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04.01.2018New in schools' delegated budgets by 2018

The new year 2018 begins with a new, reformed system for funding schools and kindergartens. It also provides opportunities for development of schools and kindergartens with fewer pupils (especially in rural areas), in order to cease the chronic underfinancing they have faced over the past decade. This new system, which remains within the delegated budgets, and yet refines them so as to reduce the disproportion in funding between urban and rural schools, was one of the main political demands of the Minister of Education Krasimir Valchev. The key parameters of its implementation are set in the State Budget Act 2018, the accompanying amendments to the Law on Pre-school and School Education, as well as in the Council of Ministers Decision 667 / 01.11.2017, which defines the standards for the state delegated activities.

New in the system of financing

What is new in the system of delegated budgets is that they will be determined not only by the number of students, but also by the number of classes and schools. Ie. in 2018, the MES will provide municipalities with funds not only on the unified standard per student, but also on the innovated standard for the class, and the institution standard.

The funds allocated to municipalities will be assigned to mandatory and additional components in a ratio of 85%: 15%. Ie. the ability of municipalities to reallocate between schools from 20% to 15% is slightly reduced, which is unlikely to cause drama because until now most of the municipalities do not use additional components of the formula (except the compulsory component of fixed costs) .

Another major innovation is the definition of standards and the reporting of regional and municipal differences. Instead of reaching different municipal standards, which depended on the population in the municipal center and the number of settlements with more than 800 people, the new system overcomes a single standard, differentiated by school type (non-specialized, specialized, vocational schools). According to CMD 667 / 01.11.2017, which sets standards for state delegated activities, the standard for a student in a non-specialized school in 2018 will be 1370 BGN. The standard for a class in a non-specialized school will be 6992 BGN, and the   school standard will reach BGN 33,000.

These standards are complemented by important regional coefficients in the allocation of funds within the Education function. Municipalities are devided into eight groups regarding the vulnerability of rural areas and suburbian regions. Thus, the Group 1 municipalities (large urbanized municipalities) have a zero regional coefficient and with each higher group the coefficient increases.

What is the increase in municipalities and regions see in the full text of the publication

Outside the above-mentioned funds under the three standards, schools and kindergartens will receive additional funding for:

1. working with students from vulnerable groups: vulnerability is expected to be determined through the point of view of parental education status. Thus, schools where the majority of parents have lower than secondary education will receive additional funds for more activities with students;

2. maintenance of classes for acquiring qualification in protected specialties of professions and specialties of professions where there is an expected shortage of specialists on the labor market;

3. maintenance of protected kindergartens and schools: the current standard for a protected school under Art. 282, para. 4, as well as Art. 282, para. 5, drops out, with the Addendum for a Protected School going beyond the standards for state delegated activities.

 

Beyond numbers

Ten years ago, when delegated budgets were introduced in an ultra-liberal way, based only on the number of students, at very low unified standards and without any protection mechanisms for small schools, I published the analyses "Educational Reform in Bulgaria and Challenges to the education of Roma children ". I outlined alarming scenarios in it, that many rural schools would be closed down, that it would lead to an increase in the drop-out rate, further deteriorating quality in rural schools due to their low budget. Unfortunately, most of these forecasts came true: 450 schools were closed down in the first two years after the introduction of delegated budgets, net enrollment rates at primary and lower secondary levels collapsed and, after temporary improvement, reached record low levels in 2015 and 2016; etc. Without denying the overall positive effect of introducing delegated budgets, we can not close our eyes to the fact that "small" schools, rural schools have suffered a heavy "punch", and it has been a serious problem for the entire education system. Due to the above reasons, Amalipe Center has supported rural schools for almost 10 years and advocates changes to the delegated budget system to reduce funding disproportion.

The system's shortcomings, especially in terms of children's scope, became apparent almost immediately. In 2013, Minister Valchev, being then a Chief Secretary of the Ministry of Education and Science initiated the introduction of a flat rate for "conditional-permanent expenses", which was the same for all schools and slightly reduced the disproportion in financing. It was included as a mandatory additional component of the delegated budget formula, ie. it did not bring change to the system.

The newly proposed changes are significantly more radical and are in the right direction. Introduction of two new standards as main components - for a class and for an institution - will reduce dependence on the number of students and the vicious practices associated with it. It will give a chance for a higher budget for schools with fewer pupils and small - size classes.

In essence, the budget to be allocated to the delegated activities under the Education function in 2018 is higher than in 2017. At the same time, the single cost standards for a student are lower. This is because of the introduction of classroom and school standards. Because they are the same for full and small-size classes as well as for the numerous and small schools, this change gives more resources to rural municipalities as well as to small schools.

Comparing budgets for small and medium-sized schools in 2017 and 2018 as well as guidelines on how to calculate the 2018 budget see in the full text of the publication.

 

Prospects

The launched reform of the school education funding system promises a positive change in terms of a more equal distribution of resources and overcoming the systemic under-financing of schools in rural areas. It will make it possible to raise the salaries of teachers, working in "small" schools: in order to meet the requirements for increased payment in education and the particularly acute need for qualified, motivated and innovative teachers in villages and small towns.

The 2018 State Budget Act, the accompanying changes to the Pre-school and School Education Act and the Council of Ministers Decision 667 / 01.11.2017, are rather the beginning of the reform than its overall framework.

In this regard, we can offer:

 

1. Categorically linking funding reform to raising educational outcomes in each school;

2. Providing additional resources for work with vulnerable groups to be programmatic: the concerned schools to receive funds against a program of activities to be carried out to increase the educational outcomes of pupils from vulnerable groups;

3. The weight of the regional component should be increased: in 2018, municipalities in Group 8 (rural municipalities in the poorest areas) will receive by standards 12% more than municipalities in Group 1 (the most urbanized municipalities). That's too small;

4. Introducing a standard or supplement for a school that is a single one in a  given settlement

 

Author: Deyan Kolev, deyan_kolev@amalipe.com

 

Detailed description of the proposals see in the full text of the article, which is available in the "Publications" section of the website of Amalipe Center.

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