A Single Targeted Financial Policy Will Help Reform the Budget-Funded Education

5 july 2016

Reducing the amount of budget spending, increasing the efficiency of state and municipal services, promoting business initiative and per capital spending caps - on the whole the trends in the development of the education system in Russia are the same as in the rest of the world; however, refinements need to be made to take the local differences into account.

The restructuring that has been going on for the past 5 years has not produced significant changes: budget funding still dominates the sector and the way the system of educational organizations functions has not changed very much either. The number of budget funded educational organizations has gone down by 26%; however, they still make up more than 50% of the sector and thus the overall way that the system functions has not changed in any significant manner. “Even though transitioning to the new autonomous type of organizations results in more freedom with regards to financial and business activities and management, this potentially increased freedom has so far failed to encourage a more active optimization in the system,” conclude  the Analytical Center experts.

Most regions try to keep financing the bulk of their educational organizations from the budget, having quickly become disillusioned about the proposed new system. Making organizations more independent to the point where they monitor their spending efficiency internally was supposed to shift the financing model towards a model of targeted subsidies with the bulk of support going to new more proactive types of organizations. In practice, however, the amount of subsidies going to budget-funded organizations ended up being almost 6 times the amount that other types of organizations, including autonomous ones, receive in funding, which, in the opinion of the experts, is evidence of ‘economic inertia’ in the education system.

At the same time, the state assignment also called for a list of requirements for educational services to be developed so that by improving the quality of specific services both municipal and federal levels in the education system could be developed. However, in this area, regional governments also failed to complete their task because the necessary documents were not available at the federal level.

Another mechanism for improving the efficiency of budget spending in education was supposed to have involved a transition to per capita financing. Work on this approach has already been going on in Russia for a number of years. Still, there are plenty of targets that have not been met yet and there is still plenty of room for improvement, the experts are sure.

Citing the findings of a survey of the heads of preschools, schools and vocational schools in Pskov, Tver, Voronezh, Sverdlovsk and Novosibirsk oblasts and in Krasnoyarsk Krai about the results of the implementation of the Federal Law on Education (conducted by the Russian Presidential Academy of National Economic and Public Administration), the Analytical Center experts note that an important stage has been completed in the reform: educators now seem to have a very good grasp of the link between the state assignment, an education service and the standards for financing that service. However, these early successes can be negated by excessive bureaucracy, replacement of strategic objectives with tactical plans with divided supervision that have the opposite effect to what is intended: the reforms of the budget-funded sector stop, while distrust in the reforms grows both among the people directly taking part in the process and among the public. 

A single targeted financial policy will help reform the budget-funded education, the experts are sure.

For more see the bulletin Reforming the Budget Policy in Education (the results of the implementation of Federal Law No 83-FZ).

For other issues of our bulletin on the state of education in Russia see Publications.