php?record_id=6166&page=12 150 http://www.nap.edu/openbook.php?record_id=6166&page=9 151 http://www.nap.edu/openbook.php?record_id=6166&page=9 152 http://unesdoc.unesco.org/images/0017/001776/177683e.pdf 153 http://www.imf.org/external/pubs/ft/wp/2003/wp03227.pdf 154 http://www.imf.org/external/pubs/ft/wp/2003/wp03227.pdf

155 Data sources: http://www.unesco.org/new/fileadmin/MULTIMEDIA/HQ/ED/pdf/gmr2012-report-edi.pdf and UIS Data Centre. All data is for the latest available year (accessed September-October 2013), and some have been calculated.

156 For those aged 17-22. The inequity measure represents the proportional difference between the average years of education of the least advantaged group compared to the average years of education of the most advantaged group (no difference would be 0%). Figures are rounded to the nearest 10%.

157 For those aged 17-22. The inequity measure represents the proportional difference between the average years of education of the least advantaged group compared to the average years of education of the most advantaged group (no difference would be 0%). Figures are rounded to the nearest 10%.

158 Sources: UIS data centre; Pol de Dakar; Research Base calculations.

159 All data obtained from the UIS data centre http://stats.uis.unesco.org/unesco/tableviewer/document.aspx?ReportId=143 160 All data obtained from the UIS data centre http://stats.uis.unesco.org/unesco/tableviewer/document.aspx?ReportId=143

161 All data obtained from the US census bureau http://www.census.gov/population/international/data/idb/informationGateway.php 162 All data obtained from the UIS data centre http://stats.uis.unesco.org/unesco/tableviewer/document.aspx?ReportId=143

163 Note that the cumulative proportions in grades 3 and 4 appear to go backwards. This is due to an admissions spike compared to the overall cohort population.

Upper secondary was omitted from the graph as it was too close to tertiary to be able to visualise it properly.

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51

More is Not Enough

Global education is grossly underfunded, despite repeated promises to ensure universal primary education from both international donors and domestic governments. But more funding is simply not enough to ensure every child’s right to learn and thrive in school.

In this report spending patterns in education are studied to unmask inequalities and suggest policies to ensure more equity. One of the findings is that poverty is the main source of inequity in education.

The poorest groups of children are systematically losing out compared to the wealthier sections of the population. Measures should be taken to target these children and compensate for their disadvantage.

Inequity has been identified as the main obstacle to achieving education for all. This report is a contribution to the ongoing debate on education financing and how to make sure that all children get access to free quality education. More funding must be accompanied by equitable mechanisms that help us reach the most marginalised and poorest children.