Private Education in China by Haitao Zhou & Qiang Liu & Jing Tian & Qian Li

Author:Haitao Zhou & Qiang Liu & Jing Tian & Qian Li
Language: eng
Format: epub
ISBN: 9789811044090
Publisher: Springer Singapore

Source Bi (2015). Financial support for private higher education—status quo, obstacles and breakthroughs. Beijing: Economic Science Press

5.3.2 Main Forms of Public Financial Assistance to Private Education in China Currently

The forms of public financial assistance to private schools by the government are different from each other according to different standards. They can divide into direct and indirect forms based on the fund source. Direct financial assistance refers to the government subsidizes private schools through appropriating funds directly or give certain concessions to private schools. For instance, providing financial support through project funding, supplying necessary teaching equipment to education providers free or at a moderate cost, appropriating start-up fees to schools and giving a certain proportion of financial incentives according to the total investment of education providers (Yang 2010). All of these are conducive to the direct settlement of funding shortages faced by private schools. Indirect financial assistance means that the government promulgates corresponding subsidy policies to support the development of private education, including tax incentives, reduction and exemption of facilities’ construction costs, reduction and exemption of land acquisition fees, providing student loans, improving the social welfare provisions for teachers and so on.

Financial assistance can divide into non-competitive and competitive regarding appropriation mechanisms (Wang and Sun 2009). Non-competitive assistance means the government provides financial support to private schools at a certain size and with a high quality of operating an education provider in accordance with relevant laws and regulations. By contrast, competitive assistance means the government allocates funds to private schools according to standards for obtaining funds regardless of their nature, as long as they meet the relevant requirements.

In addition, financial assistance forms can also be divided into education provider, teacher and student assistance. Providing financial assistance for schools means the government allocates funds directly to private schools, funds which will be allocated by the schools according to their needs. Subsidizing teachers refers to allocating financial funds to teacher’s professional development in private schools. Such grants are generally stable, standardized and easily supervised, and they can play a significant role in stabilizing the positions of teachers in private schools. Subsidizing students means the government provides funds directly to students or their parents, which mainly includes relief tuition and fees, student medical insurance, accidental injury insurance and other financial needs.

To summarize, Chinese public financial assistance to private schools realized currently through providing subsidies and rewards to private schools, purchasing services from private schools, and providing private school’s student loans, tax incentives, land incentives and other preferential policies.

The government may purchase public services from private education institutions. That is the mechanism to achieve specific public service objectives through a contractual relationship, which the government provides funds and private schools provide contracted services. The government’s purchase of education services is a main way to of government and private school cooperation, and form public-private partnerships between the government and private schools.

In line with the principles of respecting the autonomy and maintaining the public nature of private schools, the government should bear the fiscal responsibility for private education through purchasing education services from private schools.

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