1. Innovative Public-Private Partnerships on Education and Health
Harry Patrinos, Felipe Barrera, Juliana Guaqueta
HD Learning Week
November 2008

2. Outline 1. Why PPPs in Education? 2. Understanding PPPs in Education
3. What do we know about PPPs?
4. Bank Netherlands Partnership Program (BNPP)

3. Why Public-Private Partnerships?

4. Why PPPs?
Need to increase access, equity and achievement in the education sector.
PPPs Rationale:
Increased choice and greater accountability
Pulling in a greater group of providers and private capital investments
Less constraints on financial and human resources management.
Better value for money can be achieved through the exploitation of private sector competencies
Some of the arguments that support private school operation are:
1. Improving the efficiency and effectiveness of health and education services in low income countries is crucial for reaching the MDGs (by means of increased school choice, greater accountability to direct beneficiaries).
2. (By pulling in a greater group of providers and private capital investments to the service of poor students)
3. (By allowing non-government organizations deliver health and education services which will face less constraints on financial and human resources management leading to cost-efficiencies)
4. The successful PPP project is based on the concept that better value for money can be achieved through the exploitation of private sector competencies and the allocation of risk to the party best able to manage it.

5. Private enrollment rates increased between 1991-2003
Governments can contract private education providers
Enrollment rates remain low and quality of education lags considerably
Public remains an important player
Private sector is playing an increasingly important role (private enrollment rates grew by 58% & public grew 10% between )
Successfully delivering services requires accountability
Government can guide policy and financing while private sector delivers the service
The governments of many developed countries are finding ways to leverage the capacity and expertise of the private sector to provide education.
In a subset of OECD countries, more than one-fifth of public expenditure is transferred to private institutions, either directly or by subsidizing households to pay for the school of their choice. Moreover, on average, OECD countries spend 12% of their education budgets in education institutions that are privately managed. These governments have financed a wide variety of schools on a per pupil basis to meet demand for different kinds of schooling. In the United States, the number of private companies providing supplemental academic services (academic tutoring) increased by 90 percent in just one year, between 2003 and 2004.
Source: UNESCO

6. Understanding PPPs

7. Finance and Provision

8. Framework and International Experience
Contract Types
Example
Management, professional
services (input)
United Kingdom, Colombia, Senegal, Pakistan
Operational services
(process)
Qatar, Colombia, United States
Education services
(output)
Pakistan, Netherlands, Chile, Cote d’Ivoire
Facility availability (input)
Belgium, UK, Australia, Canada, Egypt, Germany
Facility availability and
education services (input
and output bundle)
None so far

9. PPP Continuum Low High Moderately Strong Very Strong Absent Weak
Democratic People’s Republic of Korea
Mexico
Argentina
Cote
d’Ivoire
Qatar
Netherlands
Public provides, finances, regulates education services
Contracts with private schools to provide a portion of education.
Private Management of public schools
Vouchers Funding follows students.
Subsidies to inputs private schools
Private schools

10. What do we know about Public-Private Partnerships?
Contracting Out Education
“risk sharing relationship based upon an agreed aspiration between the public and private sectors to bring about a desired public policy outcome.”
– Commission on UK PPPs
“cooperative venture between the public and private sectors, built on the expertise of each partner, that best meets clearly defined public needs through the appropriate allocation of resources, risks and rewards.”
– Canadian Council for PPPs

11. What does existing evidence suggest?
1. Private operation of public schools tends to yield higher test scores after initial years (US, LAC)
2. Targeted vouchers can improve academic outcomes, especially for the poor (Colombia)
3. Universal vouchers generate no robust conclusions (Chile)
4. Few empirical studies of the impact of PPPs
5. Need to evaluate how PPPs work most effectively in different contexts and which characteristics of private operation make them perform better than public schools
Some of the evidence of public provision of private services on education outcomes so far is positive but is not enough to justify either ignoring PPPs or expanding them on a large scale. The small number of studies that have been carried out so far suggest that contracting out to the private sector can have several benefits, including greater efficiency, increased choice, and wider access to education, particularly for those households who have been poorly served by traditional methods of providing education. In general, private management of public schools tends to be efficient and yield higher test scores than public institutions when students reach the end of basic education. In addition, despite being controversial, vouchers can improve academic outcomes, especially for the poor. However, few of the existing empirical studies of PPPs can be considered to have yielded robust conclusions. There is a need to evaluate how PPPs work most effectively in different contexts, particularly where contracting models need to be improved or fine-tuned and in countries where partnerships are still nascent. While much is known about funding school choice, much less is known about which characteristics of charter and concession schools make them perform better than public schools. More research is also needed on universal versus targeted school choice and on private finance initiatives.

12. Bank Netherlands Partnership Program (BNPP)
Objective: increase empirical knowledge on PPP programs
Case Studies: 4 health, 5 education, 1 descentralization in health
Geographical coverage: AFR, LAC, SAR, EAP
There are:
Four case studies on contracting of health services out to private and non-profit sectors to improve maternal and child health (Congo, Nigeria, Rwanda and Pakistan);
Five on the provision of financing and technical support to private schools and impact of provision of internet access by PPPs to low-income communities (Kenya, Pakistan [x2], Philippines, and Mexico);
One case study of decentralization or giving voice to the communities in the provision of health services (Argentina).

13. Innovative Service Delivery
Contracting health services out to private and non-profit sectors (Congo, Nigeria, Rwanda and Pakistan);
Provision of financing and technical support to private schools (Kenya, Pakistan [x 2], Philippines, and Mexico);
Decentralization or giving voice to the communities in the provision of health services (Argentina)
Four case studies on contracting of health services out to private and non-profit sectors to improve maternal and child health (Congo, Nigeria, Rwanda and Pakistan);
Five on the provision of financing and technical support to private schools and impact of provision of internet access by PPPs to low-income communities (Kenya, Pakistan [x 2], Philippines, and Mexico);
One case study of decentralization or giving voice to the communities in the provision of health services (Argentina).

14. Evaluation Designs Experimental Countries Randomization
Rwanda, Kenya, Philippines, Pakistan (E-BESP), Mexico
Quasi-Experimental
Regression Discontinuity
Pakistan (E-FAS)
Differences-in-differences
Pakistan (H), Argentina
Matching
Pakistan (E)

15. Transport Subsidy Pakistan
PPP Continuum
Low
High
Moderately Strong
Very Strong
Absent
Weak
Moderate
Strong
AGEs Mexico
FAS Pakistan
Transport Subsidy Pakistan
Public provides, finances, regulates education services
Contracts with private schools to provide a portion of education.
Private Management of public schools
Vouchers Funding follows students.
Subsidies to inputs private schools
Private schools