The bad economics of free primary education

Schools are open and thankfully there is now no talk of an impending strike. The government and the teachers’ unions have come to some truce and everything appears to be back to normal.

This, however, is a misleading impression because in reality, the Kenya public primary schools system is in a fairly bad state and the heavy investment is not yielding commensurate returns. A rethinking of the delivery of public education is of urgent concern and demands the attention of highest level of leadership.

For most developing countries, including Kenya, education takes the largest share of the national budget. In 2010, just over 17 per cent of government expenditure went to education.

In 2011, the Kenya National Bureau of Statistics reports this figure as 13.5 per cent. This is a sizeable investment and a reflection of the realisation of the crucial role that education — or human capital — plays in the development process.

Although the government has prioritised education since independence, a significant recent policy shift was the introduction on the Free Primary Education (FPE) programme in 2003 following the election of the National Rainbow Coalition (Narc) government.

The implementation of FPE reversed hitherto declining primary school enrolment experienced during the 1990s. In 2002, net primary school enrolment was 61.7 per cent and increased to 74.17 in 2003. By 2009 net enrolment rate had reached 82.7 per cent.

Thus the introduction of FPE in Kenya has contributed greatly towards the achievement of the goal of universal primary education. Kenya is likely to meet, or be very close to meeting, the United Nations primary school enrolment Millennium Development Goal by 2015.

The provision of free primary education is considered one of the most important pro-poor policies that also has the potential of reducing future income inequalities.

For most children from poor families, the only sure way to exit poverty and compete with others is by acquiring quality education. From this perspective, Kenya’s free primary education is an incredibly important policy.

But there is a great difference between attending school and learning. A number of studies and surveys that have been conducted in Kenya (and in fact in other Africa countries) reveal a sad story of public schools that are totally dysfunctional.

The children are attending school but very little learning is taking place. According to Uwezo Kenya findings from 2011, “only three out 10 children in Class Three can read a Class Two story [in English], while slightly more than half of them can read a paragraph. Four out 100 children in Class Eight cannot read a Class Two story.”

The findings are similar in numeracy, where 30 per cent of Class Three children are unable to complete Class Two division, and 10 per cent of Class Eight children cannot do Class Two division.

Such outcomes reflect a system that has broken down and is not preparing children for the 21st Century.

Although many policymakers may not want to admit it, the truth is that many public schools are literally in a comatose condition. The children from poor families who attend these schools are being cheated by the system.

The education may be free but the there is very little value that is added in many of those schools. It beats reason why a government would be investing such large sums and yet not focus on what happens in the schools.

Rise of low-cost private schools

The clearest evidence of the declining quality of public primary schools is the rise of private schools. Ordinarily, introduction of free public primary education should associate with a decrease in the demand for private schooling.

Yet, the response to FPE has been the opposite with a large increase in private school enrolment. Enrolment in Kenya’s private schools almost tripled between 2005 and 2009, from 4.4 percentage to 10.5 per cent.

Policymakers should wonder why offering a service for free associates with less demand for that product. Many do not want it even if it is free.

Unlike the traditional elite private schools, many of the private schools that have emerged since the introduction of FPE programme have been low-cost private schools — many in slums and rural areas.

The spending per pupil is much lower in the new private schools compared to public schools. While it is difficult to measure the various funding flows, a Brookings Africa Growth Initiative study found that in February 2013 “nearly two-thirds (64 per cent) of children in private schools pay fees less than the median per child funding levels in public schools.” Yet, these low-cost private primary schools outperform the public schools by a large margin.

A World Bank Service Delivery Indicators Project I was involved with in July 2013 tested Grade Four students with tasks at the level of Grade One, Two and Three.

The data showed that “scores in private schools were significantly higher both in English and Mathematics,” by 16 per cent and 10 per cent respectively.

It is often claimed that private schools outperform public schools because they are better endowed. This is true to some extent especially as relates to the old traditionally exclusive private schools. However, this is not the case for the well-performing private academies that have emerged since the early 2000s.

A large number of credible studies show that performance by these schools have little to do with resources. If anything, the public schools are at a comparative advantage when it comes to resource endowments.

Failure by Design

In fact, although the data reveals that FPE triggered a large increase in enrolment, this was quickly followed by the exit of students to private schools—mostly newly established low-cost schools.

So actually the main response to FPE has been a shift to low-cost private schooling. The migration to private schools was largely in response to the decline in the quality of public schools especially after the introduction of FPE.

Teachers in public schools are paid better than those in low-cost primary schools. A 2005 study by the Cato Institute reported that public school teachers in Nairobi earned an average monthly salary of nearly three times the pay for their private school counterparts.

The public school teachers are also generally more qualified and tend to have accumulated much more experience. There is really no discernible differences in the quality of infrastructure between many of the new low-cost private schools and the public schools.

The differences in terms of student performance are nevertheless mindboggling.

There are many ills that inflict the public school systems. Many are characterised by high rates of teacher absenteeism and even worse, teachers who are chronically absent from class even when in school. Recent studies show amazingly low teacher effort in public schools. All these and many other failures fall under the simple definition of weak accountability.

For a public education system to function well, teachers and the school administration must be accountable to the students and parents. This is what is generally referred to as client power in service delivery. Client power means that when teachers do not perform, the parents can hold them to account — having them terminated, suspended or any other punitive action.

Where the clients have power over providers, they are able to ensure that services are delivered as expected and the providers are compelled to deliver the services. Teacher absenteeism for example is chronic in some schools primarily because parents have no say in how the schools operate.

My own research and that of others shows that client power weakened dramatically following the introduction of free primary education.

For private schools, including the low-cost ones, client power is very powerful. Parents pay directly for services and expect results. Laxity on the part of teachers is quickly acted upon including immediate termination of non-performers. Failure by the school administrators to deal with provider laxity is punished through exit to other private schools.

The increasing competition among the private schools all but strengthens client power. Non-performance is not an option even in the low-cost private schools. The profit motive and competition are great sources of client power.

The fact that parents do not pay directly for public schooling detaches them from the schools. Unlike the old days when parents were more actively involved in the financing of the schools, FPE created the perception that the schools belonged to the government and not the local communities. Lack of ownership as associates with “free” schooling minimizes the client power.

When not properly understood, the idea of “free” education is itself a source of the failures in education. In reality, no public service is free — it is paid by the same beneficiaries through taxation although there are wide differences in the tax shares.

Nevertheless, when taxpayers do not pay for a service directly, they face a serious problem of what is called fiscal illusion — the misconception that the service is actually free while they indeed pay for it. Fiscal illusion tends to reduce client power and this is one of the major causes of failures in the public school system.

But clients could also impact on the provision of education indirectly through their elected officials. This is what is referred to as voice — which is the capacity to hold policymakers accountable. If teachers are not performing as expected, the citizens can demand action on the part of their elected representatives or punish them at the ballot box.

Unfortunately, in Kenya, this link has been weak and rarely do citizen groups effectively mobilise for political action against providers such as teachers.

One reason for the weak voice is the relationship between politicians and teachers. Public school teachers and their unions represent an important voting block and politicians are often not willing to step on their toes. It is for this reason that the dismal performance of public schools persists.

In essence we can say that the exploitation of the poor children in public schools system is the outcome of the interplay between the politicians and the teachers and their unions.

There is credible evidence that shows that low-cost private schools operate with only about a third of the cost of public schools and yet far outperform the public schools. We know that there is very little teaching going on in many of the public schools and that teachers are often absent from work.

We have evidence that even when in school, teachers spend a lot of the time not doing what they are supposed to be doing. This being the case, why would intelligent policymakers continue to support the status quo?

The imperative of reforms

Clearly, it does not make sense unless there is no seriousness about the long-term development of the country. Alternatively, the failure to demand performance could reflect political capture by the public school providers. Both of these scenarios would be quite unfortunate for the country and especially to the poor children who are not able to exit the public system.

The demonstrated performance of low-cost private schools in Kenya—and indeed in many other countries such as Ghana and India, provides us with many creative options for reforming the public education system.

While public financing of primary education is crucial, it does not necessary imply that delivery must be through the current modalities.

Where widespread failures in the delivery are apparent, it is necessary to consider various innovations that would ensure accountability and entrench a sense of ownership by the clients.

There is also the need to institute reforms that reduce the possibility of political capture that otherwise undermine quality provision of education.

Although the provision of primary education remains the responsibility of the central government, county governments could play a pivotal role in ensuring performance.

Next week, we will focus on proposals to reform Kenya’s public primary school system.

Prof Mwangi S. Kimenyi is senior fellow and director of the Africa Growth Initiative [email protected]