PUBLIC-PRIVATE PARTNERSHIPS

AROOJ ASGHAR
(feedback@pgeconomist.com)

July 9 - 15, 20
12

Private participation in education sector in Pakistan has increased dramatically over the last two decades, serving all types of communities from high-income to low income families. Yet provincial governments remain the main financiers of education at least of primary and secondary education. A number of contracts with the private sector have been signed to provide some of the services involved in producing education such as teacher training, management, or curriculum design. Contracts have also been signed with a number of private organizations to manage and operate a public school.

One of the most common types of public-private partnerships (PPP) these days is that the provincial governments provide subsidies to the existing private schools or fund the student places. Overall, private sector's participation at the primary school level has grown more than its participation at the secondary level.

We have seen different forms of private sector participation in the education sector in Pakistan, which are as follows:

1) Private sector philanthropic initiatives;

2) School management initiatives, under which education authorities' contract directly with private providers to operate public schools or manage certain aspects of operations of public school. Although these schools are privately managed, they remain publicly owned and funded. This also includes school infrastructure initiatives under which private sector partners design, finance, construct, and operate public school infrastructure under long-term contracts with the government;

3) Government purchases initiatives under which government contracts with private schools to deliver education at public expense;

4) Adopt-a-school programs under which private sector partners provide cash and in-kind resources to complement government funding of public schools.

Pakistan Railways contracted Beaconhouse school system to manage the 19 schools (with 13,850 students) for the children of employees in 2003. These schools were found in several locations around Pakistan, including Karachi, Risalpur, Faisalabad, Sukkur and Lahore. Schools charged a very low fee but they were allowed to enroll fee paying private students to help offset the cost of operating the schools. The management contract was for 33 years, but it was ended after three years.

The Quality Education for All project of the National Rural Support Programme (NRSP), a semiautonomous not-for-profit agency, was contracted by the district government of Rahim Yar Khan in the Punjab to take over the management of 48 rural schools in a union council in July 2002. Since its inception, the programme has been expanded to more than 3,000 schools.

The Urban Girls' Fellowship Program (UGF) was a pilot project launched in 1995 in Quetta. Its aim was to increase girls' enrolments in school through the creation of private schools in poor urban neighbourhoods. The government subsidy was made directly to the school on behalf of families.

The Punjab Education Foundation (PEF) in the Punjab province operates several funding-based PPP programs. The largest - the Financial Assistance per Child Enrolled Basis (FAS) programme - was established in late 2005. The program pays participating private schools approximately Rs500 per month per enrolled student. Schools cannot charge fees on top of the per-student subsidy paid by the PEF. FAS partner schools are located in a number of districts including Lahore, Khushab, Bahawalpur, Chakwal, Bhakkar, Bahawalnagar and Sialkot.

Aga Khan Education Services Pakistan operates a program entitled quality advancement and institutional development (QuAID) in private sector schools. The overall objective of the project is to strengthen the capacity of low cost private schools so that the education they provide to poorer communities is of high quality and well managed.

Perhaps the most common form of PPP in the basic education sector is private philanthropy. In Pakistan, the Pakistan Centre for Philanthropy (PCP) plays a similar role. It has a number of roles including providing support services to philanthropists and certifying not-for-profit organisations. A key objective is to increase the amount and effectiveness of corporate philanthropy to lift both access to education for disadvantaged children. The PCP plays an important role in facilitating PPPs in the education sector.

Corporate philanthropy in Pakistan is significant. A study carried out in 2010 showed that fully 92 per cent of Pakistani companies were engaged in some form of corporate philanthropy, with 37 per cent involved in the education sector. This placed education second only to health.

Another form of PPP in the education sector in Pakistan is the private management of public schools, where provincial government and ministry of education is contracting directly with private providers to operate public schools or certain aspects of public school operations. These schools are being privately managed, yet they remain publicly owned and publicly funded.

Singer Shahzad Roy has got a number of public schools and has turned around them. It is important to note that, contract schools are legal entities capable of negotiating contracts, spending public funds and hiring and firing staff. In order to avoid potential litigations, provincial governments also provide legal cover to these contracts. However, such initiative can only be successful if the management company meets specific benchmarks in areas such as school attendance, student performance, and community involvement.

Private education providers are also playing an increasingly important role in delivering education to low-income families in rural and urban areas of the country. That includes a range of school operators including faith-based organizations, local communities, nongovernmental organizations (NGOs), and private for-profit and not-for-profit schools.

PPP is also being used to build school infrastructure. These are a useful way to increase the funds available for constructing or upgrading school buildings and often yield better value for money than traditional public sector investments. After passing the 18th amendment in the Constitution of Pakistan, education is a provincial subject now. The provincial governments are contracting with private companies to build and/or maintain school buildings on a long-term basis, typically 25 to 30 years. The private sector is assuming responsibility for the risk inherent in the ownership and efficient operations of the project's facilities.

In short, the positive outcomes of the public private partnership in the education sector are

PPPs are creating competition in the education market. The private sector is competing for students with the public sector. In turn, the public sector has an incentive to react to this competition by increasing the quality of the education that it provides.

- PPP contracts are more flexible than most public sector arrangements. Generally, the public sector has less autonomy in hiring teachers and organizing schools than the private sector does. Public-private contracts are a better fit between the supply of and demand for education. Flexibility in teacher salary package is one of the primary motivations for PPPs.

- Government chooses private providers in PPP contracts by means of an open bidding process in which the government defines specific requirements for the quality of education that it demands from the contractor. The contracts include measurable outcomes and clauses that specify the condition to deliver a certain quality of education, and the contractor with the best or lowest cost proposal is then chosen. This one characteristic of the contract alone raises the quality of education.

It is difficult for the private sector to meet the financial requirements of infrastructure in isolation and at the same time tackling the risks inherent to building infrastructure. Therefore, PPP model represents a logical, viable, and necessary option for the government and the private sector to work together in the education sector.