The default privatization of Peruvian education and the rise of low-fee private schools: better or worse opportunities for the poor?

María Balarin, PhD

The rise of private education in Peru

• Two failed early attempts in the 1990s to introduce endogenous privatization reforms (following the Chilean model)

• In 1998 the government passed the 882 Legal Decree for Promoting Private Investment in Education– Liberalised investment enabling schools to operate

for-profit– Simplified procedures for opening schools– Provided tax incentives for investors

• Explosive growth of private education, especially in major cities, with no public funding

Evolution of national enrollments in private and public educationucation

86% 81% 75%

14% 19% 25%

0%

20%

40%

60%

80%

100%

1997 2005 2012

Distribución de la matrícula en EBR Escolarizada para menores a nivel nacional según gestión

Perú 1997, 2005, 2012

Privada

Pública

Private education in lima

• Lima, a desert city of 9million people at the feet of the Andes, concentrates almost 1/3 of the country’s population

• And almost half of enrollments in basic education

Proportion of private and public education enrollments in Lima (2012)

57%

43%

Distribución de la matrícula en EBR Escolarizada para menores según gestión

Lima 2012

Pública

Privada

The rise of private education in Lima

Assessing the impact of private education growth

Avoiding simplification: Importance of considering equity and social cohesion impacts and not only ‘productive efficiency’ and freedom of choice (Belfield and Levin 2002)

When considering equity and social cohesion we need to take into account:

• Markets and segregation: Educational quasi-markets have been shown to increase seggregation through combined effects of selection by schools and self-selection by families, where higher SES families are better positioned to make choices. In full markets segregation effects can be expected to deepen.

• Segregation and composition effects: In highly seggregated and stratified education systems, poor students concentrated in schools wih high poverty intakes tend to fare worse. Why should this differ in low-fee private schools?

• Methodological issues when considering private vs public school efects: test results need to be controlled by average school SES rather than individual SES level. When this is done, general differences between private and public schools tend to disappear (see Somers, McEwan, Willms 2004; Carnoy et al 2005)

The context in which poor families choose private schools

• The private school sector is tremendowly diverse and stratified along a very wide range of quality

• Residential segregation is high and National Assessments have shown that achievement in private schools in the poorest areas is similar and sometimes worse than in public schools

• Recent research using PISA test results, show that Perú is the Latin American country with the deepest educational segregation and where students’ SES is most strongly corelated with achievement (Benavides et al 2014)

• Educational segregation has deepened during the period in which private education growth has been highest

Peru’s unregulated private education market

• How well regulated private services are “is perhaps the single most important issue in the privatization of basic social services” (Klees 2008)

• In Peru effective regulation of the private education sector is almost non-existent

• Especially after decentralization when executive and supervisory capacities were transferred to regional governments

Peru’s unregulated private education market

• There are a number of norms that often superimpose or contradict each other, as well as normative voids

• There is confusion as to whether the Ministry of Education or the Consumer Protection Agency should regulate private schools

• Regulations are not properly applied due to functional weaknesses at regional and local levels (no regular personnel, lack of resources, etc)

• Local authorities do not collect or process data nor perform any regular supervisory role with regard to private schools (only ad hoc inspections when problems emerge)

• Little is known about what happens inside private schools – no data on profit/not for profit status; student SES, etc.

• Great degree of heterogeneity: from elite high quality and more self-regulated schools to schools of unaceptably low quality that cater for the poor

• Many unlicensed private schools that are under the radar

Poor families’ choice of low-fee private schools

Poor families choice of low-fee schools

• Families pay monthly fees of between 25 and 50 US$

• Rather than being ideologically or status driven their choice of private schools responds to very concrete/practical considerations – a reluctant choice for the private sector (Walford 2011).

Practical concerns• Availability of schools

in their area• Closeness to the home

(greater security from local risks)

Child-centred concerns• Lower student-teacher

rations• Closer attention to

students needs• Protection from bullying

Academic concerns• Narrow notions of quality• More courses/copybooks

= greater learning• Reponse to common

desirable and marketable ideas: english and computing, etc.

Most of all: High hopes and expectations • Education = progress

The other side of the private school experience

• When faced with problems – schools demands for greater economic contributions, unavailability to pay, etc. – parents realise they are unprotected and schools are often unresponsive

• This happens often for parents who often are in precarious/unstable employment

• This has a strong impact on pupils trajectories, which often get interrupted for variable times and children go in and out of different schools and in and out of the private and public sector

Will their children’s opportunities really improve?

Exploting the expectations of the poor?

• Great mismatch between parents’ expectations and the reality of low-fee private schools

• Default privatization ‘behind’ the state – very weakly regulated and known

• Great degree of heterogeneity and evidence of segregation and stratification in the private sector – where quality is correlated with fees, but higher fees don’t necessarily imply better quality

• Poor families choose from schools offering below-standard services, with little information and weak criteria to guide them