How can we best use public funding for schools improve the educational outcomes of socially disadvantaged

children?Presentation for International Conference on The Right to Education for Every Child

Belgrade June 2-3 2009Rosalind Levačić, Institute of Education,

University of London

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Interlinked issues in using public finance to combat educational disadvantage

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Examples of additional funding to compensate for social disadvantage

Netherlands (from 2007) abandoned use of immigrant status and fund only in relation to parents’ education. Additional 30% for pupils whose parents’ highest level is junior secondary and 120% more for parents whose highest level is primary or less.

England: central government funds local authorities about 70% more per pupil for those with additional educational needs (about 19% with AEN) 12% of total funding is for AEN + deprivation.

AEN based mainly on social welfare payments data.

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How has additional funding to combat educational disadvantage been used?

Policies in advanced economies date from 1960s.Examples:

USA: Title 1 for schools- small additional funding and not well used (e.g. withdrawal of pupils from class) Head Start and Follow Through for early yearsU.K. A range of different programmes for schools. Since late 1990s stronger focus on early years and integrating education, health and social work services.

Broad conclusions:additionally funded school based programmes have had at best small

positive effects.most effective are good quality early years programmes which also

involve families;decentralization: greater focus on responsibility for delivery of results

at the school level

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Stylisation of rates of return to investment in education at different stages of the life

cycle Carneiro and Heckman (2003)

5Age of individual

Rate of return to expenditure on education and training (%)

Pre-school

School Post school

Opportunity cost of fundsCost %

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Main methods of funding from central government to local level

Sustained public funding rather than one-off short term projects.

1. Categorical (ear-marked) grants for specific programmes to raise attainment of socially disadvantaged children:

can be combined with local matched funding2. Priority areas/schools: extra funding to pay teachers

more or provide more teachers per 100 pupils3. Per pupil funding: additional funding for socially

disadvantaged pupils

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Per pupil funding for social disadvantage

• First best: as part of system-wide funding of pre-school and basic education using a formula in which the main element is per pupil funding. Budgets allocated to schools and managed by them

• Second best (if school financial decentralisation is not introduced):additional funding per socially disadvantaged pupil in relation to numbers of such pupils enrolled at the school

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Why per pupil funding and school based financial management could improve

education for the socially disadvantaged Per pupil funding: horizontally equitable - stops any under-

funding of pupils of low socio-economic status (SES)Funding formula can include additions for educationally

disadvantaged pupils – makes them more attractive to enrol and retain.

Schools have more flexibility in how to use resources to combat educational disadvantage- provided teachers value this, have knowledge of how best to use resources, and are provided with information on their pupils’ progress in relation to SES and prior attainment compared with other schools.

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Four Components of a Per Capita School Funding Formula

1. Basic per pupil allocation

4. Schools’ additional site costs

3. Special programmes 2. Pupils’ additional

educational needs

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Indicators for funding pupils’ additional educational needs

Dimensions of social Dimensions of social disadvantagedisadvantage

Low educational achievementLearning difficultiesPoverty Low socio-economic statusEthnicity

IndicatorsIndicatorsTest results at end of Test results at end of previous education phase previous education phase Psychological/educational Psychological/educational assessment of the child assessment of the childIncome of family or areaIncome of family or areaOccupation or education Occupation or education of parentsof parentsSelf-identification: census Self-identification: census data from school or data from school or national surveynational survey

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Characteristics of a good indicator of additional educational need

The indicator (or indicators) should: • be a good predictor of low educational

attainment• not be manipulatable by local governments or

schools• not give schools wrong incentives (e.g. use of test

results of the school receiving the funding)• use data that are easy to collect e.g. are already

collected for other purposes

What has to be overcome in combating educational disadvantage in central and

eastern Europe: attitudes

• Lack of awareness of and concern about the relationship between socio-economic status and educational outcomes

• Schools judged by outcomes of the most able pupils and not by value added i.e. how well the school educates pupils of all social groups-

e.g. focus on olympiads- with extra funding

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What has to be overcome in combating educational disadvantage in central and

eastern Europe: provision

• Low funding per pupil and consequently low teacher salaries

• Decline since communist period of pre-school education and in particular of free provision and in rural areas

• Lack of good quality early years education, in particular for socially disadvantaged groups

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What has to be overcome in combating educational disadvantage in central and

eastern Europe: funding methods

• Centralised and inefficient use of finance and resources

• Traditional systems of school funding still remain in a number of countries- based on historic expenditure and actual numbers of staff in post

• Absence of compensatory funding for social disadvantage- only for special education to which children from poor backgrounds tend to be assigned in order to remove them from mainstream schools

• Lack of accountability for how human and financial resources used in achieving educational outcomes

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Barriers to school funding reforms

• Impossible to introduce system-wide school based financial management reforms without strong political will from central government

• Lack of interest in using indicators of social disadvantage in funding formulae

• Lack of data to identify children from socially disadvantaged backgrounds (Open Society Institute (2006) Monitoring Education for Roma.)

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What can be done?• High quality early years provision integrated with health

and social services and targeted at socially deprived areas to develop children’s social and cognitive skills in order to make them better prepared for school.

• Considerably higher per pupil funding for low SES children at school (at least twice as much) but should be used to provide good quality teaching over a longer sustained period (instruction hours, attendance and retention) rather than lower class size.

• More control at school level of use of finance and resources to improve the attainment of socially disadvantaged pupils.

• Much better data: transparent and reliable information on how pupils of different social backgrounds progress through the education system - used for evaluation, monitoring and accountability.

• Hearts and minds: teachers who value each child equally.

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THE END

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Additional funding for education of socially disadvantaged: allocation

• Major funding source must be central government since incidence of social disadvantage is uneven.

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How has additional funding to combat educational disadvantage been used?

Policies in advanced economies date from 1960s.

Examples:Netherlands Funding for schools with high proportions of socially disadvantaged pupils for additional teachers as part of formula funding.France (Priority Education Zones) Additional pay for teachers and additional staff

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Use of additional funding to combat educational disadvantage: USA

Title 1 (since 1965) Reconfirmed in 2002 No Child Left Behind Act.

Federal funding to states then allocated to schools.But relatively small amount per pupil.Not well used (e.g. withdrawal of pupils from class)

Pre-school programme: Head Start (also from 1960s) Evaluations: positive effects into adult hood of high

quality programmes on attainment, income and reduced criminality.

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Use of additional funding to combat educational disadvantage: England

• Central government funded programmes e.g. Excellence in Cities learning mentors; learning units within school for disruptive pupils; gifted and talented programmes. Modest positive effects.

• Sure Start: Neighbourhood Nurseries and Children’s Centres (0-5 years):

home-visits, support for parents, play and learning activities; health care, special needs support.

Sure Start Evaluation (2008) Improved social development of 3 year olds

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Why improve the educational attainment of children from socially disadvantaged groups?

• Equity: a child’s educational opportunities should not depend on gender, ethnic group or socio-economic-status

• Efficiency (Carneiro & Heckman, 2003; Heckman and Masterov, 2007 )

Public investment in the education of children from socially disadvantaged backgrounds creates much higher benefits over the lifetime of the child than the additional costs – but the right types of investment needed.

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Social disadvantage and educational attainment: importance of family influence

A complex of factors reflected by indicators of:• Low household income• Parental occupation- unskilled or unemployed• Parental education: low qualifications• Family structure – single parents• Home language different from national language and

language of instruction• Ethnic groups which have some of the above characteristics

and are in addition discriminated against• Living in an area of social deprivation

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Indicators of social disadvantage used in the allocation of additional funding to

local authorities in England

DATA SOURCE: NATIONAL

Children in households receiving state benefitsLow birth weight babies Deprivation indicator of area based on income, employment and qualifications of adults

DATA SOURCE: LOCAL

English as additional languageEthnic groups with low educational attainmentPupils entitled to free school meals

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Indicators of social disadvantage used in the school funding formulae in the

Netherlands

• Parents’ highest education: junior secondary and for higher per pupil allocation• Parents’ highest education: primary

Replaced indicator of child or parent born abroad- i.e. emphasis more recently is on social disadvantage not ethnicity

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Central or local discretion in use of funding?

Central: for• Ensures funding spent on

socially disadvantaged• Best practice knowledge

can be applied

Local: forEffect ways of using additional

resources depend on local contexts and cannot be determined centrally

Local professionals need to be motivated and empowered

Central control can be exercised through holding local managers to account for performance- requires appropriate data

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Studies on use of additional resources to combat educational disadvantage

• Carneiro, P. and Heckman, J. J. (2003), 'Human Capital Policy. Inequality in America: What Role for Human Capital Policy?'. IZA Discussion paper 821.

• Heckman, J. J. and Masterov, D. V. (2007), 'The productivity argument for investing in young children'. NBER Working Paper No. 13016.

• Karsten, S. (2006), 'Policies of disadvantaged children under scrutiny: the Dutch policy compared with policies in France, England, Flanders and the USA'. Comparative Education, 42 (2), 261-282.

• Leuven. L. and Oosterbeek, H. (2007), 'The effectiveness of human capital policies for disadvantaged groups in the Netherlands'. In L. Woessmann and P. Peterson (eds), Schools and the equal opportunity problem (pp. 327): MIT Press.

• Machin, S., McNally, S. and Meghir, S. (2004), 'Improving pupil performance in English secondary schools: Excellence in Cities'. Journal of the European Economics Association, 2 (2-3), 396-405.

• Nores. M., Belfield, C. R., Barnett, S. and Schweinhart, L. (2005), 'Updating the economic impacts of the High/Scope Perry Pre-School Program'. Educational Evaluation and Policy Analysis, 27 (3), 245-262.

• Stewart. K. (2009), ''A scar on the soul of Britain': child poverty and disadvantage under New Labour'. In J. Hills, T. Sefton and S. K. (eds), Towards a More Equal Society? Poverty, inequality and policy since 1997. Bristol: Polity Press.

• Sweinhart, L. J. and Weikart, D. P. (1997), Lasting Differences: The High/Scope Perry pre-school curriculum through age 23. Ypsilanti, Michigan: High Scope Press.

• The National Evaluation of Sure Start (NESS). (2008), The Impact of Sure Start Local Programmes on Three Year Olds and Their Families: Institute for the Study of Children, Families and Social Issues. Birkbeck, University of London. HM Stationery Office.

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From what angle am I approaching this question?

• As an education economist: recent revitalisation the this area of economics due to (a) realisation of importance of human capital of all members of society for its welfare;

(b) more empirical evidence• As an international consultant who has

worked on school finance reform attempts in 7 transition countries

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Conference proceedings highlight importance for improving Roma

education of• Access to good quality early years education

• Inclusion into mainstream schools

Consistent with what has been learnt in west Europe and North America about best ways to combat educational disadvantage

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Accountability: monitoring and evaluation

Is an essential component of an effective and efficient decentralised education system.

Transparency in how funds allocated and used.Monitoring of attainment of children from

socially disadvantaged backgrounds.Evaluation of education interventions for

socially disadvantaged children to learn which are cost effective and which not.

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Pupil Level Annual Survey in Englanda question: “What is the child's ethnic group?”

White: British White: Irish Traveller of Irish Heritage Gypsy/Roma Any other White background Mixed: White and Black Caribbean Mixed: White and Black African Mixed: White and Asian Any other Mixed background Asian or Asian British: Indian Asian or Asian British: Pakistani Asian or Asian British: Bangladeshi Any other Asian background Black or Black British: Caribbean Black or Black British: African Any other Black background Chinese or other ethnic group: Chinese Any other

Parents supply information when registering child: self-classification

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What can be learnt from experience of compensatory educational policies?

• The richer economies of Europe and North America have made limited progress in the last 40 years in reducing educational inequality.

• Nevertheless the issue is receiving ever greater political attention because of the increasingly apparent social costs of educational inequality.

• Eastern and central Europe can learn from this experience and adopt and adapt what our current knowledge indicates are better practices

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