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La Educación
Número: (116) III
Año: 1993

Lessons and Recommendations

The adverse effects which structural adjustment policies have had on the educational system and other social services have forced the World Bank to reconsider some of its policies. As Noss (1991) notes, the early WB adjustment programs ignored education issues. In recent years, more attention has been paid to the education sector via sectoral adjustment loans (SECALS). The WB and other financial institutions are becoming aware that destroying the human capital of a country impairs the long-term economic development which their policies are seeking to achieve. Both the governments and the financial institutions have begun to assess priorities in educational provision with respect to the problems of sustainability and affordability. With the increase in demand for education and the increasing costs of its provision, the governments of the region must establish priorities for public educational provision given their restrictive budgets. Limited resources must be carefully managed in order to maximize the benefits to be derived from their use. Caribbean governments need to ensure that in the rationalization of the educational system the human resource development programs of the countries are not impaired since this can result in long-run economic stagnation.

In the rationalization process, the following criteria can be applied: efficiency (both internal and external) and equity and flexibility. Internal efficiency refers to how the educational institution educates its pupils and turns out graduates. Using cost-effectiveness analysis, differential costs are compared for producing the same output. External efficiency is concerned with how the graduates of the system fit into the socio-economic system in relation to the resource used in the educational system. Equity of access and opportunity in the education sector has an influence on the degree of social and occupational mobility and the structure of earnings in the labor market. A flexible educational system can respond quickly to the technological changes taking place in the economy by providing the necessary human resources. Small developing countries, such as those in the Caribbean, must have flexible educational systems—new teaching methods, curriculum changes, new teaching aids—if they are not to be relegated to the backlands of international economic activity.

In allocating scarce financial resources, the following decisions must be made:

(i) how many resources should go to education vis-à-vis other sectors of the economy;
(ii) how many resources should be devoted to different levels of education primary, secondary, tertiary;
(iii) how much should be allocated to academic/general education versus vocational/technical education;
(iv) how should shortfalls be financed—increased taxation, private provision, user fees to recover costs.

There is a need to maintain a high quality of delivery in education in the region. Priorities have shifted over the years where the provision of education is concerned in the region. As Layne (1986) indicates, in the 1960s the WB and other financial institutions provided funding for secondary and tertiary education. In the 1970s and 1980s, their policy focus shifted to the public provision of education especially at the primary level, the reduction of public subsidies to education, a greater emphasis on technical and vocational training, and the need to train educational managers and administrators. A recent World Bank report on education in the Caribbean has emphasized:

(i) expanded access to higher education;
(ii) the need to raise achievement levels in primary and secondary school subjects, especially mathematics and English;
(iii) more equitable distribution of resources across distinct secondary schools;
(iv) greater generation of funds from private sources;
(v) reducing the level of government financing of post-secondary education.

The experience with macroeconomic adjustment policies in the region has indicated that Caribbean governments must be more prudent with the use of public resources. In the context of Caribbean education, the following recommendations can be made:

(i) increase the share of current and capital expenditure going to health and education in order to develop the human resource base of the countries of the region.
(ii) primary and secondary school provision should continue under the aegis of the State. The government would, however, have to reconsider its provision of such amenities as textbooks, uniforms, school meals, bus fares.
(iii) emphasis should be placed on general education and selective vocational/technical areas. The flexibility needed by small developing countries requires the workforce to have a solid general or basic education which assists with adaptability and trainability. Evidence suggests that most training takes place on the job.
(iv) partial funding of tertiary (especially university and college) education. Since the university engages in teaching, research, and public service activities, students should be asked to finance part of their university education. Given the relatively high unit costs of providing tertiary education in the region, the government should only contribute to the capital and research cost of these institutions. Payment by students can bring greater efficiency and effectiveness in the university system.
(v) the provision of loans, scholarships, and bursaries, especially for the needy and good performers. Because of the problems of administering loan facilities by private financial institutions, government can provide the bulk of such loans to absorb the risk of nonrepayment.
(vi) tax concessions for special education-linked insurance policies can be used as part of a cost-sharing arrangement. Individuals can take out policies with insurance companies to finance their children’s future education.
(vii) there is a need to balance expenditure on teachers’ salaries and expenditure on maintenance of buildings and equipment, books, and teaching supplies. Teachers’ salaries generally form the bulk of recurrent expenditure; therefore, consideration should be given to:

(a) the re-use of textbooks over short periods to avoid the deterioration of the quality of education;
(b) charging for supplementary books and materials;
(c) using low-cost learning materials—newspapers, magazines;
(d) community and parent-teacher association (PTA) effort to maintain and repair schools and equipment;
(e) using the private sector to provide some supplies and equipment (computer hardware and software);
(f) the need to maintain basic salaries of teachers at a sufficient level to provide a comfortable living and avoid turnover and lack of motivation;
(g) greater involvement of PTAs in the management of schools and also greater decentralization of management systems to reduce administrative costs;
(h) maintain and provide incentives to help sustain the motivation and commitment of teachers (e.g., merit pay, special awards, leave arrangement).

Macroeconomic economic policies have forced Caribbean governments to reassess priorities and redirect their development thrust. Since human resource development is important to the economic development of Caribbean countries, Caribbean governments must re-examine their educational systems to make them more responsive to the development effort and also more resilient to structural adjustment policies.