Sri Lankan examination authorities are renowned throughout the world with respect to quality and standard assurance and, therefore, the blame is squarely placed on the country’s school system for failing to deliver the results expected by the community. Since the education system in the country is funded out of tax payers’ money and educational services are delivered through public production, it gives an opportunity for concerned citizens, analysts, political leaders and educationists to voice their concern about what they reckon as the sad state of affairs.
Education is not entirely a public affair
Though many are under the impression that the entirety of the national education expenditure is borne by tax payers, it is not strictly accurate. In any publicly funded system, individuals too incur some part of direct expenditure, known among economists, as ‘out of the pocket spending’ to receive public services. If such spending remains low, then, it is the tax payers who bear the full burden of providing the public service concerned.
‘Out of the Pocket Spending on Education’ is also enormous
Information relating to ‘out of the pocket spending’ on education by individuals is obtained through periodic socio – economic or household income and expenditure surveys conducted by the authorities.The first type of the survey is conducted by the Central Bank of Sri Lanka and according to its survey in 1996/97, the nation as a whole has spent an estimated sum of Rs 10 billion on education as private expenditure when the tax payers spent some Rs 18 billion. So, the private expenditure in the form of out of the pocket spending amounts to some 35 percent of the total expenditure on education.
The Household Income and Expenditure Surveys are conducted by the Department of Census and Statistics. According to the Survey in 2006/07, the total out of the pocket spending on education by individuals is estimated to be at Rs 38 billion when the tax payers had spent Rs 72 billion for same. This level of private out of the pocket spending amounts roughly to 35 percent of the total national expenditure on education. Hence, education in Sri Lanka is an enterprise of which the burden is shared by tax payers collectively and individuals privately. The concern for deteriorating educational quality delivered by the public school system is compounded by this fact.
The Low Performance is a Historical Phenomenon
However, the low pass rates at public examinations are not a new phenomenon and it has always been the case in Sri Lanka. For instance, the GCE (Ordinary Level) Examination about which the wildest protests are made after the results are released, has surprisingly recorded the same performance rate from as far back as 1994 for which year the earliest data are available. In that year, 26 percent has failed Sinhala Language, 25 percent Tamil Language, 72 percent English Language, 69 percent Science and 66 percent Mathematics.
This performance has marginally improved at the 2000 examination but remained at that level thereafter. When one takes the latest examination in 2009 too into account, on average from 1994 to 2009, the failure rates have been alarming: 20 percent in both Sinhala and Tamil, 65 percent in English, 55 percent in Science and 60 percent in Mathematics. It is therefore a perennial grievance which people harbour and let out as wild protests both as individual spenders and collective tax payers.
Public Production Model is Freakish
The model involving the public production and supply of education funded collectively by taxpayers is inherent with a defect that acts to prevent it from ensuring quality of the service automatically. This was discussed by me fully in a chapter in my publication titled ‘Economic Wisdom for Babies’, (Sanhinda Printers and Publishers, 2008), under the title ‘Is Free Education Really Free and Can it Guarantee Quality too?’. Since the arguments in this chapter are valid even for today, I reproduce it below: From Economic Wisdom for Babies
“We should provide education free of charge to make it universally available to everybody as is being done by Sri Lanka” The eminent professor from a prestigious Indian university declared. The faces of other participants who were also professors from different universities got lit up at this suggestion. But, one professor who appeared to be an out-believer lamented openly “But, free public education is widely criticised for its failure to maintain quality. This is very much demonstrated by the high failure rates at exams. So, it has treated parents not to the expected ambrosia, but to a woefully distasteful meal”
We were at an international conference in India debating how to make education available to all. This was the acclaimed strategy for helping the down-trodden to move up the social ladder.
There were two of us from Sri Lanka and some in the audience looked at us for our opinion. My colleague rose and said “Even in Sri Lanka, the free availability of education hasn’t guaranteed good quality. For instance, at the GCE Ordinary Level exam, about 20 percent fail in mother tongue, that is, in Sinhala and Tamil, and about 60-65 percent in English, Math and Science. There’s a very significant number who wouldn’t get any mark at all. About 10 percent fail in all subjects. So, compared to the enormous amount of public funds used, the results delivered haven’t been up to the expectation”
Now, it was my turn to intervene. “The popularly known idea of free education is a misnomer” I said. “There’s nothing in this world which is free. Someone may get something without having to make a sacrifice, money-wise or otherwise. But, for him to get it without a sacrifice, someone else has to make a sacrifice. In the case of education, what has happened is that students don’t have to pay tuition fees. But, the community as tax payers bears the total cost through the budget. When we use a rupee for education, remember that we lose an opportunity to satisfy some other requirement of ours. May be a road to our village. So, education is not free at all. It’s like our giving free gift vouchers to people without discrimination so that they could use them to have their children educated at public schools”
Some of them were nodding their heads in agreement and I got emboldened by the encouraging gestures. So, I continued. “If free things are available, that would be only in the heaven ruled by God Indra. There, a tree known as kalpa wruksha, would give you everything you want just by a touch of the tree. Even there, you have to make sacrifices. To touch the tree, you need to spend your energy. Besides, to get into that heaven, you need to do a lot of merits that involve continuous sacrifices” I said in a lighter vein provoking an instant laughter in the hall.
“What do you think of the quality of public education?” Somebody asked me.
I took sometime to formulate my answer. “Low quality is an inherent factor in our free education model. Do you have any problem about maintaining quality by a soap manufacturer? No. Because, in that private production model, financier is also the producer. On the other side, the payer and user are the same. So, there’s no diffusion of interests of the two parties. The user who is also the payer can punish the soap manufacturer by withdrawing his demand. So, manufacturers have incentives to supply quality goods, for otherwise they’ve to close the business”
“How does it relate to education” Another professor asked.
I continued my reply. “In the case of education, the direct market link you observe in other production models is somewhat distorted. There’re several parties involved in the production of free public education and no one is accountable to users. So, the model itself doesn’t have incentives to produce a quality output”
“Can you elaborate on it further?” An incredulous professor asked.
“It’s like this” I started my explanation. “There, the financier is the tax payer. But he has no control over the producer who is the bureaucracy, namely, the school system. It produces what it wants and thrust it on users. The demanders of education are the parents. But, they aren’t the users and, therefore, can’t judge on the quality. The students are the people who go through the educational process, but they can’t comment on quality because they don’t know what’s required on one hand and they’re not the users of education, on the other. Students are simply a throughput, not even an input, which goes through the educational machine.
"They enter the system tunnel from one end and come out from the other end, basically in the same form. Not as a new output that you get when you put an input into a machine! They’re simply polished by the machine and thrown out for use by others. The final users of education are the employers who hire the throughput. They find that the people whom they hire can’t produce a marketable output straightaway. So, they’ve to incur additional expenditure for training them to make them employable. But, the employers as consumers have no say in the process at all because they don’t pay direct to the schools. So, they relegate themselves only to cry about low quality in public. But, the bureaucracy can ignore that protest and continue to produce only what it wants. So, the model has no innate incentive to maintain quality”
“So, what’s the solution?” Somebody asked.
“Easy” I said. “Fund schools according to results. It requires re-training of teachers and if, they aren’t trainable, show them the way out. And also, subject them to competition from private schools”
The writer is a retired deputy governor of the Central Bank of Sri Lanka. To read previous columns in the series go to the WatchTower section on the main navigation panel or click on the links below. He can be reached on email@example.com)