Call for supporting for-profit education

call for supporting for profit education Call for supporting for profit educationGlobal education experts are calling on governments to continue supporting private for-profit education to bring the sector on a par with innovations in other sectors affecting human life.

“Non-profits usually waste money on their executives and things that are not associated to the mission. For-profits are concerned about their brand, their customers who are basically parents and students. They have the strongest incentive to produce good, universal education,” said Michael Block, chairman, BASISed, USA.

His comments came at a session on ‘Tthe Business of Education’ during the second day of the Global Education and Skills Forum being hosted in Dubai by GEMS Education.

“One of the fears about for-profit private activity in the education space is there won’t be a free dissemination of information. The problem with public good is they will always be under provided. You need a mechanism to monetise,” added Block.

Private education has remained a lucrative investment option for education providers in the UAE — with a record 11 new schools opening this year.

“For-profit education allows schools to go where people are under-served. If you look around the world and see how governments are catering to the poor, you wouldn’t think they have any role. In these schools, teachers don’t turn up, students don’t come. It is these places where private schools can go and make a difference,” said James Tooley, Director of E. G. West Centre at Newcastle University, UK.

He called on education providers to look at new ways of reducing the cost of education by introducing a daily payment system.

“Typically, schools have term fees, uniform fees and books. Some parents can’t send their kids to these schools. Let’s create an all-inclusive daily fee where all school costs are included. They pay daily and this would immediately open schools to parents who couldn’t afford education. This little innovation can increase access to education,” recommended Tooley.

Banks have long supported investments in education, with a demand-supply gap helping investors build education infrastructure and reap benefits.

“From the point of a commercial bank, we like dealing with long-term stability and businesses which have negative working capital requirement. Fees for schools are paid up front and your working capital requirement is not there. It is a very stable form of income and it gives us an ability to take a long-term view of the school,” said John Lossifidis, executive vice-president and head of Corporate & Investment Banking Group at Mashreq Bank, UAE.

From the UAE perspective, Dino Varkey, executive director of GEMS Education highlighted how regulations in private education could help ensure quality.

“There is an onus on all providers of education to share what they are doing well, irrespective of whether they are private or public. Competition is in the benefit of families. The inspection regime makes it very visible to parents the relative performance of schools within a system. It gives parents as much information as it can to help parents choose. Governments can ensure quality of provisions but it looks at what happens at the end of the cycle,” said Dino.

© Khaleej Times

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