Remodel the education system

-This article has been originally published by Jyotika Rimal in The Himalayan Times on May 14, 2017.

Recently, news about the protest by student unions against the price hike by private schools has made it to many national dailies. The unions padlocked more than 100 schools with the demand to roll back the fee hikes by PABSON and NPABSON in private schools. It can definitely be argued that many private schools are unaffordable for many common Nepalese parents. Having said that, it is also important to consider whether that is a problem in itself, or a mere response to something different. The recent protest is not the solution, and in fact only adds more to the problem. One of the major reasons behind that is that the existing legislations make it impossible for private schools to offer cheaper services.

Two Major Problems

  1. Cost of Compliance

If one were to follow the Institutional School Criteria and Operations Directives, 2013, it maintained that a private school could only be registered if it followed a set of given rules and regulations specified by the government. Like any other legislation, this also had two implications—what is seen and what is not seen. What is “seen” here is that government seems to be serious regarding the quality of education, and is not willing to make any compromises on the quality front. However, what is not seen here is that it is impossible for the schools to comply with the quality of infrastructure standards and offer education at the fees mandated by the government. Private schools then have to charge extra non-tuition fees in order to leverage the costs.

  1. The Demand-Supply Mismatch

The demand for private schools has been increasing over the years. Not only high and middle-class families but increasing number of families with lower income are willingly sending their children to private schools in the hope of securing a better future for their children. Common sense economics says that when demand increases, price follows. If, on the other hand, supply were also to increase, then the prices would fall back again.

However, the new provision in the eighth amendment of the Education Act effectively bans opening new private schools (except under trust model). Under a trust model, investors cannot take back returns on their investment. Therefore, not many private schools will open in the days to come, until the legislation is reversed. What that means in terms of education fees is that all other conditions remaining the same, the prices are not going to come down.

Possible Solutions

  1. Deregulation of Education

When government deregulates the education sector (i.e. allows new private schools to open, and rolls back price controls), newer private schools will open. With more schools in the industry, there will be greater competition in the market. The biggest beneficiary of this competition will be the poor parents. When schools see that parents are taking their children away from their school and sending them to others (because there is now greater choice), the existing schools will be forced to bring down their prices in order to retain their students. The more the number of schools, the greater will be the competition, and the lower the prices will fall.

  1. Rethinking the Modality of Public Schools

Even though public schools are free up to a certain grade, a growing trend of parents sending their children to paid-private schools tells us that parents perceive private schools as better educators.  Data has also shown that while pass rate for the School Leaving Certificate (SLC) in private schools is 90%, that of public schools have hovered between 30 and 40 percent over the years. Along with this, other reasons like regular classes, presence of teachers and better infrastructures are reasons that private schools have received higher preferences compared to public counterparts. However, if we look at the number of schools, there are far more public schools in comparison to private schools.

One thing that could be done under the given circumstance to improve the quality of education provided by public schools is to rethink their operation models. Under the current model, government runs schools, finances public education, teachers have a secure job, and there is a clear lack of proper reward and punishment mechanism. If, on the other hand, newer models like vouchers (where government funds students and not schools) or charters (where private managements run public schools) were adopted, these public schools would also attain certain attributes of private schools—having to compete in price and quality terms to attract students. Poor parents would then have an enhanced choice over what school to send their children to since the government is covering the cost of education. This way, the public schools themselves would also be direct competitors of the private schools.

It is time the government starts thinking along the line of increasing the efficiency and quality of these public schools by taking strategic decisions to deliver better results. In doing so, it is very important to realize that in any market, competition plays a vital role in bringing better results. It is important for parents to realize that the recent padlocks like those by various student unions do not solve any problems. This is because they are not responding to the cause of the problems; they are merely responding to the symptoms. Any legislation that overlooks the root cause and responds only to the superficial issues will inevitably lead to greater problems in the future.