Education Finance and Education Reform: A Framework for Sustainability. Policy Paper Series.

Overview & Synopsis

Much of the recent discussion on basic education finance in Latin America points to a decline in education funding and to problems in the political economy of the education sector. This paper presents findings of a study that reviewed the existing framework for education finance and proposed a more organic linkage between education finance and education reform. The paper suggests that increased funding for basic education will result in better and more equitable education only if the system deals first with the issue of accountability. Following the introduction, section 2 reviews the historical evidence leading to the current trends on education finance in Latin America. The section asks if the current crisis in education finance is relegated only to public finance, suggesting that the private cost of public education may be picking up the difference. Section 3 reviews the main prescriptions given by analysts and governments concerning the uses for increased education funding, and discusses the myths surrounding some of those prescriptions, as well as the links between the sustainability of each prescription within a context of accountability. The fourth section analyzes the overall links between accountability and finance, and suggests a sequence for policy reform leading to increase public spending, leading in turn to increased efficiency in resource use, increased quality, and equity. Six tables and one figure are included. Six tables and one figure are included. (Contains 53 references.) (LMI)