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Does Ghana’s Main Opposition Party’s Free Secondary Education Policy Add Up?

Does Ghana’s Main Opposition Party’s Free Secondary Education Policy Add Up?

For the first time since the New Patriotic Party (NPP) proposed the “free
secondary education” policy sometime between 2007 and 2008, Ghanaians now
have a very basic financial proposal from the main opposition party
regarding how they intend to fund it.

Whilst waiting for the comprehensive set of financial proposals, it makes
sense to launch the debate right away to ensure that there is enough time
to evaluate this longstanding policy of one of the two major parties in
the country. At the very least the debate can focus on settling the
financial cost of the proposed policy so that the country may more
effectively debate the merits.

Here are the assumptions one can glean from the preliminary NPP announcement:

1. Basic education shall in the wake of the policy terminate at the
secondary level. The clear goal of the policy is to ensure that all JHS
students automatically progress to secondary level (abolishing the BECE in
the way that the 1987 reforms abolished the Common Entrance Exams).

2. To succeed with this policy an additional $150 million would be
required to supplement current public expenditures on secondary students.

3. The cost of implementation shall peak at $400 million over the 4-year
tenure of a prospective NPP government, clearly anticipating massive
expansions in enrolment.

Here are some assumptions that we have in turn used:

1. Extrapolating from data provided by the UN Population Division, there
are 3.8 million persons of secondary school age in Ghana, of which 1.2
million are enrolled in 415 public secondary schools and 100 privately
owned and managed ones.

2. Based on data provided by the UNESCO Institute of Statistics, the per
capita public expenditure on secondary education (how much the government
spends on each student) is $215, implying a total average annual
expenditure of $258 million at secondary school level.

3. According to data from the Ghana Living Standards Survey 4, the average
household spends $175 per student at secondary school level.

4. From surveys, the additional amount of wages earned by senior secondary
graduates over junior secondary graduates does not translate into enough
tax-take to offset additional expenditures on secondary education over a
4-year horizon.

5. The policy can only be said to have been effective if it leads to a
considerable expansion in enrolment at the secondary level, one of its
primary objectives. We shall use a growth from the current roughly 32% of
net enrolment to 66% over four years as our benchmark. Our assumption 6
below assumes on principle that 100% of CURRENT enrolees shall from the
outset be ENTITLED to benefit from the policy. For practical reasons we
shall assume that IN PRACTICE 66% of beneficiaries shall receive support
under the policy on commencement.

6. Implementation of such a policy cannot easily be designed to benefit
only a segment of the enrolled secondary population because students
circulate all over the country making a piecemeal implementation based on
geography impractical.

For instance, if a number of districts were selected due to low income
levels for the initial phase of the policy, students from that district
who are awarded places outside the implementation area through the
computerised placement system would have to be discriminated against. This
shall be both unlawful and indefensible.
Based on the full complement of these sets of assumptions, one can proceed
by elementary arithmetic to establish the initial cost of implementation,
based on absorbing private household expenditure on secondary education
for 60% of beneficiaries and a 20% administration budget, at $151 million.
This aligns with the NPP’s projections for the commencement period.

However, at growing enrolment, the figures begin to diverge significantly
from the upper range of estimates provided by the NPP. At a 66% gross
enrolment figure (66% of secondary school age students enrolled) the costs
balloon to $1.1 billion at a constant rate of recurrent expenditure.
Attention has not been paid to capital expenditure or the need to invest
in quality improving measures to match growing enrolment.

There are caveats that may become evident as the full policy is unveiled.
In particular, it would be important for the NPP to explain what
percentage of private household expenditure on secondary expenditure it
intends to absorb.
The following assumptions were not used in the analysis. It should be
noted that their use would have further aggravated the financial
challenges facing the NPP policy:

1. The NPP will revert to a 4-year secondary educational system (the
financial cost could be upwardly affected by 20% in that event).

2. The average population growth rate over a 4-year horizon of the policy
shall be 2.5%, and that the secondary student population growth rate shall
follow the same trend (the financial cost could be inflated by 12% under
this assumption).

3. Concurrent pressures to expand the number of places at tertiary
institutions to maintain the national per capita university enrolment
rate, and associated costs.

In summary, we conclude that the NPP’s financial proposals for funding the
cost of the party’s proposed free secondary education policy is
conservative by a multiple of nearly three, if by the same policy it also
aims to meet the key objectives of the policy: expanded enrolment and the
shift of the cost-burden of secondary education from private households to
the public purse.
Kofi Bentil is Assistant Professor of Strategy at Ashesi University
(www.ashesi.edu). Franklin Cudjoe is an Earhart Fellow at Buckingham
University. Bright B. Simons is a Brain Trust member at the Evian Group @
IMD (www.imd.ch). They are all affiliated with IMANI Center for Policy &
Education (www.imanighana.org). This comment was commissioned by
www.ghanareporters.com

Written by iselorm