Education and development the issues and the evidence - Education Research Paper
No. 06, 1993, 61 p.
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2.5 Private expenditures and cost
recovery
2.5.1 Private financing
2.5.2 Cost recovery and user fees
2.5.3 Loans
2.5.4 Some conclusions
2.5.1 Private financing
National policy on private education and the introduction of various types of cost
recovery is an important consideration in policy dialogues with donors. In so far as
increases in educational investment can be achieved through increased private
expenditures more pupil places can be financed by the public budget and/or quality
improvements can be introduced. This is only likely to remain attractive if other
educational development indicators do not deteriorate as a result of introducing such
policy reforms. This is a current issue for debate since policy to encourage cost
recovery is commonly associated with adjustment loans. One fifth of a sample of 50
structural adjustment loans recently analysed included conditions that required the
introduction or increase of fees for books and tuition (Stewart 1991 a: 1921) and many
countries have independently introduced similar measures.
There is very little detailed data on the distribution of private and public enrolments in
most developing countries. Psacharopoulos and Woodhall (1985) suggest on the basis
of what is available that there is more provision at secondary rather than primary level,
that it has been declining rather than increasing in the recent past (with some exceptions
e.g. Tanzania), and that public subsidies for private institutions vary widely from
country to country. Data from Lockheed and Verspoor (1990:20) suggest that primary
enrolments in private schools in low income countries declined from about 8% in 1975
to 5% in 1985, and increased from 1% to 14% in lower middle income countries
(weighted mean without China and India). These trends may have reversed since the
mid 1980s since when conditionality for adjustment has favoured more private
schooling.