The Education Service Contracting (ESC) Program of the Philippines Michael M. Alba De La Salle University  Manila

The ESC program in a nutshell provides a fixed tuition subsidy to graduates of public elementary schools who opt to enroll in participating private high schools. effectively, contracts private schools to provide secondary education to students who otherwise would have attended public schools.

Program Features Beneficiaries graduates of public elementary schools who opt to enroll in participating private high schools Grantees pay school fees and expenses in excess of the tuition subsidy. who are accepted by the participating private high schools A school committee processes applications and screens grant applicants.

Program Features Benefits Requirements a fixed annual tuition subsidy through 4 years of high school Value of the grant since SY 2008-2009: PhP10,000 per year in NCR and PhP5,000 elsewhere in the country. Requirements Grantees must pass all academic requirements in each year level. Grantees cannot take a leave from schooling except due to force majeure or illness.

Program Features Service Providers Private high schools who apply to DepEd to participate in the program who pass an annual certification process for quality of delivery.

How the ESC Program came to be Education policy makers (in government and the private sector) wanted to make use of excess resources in private schools to address congestion and poor quality in public schools Legal bases RA 6728 of 1989: Government Assistance to Students and Teachers in Private Education (GASTPE) RA 8545 of 1998: Expanded GASTPE

Program Objectives Make quality secondary education more accessible to poor Filipino students Enhance the complementary roles of public and private education sectors Maximize the use of existing resources in the private education sector Realize savings for the government Ease the need for constructing new classrooms and hiring new teachers

What has been achieved? (1) National Coverage as of SY 2008-2009 476,776 grantees 9.3 percent of 5.1 million students in public high schools 35.8 percent of 1.3 million students in private high schools 2,033 participating private high schools 39.8 percent of 5,110 public high schools On average, 4 private high schools handle the enrollment spillovers or congestion problems of 10 public high schools 46.3 percent of 4,392 private high schools 234.5 grantees per school, on average 58.6 grantees per year level per school, on average

What has been achieved? (2) The ESC program provides a lower cost alternative to direct public provision of education Cost of a public high school student: PhP9,048 Cost of an ESC grantee: PhP5,344

What has been achieved? (3a) On average, a participating school receives PhP1.18 million per year from DepEd due to the ESC program But, in general, school fees exceed the ESC grant. The average support value of the ESC program is 0.67 sv = ESC grant ÷ school fees

ESC grants generate P4.43 billion in revenues for ESC schools ESC grantees shoulder P2.0 billion of the P4.43 billion.

What has been achieved? (3b) In effect, the ESC program generates resources for participating schools, in excess of government transfers, since grantees make significant co-payments. More resources are thus generated for basic education.

Challenges Can the ESC program be expanded without increasing costs and lowering the quality of private school education? What is the cost structure of the program? What is the optimal mix of delivery? Will private schools themselves become congested or suffer in quality? Can the ESC program be better targeted to improve the overall accessibility and quality of secondary education? How can the ESC program be used to improve public high schools?