Tunisia - Private Provision and Financing of Education and Training

Document of THE WORLD BANK For official use only Draft CONFIDENTIAL Report No. 14736 - TUN REPUBLIC OF TUNISIA PRIVATE PROVISION AND FINANCING OF EDUCATION AND TRAINING June 30, 1995 =FILE COPY Human Resources Division Maghreb and Iran Department Middle East and North Africa Region This document has restricted distribution and may be used by recipients only in the performance of their official duties. Its contents may not otherwise be disclosed without World Bank authorization. TUNISIA ROLE OF THE PRIVATE SECTOR IN THE PRODUCTION AND FINANCING OF EDUCATION AND TRAINING SERVICES Table of Contents List of Acronyms and Abbreviations SUM M ARY ....................................................... A INTRODUCTION ................................................... 1 I. CONCEPTUAL FRAMEWORK .................................... 2 A. Economics of Public and Private Education .......................... 2 B. International Experience ...................................... 5 II. PUBLIC AND PRIVATE EDUCATION IN TUNISIA: PRESENT SITUATION ..... 8 A. Private Education in Tunisia ................................... 8 B. Legal and Institutional Framework .............................. 12 C. Growth Factors of PrivateEducation ............................. 14 D. Obstacles to the Growth of Private Education ....................... 16 III. EXPANDING THE ROLE OF THE PRIVATE SECTOR ................... 19 A. Need for an OverallStrategy .................................. 19 B. Proposed Reforms ........................................ 21 IV. CONCLUSION ............................................... 29 ANNEXES 1. StatisticalAnnex ......................................... 33 2. Private Education Legal Framework ............................. 42 3. Regulatory Framework of Vocational Training ....................... 44 4. Distribution of Public Educational Expenditure ...................... 46 5. [Enseignement Supdrieur Public: Rationalisation du Financement] ........... 49 6. [Enseignement Secondaire et Supdrieur: Simulations] .................. 50 LIST OF BOXES 2.1 Tunisia: Organisation Tunisienne de l'Education et de la Famille (OTEF) .... 10 3.1 Continuing Education inFrance ................................ 21 3.2 Methods of State Aid to Private Secondary Schools ................... 23 3.3 Aid to Private Education: Chile and Colombia ....................... 24 3.5 The Manpower Training Market: The Case of Chile ................... 25 3.6 Massive Development of Private Higher Education: Four Examples ......... 26 3.7 Scholarship Student Monthly Budget, 1994/95 ....................... 27 LIST OF TABLES 1.1 Percentage Shares of Private Education in Total Primary and Secondary Enrollments, 1989/90 .................................. 6 2.1 Student Enrollments in Tunisian Private Education, 1994/95 ............... 9 2.2 Vocational Training,1993 ................................... 11 2.3 Private Vocational Training Enrollments, by Branch of Economic Activity, 1992 . 11 2.4 Private Higher Education: Student Distribution, by Specialty (%) ........... 12 3.1 Basic Scenarios: Projected Gross Enrollment Rates, 1995-2005 ........... 20 3.2 Annual Recurrent Unit Costs in Public Education; Annual Tuition Fees in Private Education .................................... 23 3.3 Savings from Higher Education Recurrent Budget (Base Scenario) Resulting from Expansion of Private Provision and Financing, 1994/95-2004/05 ...... 27 BIBLIOGRAPHY .................................................. 53 LIST OF ACRONYMS AND ABBREVIATIONS CNEP Conseil National de l'Enseignement Privd National Council of Private Education DEP Direction de l'Enseignement Privg Department of Private Education MDE Ministere du Developpement Economique Ministry of Economic Development ME Ministere de l'Education Ministry of Education MES Ministere de 'Enseignement Superieur Ministry of Higher Education MFPE Ministre de la Formation Professionnelle et de l'Emploi Ministry of Vocational Training and Employment NGO Non-Governmental Organization OTEF Organisation Tunisienne Enfance Famille Tunisian Organization of Childhood and Family TFP Taxe.d la Formation Professionnelle Vocational Training Tax UTICA Union Tunisienne de 17ndustrie, du Commerce et de l'Artisanat Tunisian Union of Industry, Commerce and Crafts (Employees' Union) Currency Unit: Tunisian Dinar (D) In 1994, 1US$ = D 1.0126 Fiscal Year January 1st-December 31st Academic Year September-June This report is based on a mission that visited Tunisia form March 11 to March 24, 1995. Mission members included Francis Steier (education economist, mission leader), Guy Allain (education specialist), Anne-Marie Leroy (senior public administration specialist), Jacques Mazeran (education specialist), and Dung-Kim Pham (operations analyst). Peer reviewers were William Experton, Fredrick Golladay, and Elizabeth King. At the time of the writing of the report, Roslyn Hees was the Division Chief, John Underwood the Lead Economist and Daniel Ritchie the Department Director. The report was desktop published by Micheline Agbo. TUNISIA PRIVATE PROVISION AND FINANCING OF EDUCATION AND TRAINING EXECUTIVE SUMMARY 1. The Tunisian Government has devoted a major part of its budgetary resources to education, and this has resulted in a considerable reduction in illiteracy, in universal access to primary education, and girls' enrollment rates approaching those of boys. Primary education drop-out rates are still high, however, and enrollment rates in secondary and higher education, though similar to those in countries of a comparable stage of economic development, are nevertheless too low if Tunisia is to compete in the international economic arena and see its economy integrated with that of Europe. 2. In addition, Tunisian education is at present characterized by an inequitable distribution of public expenditure. The primacy of public higher education (97% of all students at that level, of which 40% hold scholarships), which is tuition-free, results in a disproportionate allocation of public education resources to the segments of the population in a position to benefit from higher education - i.e. those already most favored socially and economically. 3. Overall Tunisia faces four challenges: (i) to reduce the selectivity of basic education; (ii) to increase the capacity of its higher and secondary education systems; (iii) to improve the quality and the responsiveness to the economic environment of secondary, vocational and higher education; and (iv) to ensure the effective use and a more equitable allocation of public resources in education. Since an increase in public resources is unlikely, these challenges will have to be faced through the increased efficiency of public resource use, as well as a growing role of the private sector. 4. This would require the design of an overall strategy framework in which the respective roles of public and private education would be redefined. It would also require responses to three kinds of question: (i) factors that should guide Tunisia's choices of enrollment objectives (international comparisons, the country's own economic realities, etc.); (ii) once desired enrollment paths are chosen, shares of responsibilities between public and private education; and (iii) policy measures to be introduced by the State to encourage movement in the desired directions. 5. Government will need to define the functions it expects private education to fulfill. Possible missions that might be assigned to private education in Tunisia include: increasing overall capacity, improving the education system's links with its economic and social environment, and inducing quality improvements in the public education system. 6. Private education today is not well developed in Tunisia, except at the secondary level (both general education and vocational training). It accounts for less than 1% of enrollments in primary schools, 10% in general secondary schools, 46% in vocational training, and 3% in higher education. 7. The role of the State, which regulates student intakes to the secondary and higher levels of the education system, partially explains these circumstances. Access to these levels is rationed by means of entrance examinations that qualify candidates on an "all or nothing" basis: those who pass go up to the next level, which is subsidized by the State, while those who fail are not given credit even for studies they have completed. Since students who fail at the secondary and university levels receive no official recognition of their achievements up to that point, they have little economic incentive to enroll in private - ii - institutions, which are in no position to award diplomas which the State, much less the labor market, is prepared to recognize. The only two areas in which private education institutions have a place is in remedial education (geared to students who have exceeded their allowed two failures in the public system) and vocational training, which explains the present distribution pattern indicated above. 8. The policies recommended in the report can be summarized as follows: (i) the State opens access to secondary and higher education by clearly distinguishing between the two functions of the present entrance examinations - i.e. instead of a test with a single outcome (pass or fail), there would now be one which is both a full-scale competitive examination giving the successful candidate the right to continue on to the next level of public education, and a diploma certifying the candidate's completion of the present cycle of studies; (ii) the State subsidizes private secondary and (possibly) higher education, and rationalizes public higher education financing; and (iii) the State regularly monitors the quality of education provided by private institutions. Possible forms of State aid and regulatory frameworks are discussed below. 9. Higher education. Raising the gross enrollment rate from its current level (12% in 1994/95) to 18% by 2004/05 (the average for countries with per capita income in the intermediate range) would result in a 70% expansion in the size of the student body. Assuming the present status quo in public provision and financing practices, the investment and recurrent cost implications of such an increase make it unsustainable by the State budget. The role of the private sector must therefore be expanded. The Tunisian context provides the State with two policy instruments to increase enrollments in an equity efficient framework, the combination and degree of which are a political choice: (i) promote the development of the private sector; this implies a numerus clausus in public sector admissions, minimum or zero quality control during the initial years for the private sector, and a substantial increase in the number of secondary school graduates; and (ii) increase private financing of public institutions and improve public sector efficiency (e.g. increasing cost recovery of educational and non-educational expenditure, and reorganizing teaching practices). This would be accompanied by improved targeting of the scholarship program, and definition of an appropriate student loan scheme. 10. Secondary education. Tunisia needs to vastly expand enrollments in secondary education, but high investment and recurrent costs exclude thepossibility of significantly increasing enrollments in public schools alone. Furthermore some 60,000 students currently drop out of the secondary public system. Given these needs, as well as the fact that private secondary schools and vocational training institutions are currently in financial difficulties, and that the quality of the instruction they offer is on the whole comparable to and less expensive than that provided by their counterpart public institutions, State aid for the private education sector is warranted. 11. There are two possible modalities: (i) direct subsidies to institutions, in the form of incentives to quality - e.g. ex-post payments made on the basis of Baccalaur6at results or evidence of scholarships granted to pupils from disadvantaged families; and (ii) a system of education vouchers, allocated directly to households. Of the two, the latter, despite its higher administrative costs, has the advantage of the incentive character of the market forces it would create. The choice of target beneficiary groups and implementation procedures would depend on the particular social and economic objectives sought. 12. Vocational training. Government efforts to involve enterprises more closely in public vocational training should be continued. Special attention should be paid to increasing: (i) participation by the private sector in the management of sectoral training centers, through agreements signed with professional associations; (ii) enterprise participation in the formulation of training programs; an (iii) incentives for - iii - training centers to seek additional resources from enterprises. The latter must be encouraged to train their employees, either internally or through training programs provided by private training institutions. Two reforms of the vocational training tax system would help achieve this objective: (i) give businesses direct use of the proceeds of the tax, and (ii) use the proceeds to set up a Find which would be utilized on the basis of competitive bids from both the private and public training sectors (as in Chile and Sweden). 13. Basic education. It would be advisable to reduce the number of dropouts at this level, as they represent a considerable economic loss to the nation. In addition the authorities should monitor for the possible slippage in quality represented by present private tutoring practices in public education. It would be useful to identify the causes of this phenomenon, and, if need be, to authorize instructors and teachers to give private classes, provided checks are instituted to ensure that they do not do so to their own students. Group remedial courses, organized by OTEF (Organization Tunisienne de l'Education et de la Famille) or other NGOs, could also help improve quality. TUNISIA PRIVATE PROVISION AND FINANCING OF EDUCATION AND TRAINING INTRODUCTION 0.1 Since its independence in 1956, Tunisia has placed considerable importance on its human resources development, and its efforts have resulted in noteworthy achievements: access to primary education is now virtually universal; girls' enrollment rates are similar to those of boys at all levels of education; and the literacy rate among adults has risen from 15% in 1956 to 65% today. However, a number of weak points remain: the high degree of selectivity throughout the system results in low enrollment rates at the secondary and higher levels (gross rates of 44% and 12%, respectively, in 1995); the high selectivity and the disproportionate share of public resources allocated to higher education result in an inadequate distribution of these resources; and the linkages of vocational training and higher education with this economic environment are inadequate. 0.2 Furthermore, private education represents only a small part of Tunisian education. With less than 10% and 3% of enrollments at the general secondary and higher levels, respectively, this partly explains the inequitable distribution of public spending on education. The Tunisian education system thus faces three major challenges in the years ahead. First, it must reduce the higher selectivity of basic education. Second, it must expand its capacity if it is to meet growing needs, particularly at the secondary and higher levels. Third, the internal efficiency of the system, and its ability to adjust to labor market needs, must also be improved if it is to respond to the growing hopes of the population and enable the country to take its place in the world economy. Finally, public education resources need to be allocated with greater efficiency and equity. Since an increase in public resources is unlikely, these challenges will be faced through the increased efficiency of public resource use and a growing role of the private sector.' 0.3 The private sector could contribute to the future development of education and training services by: (i) mobilizing additional resources which could relieve the increasing pressure on public funds (caused by the expected rise in secondary and higher-level enrollments); (ii) providing a wider choice of education and training services and making them more responsive to changing economic needs; and (iii) introducing competition and complementarity in education, potentially resulting in improved efficiency and lower unit costs. 0.4 This study is divided into four parts. Chapter I sets out a conceptual framework, based on economic theory and international experience. Chapter II describes the current status of private education in Tunisia from quantitative, qualitative, and institutional perspectives, and analyzes potential contributing factors of development as well as obstacles to expansion. Chapter III makes the case for an expansion of private education, urges the Government to define a comprehensive strategy that recognizes the importance of the links between public and private education at all levels, and concludes with a description of possible State tools to ensure successful implementation of this strategy. Chapter IV summarizes the findings of the study and their policy implications. 1 The term "private sector' includes nonprofit institutions. -2- I. CONCEPTUAL FRAMEWORK 1.1 This chapter is divided into two sections: the first summarizes economic concepts useful in the analysis of the public and private provision and financing of education and training; and the second summarizes international experience. A. Economics of Public and Private Education 1.2 This section first looks at social services in general and then at education and training in particular. The effects of expansion of the private sector on the equity of the education system are then examined briefly, followed by a short analysis of the overall recommendations for each level of education, as they appear in recent World Bank publications. An in-depth analysis would need to focus on the relationships between the two economic agents under consideration (the education-training system, producer of human capital, and the production system, user of that capital), the two types of agent in each case (public and private), and the two possible arenas of responsibility (production and financing).2 1.3 Social services. According to economic theory, a market is said to be competitive when the following three conditions are met: many producers, free entry, and full information for consumers, who have freedom of choice. Under these circumstances State intervention cannot improve the functioning of the market. Such intervention is warranted only under market failure, or when there are other objectives (e.g. equity). 1.4 In the case of social services, the following factors contribute to a market failure: (i) social services are generally not simple private goods, but rather public goods which benefit society as a whole (e.g. schooling of children, adult literacy training); (ii) consumers rarely have access to exhaustive information on social services (e.g. children, and even their parents, are rarely in possession of full- scale, relevant information on schools); and (iii) credit markets cannot support investments in human social capital (e.g. banks cannot obtain satisfactory guarantees for loans to students without funds or assets). 1.5 There are, however, other reasons for government intervention in the provision or financing of social services, especially such as universal access or equitable distribution. In such cases, an important policy instrument lies in the social services pricing policy - i.e. Most developing countries finance their social services out of the general budget. If there is any real cost recovery from users, it is often weak and applied to virtually the entire population. This can lead to an inefficient and inequitable allocation of public resources. In fact, cost recovery should differ depending on the "public good" characteristic of the service in question: if the externalities and the economies of scale involved are substantial, or if exclusivity of use cannot be guaranteed, the role for subsidies in financing the service is increased (Jimenez, 1987). 1.6 Education. Education is a "quasi-public" good, yielding both private and social benefits, the mix of which varies across educational levels. The importance of the private sector in education and the nature of the relationship between the private and the public sectors vary from country to country. There 2 Management should also be added in particular private management of public schools. International experience, even in the industrial countries, is too recent to be conclusive (e.g. the case of Baltimore in the U.S., since 1992), and the context is very different from that of a developing country. -3 - are generally three reasons why private education institutions appear. The three can interact simultaneously, and they all arise out of a demand for schooling not met by the public sector:' (a) The public sector does not provide enough schools, and therefore tends to make the education system highly selective - this is the case in Japan, in many developing countries (e.g. the Philippines) and some Latin American countries (e.g. Brazil); (b) Available schooling is of poor quality, so that upper- and middle-income groups seek other ways to ensure quality education for their children (e.g. secondary education in the U.S., Venezuela, Peru, Brazil); (c) The society is characterized by ethnic, linguistic or religious diversity, so that the different or the minority communities organize a private education sector in order to ensure the transmission to their children of their cultural and moral values, or of their religious values if these are not provided by the public system. 1.7 This last factor explains the rise of a private sector in many countries with strong Catholic minorities (Canada, U.S., Australia, Germany), where the Catholic Church has to contend with hostility on the part of the authorities (France," Latin America), or where there are marked religious or linguistic divisions (the Netherlands until recently,-and Belgium, respectively). 1.8 Private education and equity. An assessment of the impact of expanded private sector provision of education on the equity of the existing education system must take several factors into account. It could be argued, for example, that the rapid and unregulated expansion of private education may result in inefficiencies and run counter to current public sector efforts to improve system equity, by transferring the children of privileged families from public to private schools. This would lead to the creation of a two-tier education system in which the public sector would increasingly cater to the least qualified students. However, the opposite may also be true: the transfer of children of the wealthy to private (paying) institutions could improve system equity if the incidence of Government spending falls more on the poorest students enrolled in public schools - i.e. if the Government does not cut spending on public schools. 1.9 Educational and Economic Development.' Education is critical for economic growth and poverty reduction. Changing technology and economic reforms are creating dramatic shifts in the structure of economies, industries and labor markets throughout the world. The rate of acquiring new knowledge and the pace of changing technology raise the possibility of sustained economic growth with more frequent job changes during individuals' lives. These developments have created two key priorities for education: it must meet economies' growing demands for adaptable workers who can readily acquire new skills and it must support the continued expansion of knowledge. 1.10 Adaptability and productivity of the labor force depend chiefly on the qualification levels of skilled workers and technicians, and on their ability to profit from continuous retraining. This in turn 3 Estelle James (1987a and 1987b). In certain regions of France, limited availability of public higher education has also been a factor. 5 World Bank (1990, 1992 and 1995), Becker (1964). -4- depends on their general knowledge and their ability to write clearly and make use of mathematics and science in identifying and solving problems. As for higher education, it contributes to sustainable growth through the dissemination of the knowledge of its graduates. The chief mission of a country's higher education institutions is graduate individuals equipped with the knowledge and training that will enable *them to think and act effectively as future business, professional and Government leaders. 1.11 Technological change means that qualified workers need more general and theoretical knowledge in order to be productive, which in turn means that they must already possess solidly founded skills before they can usefully be retrained. The most economical way to utilize public resources to upgrade the productivity and adaptability of the labor force is therefore to invest in primary and general secondary education. Not only does general education contribute to the well-being of society as a whole, but it also directly increases worker productivity and improves access for the poor and the disadvantaged to training and to salaried employment. In addition, in a modern economy close to 80% of jobs created will often be in the services sector, where 70% of the work force needs to have completed secondary education. 1.12 With respect to vocational training, its provision by the private sector, either by enterprises themselves or in private training institutions, may well be the most effective way to expand the qualifications of the work force. In the best of cases, businesses train workers for existing jobs; not only is the cost low compared to pre-employment training, but trainees are automatically assigned to jobs where they use their qualifications. Private training institutions, on the other hand, must keep abreast of labor market developments and be flexible enough to change teaching methods and curricula so as to equip their students with qualifications that are in demand. 1.13 In order to encourage the upgrading and expansion of private training programs, the State needs to create an enabling environment. To this end, governments need to reassess and adjust their roles as the producers, financiers, and promoters of training. Steps taken to facilitate the development of training programs by employers and to reduce the regulations governing private training institutions can be expected to encourage the private sector to react more quickly to changes in policy or economic circumstances. 1.14 If training is designed to fill market gaps, reimbursement of training costs may stimulate business demand for training. Any training financing policy should therefore (i) ensure reliability of supply of the resources essential for' establishment of the permanent institutional structure required for implementation of the policy, and (ii) make sufficient funds available to allow training results to be improved. 1.15 Finally, in most countries, higher education is heavily dependent on public funds. At a time when budgetary constraints are common, both industrial and developing countries are faced with the same challenge: to maintain or improve the quality of higher education in a context of shrinking education budgets and expenditure per student. 1.16 In many countries higher education is also characterized by low student/faculty ratios, under- utilization of facilities, curriculum redundancies, high dropout and repetition rates, excessive non- education expenditure (student accommodations, meals and other subsidized services). A review of country experience suggests four key directions for reform: -5- (a) encouraging greater differentiation between institutions, including through the development of private institutions; (b) providing incentives for public institutions to diversify their sources of financing, including cost-sharing with students and linking public funding to performance; (c) redefining the Government role in higher education (by establishing a coherent policy framework, using market-oriented instruments to implement policies, and granting increased management autonomy to public institutions); and (d) introducing policies explicitly designated to give priority to quality and equity objectives. B. International Experience 1.17 Primary and secondary education: The nature of the relationship between the State and private education varies considerably from country to country, to the point that it is sometimes difficult to distinguish one from the other. This diversity is very apparent in Europe, extending between the two extremes of Ireland, where schools, although characterized as "public" and financed entirely out of public funds, are run by independent boards controlled by the Catholic church, and Italy, where no publie funding is available for private schools, which cater to only a small number of pupils. Between these two extremes are the following: (a) The Netherlands: The State pays teachers and reimburses local authorities for the cost of buildings. Families receive an allowance calculated on the cost per pupil of public schooling; they are free to use it for either public or private schooling, but in the latter case they pay only minimal tuition fees, which are strictly controlled by the State. (b) France and Chile: The State pays private-school teachers under contract, is responsible for their training, and pays schools a flat-rate operating subsidy equivalent to the cost per student in public schools. Capital subsidies are granted by local authorities, and are limited (except in the area of technical education, where the private sector is not very active) to 10% of capital cost. (c) Germany: The Lander pay subsidies that are a variable percentage of operating costs, but schools remain dependent on tuition fees. 1.18 In the three cases listed above, State assistance goes hand in hand with close monitoring of and clear requirements on: teacher qualifications, curricula and the organization of instruction, access for all children, etc. In fact, the link between public funding and a high degree of State control is a.constant in Europe and elsewhere - either because the State believes the allocation of public funds should be accompanied by greater insistence on quality, or because it believes its insistence on quality makes financial aid a necessity. 1.19 The link between the extent of public financing of private education and the student enrollments in private schools is less clear. For example, the weakness of private education in Italy seems more a reflection of the fact that public schools provide religious instruction to all students (except those who request exemptions), making it pointless for the Catholic Church to maintain its own schools, than of the fact that no public assistance is provided for private education. Similarly, the growth of private education -6- in France is a recent occurrence, although the system of State aid dates back to 1959. In Australia, on the other hand, private education expanded in the 1980s, after introduction of a sophisticated and generous system of aid which is a function of the school's own resources. The most likely hypothesis is that State aid contributes to the growth of a sector only when the latter has already come into existence in response to excess or diversified demand not met by the public sector, by providing the financial means to satisfy part of this demand. 1.20 Private sector participation in higher education varies greatly worldwide (from a very small percentage in Sweden, Pakistan and Austria to over 70% in Korea and the Philippines (World Bank, 1994). The picture for primary and secondary schooling is given in Table 1.1, which shows private sector shares in total school enrollment figures for the year 1989/90. Table 1.1: Percentage shares of private education in total primary and secondary school enrollments, 1989/90 Country Enrollments (%) Germany 5.8 Australia 30.0 Canada 5.0 Scotland 4.0 France 15.0 (primary); 21.0 (secondary) U.S.A. 12.0 (1.5-17.0, depending on state) India 7.0 (primary); 23-55 (secondary) Japan 0.5 (primary); 2.9-25 (secondary) Sources: Reddy (1993); Walford (1989); Ministry of Education, France (1993) 1.21 Sociologically, all studies confirm what is suggested by empirical observation: with the single exception of the Netherlands (for reasons related to the country's history and education system), private schools tend to serve a higher proportion of children from the upper and upper-middle income groups. This is true even of countries (such as France) where State aid to private schools requires them to charge very low tuition. This pattern stems partly from the fact that private schools tend to be located in the best neighborhoods, but there are also more complex and not so easily understandable sociological reasons, such as tradition, the fact that the "bourgeois" reputation of some of these schools may intimidate low- income parents, the better information privileged groups obtain, and their greater readiness to use all means at their disposal to facilitate their children's school careers by taking advantage of whatever resources the education system has to offer. 1.22 Average cost per student is generally significantly lower in private than in public education. This difference can be ascribed mainly to staffing practices: private schools tend to hire teachers who are less -7- well-qualified, to pay them less, to have more students per class, and to provide less in-service teacher training. Moreover, union membership is also lower in private schools. 1.23 As far as the quality of schooling is concerned, the public-private comparison is difficult. If "inputs" (number and qualifications of teachers, facilities, etc.) alone are considered, the public sector is the clear winner. In terms of student performance, various studies6 have shown that children in private schools had better success rates on tests devised for the purposes of the particular study. However, once "recruitment effects" are taken into account - in other words, the fact that the children concerned are mostly from privileged social groups - this margin of difference shrinks, though without disappearing entirely. Moreover, the difference observed is not identical in all countries (in France, for instance, there are wide variations from one school to another), and the methodology of the studies has been challenged as well. The outcome of the debate is therefore still in doubt. 6 Jimenez and Cox (1989), and Coleman and Hoffer (1982). -8- II. PUBLIC AND PRIVATE EDUCATION IN TUNISIA: PRESENT SITUATION 2.1 This chapter is divided into four sections. The first describes the current situation in private education in Tunisia by level of schooling; the second summarizes its legal and institutional aspects; the third analyzes present factors that could contribute to the development of private education and training; and the last describes current obstacles to that development. A. Private Education in Tunisia 2.2 The education system." Pursuant to the Education Reform Law promulgated in July 1991, the Tunisian education system is composed of nine years of compulsory basic schooling (six years of primary school followed by a second three-year cycle). Technical schools (Ecoles de qualification technique) offer an alternative for students unable to attend the second cycle of basic schooling. A very diversified system of vocational training completes the options at the primary and secondary levels. Two national examinations each play a dual role, confirming the studies already completed on the one hand and acting as a passport to the higher level on the other. They are the high-school entrance examination (which was given at the end of the sixth grade prior to the reform but is now administered at the end of grade nine) and the Baccalaurgat examination, which entitles its holders to automatic admission to the university. 2.3 Thus Tunisian education presents two particular features. First, it requires 13 years of study prior to university, while most countries require 12 years or less; and second, and this is significant for this report, it rations access to the secondary and higher levels based on examinations that give candidates "all or nothing": those who pass are able to go on to the next level, subsidized by the State; those who fail do not even obtain official recognition for the studies they have actually completed. 2.4 Private schools. Tunisian society is fairly homogeneous in its religion and language, and religion is taught as a mandatory subject in public schools. Accordingly there is no room for the "differentiated" demand that exists in most developed countries. Furthermore, access to primary education is universal, and educational content appears thus far to have maintained acceptable quality levels. These two special features influence the profile of private education in the country. 2.5 Private pre-university schooling is offered by close to 3,000 institutions, but only 35 of them are at the primary level. Private universities are a very recent development, and number just ten establishments. The bulk of institutions, therefore, is at the secondary level (general and vocational streams). For more details, see World Bank (1994a and 1994b). -9- Table 2.1: Student Enrollments in Tunisian Private Education, 1994/95 Level Private Public Percentage of private enrollments per level Primary 8,900 1,472,800 0.6 Secondary 71,000 678,200 9.5 Vocational 20,200 23,500 46.2 University 3,100 101,000 3.0 Source: Annex 1. 2.6 The first cycle of basic education.' There are currently very few private schools offering the first cycle of basic schooling (see Table 2.1). In 1994/95, only 8,900 students (0.6% of the total), studied in 35 private schools. These are primarily located in cities (Tunis and Bizerte), they offer first-class education, they are often the heirs of colonial-era missions, and they serve the children of the wealthy. From 90% to 100% of their pupils complete grade six. Except for a few schools that are operated by the Municipality of Tunis and two schools run by the Organisation Tunisienne de l'Education et de la Famille (OTEF) in Tunis and Monastir, the private schools are profit institutions operated by individuals. The sector has evolved unevenly, with a sharp decline between 1975/76 and 1985/86 (-38%), succeeded by a strong recovery (+28% in just one year), and followed by peaks and troughs which saw growth from 1990 to 1994 and stagnation in 1994/95. In 1994/95, enrollments in private primary schools were back at the 1975 levels, although the total school population had risen by 60%. Their share fell from 1% to 0.6% of all children attending primary schools. 2.7 The second cycle of basic education and secondary education.' Private schools at this level enroll 71,000 students, or 9.5% of total secondary school enrollments (Table 2.1). Private secondary schools are basically the refuge of students who have failed the entrance exam for public schools and of those who have failed twice (the maximum allowed) in public school. Only a few secondary schools, with an enrollment of under 8,000, offer good quality education. In the rest, many of the students suffer from family, social, or personality problems. The Conseil National de l'Enseignement Privd (CNEP, see para. 2.17) estimates that 10% of private school students come from the upper class, 40% from the middle class, and 50% from the lower socio-economic classes. 2.8 Students in private secondary schools are allowed to take an examination to return to a public school, but the success rate is very low, 6% on average (Table 9 in Annex 1). They are also eligible to take the national Baccalaurdat examination. In 1994, 14% of those students passed, vs. 40% of students in the public system. The best private schools had success rates ranging from 25% to 30%. The results cannot be ascribed to the quality of teaching per se, but rather to the nature of the student population. A recent study on private secondary schools in Tunisia has shown that the quality of private schools was This terminology is based on the Education 1991 Reform Act and refers to primary education. These two levels have been grouped together since the structure of private education in Tunisia is still based on the old system (dating prior to the 1991 reform), e.g., 6 years of primary followed by 7 years of secondary school. - 10 - comparable to that of public secondary schools (all things being equal, i.e. allowance being made for the lower quality of private school students), but that the unit costs were lower (World Bank, 1994). 2.9 Private secondary school enrollment growths was strong between 1975/76 and 1991/92, but failed to grow afterwards. As a rule, the schools are operated by private entrepreneurs, although some are run by Organisation Tunisienne de l'Education et de la Famille (O7EF), a nonprofit NGO that operates 70 schools enrolling 20,000 students in secondary general education (Box 2.1). Box 2.1 Organisation Tunisienne de I'Education et de la Famille (OTEF) Founded in 1964 as a parents' association, OTEF, has 500,000 members and a budget of TD 800,000. It changed its structure and began to build schools in the 1970s. It currently operates 70 schools with 20,000 students in the secondary general stream (plus two primary schools in Tunis and Monastir), accounting for one fourth of all private secondary school students. It mainly operates in rural areas where there are often no public schools. It is legally independent of the Government but has ties to it (its chairman is the Secretary of State for Social Affairs, and 500 civil servants have been assigned to its permanent staff). OTEF employees 2,000 teachers, most of whom have come from the public system. Fees are considerably lower than in the for-profit private schools, ranging from D 40 a month in grade 6 (D 35 in the provinces) to D 50 for Baccalauriat classes as compared to D 50 to D 120 in for-profit schools. OTEF schools provide meals for D 0.5 per meal, and day-care facilities, including directed studies costing D 7 a month. OTEF also offers remedial courses for two hours a week costing D 20 a month. 2.10 Private secondary schools all use teachers from the public system. A decree (dated October 21, 1994) -sets the number of full-time teachers per full hour of teaching in Arabic, Islamic studies, philosophy, English, physical and natural sciences, and technology. This requirement results more from the existence of surplus teachers in the public sector than teaching considerations, and there are no assurances that it is being complied with. 2.11 The sector is marked by insufficient facilities. Schools are often located in rented premises, and they do not have sufficient educational materials or equipment. The entrepreneurs are usually unable or unwilling to take great financial risks. 2.12 Vocational training.11 In vocational training (VT), there were 505 training centers throughout the country in 1993, with a capacity to enroll 43,700 students. The private sector had 20,200 students, or 46% of total enrollments (Table 2.2). About 60% of the students in private vocational training institutions were studying for office jobs and 27% for jobs in the textile industry (Table 2.3). There is a defacto sharing of responsibilities with public VT establishments, as the latter take charge of the more costly industrial sector technical training programs. 10 Considering the detailed study on vocational training in the World Bank Report (1994), and the forthcoming report (September 1995) on private-sector participation in vocational training, the present report will only cover vocational training in a summary manner. - 11 - Table 2.2: Vocational Training, 1993 Number Number of Enrolment of centers specialties capacity Ministry of Vocational Training and Employment 73 139 8,653 Ministry of Agriculture 37 31 2,596 Ministry of Tourism and Crafts 20 18 2,180 Ministry of Transport 1 2 60 Ministry of Education 40 13 8,000 Ministry of Health 19 1 770 Private Sector 315 34 20,198 Total 505 238 43,739 Source: Ministry of Vocational Training and Employment Table 2.3: Private Vocational Training Enrollments, by Branch of Economic Activity, 1992 (%) Branch of economic activity Percentage Clerical 62.4 Textiles and clothing 26.5 Computers and office systems 10.0 Electricity and electronics 1.2 Total 100.0 Source: Tables, Statistical Annex. 2.13 Higher education. With 3,050 students (out of a total of some 100,000 in 1994/95), the private sector is quantitatively marginal in Tunisian higher education. The largest institution (UniversitO Libre de Tunis) has about 2,000 students, i.e. 71% of private enrollments. Another institution which has opened very recently reports an enrollment of 350. Others, which are precariously installed (in rented apartments), have about 40 students each. Ninety percent of the students enrolled are studying business and management related fields, while the rest are specializing in the hotel and tourism industry, languages, and the arts (Table 2.4). - 12 - Table 2.4. Private Higher Education: Student Distribution by Specialty Specialty % Business management 57.0 Management information systems 24.0 Business law 9.0 Hotel and tourism industry 4.0 Languages. and communications 4.0 Fine Arts 2.0 Total 100.0 Source: Ministry of Higher Education 2.14 The institutions are extremely diverse and their physical infrastructure is generally inadequate and not adapted to their specific needs. They all offer diplomas either at the Mattrise level, which require four years of study after the Baccalaurat, or at the more advanced Ingenieur level. They mainly draw their students from: (i) those who have failed to pass the Baccalaur6at examination (nearly 50% of their enrollments - as seven out of ten candidates fail); (ii) those who have passed the Baccalaurdat but who are dissatisfied with the fields of study or public institution to which they have been assigned (fourth choice and downward); and (iii) those who have failed more than twice in public universities. Some of the larger schools also accept foreign students (mostly from Africa and other Arabic countries). Fees - at least in Tunis - vary depending on the level of study. They range from D 1,300 to D 1,500 a year, with the third cycle costing from D 1,500 to D 1,800. B. Legal and Institutional Framework 2.15 Tunisia has already liberalized the legal system governing private education. The Framework Law of 1958 made explicit provision for the latter, and private investment is encouraged under the present Investment Code. 2.16 Structure and organization. Private education up to the Baccalaurgat is governed by the Education Law of July 29, 1991, which covers all levels of schooling except higher education. There is no law at present that governs private universities and the Ministry of Higher Education (MES) does not exercise control over them. The February 17, 1993 law which governs vocational training does extend to private vocational training establishments. The ministries responsible (Education, Vocational Training and Employment, Youth and Childhood) authorize and inspect private institutions, which are required to have a certain percentage of full-time teaching staff and principals, whose qualifications are established by decree." According to the regulations governing primary and secondary education, the Ministry of Education (ME) authorizes the establishment of private institutions on the advice of regional consultative committees. The ME permits teachers from public schools to teach in private secondary schools for a maximum of 10 hours a week. Curricula of private primary and secondary schools are the same as those of public schools, unless special permission is obtained from the ME (see Annex 3). 11 Enforcement.of those regulations appears to be lax. - 13 - 2.17 The Conseil National de l'Enseignement Prive (CNEP), a cooperative association representing more than 1,250 private establishments," advises the Ministry of Education on the authorization of new institutions, and also represents its members during negotiations on new regulations. It requires its members to offer full scholarships to 10% of their students, and recommends that tuition fees be kept within certain ranges." The CNEP thus plays a self-regulating role in private education. 2.18 The Government is about to issue a decree authorizing children to return to public schools in the third year of basic education with a three-month age waiver and without an admission test (at present they can only return in the sixth year, after passing an admissions test). This opportunity will be gradually extended to all basic education. Moreover, the Ministry intends to facilitate the reincorporation of secondary school students, possible only at present after an examination, which many students fail (see para. 2.8 and Table 9 in the Annex). 2.19 From a financial perspective, private schools do not receive any direct public assistance. However, they benefit from tax breaks and customs advantages (Annex 3). From an institutional perspective, the Private Education Department (DEP) of the Ministry of Education began to operate in May 1993. Its organizational chart provides for an administrative office responsible for the monitoring of private school authorization permits and oversight of the administration of the establishment4 themselves, and a pedagogical office responsible for teaching supervision. Each office is subdivided into three, one division for each of the two basic cycles and one for secondary education. At the time of this report, however, only the director and two division chiefs have been appointed. 2.20 Administrative inspections are performed by the central offices of the Ministry, and pedagogical inspections, are organized regionally. The Private Education Directorate is making efforts to regularly inspect private schools, which have largely been ignored up to now, particularly from the pedagogical standpoint. 2.21 Vocational training. The vocational training tax, Taxe d la Formation Professionnelle, (TFP), levied on 1% of the wage bill in the manufacturing sector and on 2% in the other sectors, is refunded to companies which provided training to their employees during the fiscal year. The system was reformed, by agreement between the Ministry of Vocational Training and Employment and the business community, so that rebate provisions could be reorganized and modernized. Procedures were simplified and provision was made to pay rebates more quickly (Annex 4). A second' stage of the reform is expected to redefine the purpose of the TFP and the rate at which it is levied, expand the field of application, mobilize resources to provide continuing training for workers in certain sectors not covered at present (small and medium-sized companies, export companies, etc.), and review the scale of rebates in light of the types of training undertaken. 2.22 Higher education: There is no official regulation of private higher education at present. The Ministry of Higher Education is working on a bill that it proposes to submit to Parliament before August 1995 (not yet made available). 12 It is financed by contributions from member institutions and currently has a 12-member Board of Directors. 13 In 1994/95, the tuition fees recommended by CNEP were between D 25 and D 50 a month for secondary schools and between D 30 and D 50 a month for vocational training. - 14 - C. Growth Factors of Private Education 2.23 This section describes the factors that could lead a 'spontaneous' expansion of private education, by level. 2.24 Basic education. There are two factors that contribute to the development of private primary schooling. The first stems from the growing role played by women in the Tunisian workforce,"' which has led a rising number of middle-class families to seek more practical schedules than those offered in public schools. Due to a lack of space (not teachers), the latter operate on two shifts a day (affecting 70% of primary schools and more than one million students)." These schedules are difficult for families with two working parents. Children are out of school for two and a half hours in the middle of the day and public schools do not provide meals or day-care facilities. Families able to do so hire baby sitters or day-care services, but the children of poorer families are left to their own devices. 2.25 Private schools, on the other hand, operate on a 'normal' schedule and provide meals and day care at a modest extra charge, which makes them attractive to middle-class families, particularly when a double salary makes this alternative both necessary and affordable. This development is not without risk to public education. If the trend towards sending children to private schools strengthens, public schools risk losing the children of educated working women, who are generally the best students. 2.26 The second factor is the extreme selectivity of public schools.16 The severity of the selection creates a deep fear of failure in children and their families, while demand for general education continues to increase. As a result, large numbers of students are taking private or semi-private tutoring (a figure of 70% has been suggested for urban areas), which instructors offer for individuals or small groups. It is difficult to say how many families of modest means send their children to tutors, but a fair number probably make major economic sacrifices - from D 30 to D 50 a month per child - and are sometimes forced to choose which of their children will receive the extra attention. The quality of private primary schools is good enough, with passing rates of over 90%, so that the families of children attending them do not find it necessary to provide them with tutoring. Moreover those schools do provide extra tutoring for children who need it, and the most expensive of them do not charge for the service. 2.27 If the cost of extra tutoring (an average of TD 40 a month) is added to the cost of day care (about D 40 as well) and of having someone accompany the child to the center (ID 15), parents end up spending D 95 a month for each child in public school, which makes the cost of private schools less onerous, since they currently charge about TD 40, to which the cost of occasional tutoring must be added. Fees can be as high as TD 120 (senior year) in the most expensive schools, but this includes tutoring when needed." At least, in urban areas, therefore, there exists a potential demand that is bound to grow as Tunisia develops economically and more women join the workforce. 14 Specifically, urban women between the ages of 25 and 50. 15 Te first shift runs from 7:30 a.m. to 10:00 a.m. and from 12:30 p.m. to 3:00 p.m., while the second shift runs from 10:00 a.m. to 12:30 p.m. and from 3:00 p.m. to 5:00 p.m. 16 The passing rate from the first to the second cycle of basic school, in spite of a notable improvement in the internal efficiency of the system, is still about 60%. The Government's goal is to raise it to 70% in 1996/97 (55% of children are expected to go on to secondary school). 17 The former Jeanne d'Arc School, which is now run by the Universii Libre de Tunis and is the school with the best reputation, charges D 650 a year. - 15 - 2.28 Secondary education. After years of strong growth, private education at this level is in economic difficulty and will need to adapt. First, it will have to adjust to the gradual effect of the reform. The last admissions exams to grade seven will take place in June 1995, and starting in 1996 public schools will keep most of their students until the end of grade nine (70% in 1997/98 according to Ministry of Education projections). If the improvements in the internal efficiency of the system are maintained, private schools at the former secondary level will see their clientele shrink. 2.29 This expected development will compound the difficulties already encountered by schools due to market saturation: Table 10 in the Annex shows a steady drop in number of students per school and per class, as the student body grew by 5% between 1990/91 and 1994/95, while the number of schools grew by 30%, suggesting that too many schools have entered the market. According to CNEP, some schools have lowered their fees to TD 10 a month by illegally employing second- and third-year university students instead of qualified teachers, and by not providing minimum levels of pedagogic equipment. 2.30 As it loses students from the second cycle of basic education, private secondary education will be forced to restrict itself to vocational training and to the four years of secondary education envisaged by the reform. This will tend to decrease the large number of schools currently on the market. 2.31 However, the market is not fully saturated. In 1993/94 alone, more than 56,000 students dropped out of public secondary school, and the numbers are expected to rise according to Ministry of Education projections. Even when students who turn to vocational training, apprenticeships, or public technical schools, or who find jobs are subtracted, there are still quite a few children not attending secondary school, many of whom represent potential demand for private schooling, since they cannot afford to pay the current tuition fees. 2.32 Vocational trainin2. The situation of private vocational schools is similar to that of general secondary schools. According to CNEP, the average number of students per institution dropped from 98 in 1991 to 60 in 1993. The training incentive represented by the vocational training tax is attractive only to large companies. 2.33 Higher education. These. factors could potentially result in an expansion of private higher education: (i) high dropout rates in public secondary and higher education; (ii) comparative advantages of the private sector in certain fields; and (iii) changing attitudes. 2.34 Social demand for higher education is particularly strong in Tunisia, yet it is largely unmet owing to the high dropout rates at the secondary and higher levels. Only 10% of each age group goes as far as the Baccalaureat, and the failure rate in that examination, which opens the doors to university, is around 70%. Only 10% of any cohort that attends university actually obtains a degree. Accordingly, there are many students who fail to obtain a Baccalaureat, as well as students with that diploma who are dissatisfied with the field of study and institution to which they have been assigned," and students who have dropped out of the first cycle of higher education. The private sector could play a major role in replacing the public sector for this group - especially since certain graduates from private institutions (particularly in computer sciences) are more sought by employers than their counterparts from public 18 Seventy-five percent of students obtaining a Baccalauriat are accepted in one of their first three chosen fields of study, leaving 25% accepted in their fourth choice or lower. - 16 - universities. There are also interesting prospects for studies more closely focused on business needs for management and technical skills. 2.35 With the growth of private companies, the opening of economic borders, and the regulatory, fiscal, and financial changes that accompany these trends, enterprises will need to hire well-trained, efficient, and adaptable technicians, senior technicians, managers, and engineers. Traditional universities are poorly adapted to this demand and their response time is too long. The new Advanced Technology Institutes (Instituts Sup6rieurs d'Etudes Technologiques, ISETs), which are expected to open in September 1995 and will eventually graduate 5,000 senior technicians a year, provide a solution at that level. .The other levels (particularly applied engineers) require institutions also. If private higher education establishments can provide a response tailored to the demands of enterprises, they may rapidly make a dent in a market that is still extremely underdeveloped. 2.36 Finally, attitudes are also slowly changing in Tunisia. The traditional hostility to the private sector, stemming from the historical pervasiveness of the State, is now giving way to greater receptiveness to liberal economic thinking. Attitudes toward the public sector are also changing. The population is becoming increasingly critical of administrative sluggishness and red tape; users and a growing number of civil servants are becoming more vocal in their demand for quality and transparency; and concerns for greater austerity and efficiency are accompanied by a growing awareness that the State cannot be all things to all people. Although resistance to change in education remains strong, it seems possible that the private sector will play a significant role. 2.37 The very new Universitg arabe des sciences, which opened at the start of the 1994 school year, has accepted 350 students from among 3,000 applicants. It would appear, then, that there is a sufficient pool of interest to enable this level to develop. However, potential demand is very volatile. For example, an official statement made at the beginning of the 1994/95 academic year to the effect that private higher education establishments had no institutional approval was sufficient to frighten away many applicants. Newer and smaller institutions were badly hurt. This clearly highlights the problem of the official positioning of private institutions. 2.38 Lastly, Tunisian education enjoys a good reputation in the field of education among many African and Middle Eastern countries, and a strong potential demand can be expected from that quarter. If the private sector is capable of offering quality education, it could also attract a significant number of foreign students. D. Obstacles to the Growth of Private Education 2.39 Private education has been legally allowed to operate since 1958 and has never been subject to economic constraints imposed by the State (fees have not been regulated, tax incentives have been offered, etc.), and yet its growth has been quite modest. Where primary schooling is concerned, this can -be explained by the State's successful emphasis on its development. However, the reasons for the slow growth of private education at the secondary and higher levels are worth looking into. They are of two types. The first stem from the education system itself, particularly from the rationing it imposes (para. 2.3). Since students who fail the. secondary school or university entrance exams do not receive any official recognition of the studies they have completed, there is little economic incentive for them to enroll in private establishments, whose diplomas are not recognized by the State, much less by the labor market. The only two niches to which private education establishments can aspire are remedial teaching and vocational training, which explains the current distribution of their students. - 17 - 2.40 The other reasons for the slow development of private education are economic and cultural. Despite the changes discussed earlier, aversion to the private sector remains strong, particularly in a field as sensitive as education. The Tunisian public views education at all levels as a right, sees it as a determinant factor in social mobility, and prizes the fact that it is free of charge. Private education remains tarnished by a pejorative idea of mercantilism - which is felt to be incompatible with the dissemination of knowledge and the preparation for a career - and any introduction of fees, even modest, is viewed with suspicion. Some progress has been made, but Tunisia remains very sensitive on this issue. The yardstick of quality, measured in particular in vocational training and higher education by the labor market success of its graduates, will be a determining factor. 2.41 Secondary education. There are two types of obstacles at the secondary level. The first is the poor image attached to private education, which has historically been the refuge of those who have failed in public schools. The second was mentioned earlier (para. 2.30) and has to do with the unaffordability of most private schools. 2.42 Vocational training. Private vocational training suffers from three handicaps: (i) the poor image of vocational training as a whole; inherited from a still recent past; (ii) the economic difficulties of existing establishments; and (iii) competition from public training schools (seen as unfair, since they are indirectly subsidized by the State). 2.43 Higher education. There are four main obstacles to the development of private higher education. The first two concern demand, the third supply, and the fourth attitudes. The main obstacle is that access to public universities (through the Baccalaurdat, and without restriction on the number of admissions) is free of charge. 2.44 Furthermore, the fees charged by private institutions are another powerful obstacle to attracting larger numbers of students. They are too high for most Tunisians and become prohibitive when there are several students in one family. If the private sector is to develop, support would have to be provided to lower the cost (subsidies) or to facilitate access (loans and scholarships); in return, the state could set high quality standards for institutions. Possible linkages of State support and academic standards are addressed in Chapter m. 2.45 Moreover at present, private establishments are mostly interested in the tertiary sector of the economy (Table 2.4). Instruction is offered in certain engineering fields, but enrollments are small. The cost of the equipment needed for scientific fields and industrial technologies is high. If the necessary private capital is to be attracted to the education sector, strong financial and fiscal incentives need to be put in place. Significant steps have been taken in this direction (partial tax relief on investments, exemptions or waivers of the VAT, etc.) and further thought is being given to such moves. 2.46 Finally, the very idea of private education is not well accepted; all actors involved agree that regulation is necessary but they each have different objectives. Users, particularly the parents of students, expect the regulations to set strict criteria for new institutions (number of permanent staff, staff qualifications, etc) to guarantee quality and ensure that the institutions will endure. The academic community fears unfair competition (professors who leave for better pay, more opportunities to establish ties to business), and deplores the possible laxity of private institutions, which have been accused of attaching more importance to profits than to their students' welfare. Its members therefore want strict and demanding regulations (minimum number of permanent staff, staff qualifications, monitoring of educational equipment and resources, oversight of academic juries, etc). Aware of the difficulties - 18 - currently facing the public sector, many universities acknowledge the need to open up to the private sector, but are not truly reconciled to it. Private providers, for their part, want to be protected from surprises sprung by the authorities *(which explains their demands for certification, for acknowledgement of their right to operate) and some of them want still greater acceptance, extending even to the certification of their diplomas. But although they might be willing to accept controls in return for recognition, they are also fearful of rules that would be difficult to abide by or that would justify Government interference. 2.47 The Government, for its part, is officially in favor of private-sector development but, is hesitating over the content of the necessary regulations, as it wishes to: (a) take into account the public's and the academic community's fears, which would require a strict regulatory framework; (b) counter the risks: of permissiveness that could result from a sweeping liberalization, since this might allow possibly subversive organizations to gain a foothold in the country; (c) protect the interests of students and their families with respect to quality and costs; and (d) ensure that Government administration are not required to assume oversight responsibilities beyond their capacities. 2.48 This suggests the need for an independent accreditation and evaluation system, for both public and private institutions. The choices (nature and types of controls, implementation schedule, independence of the evaluating body) will be of key importance in the design of an overall higher education strategy. They are addressed in the next chapter. - 19 - III. EXPANDING THE ROLE OF THE PRIVATE SECTOR 3.1 As indicated in the Introduction, -despite the remarkable results obtained since Independence, primary education is too selective and the secondary and higher education enrollment rates in 1995 (44% and 12%, respectively, Table 3.1) are inadequate in view of the prospective opening of the Tunisian economy to international competition and integration with the European economy. 3.2 This suggests the need for an overall strategy framework in which the respective roles of public and private education would be redefined. The design of such a framework would require a discussion of three kinds of questions: (i) factors that should guide Tunisia's choices of enrollment objectives (international comparisons, the country's own economic realities, etc.); (ii) once desired enrollment paths are chosen, shares of responsibilities between public and private education; and (iii) policy measures to be introduced by the State to encourage movement in the desired directions. 3.3 This chapter is divided in two sections. Section A argues the need for the State to design a comprehensive education strategy in which the private sector plays a full role in the production and the financing of education and training. Section B suggests possible reforms. A. Need for an Overall Strategy 3.4 Enrollment capacity. Current Ministry of Education (ME) and Ministry of Higher Education (MES) projections translate into enrollment rates of 61% and 18%, in secondary and higher education, respectively, in 2005 (Table 3.1). While there is no "magic" formula linking enrollment rates to stage of economic development, the role of general secondary education in a modern economy (Chapter I) suggests that ME projections are too low. Similarly the MES rate corresponds to the average rate for the middle-income countries in 1991; it will therefore presumably be insufficient by 2005. 3.5 Need for an expanded role of the private sector. There are two economic reasons to expand the role of the private sector: equitable distribution of public education expenditure, and the State's financial capacity. With respect to the first, it can be calculated, on the basis of certain hypotheses (Annex 5), that 34% of total public education resources spent on an age cohort has been allocated to the 10% of the cohort with higher education (that is, who in general belong to the groups), whereas only 19% has gone to the 58%. who only completed primary school. An increase in the share of private expenditure, at the secondary and especially the higher level, would therefore improve the equity of distribution of public resources. 3.6 It is outside the scope of this paper to make an absolute judgement on the State's capacity to finance the recommended educational expansion(s); clearly this depends on priorities given to education and other sectors in overall public spending. Assuming however that educational spending represents a constant share of GDP, a quick review suggests that the proposed education expansions are not, ceteris paribus, sustainable. With respect to secondary education (2nd cycle of basic and secondary in the new system) the Bank's Post-Basic Education Study (1994) establishes that the ME projections would result in average annual growth rates of 4.2 %, 10.0 % and 9.8 % in the recurrent budgets of the first cycle of basic, the second cycle of basic and secondary schooling, respectively, between 1992 and 2001, and of 4 % in the investment budgets of the combined three - placing the ME scenario "at the limit of the State's financial capacity." Yet this ME scenario assumes, among others, modest targets of 70 % pass rate from 1st to 2nd cycle of basic, and a steady state pass rate of 55 % from basic to secondary education. Given Tunisia's ambitious goals, these rates should be closer to 95 % and 80-85 %, respectively. - 20 - 3.7 With respect to higher education, assuming the same conditions as today - pre-eminent role of the State system, free education, subsidies of non-education expenditures, etc. - the targeted increase in enrollment (gross enrollment rate of 18% in 2005) would require an increase in recurrent costs of nearly 54% in real terms, i.e. an average annual increase of 4.8% without any improvement in quality. Such an expansion of public education is not sustainable, for two reasons: (i) the planned rates are slightly below the projected GDP growth rates and therefore could not withstand a decline, however slight, in the latter - due, for example, to exogenous causes; and (ii) an improvement in quality is indispensable, in Tunisia as elsewhere, and would result in rates of growth of recurrent costs in excess of GDP growth. This is in addition to the necessary investment costs. Table 3.1: Basic Scenarios: Projected Gross Enrollments Rates, 1995-2005 (%) Education Year Level 1995 2000 2005 Primary 101.3 98.8 100.8 Secondary 43.5 58.6 60.7 Higher 12.1 14.6 17.8 Sources: Annex 1, Table 11. ME and MES projections 3.8 The State needs to define the functions it expects private education to fulfill. Among these, raising secondary and higher education capacity and improving the linkage with the economic environment, have already been mentioned. A third one, complementarity with.public education, is discussed below. 3.9 Private and public education: competition and complementarity. The development of a dynamic private sector should, in theory, serve as a healthy stimulus to the public sector: fair competition with respect to quality of training, diplomas awarded and job placement can generate positive reactions on the part of public education institutions. International experience in this area, however, is unfortunately not very conclusive: in practically no country has the development of the private education sector had a documented positive impact on the quality of the public sector. The reason is that in most cases public institutions continue to be constrained by restrictive regulations: their staff is eager to react positively to the development of private-sector competition, but because they are hindered from doing so, they often suffer from a sense of growing frustration and decreasing motivation. In some Latin American countries (Brazil), the development of private higher education associated with the lack of significant change in the still "corseted" public sector has led to the emergence of two independent subsectors without any relationship or communication between them. 3.10 Public education should, therefore, be provided the necessary means to accomplish this, including inter alia financial autonomy and responsibility, flexibility of procedures, and personnel management autonomy (Box 3.1). Higher education institutions in particular need to be granted autonomy in the three - 21 - areas of teaching, administration, and finaice. Management should be allowed to promote policies, make choices and authorize exceptions where necessary - while avoiding to defeat safeguards to education quality, to weaken the strictness, transparency and security of the public service, or to allow any violation of public finance rules. The counterpart of this measure would be to institute a system of ex post evaluation of results and performance. Delegation of responsibility, evaluation, supervision: these three concepts are currently little used in Tunisia's public higher education, yet they are decisive factors in any future progress. Box 3.1 - Continuing Education.i France The example of the participation of some French secondary schools (lycies) and universities on the continuing education market provides a good illustration both of the public sector's capacity to respond to private competition and of the conditions that need to be met to make this possible. When in 1971 the law on continuing education required employers to devote 1% of their salary bill to the continuing training of their employees, a new market was literally created. The public ycies and universities were able to penetrate the market because their activities in this field, being new, were practically not regulated (they were able, for example, to recruit part-time instructors - in fact, their own faculty). 'In doing so, they regained the flexibility characteristic of the private sector. Today, the public lyces represent 30% and the universities 50% of their respective markets. B. Proposed Reforms 3.11 This section summarizes the main recommendations of the study, by education level. The recommendations concerning primary education are aimed essentially at improving - or at least maintaining - the quality of the public system, and improving its high selectivity. In contrast, those for the other education levels involve far-reaching reforms of certain regulations and of education financing. The logical sequencing of proposed reforms affecting the secondary and higher levels can be summarized as follows: (i) the State opens access to secondary and higher education by eliminating the link between the two roles of each of the two entry examinations, i.e. each examination would be replaced by two modalities: an entry examination proper in public education, and a completion of studies diploma; (ii) the State subsidizes part of private secondary and (possibly) higher education, increases the private financing of public higher education and improves its efficiency; and (iii) the State ensures periodic quality control throughout the system. These last two points are discussed in more detail below. 3.12 Basic education. At this level, the Government needs to be concerned by two situations. First, the nature of the two-shift school schedules (including the 2 1/2 hours daily interruption, para. 2.24) threatens to drive the best students away, thereby exacerbating existing inequalities. While current demographic projections suggest that "normal" schedules will be in place within a few years, a study would be needed to determine whether and how this pace can be accelerated. Meanwhile, solutions involving day-care or supervised studies, perhaps based on support from OTEF or other NGOs, could be explored. 3.13 Second, remedial or tutoring courses today apparently place a heavy burden on family budgets, to the point that some families are reportedly forced to make painful choices between children. Conducted by public school teachers (in many cases in fact by the child's class teacher), often without - 22 - the permission that is in principle required," these courses represent in effect a clandestine privatization of public education, a source of serious social inequities and probably of a great deal of frustration? It is moreover doubtful that this tutoring provides any real value added to the knowledge acquired, while the physical and mental fatigue associated with it is considerable for students who already spend 30 hours a week in class. 3.14 A study would be necessary to measure the scale of this phenomenon and the amount of family expenditure involved. An outright prohibition of the practice would be counterproductive since demand for such courses is high and is sustained by the high selectivity of the system, coupled with the families' growing awareness of the need 'to pursue studies. Significantly, the current rule requiring teachers to obtain permission before giving private lessons is not being observed. The solution probably lies in action to institute effective supervision of tutoring and its fees and to encourage the development of private non-profit supply (of the OTEF type), which would have to be subsidized to ensure that it reaches the poorest students. 3.15 Secondary education. Considering (i) the low level of secondary enrollments, (ii) the State's limited financial capacity, (iii) the inequity of a system in which disadvantaged population groups are over-represented among those rejected by the public system, (iv) the private sector's lower unit costs (Table 3.2), and (v) the comparable quality of the education services provided, everything being equal, in secondary education the Tunisian economy would benefit greatly from improvements in the education level or vocational skills of the thousands of young people rejected by the education and training system. It would therefore be advantageous for efficiency as well as equity reasons, to provide the financial means to satisfy this latent demand (the allowance need not cover total expenses except in the case of the poorest children), and it can be capped to avoid an excessive increase in fees. This would represent a less expensive method of improving the efficiency of the education system. 3.16 Two types of solutions are available: (i) direct subsidies to the schools in the form of quality incentives, and a requirement to grant scholarships to pupils from disadvantaged families, and (ii) a system of education vouchers, allocated directly to families (Box 3.2). This last method has the drawback of higher administrative costs than direct assistance to schools but the advantage of the stimulation of market forces it would generate. An example of each method (Colombia and Chile) is given in Box 3.3. If the education vouchers solution is adopted, other questions have to be decided, in light of the specific socioeconomic situation of the target populations and the objectives in mind: nature of the target populations (rejected pupils only, or everybody?), eligible institutions (private only, or both private and public?), and amount of the vouchers in relation to education cost. Annex 6 summarizes the budgetary consequences of two subsidy scenarios. 19 A ministerial circular prohibits primary and secondary school teachers from giving private lessons to their own students, and prescribes the maximum number of students per teacher and the conditions of use of premises. 2 The average annual salary of a primary teacher is D 5,800 and that of a secondary teacher D 6,800. At D 40-50 per child per month, a teacher of a class of 30 pupils, even if only 20 of them take collective support courses, substantially increasing his/her income. - 23 - Table 3.2: Annual Recurrent Unit Costs in Public Education Annual Tuition Fees in Private Education (in TD, 1994/95) Education Level Public Private Primary 242 250-500 Secondary 592 450-1,200 (*) Vocational training n.d. 300-800 Higher 1851 1,300-1,500 (*) Senior year 3.17 According to CNEP, private school owners would welcome land and building investment assistance to help them build adequate school facilities, instead of renting inadequate ones. Available tax incentives are reportedly insufficient, especially in Tunis and other large cities, where the cost of land is high. In order to steer private schools toward disadvantaged neighborhoods, this assistance (bank loan interest subsidy, subsidy per square meter, even provision of subsidized land) could be targeted to schools locating in these neighborhoods or in rural areas. 3.18 This real-estate assistance would not automatically result in a decrease in fees, which include a very small amortization element since the buildings of most of the schools are rented. It would therefore have to be supplemented either by recurrent cost subsidies (e.g. linked to tuition-free enrollment of the poorest students or by an allowance paid directly to the student on condition that he/she attends an authorized institution) (Box 3.2). Box 31 - Methods of State Aid to Private Secondary Schools: 1) Direct School Subsidy; 2) Education Vouchers The first of these solutions assumes that the authorities set a percentage of pupils exempt from tuition fees and/or a percentage paying a reduced rate. It has the drawback of adding to the tasks of education quality and standards control that of supervising the tuition fees and application by the school of the public assistance eligibility criteria. It offers the advantage, however, of leaving day-to-day management of the system to the institution instead of making the Ministry responsible for it. The second alternative, like the first, requires that adequate information be available about family incomes and that a threshold be calculated, based on number of dependent children enrolled in private and public education, beyond which an allowance is given to the family on condition that it demonstrates that the child is enrolled in a school authorized to receive the scholarships. This imposes a heavy administrative burden, for which the current system of family allowances could assume responsibility. The choice would have to be dictated by the capacity of the family allowances system, or of the Ministry of Education's inspection services, to take on new tasks rapidly. In the long term, it seems that the first alternative is less expensive in terms of administrative resources since it leaves management of the system to the private schools and makes the Government responsible only for periodic ex-post supervision. - 24 - Box 3.3 - Aid to Private Education: (1) Direct Subsidies to Schools (Chile) (2) Education Vouchers (Colombia) Chile reformed its education system in 1980/81. One of the reforms provided that the Ministry of Education would give the public and private schools a subsidy per pupil enrolled, the amount of which was based on the average unit cost of public education. This represented a major incentive to the schools of the private system, in which unit costs averaged 70% of those in the public system. In 1986, the primary school enrollment rate in the private system rose from 14% to 29%, whereas enrollment in private secondary system increased by 370%. In Colombia, current net enrollment rates are 80% in primary and 46 % in secondary. Despite the social progress achieved, social benefits continue to be very unequally distributed, and 25% of the population still live below the poverty threshold. The Colombian Government's economic and social development plan for 1990-94 makes education the cornerstone of social development and assigns top priority within education policy to the development of secondary education, in both quality and quantity. At this level, 60% of the pupils are in the public system and 40% in private schools. Pupils coming from better-off families attend private schools, which also enrol students from all social groups. The Government's education voucher program, launched in 1991, is aimed at expanding secondary education capacity by offering coupons to pupils from disadvantaged families to enable them to attend schools with surplus capacity. The selection criteria are strict, for both students and schools. The pupils have to be at least 15 years old, must belong to one of the two most disadvantaged social strata, and must have graduated from public or non-profit private primary schools. For their part, the schools have to demonstrate their ability to provide an education of acceptable quality by being approved by the Ministry of Education. Source: World Bank, 1995 3.19 The recommended aid to private secondary education must be supported by strong supervision. The rules already in place regarding the opening of a private school are already very strict, however, and are more akin to the standards imposed by countries that subsidize private education than by those that merely authorize it."' Moreover, the existing administrative capacity to enforce standards, assuming they apply to all existing institutions, seems to be very small. The Ministry of Education's Private Education Department is still limited to its three senior professionals, and its inspection units have not yet begun to systematically supervise private schools. 3.20 It would therefore be more efficient to limit public assistance - for a given renewable period - to schools able to demonstrate that they meet these standards or undertake to comply with them in the future, while relaxing them for other schools. The latter could be subjected to less close surveillance of the minimum standards that would continue to apply to them, so as to avoid dispersing the limited inspection resources available. Moreover, standards of compliance with public-education teaching methods could be relaxed somewhat in order to leave more room for innovation, e.g. public assistance could be granted to an innovative school on condition that it maintain a satisfactory success rate in State examinations. Finally, no true private-sector development policy that includes the public assistance can be implemented without strengthening the department responsible for managing the aid and implementing the supervision: the Ministry of Education should therefore assign priority to staffing its Private Education Department with the appropriate number of qualified individuals. 3.21 Vocational training. subsidies to private institutions could also be applied to vocational training, in specific fields. Government efforts to involve enterprises more closely in public vocational training should be continued. Special attention should be paid to increasing: (i) participation by the private sector 21 The legal question of whether the rules apply to institutions authorized to operate before regulations were enacted is in fact the subject of an ongoing dispute between the parties concerned. - 25 - in the management of sectoral training centers, through agreements signed with professional associations; (ii) enterprise participation in the formulation of training programs; an (iii) incentives for training centers to seek additional resources from enterprises. The latter must be encouraged to train their employees, either internally or through training programs provided by private training institutions. Two reforms of the vocational training tax system would help achieve this objective: (i) give businesses direct use of the proceeds of the tax, and (ii) use the proceeds to set up a Fund which would be utilized on the basis of competitive bids from both the private and public training sectors (as in Chile and Sweden). Box 3.5 - The Manpowek Training Market: the Case of Chile Until 1979, Chilean enterprises were subject to a tax of 1% of their wage bill, the revenue from which was allocated to the National Training Institute (INACAP). A series of labor legislation amendments abolished this tax and established an incentives system based on tax credits, voluntary participation by private-sector employers in training, competition for training and training scholarships targeted on disadvantaged groups. Tax Credit. Businesses that train their employees are entitled to a tax credit based on three, often complementary, formulas: 1. The tax credit can reimburse total training costs up to a maximum of 1% of the wage bill. Eligibility for and the amount of the tax credi' are certified by the Ministry of Labor. 2. Contributions by member businesses to their Technical Assistance Institute are also eligible for the tax credit. These institutes are intermediate agencies, representing economic sectors or regions, that support their members through training and the dissemination of technology. While these charge for their services, they are non-profit establishments. 3. Apprentices' wages also qualify for the tax credit. The program is limited to the wages of employees under 21 years old. In sum, direct training costs and indirect support for the training market through contributions to the Technical Assistance Institutes may also be eligible (in part) for tax credits. Training scholarships. For the many people who do not have access to employer training schemes, the Ministry of Labor distributes training scholarships to specific population groups (young people, the unemployed, rural women, convicted persons who have served their sentences, etc.). The Ministry of Labor then puts the training courses up for bid on a competitive market; many establishments participate on this market, including the National Training Institute, universities, vocational training institutions and secondary schools. These establishments then propose the training curricula. Although no precondition is imposed on curriculum content, it is in the establishments' interest to offer useful programs since reimbursement of costs is conditional on recruitment of a minimum percentage of their graduates. The new role of Government. The regulations are enforced by the Ministry of Labor. There are also three special provisions which have a redistributive effect. First, the tax credit per hour of training and per person trained is capped (at about US$5 equivalent in 1992). Second, in the case of trainees with incomes exceeding 10 times the minimum income, the tax credit is limited to 50 percent of cost. Third, employers' contributions to the Technical Assistance Institutes are also controlled: at least 80% of the funds must be allocated to training proper, and a maximum of 20% to overhead. Labor market results. According to the Ministry of Labor this program represents the major source of public financing allocated to worker training. In 1992, the program reached some 250,000 employees, i.e. 5.5% of the total number of wage-earners. In 1990, SMEs used 30% of the fiscal resources generated in this way, and large enterprises 58%. Source: World Bank (1995) 3.22 Higher education. The Tunisian context provides the State with two policy instruments to increase enrollments in an equity efficient framework, the combination and degree of which are a political choice: (i) promote the development of the private sector; this implies a numerus clausus in public sector admissions, minimum or zero quality control during the initial years for the private sector, and a substantial increase in the number of secondary school graduates (see the examples for Romania, Iran, - 26 - Chile and Jordan in Box 3.6); and (ii) reform the public system financing (sharing by students in tuition costs, non-educational expenditure, etc. and reorganization of teaching structures). Box 3.6 - Massive Development of Private Higher Education - Four Examples: Romania, Iran, Chile, Jordan In Romania, private higher education has expanded spectacularly since the transition to a market economy (1989/90). Enrollments rose from zero to 28,000 in the first year and 63,000 in the second year. The 146,000 students registered in 1994/95 in the 73 existing institutions account for 36% of total enrollment and cover all branches of study. In Iran, the Islamic Azad University, a privately-financed non-profit institution founded in 1983, is perhaps the largest private higher- education establishment in the world. It has experienced spectacular growth, over the past ten years. Enrollment has risen from 2,500 to more than 400,000, the number of degree programs from 10 to 126 and the number of campuses from 9 to 118, distributed among 105 cities. The University's students today represent nearly 40% of total higher-education enrollment in Iran; the other 60% attend the free public higher-education establishments. This result has been achieved without State support for operating expenditure, the bulk of which is met out of the schooling expenses paid by the students. The Government has helped the University with capital formation by providing it with land and subsidizing construction projects; private donations by local businesses and civic groups have also played a decisive role. In Chile, enrollment in private institutions (whose recurrent costs are financed almost exclusively by attendance fees) rose from zero in 1982 to 159,000 (54% of the total) ten years later. Finally, in Jordan enrollment in private institutions has risen from 1,300 in 1990/91 to 14,000 (20% of the total) in 1994/95, in 10 institutions. Source: World Bank, 1995; Haddad (1994), and World Bank documents. 3.23 Three simulations of higher education expansion paths during the 1994/95-2004/05 period were performed, with a different role of the private sector in each. The resulting savings, measured as a percentage of the base scenario, are summarized in Table 3.3. If the Tunisian Government opts for a more "measured" expansion of private higher education (even one reflected in annual enrollment growth rates of 20% or 30%) the private sector will not, in the short term, contribute any significant solution to the problem of inadequate public financing of public higher education. It will then be essential to boost private financing of public higher education. Several options are available: (i) selectively establishing and raising tuition fees while re-targeting the scholarships system to the neediest students; (ii) reducing the share of scholarships (Box 3.7) and of non-education subsidies in the recurrent budget (which today account for 16% and 10%, respectively, of this budget), and (iii) increasing enterprise participation through the purchase of university services. In parallel with the introduction of the first two measures, it would be necessary to define an appropriate student loan scheme. - 27 - Table 3.3: Savings of Higher Education Recurrent Budget (Base Scenario) Resulting from Expansion of Private Provision and Financing, 1994/95 - 2004/05 (%) Years Scenarios Period Total 1998/99 2004/05 Scenario 1 0.3 1.2 0.6 Scenario 2 2.5 2.8 2.5 Scenario 3 2.4 27.4 8.5 Source: Annex 6 Base scenario: Total enrollments as indicated by MES; 5% annual growth rate of private enrollments. Scenario 1: Total enrollments as indicated by MES; annual private enrollment growth of 15% in Law and Economics/Business, and 20% in Humanities. Scenario 2: Total enrollments as indicated by MES; annual private enrollment growth of 5%; tuition fee of D 156 paid by 25% of students in public. Scenario 3: Total enrollments to reach 20% enrollment rate in 2003/04; private enrollments to reach 50% of the total that year. Box 3.7 - Scholarship Student's Monthly Budget, 1994/95 (in TD) There are 38,000 higher education scholarship holders in Tunisia. Their scholarship payment (D 40/month) and the structure of their basic expenses are summarized below. Income (amount of fellowship) 40 Expenditure 14 - Lodging (university residence) 5 - Meals in university cafeteria 5 - Transportation expenses 4 Source: MES 3.24 The nature of the regulations governing private education, currently under preparation, will be key to the sector's growth. The constraints they will impose on the private sector need to be carefully weighed in order to: (i) prevent unsurmountable obstacles to private initiative, such as excessive controls over methods and choices (equipment, academic juries, origin of teachers, etc.); and (ii) avoid setting up eligibility and control procedures that could enable MES to create additional formal obstacles and block the system through deliberately slow procedures. 3.25 These regulations would need to be flexible, both in terms of implementation calendar and accreditation level.' First, some measures would need to be phased in over several years in order to give 22 And according to education level. For example, control of access to public higher education can be exercised either at the higher-school graduation (Baccalauriat) level by setting the admission threshold very high, or at the end of apropdeudque (university foundation course) year, for which the private schools could in facto also prepare their students. - 28 - private schools time to get organized and to find the resources with which to meet quality objectives prescribed by the regulations. Second, it is necessary that such requirements be tailored to the level of accreditation granted. Several degrees of accreditation might be possible, e.g. by order of increasing quality: simple authorization, diploma recognition, diploma equivalency or co-signature, etc. The guarantees sought would thus depend on the kind of recognition or accreditation awarded by the education authorities. 3.26 In addition, access to public assistance, both direct (subsidies, scholarships, etc.) and indirect (tax assistance, access to public facilities such as libraries, resources center, etc.) could be tied to different requirements. The possibility could then be considered of imposing quality controls: they would not necessarily involve the education authorities but could instead take the form of external audits performed by an independent agency, which could in the process also perform quality control of public education. It is also advisable to ensure that these regulations do not stifle competition or discourage innovation; they should not, therefore, impose a model or refer to the existing one with respect to diplomas or teaching methods. The private sector can be a testing ground for innovative experimentation of benefit not only to students and the economy but also to the entire academic world. Experiments impossible to attempt in the public sector can be conducted in the private sector, under contract, and serve as tests for changes that might be of interest to the entire education sector. 3.27 In the Tunisian context specific financial guarantees need to be required, with two aims in mind. First, in order to protect students, measures need to be taken that rule out any deception concerning quality and, in particular, an approach that might make the student a hostage from the moment he or she is committed to a specific field of study; commitments need to be given with respect to the useful life of the training and to tuition fees (for example through a guarantee fund). Second, in order to prevent the diversion of teaching institutions to non-teaching purposes, it could also be necessary to exercise supervision over their financial structures and the origin of their capital. 3.28 Finally, two points need to be stressed. First, the regulations now in preparation must avoid the pitfall of imposing requirements on the private sector that would be inapplicable in the public sector. Second, the Government needs to weigh the risks of a qualitative depletion in the public sector, which might become the base from which the private sector would develop. This would have harmful long-term consequences. - 29 - IV. CONCLUSION 4.1 Tunisia is now at an important crossroads in its economic and social development. In order to select the optimal education strategy and implement it effectively, the Government needs to: (i) grasp the country's .economic, political, cultural, and social realities to the fullest extent possible; (ii) set strategic objectives in light of these realities and choose policies to achieve them; and (iii) manage the sequencing and geographic targeting of the implementation of these policies. 4.2 First, the following topics will need to be studied further (the household survey currently in progress will generate some of the data needed): household spending on, and capacity to finance, education; external efficiency of specific streams in vocational training and higher education; current occupations of those who failed to obtain a primary or a secondary school diploma; and rates of return (private and social) of the various education streams, for each level. 4.3 Second, the State needs to think through an overall education strategy that includes enrollment growth and quality improvement, the public-private mix required to achieve this strategy, and the steps needed to arrive at this combination. Table 4.1 summarizes possible policy measures and their linkages. One of the most important will be to separate public secondary- and higher-system competitive entrance exams from the diplomas awarded on completion of (respectively) primary and secondary studies. Another will be the partial and selective subsidization of private secondary education. With respect to higher education, the State needs tb make a strategic choice on the speed of private sector development. On this point, Tunisia needs to see a considerable increase in the numbers graduating from the higher education system in the medium and longer terms, and that it is simply not enough to maintain the status quo (i.e. guaranteed access to university-level institutions for holders of the Baccalaurgat, free tuition, massive subsidization of non-education expenses. In short, choices need to be made as to the speed and combination private sector expansion and reform of the public sector financing and institutional structure. 4.4 Finally, a policy based (even if partially) on experimentation, may successfully contribute to the consensus building required in a comprehensive strategy of innovation. It is always very difficult to assess the consequences of a new measure in a sensitive sector where principles are closely guarded. In this kind of situation, provided there are no legal obstacles, an experiment limited in time and space (with prior announcement of these limits and pledge to announce results) can provide a way of circumventing many difficulties: it precludes the hue and cry likely to be raised in the case of a general measure, and, if the measure proves to be a judicious one, may on the contrary very well create a demand for an extension of the experiment upon its completion. This may be useful in the sensitive subject of financing - e.g. an experiment of full-cost recovery cafeteria as part of a university restaurant; if well conducted, this may lead to student demand for expanded services of this type. 4.5 Such an approach also means that various experiments can be run simultaneously in different locations, allowing reactions to be measured, risks to be shared, and policies to be adjusted in accordance with findings. The overall policy. would thus benefit greatly from a series of limited experiments. - 30 - Page 1 of 3 Table 4.1: Summary of Recommendations Action, by Primary Impact Objective ReformlDecision Studies Institutional Financial . Increase basic education . Increase primary school (1st . Remedial teaching (OTEF or . Causes of high repetition and enrollment rates. cycle basic) completion rates to other NGOs) or in public schools. dropout rates. - 95%. . Improve quality of public basic and secondary education . Increase transition rates to second cycle of basic education. . Decrease repetition and dropout rates in 2nd cycle of basic school. . Enforce implementation of 1991 . Strengthen supervision functions . Scope and incidence of private ME Circular on private tutoring. of ME on private tutoring. tutoring. . Increase enrollments at the . Separate admission requirements . Replace secondary school secondary level into public secondary schools from entrance examination by: (1) basic school diploma competition to enter gubli secondary schools; and (2) basic . Promote quality private school completion diploma. secondary education . Determine State subsidy . Two modalities are possible: . Household capacity to finance eligibility criteria for: (1) schools; (1) direct assistance to private education (2) students. institutions land and building (e.g. donations or subsidies, per student . Cost-benefit analysis of the . Strengthen DEP in ME. payments); various formulas (direct aid, (2) education vouchers for vouchers). students. Improve relevance of vocational . Restructure use of Vocational . Give enterprises usage of their . External efficiency of vocational training. Training Tax (TFP). own TFP. training (public and private). Create Fund to finance VT programs on competitive bidding. - 31- Page 2 of 3 Table 4.1 Summary of Recommendations Objective Action, by Primary Impact Reform/Decision Studies Institutional Financial Increase enrollments in higher . Separate admission into public . Transform Baccalaurdat in a . External effciency of selected education by increasing demand higher education from secondary two-pronged examination: higher education streams. for and supply of private higher school completion diploma. 1. admission competition into education. pugc higher education (high . Tailor official recognition of required score = "BAC 1"). private institutions with varying 2. secondary school completion degrees of quality control. diploma (lower required score = "BAC 2'). . Authorize private higher . Subsidize private institutions education establishments to operate through: if they admit holders of *BAC 2. 1. land/building grants; 2. recurrent cost per student. . Certify diplomas delivered by establishments that satisfy certain minimum quality criteria (to be defined). Increase private financing of . Define appropriate student loan . Increase selected tuition fees. . Socio-economic profile: (1) of public higher education. scheme. students in general; (2) of Improve equity and efficiency of Increase room and board fees. scholarships recipients. public educational spending. . Target scholarships on vulnerable groups. . Create student cafeterias (full cost recovery). Increase enterprise financing of higher education. . Define scholarships attribution . Allow public institutions to sell criteria to improve targeting. services to enterprises,and keep revenues. Create incentives for enterprise financial participation. Page 3 of 3 Table 4.1 Summary of Recommendations ReformlDecision Action, by Primary Impact Objective Studies Institutional 7mancial Improve quality of higher Increase academic, financial and Variable accreditation of private Introduce quality linked, formula Issues in public higher education. personnel management autonomy higher education institutions. based public funding. education institutions: of higher education institutions. - academic; . Create an independent - management. . Reform curricula and teaching Accreditation and Evaluation organization, as needed. Institute, for public and private institutions. . Create a gradual accreditation framework for private institutions. . Plan for ex Post control of teaching quality. - 33 - Annex 1 Statistical Annex Table 1: Public Primary Education, 1975/76-1994/95 Number of Number of Number of Number of School Year Enrollments Schools classrooms grade groups Teachers 1975/76 920,924 2,319 13,526 25,907 23,181 1985/86 1,285,883 3,358 19,643 39,599 40,703 1986/87 1,319,372 3,503 20,844 40,095 40,978 1987/88 1,338,905 3,605 22,042 42,167 43,189 1988/89 1,326,150 3,676 22,739 43,466 43,921 1989/90 1,369,476 3,774 23,529 44,911 46,077 1990/91 1,398,119 3,841 24,085 45,790 50,280 1991/92 1,417,803 3,940 24,690 46,811 53,652 1992/93 1,432,112 4,044 25,689 46,872 54,560 1993/94 1,467,411 4,164 26,052 46,995 55,720 1994/95 1,472,844 4,286 26,371 47,008 58,279 Source: Ministare de l'Education (Statisiques de PEnseignement Ptimalre, 1994-95) - 34 - Table 2: Public Primary Education: Percentage of Girls Enrolled, 1985/86-1994/95 1985/86 1986/87 1987/88 1988/89 1989/90 1990/91 1991/92 1992/93 1993/94 1994/95 44.5 44.5 44.7 45.1 45.5 45.8 46.0 46.4 46.6 46.8 Source: Ministre de I'Education (Sladstiques de VEnseignement Primaire, 1994-95) Table 3: Private Primary Education, 1975/76 - 1994/95 Average Student Enrollments Teachers Number School Number Grade Student/ of % Year of Schools groups Teacher' Student Girls Ratio per Boys Girls Total Men Women Total classroom 1975/76 50 4,784 4,290 9,074 47.3 1985/86 15 160 2,731 - 2,876 5,607 10 174 184 30.5 35.0 51.3 1986/87 18 205 3,447 3,722 7,169 59 186 245 29.3 35.0 51.9 1987/88 28 212 3,567 3,449 7,016 40 261 301 23.3 33.1 49.2 1988/89 25 227 3,646 3,694 7,340 49 238 287 25.6 32.3 50.3 1989/90 24 229 3,676 3,367 7,043 30 259 289 24.4 30.8 47.8 1990/91 25 233 3,713 3,833 7,546 49 280 329 22.9 32.4 50.8 1991/92 31 270 4,214 4,198 8,412 46 315 361 23.3 31.2 49.9 1992/93 36 296 4,493 4,355 8,848 91 362 453 19.5 29.9 49.2 1993/94 37 302 4,437 4,481 8,918 66 368 434 20.5 29.5 50.2 1994/95 35 311 4,476 4,439 8,915 86 373 459 19.4 28.7 49.8 Source: Ministre de I'Education (Stadstiques de I'Enseignement Primaires, 199495) - 35 - Table 4: Private Primary Education, 1994/95 Student Enrollment Average Number of Students per Year Boys Girls Total Classroom First 1,219 1,187 2,403 30.0 Second 798 788 1,586 29.6 Third 743 733 1,476 29.8 Fourth 651 643 1,294 28.1 Fifth 571 563 1,134 27.0 Sixth 494 528 1,022 25.6 Total 4,476 4,439 8,915 28.7 Source: Minist4e de I'Education (Statistiques de I'Enseignement Primaire, 1994-95) Table 5: Entrance Exminination into First Year of Secondary School (June 94): Success Rates (%) Boys Girls Total Public Schools 58.5 61.5 59.9 Private Schools 92.0 94.2 93.1 Total n.a n.a 60.1 Source: Ministare de I'Education (Staistiques de I'Enseignement Pimaire , 1994-95) - 36 - Table 6: Private Primary Education, by Governorate, 1994/95 Average Student Enrollments Teachers Number Number Grade of Student/ % Governorate of Groups Students Teacher Girls Schools per Ratio Boys Girls Total Men Women Total Classrm. Tunis 18 191 2,771 2,637 5,408 74 224 298 28.3 18.1 48.8 Ariana 5 47 596 731 1,327 5 62 67 28.2 19.8 55.1 Ben Arous 6 23 294 251 545 4 25 29 23.7 18.8 46.1 Bizerte 2 29 438 482 920 39 39 31.7 23.6 52.4 Sfax 3 9 131 89 220 3 6 9 24.4 24.4 40.5 Sousse 1 12 246 249 495 17 17 41.3 29.1 50.3 Total 35 311 4,476 4,439 8,915 86 373 459 28.7 19.4 49.8 Source: Ministire de I' Education (Stadsdques de VEnseignement Primaire, 1994-95) - 37 - Table 7: Student Enrollments in Public and Private.Secondary Schools, 1975/76 - 1994/95 Public Schools Private Schools School Year Total % Enrollments % Enrollments 1975/76 91.2 184 150 6.7 13 608 201 845 (a) 1983/84 94.1 364492 5.9 22953 387 445 1984/85 92.9 389 462 7.1 29 875 419 337 1985/86 92.3 422 469 7.7 35 161 456 630 1986/87 91.3 419265 8.7 39769 459 034 1987/88 91.1 437604 8.9 42641 480245 1988/89 90.1 477 795 9.9 52 209 530 004 1989/90 88.7 485090 11.3 61 863 546 953 1990/91 88.0 496 840 12.0 67 700 564 540 1991/92 87.9 518522 12.1 71 152 589674 1992/93 .88.9 572692 11.1 71779 644 471 1993/94 89.8 618051 10.2 69 953 688004 1994/95 90.5 678 157 9.5 71 018 749 175 Source: Ministre de I'Education (Statisdques de I'Enseignement Secondaire, 1994-95) (a) Including students enrolled in teacher training schools - 38 - Table 8: Results of Baccalaureate Examination by Field of Study (June 1994) Field of Study Sector Success Rate Public 38.5 Language Private 14.2 Independent 1.7 Total 27.0 Public 67.3 Mathematics Private 25.2 Independent 2.4 Total 62.3 Public 36.9 Experimental Sciences Private 13.8 Independent 0.3 Total 30.0 Public 46.6 Mathematics & Technical Private 32.7 Independent 4.9 Total 38.8 Public 40.6 Total Private 14.3 Independent 1.7 Total 30.0 Source: Ministire de I'Education (Staistiques de PEseignement Secondaire, 1994-95) - 39 - Table 9: Private Secondary Education: Results of Re-admission Entry Examination to Public Schools Admission into 3rd Admission into 4th Admission into 5th Admission into 6th Total Year Year Year Year Girls Boys Girls Boys Girls Boys Girls Boys Girls Boys Total Candidates 329 256 420 325 346 313 317 227 1,412 1,121 2,533 Admitted 6 6 68 47 9 5 9 1 92 59 151 Rate (%) 6.0 2.3 16.2 14.5 2.6 . 1.6 2.8 0.4 6.5 5.3 .6.0 ource: Ministire de i'Education (Staistiques de I'Enseignement Thmaire, 1994-95) - 40 - Table 10: Private Secondary Education,1975/76 - 1994/95 Students Teachers Average Number of Number of Students/ No. of Grade Students Teacher Schools Groups Boys Girls Total Men Women Total per Ratio Classroom 1975/76 30 324 6,000 2,553 8,553 .. .. .. 26.4 .. 1985/86 109 1,160 25,114 10,047 35,161 3,314 430 3,744 30.3 9.4 1986/87 149 1,399 29,026 10,743 39,769 4,304 580 4,884 28.4 8.1 1987/88 182 1,571 31,724 10,917 42,641 5,292 371 5,663 27.1 7.5 1988/89 195 1,796 38,854 13,355 52,209 5,578 884 6,462 29.1 8.1 1989/90 236 2,167 49,037 15,826 64,863 6,676 1,055 7,731 29.9 8.4 1990/91 264 2,346 50,271 17,429 67,700 7,396 1,188 8,584 28.9 7.9 1991/92 286 2,542 52,553 18,599 71,152 7,985 1,378 9,363 28.0 7.6 1992/93 328 2,677 52,448 19,574 72,022 8,836 1,602 10,438 26.9 6.9 1993/94 330 2,747 50,124 19,829 69,953 9,053 1,771 10,824 25.5 6.5 1994/95 342 2,937 49,994 21,024 71,018 9,545 2,257 11,802 24.2 6.0 Source: Ministre de I'Education (Satisiques de Enseignement Primaire, 1994-95) -41- Table 11 Demographic Projections, 1995-2005 (thousands) Year Age 1995 2000 2005 0-5 1,216 1,187 1,214 6-12 1,454 1,418 1,391 13-20 1,523 1,639 1,636 21-25 834 916 1,008 Over 25 3,813 4,438 5,126 Total 8,840 9,598 10,375 Source: World Bank estimates -42 - Annex 2 Private Education Legal Framework Law 91-65 dated July 29, 1991 on the educational system rules over private education under its chapter IV. It is complemented by decree 92-1187 dated June 22, 1992 on the requirements for authorization to create and operate private schools, as well as their organization and management. The June 24, 1992 bylaws of the Ministry of Education and Science concerning the Baccalaurdat examination comprise particular dispositions for candidates from private schools. Finally, the October 21, 1994 bylaws state the mandatory portion of full time teachers to be recruited by private schools. These texts authorize any person to create and finance education establishments after obtaining an authorization, which is granted by the Governor within two months from the request. The Governor consults with a regional commission for private education chaired by the regional director for education and comprising a regional deputy director for primary education if the request concerns a primary school, a regional deputy director for secondary education if the request concerns a secondary school, the manager of the Regional Service of Programs, Equipment and Buildings, a representative of the National Council for Private Education, a representative of the Tunisian Organization of Education and Family, and one or two other members designated by the President. The owner and the director must be of Tunisian nationality, with no criminal record. The director must also be a primary school teacher and holder of the Baccalaur6at in the case of a school in the first cycle of basic education, or a secondary school teacher into the first cycle of secondary education, or secondary for a secondary education establishment. He must be no older than 70, must have been a full-time teacher, at the corresponding level, in public or private education, for at least 5 years, without any serious disciplinary record. The director is to be responsible for the administrative and educational management, and may not cumulate the management of two schools, except within a same establishment for both degrees of basic education, or for the second cycle of basic education and secondary education. The regional commission evaluates the conformity of the establishment's technical file with the building regulations and with administrative and teaching norms. The commission also evaluate the project's conformity with the region's education needs. Teachers must work full-time in primary schools and hold the Baccalaurtat, or have been granted tenure in public education. For the second cycle of basic education and secondary schools, they must hold a Master's degree or hold the corresponding teaching title in public education. Public sector teachers may be authorized by the regional director of Education to work part-time in private schools, for no more than 10 hours per week. Private schools must use manuals, teaching tools, and all documents used as well as programs and grading methods in public schools. However, they are authorized to add to their curricula subjects not offered in public schools, or complemented the schedule of certain courses. Private schools students may apply for State examinations under the same conditions as public school students. However, for practical technical tests and the physical education component of the Baccalaurgat, the grade given to students of public schools results from grades obtained all year long, whereas students in private schools must take a special examination. -43 - Private schools do not receive direct public financial aid. They benefit, however, from tax and duty credits. Duty credits result from the "Lake Success" international convention adopted by Tunisia in 1971, allowing the free. import of selected teaching and scientific research material. As for taxes, Tunisia exempts all materials free of duties from the Value-Added Tax (VAT) in accordance with the Lake Success Convention. Furthermore, the investment code resulting from Law 93-120 of December 27, 1993 envisages a certain number of incentives for investments in education. Thus, imported teaching materials which have no local equivalent are duty-free and VAT-free. Local teaching materials are purchased VAT-free (the VAT's average rate is 17% and books are also exempt). Decree 94-557 of March 15, 1994 sets the tax exempt equipment list in addition to the list included in the Lake Success Convention. Finally, investments in materials or buildings are deducted from up to 50% of taxable income, provided that the investment be 30% self-financed. The education sector benefits also from tax relief common to all priority sectors covered by the investment code (digressive amortizations and various exemptions on materials other than teaching), and the various benefits may be cumulated. -44- Annex 3 Regulatory Framework of Vocational Training For the first time in Tunisia, a Law for Vocational Training has been passed on February 17, 1993. In addition to upgrading the system of qualification and employment to the level of component of the national education system, it organizes consultations and coordination among the various partners, training institutions, enterprises, professional organizations, system apprenticeships, organizes the implementation and completion of training in both private and public sectors and sets up the needed framework capable to ensure its development. Public Vocational Training Office of Vocational Training and Employment (OVTE) OVTE's restructuring was subject to two laws also promulgated on February 17, 1993, aiming at linking to the Ministry of Vocational Training and Employment, in accordance with its responsibilities, all public tasks previously handled by the Office (coordination, Vocational Training Tax, private training, diploma recognition, etc.) and also to rehabilitate some strategic functions such as employment, trainers' training, training engineering, in-service training and career development, which were regrouped within the Office of Vocational Training and Employment and often marginalized. Law 93-11 of February 17, 1993 specifies OVTE's dissolution and the creation of two public establishments of an industrial and commercial nature (EPIC), i. e. the Tunisian Employment Agency and the Tunisian Vocational Training Agency. Law 93-12 of February 17, 1993 creates two public establishments of an administrative nature (EPA), with a relatively important management flexibility, such as: the National Center for the Training of Trainers and Training Engineering, and the National Center for In Service Training and Career Development. Training will be offered in auxiliary establishments which are relatively autonomous, in order to allow them to pursue interactive relations with their environment. The administrative, financial and scientific set-up of the two agencies, the two centers and auxiliary establishments attached to them are the object of two draft decrees, presently under consideration. A strong involvement of the partners who will be represented at the management level of these establishments is envisaged, as well as the possibility to call upon all national or foreign academic and professional skills. National Council for Vocational Training and Employment A decree dated January 24, 1994 sets the composition of this Council to representatives of the following institutions: 15 ministries, all political parties, four per labor union, one for the National Union of Tunisian Women (UNFT), one for the Engineers' Council, one for OTEF, one for CNEP, and five people selected for their skills in the field of training and employment. - 45 - Private Vocational Training In accordance with Article 49 of the Law on Vocational Training of February 17, 1993, any person may create a private training establishment provided prior agreement from the Ministry of Vocational Training is secured, after advice of a consultative commission in which the National Conference of Private Education is represented. The Commission verifies that the file is in accordance with health, safety and training regulations as stipulated by a decree. This commission, established by decree of October 25, 1993, advises on requests to create private establishments and offices, on evaluation and operating regulations applied as well as on disciplinary measures. It is composed of one representative each from the Ministry of Education, the Ministry of Vocational Training and Employment, the Ministry of Social Affairs, National Center for Inservice Training and Career Development, UGTT, UTICA, CNEP and OTEF. Private establishments must present their curricula, fees, tariffs and operating regulations in advance and address to the Ministry, each year, a financial and education statement. The law specifies the numbers and qualifications of supervisory and training staff, and prohibits the employment of a director with criminal record. The Law also contains consumer protection clauses: the organization must give each intern, prior to the beginning of training, a document setting the conditions of operation of the internship, its duration, the program, the conditions of delivery of the completion certificate, supply of training materials, as well as costs and methods of payment for the training. Finally, the Law calls for a system of homologation and equivalency of qualifications received, set by decree of June 20, 1994. The homologation is granted for a duration of five years by bylaws from the Ministry of Vocational Training and Employment after advice from the permanent commission for the coordination of vocational training on a technical file addressed by the training organization. This procedure is the same for both public and private institutions. Vocational Training Tax Decree 93-696 of April 5, 1993 introduced the following innovations: (i) participation of the representation structure within the company in the elaboration and evaluation of training measures; (ii) reduction of agreement schedules for these measures and need to justify any decision of total or partial rejection; (iii) implementation of a procedure of amicable recourse allowing the company, if necessary, to request the revision of decisions rejecting its training measures, or related to the amount of tax credits granted; (iv) simplification of methodology reviewing credit requests; (v) the set-up of a mechanism for the granting of advances on discounts from the month following the date of payment of approved training related expenses; (vi) the replacement of individual training measures by an annual training plan. - 46 - Annex 4 Distribution of Public Educational Expenditures' The distribution of public resources in the education sector depends on (i) the level of education acquired by children in a same age group, measured by the number of school years attended, and (ii) the structure of unit costs of the education system. The results indicate the characteristics of the entire education system rather than of any one level of education. Based on enrollment rates for 1994/95 and assuming steady state educational flows, it can be inferred that of 100 children in the same age group: (a) 9 children have no education (100 - 91 children who enter primary school) and will therefore accumulate no public resources for education. (b) 49 will leave the school-age range with primary schooling (91 - 42 children who continue to secondary school) and will accumulate D 1,451 of public spending (D 241.9 a year for six years of primary education). (c) 32 children will leave the school-age range with secondary schooling (42 - 10 children who continue to higher education) and will accumulate D 5,598 of public spending (D 1,451 in-primary and D 592.3 for seven years in secondary). (d) 10 children will leave the school-age range with higher education. They will accumulate D 13,002 of public spending (D 5,598 in primary and secondary school plus D 1,851 for four years in higher education). Multiplying the resources accumulated per student by the number of students yields the total amount of public spending received by the population having attained the educational level. The results show that 10% of the students (who have higher education) receive 34.2% of education cumulative resources, whereas 58% of the cohort benefits from only 18.7% of resources (when maximum level attained is primary) and 9% of the age cohort benefit from no public spending. The Lorenz curve of the following graph describes the distribution of cumulative education public resources for the Tunisian education system. A, B, C, and D on the curve represent a relation between the percentage of students on the range who have acquired a certain level of education and the percentage of cumulative resources received. For example, B shows that 58% of the range receive 18.7% of cumulative resources. Equity in a distribution of resources is translated by the degree of closeness of the Lorenz curve to the OD diagonal. This equity level can also be illustrated by the computation of the Gini coefficient. The latter is the ratio between the area OABCD and the triangle ODE, and has a range between 0 and 1. A value close to 0 reflects a larger equity in the distribution of public spending. 23 See Mingat and Tan (1988) -47 - The Gini coefficient is calculated as follows: Area ABCDE = Area AGB + Area BGFC + Area CFED = (0.5 x 49 x 18.7) + [0.5 x (18.7 + 65.8) x (90 - 58)] + [0.5 x (65.8 + 100) x (100 - 90) = 2,639.15 Gini coefficient = Area OABCDIArea OED = (5,000 - 2,639.15) / 5,000 = 0.47 Table 12: Gini Coefficients, Tunisia and Selected Asian Countries Country Gini Ratio (%) Tunisia 0.47 Bangladesh 81.9 China 44.4 India 65.8 Indonesia 27.3 Korea 15.9 Malaysia 37.9 Nepal 57.9 Papua New Guinea 62.1 Philippines 18.6 Sri Lanka 32,6 Thailand 32.9 Regional Average 43.4 Source: Tan and Mingat (1992) dépenses publiques cumulatives en éducation -ý n M M (o <D 0 c 0 C> 0D 0D C> 0> 0> 0 .a .... ..... .B . . B B cor =r C n <.7< * O - CA> D S.... Cn CL .5.- B. CL( .. C *s Cl (n. -gu o .~ B 0 S CO . -C C . 3. to- g æ- 0>- B -49 - Annex 5 Enseignement Supérieur Public: Rationalisation du Financement La diversification des filières et des méthodes pédagogiques pourrait permettre que des expériences soient faites de participations des usagers au financement. Dans l'enseignemnent supérieur, sous réserve de prendre les mesures d'aide aux étudiants issues des familles à moyens limités ou insuffisants, il conviendrait d'aller par étapes successives vers une telle participation. On peut donc imaginer que des essais soient faits avec des filières nouvelles, utilisant des moyens acquis sur ressources propres par exemple, et justifiant de ce fait un système différent de droits universitaires. Parallèlement, des prestations nouvelles, non directement liées à l'enseignement, pourraient aussi être introduites moyennant un paiement compensatoire - toujours sous réserve d'une protection des étudiants à faible revenu familial. Ce peut être le cas avec les fournitures de photocopies, libre-service informatique, nouveaux médias de documentation, cafétaria au sein des restaurants universitaires, etc... Il conviendrait alors d'initier une procédure de publicité des coûts pour justifier l'introduction de services payants (voir en France l'exemple de cafétarias fonctionnant au prix coûtant ou plus à côté des restaurants universitaires). Il conviendrait également de signaler que l'efficacité accrue de l'usage des ressources passe aussi par une recherche d'économies d'échelle et de rentabilisation de moyens. L'expérience montre que de nombreux locaux spécialisés - et donc les équipements et matériels qui s'y trouvent - sont utilisés peu de temps par le service ou département de formation auquel ils sont rattachés. Pourtant, de tels locaux sont dupliqués, souvent dans un établissement voisin.. .parfois même au sein de la même université, vôire de la même faculté. Il conviendrait de développer la notion de "centre de ressources"- ce qui diminue incontestablement le confort d'emploi et complique l'organisation pédagogique - l'incitation pouvant alors venir d'une dotation plus large permettant de faire mieux et donc d'encourager les responsables pédagogiques à rechercher ce type de complémentarité. Ce raisonnement ne s'applique pas seulement à des locaux techniques et des laboratoires, mais il est valable aussi pour des salles et équipements banalisés : informatique de gestion, laboratoires de langues, salles d'examen. Actuellement, l'année universitaire compte 25 semaines d'enseignement. Il est sans doute possible de réexaminer cette organisation pour tendre, comme de nombreux pays l'ont fait, vers une année universitaire de 30, voire de 32 semaines d'enseignement. A volume horaire global constant pour les étudiants, le gain théorique d'espace est de 20 à 30 pour cent, ce qui peut permettre de détendre la situation en matière de locaux disponibles. On peut également noter que les obligations statutaires des enseignants-chercheurs, bien qu'ayant été réajustées il y a quelques années, restent en dessous des pratiques courantes en Europe Occidentale ou en Amérique du Nord. Une révision de ces obligations dans le sens d'un ajustement avec ce qui se fait ailleurs, avec également une définition annuelle du service d'enseignement plutôt qu'une définition hebdomadaire, augmenterait le potentiel. Cette mesure risque de ne pas être bien acceptée des enseignants, sauf si elle s'accompagne d'une intégration des heures complémentaires, afin que l'accroissement de la charge ne se traduise pas par une perte de revenu. Il faudrait aussi conduire parallèlement une analyse de temps effectivement consacré à la recherche et chercher des solutions acceptables pour corriger les dérives existantes (prise en compte des autres missions assurées par les enseignants-chercheurs : administration, encadrement, transfert de technologie, formation continue, etc...; service différent pour ceux qui ne font plus de recherche...). - 50 - Annex 6 Enseignement Secondaire et Supérieur: Sin'ulations Les simulations résumées dans les tableaux ci-joints, effectuées pour la période 1994/95 - 2004/05, ont été réalisées en DT constants et coûts unitaires constants. Cette dernière hypothèse suppose en particulier qu'il n'existe aucune amélioration de la qualité pendant la période considérée. A. Enseignement secondaire Les projections d'effectifs, de personnel et de coûts récurrents dans les trois scénarios supposent des taux d'encadrement constants. De plus les hypothèses suivantes ont été faites: Scénario de base. Effectifs du primaire et du secondaire public calculés sur la base des taux de passage et de redoublement du ME, tels qu'ils apparaissent dans le rapport de la Banque mondiale (1994). Scénario A: subvention annuelle par élève de 200 DT à 20 % des abandons du secondaire. Coût: 0,4% du budget récurrent de l'enseignement primaire et secondaire publics. Scénario B: subvention annuelle par élève de 450 DT à 35 % des abandons du secondaire. Coût: 1,8. % du budget récurrent de l'enseignement primaire et secondaire publics. B. Enseignement supérieur Les projections d'effectifs et de coûts récurrents dans les 4 scénarios supposent constants les taux d'encadrement du personnel enseignant, et à 50 % le pourcentage des effectifs bacheliers de l'enseignement privé. De plus les hypothèses suivantes ont été faites: Scénario de base: effectifs globaux indiqués par le MES; taux de croissance annuel de 5% des effectifs de l'enseignement privé en Droit et Sciences Economiques, et de 5% en Lettres et Sciences Humaines. Scénario 1: effectifs globaux indiqués par le MES; taux de croissance annuel de 15% des effectifs de l'enseignement privé en Droit et Sciences Economiques, et de 20% en Lettres et Sciences Humaines. Economies par rapport au scénario de base: de 0,1 % à 1,2 % ; 0,6 % sur l'ensemble de la période. Scénario 2: effectifs globaux indiqués par le MES; taux de croissance annuel de 5% des effectifs de l'enseignement privé en Droit et Sciences Economiques, et de 5% en Lettres et Sciences Humaines; frais de scolarité de 150 DT payés par 25 % des étudiants du public. Economies par rapport au scénario de base: de 2,3 % à 2,8 % ; 2,5 % sur l'ensemble de la période. Scénario 3: effectifs calculés en sorte que le taux de scolarité ets de 20 % en 2005, et que le privé représente 50 % du total. Economies par rapport au scénario de base: de 0,9 % à 27 % (en 2004/05); 8,5 % sur l'ensemble de la période. - 51 - Annex 6 Table 13: Higher Education Scenarios Year 1994195 1995/96 1996/97 1997/98 1998/99 1999/2000 2000/01 2001/02 2002/03 2003/04 2004/05 Total Base Total Students in Public 99,488 104,650 112,261 119,231 126,012 132,143 137,611 143,375 150,796 161,567 174,423 - Total Students in Private 3,036 3,188 3,347 3,515 3,690 3,875 4,069 4,272 4,486 4,710 4,945 - Scenario 1 Total Students in Public 99,488 104,494 111,916 118,660 125,170 130,979 136,064 141,374 148,259 158,398 170,509 - Total Students in Private 3,036 3,507 4,051 4,680 5,408 6,251 7,226 8,356 9,663 11,178 12,933 - % Savings in Costs 0.0% 0.1% 0.1% 0.2% 0.3% 0.4% 0.6% 0.7% 0.9% 1.0% 1.2% 0.6% Scenario 2 1 Total Students in Public 99,488 104,650 112,261 119,231 126,012 132,143 137,611 143,375 150,796 161,567 174,423 - Total Students in Private 3,036 3,188 3,347 3,515 3,690 3,875 4,069 4,272 4,486 4,710 4,945 - % Savings in Costs 2.3% 2.3% 2.4% 2.4% 2.5% 2.5% 2.6% 2.6% 2.6% 2.7% 2.8% 2.5% Scenario 3 Total Students in Public 96,453 101,751 107,563 113,161 118,274 122,515 125,325 125,911 123,149 115,452 100,515 - Total Students in Private 3,036 5,000 6,980 9,744 13,603 18,989 26,509 37,007 51,662 72,120 100,750 - % Savings in Costs 0.6% 0.2% 0.9% 1.7% 2.4% 3.2% 4.3% 6.5% 10.6% 17.6% 27.4% 8.5% - 52 - BIBLIOGRAPHY General References Albrecht, D. and Ziderman, A. 1992. Funding Mechanisms for Higher Education. Washington, DC: World bank Discussion Paper No. 153. Blomqvist, A. and Jimenez, E. 1989. The Public Role in Private Post-Secondary Education: a Review of Issues and Options. World Bank WPS No. 240. Coleman, J. and Hoffer, T. 1982. Public, Catholic and Private Schools Compared. New-York : Basic Books. Jimenez, E. and Cox, D. 1989. The Relative Effectiveness of Private and Public Schools. World Bank: LSMS Working Paper No. 60. James, E. 1987a. The Political Economy of Private Education in Developed and Developing Countries. World Bank: Report No. EDT81 James, E. 1987b. Public Policies Toward Private Education. World Bank: Report no. EDT84. Jimenez, E. 1987. Pricing Policy in the Social Sectors Cost Recovery for Education and Health in the . Developing Countries. Baltimore and.London : The Johns Hopkins University Press. Middleton, J., Ziderman, A. and Van Adams, A. 1993. Skills for Productivity: Vocational education and Training in Developing Countries. New-York: Oxford University Press. Mingat, A. and Tan, J.P. 1988. Analytical Tools for Sector Work in Education. Baltimore: The Johns Hopkins University Press. Ministbre de l'Education Nationale, France. 1993. L'enseignement Primaire en France. Ministbre de l'Education Nationale, France. 1993. L'enseignement Secondaire en France. Newberry, D., and Stern, N. 1987. The Theory of Taxation for Developing Countries.. New-York: Oxford University Press. OECD. 1990. Financing Higher Education: Current Patterns. Paris: OECD. Page, J. 1994. The East Asian Miracle. Oxford and New-York: Oxford University Press. Reddy, N. 1993. Public and Private Education: an International Perspective. Hyderabad Academic Services. Roth, G. 1987. The Private Provision of Public Services in Developing Countries. Oxford and New- York: Oxford University Press. - 53 - Tan, J.P. and Mingat, A. 1992. 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