FUNDING OF SCHOOLS

1
FUNDING OF SCHOOLS Policy issues and proposed
amendments to the Norms and Standards Presentatio
n by the Department of Education October 2004
2
Legal Background

• Main legislation South African Schools Act
  (1996)
• The cornerstone for a post-apartheid
  institutional landscape for schools.
• Subordinate policy National Norms and Standards
  for School Funding (1998)
• A system of pro-poor funding of schools.
• Subordinate regulations Regulations for the
  Exemption of Parents from Payment of School Fees
  (1998)
• Protection of the most vulnerable in a context of
  school fees.

3
Policy Background

• Proposals for new approaches Plan of Action
  (2003)
• Greater equity between provinces and a
  sustainable removal of school fees in the poorest
  communities.
• New draft Norms and Standards for School Funding
• To be released for public comment 2004, for
  implementation 1st January 2006.
• New Exemption Regulations
• To be released for comment in 2004, for
  implementation 1st January 2006.

4
Policy Developments

• Further additions to the school funding policies
  currently in the pipeline
• Norms for Grade R funding in public ordinary
  schools
• Norms for the funding of ABET centres
• Provisions for non-personnel funding for special
  schools and inclusive education.
• Other key school issues being dealt with outside
  the Norms and Standards for School Funding
• Capital investment strategy for school
  infrastructure
• Norms for provisioning of non-educator posts
• Focus today is on funding of public ordinary
  schooling in Grades 1 to 12 through school
  allocations, and the related matter of school
  fees.

5
School Allocations 1
The school allocation is a per learner allocation
paid by the PED to schools The amount is pro-poor
in recognition of the greater need for public
spending on education in poorer communities. The
allocation to poorest schools varies from R400 to
R600 per learner per year currently. Poor schools
get 7 times more per learner. A poor school with
1 000 pupils will get around R500 000 per year as
a discretionary budget. This money should be used
in local communities,and represents some R3
billion in transfers from the fiscus each year,
much of it to poorer rural areas.
6
School Allocations 2

• What is the school allocation for?
• It is for educational purposes such as books
  and stationery, for lights, phone and water, and
  for equipment. The allocation is also intended to
  cover cleaning materials and routine maintenance.
  It does not cover personnel or capital costs.
  School feeding is also separately funded.
• Apartheid backlogs in terms of school
  infrastructure, and large scale maintenance are
  tackled through provincial budgets.

7
Information about School Allocations

• By September each year, a school should be given
  the following information
• Which national quintile they are in
• The per learner amount for that quintile and
• The school allocation for the school for the
  following school year, and how this was
  calculated.
• In addition, MECs will release to the public the
  full resource targeting list for the province, to
  ensure transparency.

8
Fee Exemptions

• Automatic exemptions
• Learners such as orphans are already
  automatically exempted from school fees. In
  future, all learners subject to a social grant
  are also automatically exempt, whatever school
  they attend.
• Other exemptions, on application
• Any parent with insufficient income may be
  exempted on application. Where income is less
  than 10 times the school fee a full exemption
  applies, and up to 30 times the school fee
  qualifies for a partial exemption. In future,
  parents paying fees for more than one learner are
  to be given a discount.
• New exemption calculations furthermore take into
  consideration certain non-fee contributions.

9
The Revised Draft Norms and Standards for School
Funding

• Follow directly from the Costs of Education Study
  and the Plan of Action
• Approved by HEDCOM and CEM for publication
• To be gazetted for public comment
• Amendments to three policy fronts
• Exemptions for the poor
• Use of the school allocation
• Targeting adequacy amounts and national poverty
  quintiles

10
The revised draft Norms and Standards Policy
front 1

• Fee exemptions for the poor
• Poorest schools with lowest fees to become no
  fee schools, by eliminating need for compulsory
  fees.
• Automatic exemptions for special categories of
  children, including recipients of social grants.
• Easier access to exemptions for multi-learner
  households.
• Stronger imperatives around Departmental
  monitoring of fee exemptions.

11
School Fees and Exemptions

• The most significant change poposed in the
  revised Norms is the declaration of no fee
  schools by the Minister. These are schools that
• receive school allocations that exceed the
  adequacy benchmark, and
• are in quintiles which the Minister has declared
  should not have school fees.
• No fee grades, (particular grades where school
  fees may not be charged) are also contemplated in
  the draft revised Norms, in recognition of the
  primary Constitutional obligation to provide a
  basic education.

12
School Fees and Exemptions

• These measures will require legislative
  amendments to the SA Schools Act, which may only
  be effected as from January 2006
• An interim process for 2005, involving the
  identification of selected schools to be no fee
  schools, in exchange for an adequacy allocation,
  is under consideration, and the Minister is
  seeking the advice of Cabinet on the matter

13
School Fees and Exemptions

• School fees in richer schools permit a pro-poor
  transfer of state funding of at least R300m per
  year, through the collection of school fees from
  the rich, and the diversion of funds from these
  schools to poor ones.
• With a robust and effective exemptions system in
  place, school fees can bring much-needed
  resources into the system without compromising
  the right to an education.

14
The revised draft Norms and Standards Policy
front 2

• Use of the school allocation
• Guidelines on how the school allocation may be
  used
• National targets to bring about greater
  transparency in fee setting school communities
  to know what they are getting
• Better medium-term planning promoted through
  three-year framework for school allocations

15
Use of the School Allocation

• There are no changes regarding the status of
  schools in the revised draft Norms and Standards.
  However, more transparency in regard to budgets
  is required.
• PEDs will issue a recommended breakdown of
  expenditure to all schools. Deviations from this
  breakdown will be monitored, and unjustifiable
  deviations followed up. Withdrawal of Section 21
  functions is, as in the past, a possibility.

16
The revised draft Norms and Standards Policy
front 3

• 3. Adequacy amounts and measurement of poverty
• Monetary school allocation targets based on an
  adequacy amount, determined annually by the
  Minister
• A national distribution of poverty quintiles to
  replace the current provincial quintiles, since
  not all provinces are equally poor
• New poverty measures determined by the poverty of
  the community around the school.

17
Proposed Adequacy amounts 2006-2008 Note These
targets are strong guidelines for PEDs, but
allocations cannot be guaranteed. Non-attainment
of poverty or adequacy targets should prompt
special collaboration between national and
provincial Treasuries.
THE TARGETS TABLE
2006 2006 2007 2007 2008 2008

NQ1 30.0 R 703 R 738 R 775
NQ2 27.5 R 645 R 677 R 711
NQ3 22.5 R 527 R 554 R 581
NQ4 15.0 R 352 R 369 R 388
NQ5 5.0 R 117 R 123 R 129
Overall 100.0 R 469 R 492 R 517
Adequacy benchmark Adequacy benchmark R 527 R 554 R 581
18
Pro-poor Allocations
The new Norms are based on a flatter pro-poor
curve at the poorer end than previously. This
allows for better funding in all poor schools
(Quintiles 1 3) as overall funding levels
improve.
19
Resource Poverty Targeting

• School-based or individual poverty targeting
• Governments aim is to provide quality public
  schooling that is closest to where communities
  live. Pro-poor school-based funding is thus
  directed towards building poorer communities.
• Changes to the resource targeting lists
• There will be nationally aligned criteria for
  determining poverty levels of individual schools.
  Transition from the previous place in list to new
  place will be gradual. Further updating will
  occur from time to time.
• Dealing with poor learners in rich schools
• A special framework will be provided for
  assessing (suburban) schools with many poor
  learners.

20
National Poverty Distribution Table
Inter-provincial equity to be pursued by taking
into consideration the distribution of the
poorest households across the country, as shown
in the Table below. Data is from StatsSA.
National quintiles National quintiles National quintiles National quintiles National quintiles National quintiles
1 (poorest) 2 3 4 5 (least poor) Total
Eastern Cape 34 26 18 10 11 100
Free State 33 20 16 14 18 100
Gauteng 7 11 18 28 35 100
KwaZulu-Natal 19 22 22 21 16 100
Limpopo 27 25 22 15 10 100
Mpumalanga 14 23 25 21 17 100
Northern Cape 18 17 21 20 23 100
North West 20 19 23 23 15 100
Western Cape 4 10 16 29 40 100
South Africa 20 20 20 20 20 100