Fis­cal dis­ci­pline and ed­u­ca­tional qual­ity

Financial Mirror (Cyprus) - - FRONT PAGE -

The world is mov­ing into a post-in­dus­trial age in which man­u­fac­tur­ing is be­com­ing ever more com­plex and com­pe­ti­tion has be­come global. To suc­ceed, coun­tries in­creas­ingly need a highly skilled and ed­u­cated work­force. There­fore, rais­ing the level of skills con­ferred by sec­ondary schools has be­come an ur­gent pri­or­ity for de­vel­op­ing and de­vel­oped coun­tries alike.

For me, the is­sue of ed­u­ca­tion is no mere aca­demic mat­ter. I was born into a fam­ily of nine chil­dren. My par­ents were il­lit­er­ate, and none of my sis­ters at­tended school be­yond the pri­mary level.

How­ever, in my fam­ily’s next gen­er­a­tion, all of my nieces and neph­ews have a high-school di­ploma and most have at­tended univer­sity.

Im­prov­ing the ed­u­ca­tion sys­tem of a coun­try with more than 16 mln pri­mary and sec­ondary school stu­dents – more than the com­bined pop­u­la­tion of 20 Euro­pean Union mem­ber states – poses con­sid­er­able fis­cal chal­lenges. So the first step is to cre­ate a sound macroe­co­nomic ba­sis for re­form.

For many years, high pub­lic debt and macroe­co­nomic mis­man­age­ment forced Turkey to pay a huge in­ter­est-rate pre­mium in in­ter­na­tional fi­nan­cial mar­kets – money that might have other­wise been in­vested in schools. How­ever, since as­sum­ing of­fice in 2003, Prime Min­is­ter Re­cep Tayyip Er­do­gan’s govern­ment has re­duced the fis­cal deficit as a share of GDP by nearly ten per­cent­age points, from 10.8% in 2002 to 1% in 2013, and cut the pub­lic debt/GDP ra­tio from 74% in 2002 to 36.3% in 2013. As a re­sult, govern­ment in­ter­est pay­ments as a share of tax rev­enues fell from 85.7% to 15.3% dur­ing this pe­riod.

These fis­cal im­prove­ments have freed up funds for siz­able in­vest­ments in ed­u­ca­tion, with­out adding to pub­lic debt. From 2002 to 2014, Turkey dou­bled the pro­por­tion of ed­u­ca­tion spend­ing in the to­tal budget to 18% with­out hurt­ing the coun­try’s fis­cal po­si­tion. Since 2003, this ex­tra money has al­lowed the govern­ment to hire some 410,000 more teach­ers, add 205,000 class­rooms, and dis­trib­ute 1.8 bln free text­books.

But to com­pete with the world’s eco­nomic pow­er­houses, like China, we also needed to im­prove the over­all qual­ity of our labour stock. From the 2002-03 aca­demic year to 201213, gross school­ing rates (which in­cludes stu­dents whose age ex­ceeds or falls short of the of­fi­cial age group) in­creased from 96.5% to 107.6% in pri­mary ed­u­ca­tion; 80.8% to 96.8% in sec­ondary ed­u­ca­tion; and 35.8% to 92.1% in higher ed­u­ca­tion.

Pupil-teacher ra­tios have also fallen. In the 2002-03 school year, there were 28 stu­dents per teacher in pri­mary ed­u­ca­tion and 18 in sec­ondary schools; by 2012-13, this had fallen to 20 and 16, re­spec­tively. And in 2012, Turkey raised the min­i­mum pe­riod of com­pul­sory ed­u­ca­tion to 12 years. This is an im­por­tant re­form, given that the aver­age school­ing of people over 25 is only 6.5 years in Turkey, com­pared to an OECD aver­age of more than 11.

More­over, the govern­ment has im­proved ed­u­ca­tional op­por­tu­ni­ties. As part of the FATIH project to help un­der­priv­i­leged stu­dents, Turkey has al­lo­cated 1.4 bln lira ($665 mln) in 2014 to equip its schools with broad­band In­ter­net and the lat­est in­for­ma­tion tech­nol­ogy. Other ini­tia­tives, such as “Baba Beni Okula Gon­der” (Daddy, Please Send Me to School) and “Haydi Ki­zlar Okula” (Girls, Let’s Go to School), have im­proved en­roll­ment gen­der ra­tios, from 91.1 girls for ev­ery 100 boys in 2002, to 101.8 girls for ev­ery 100 boys in 2012. This is likely to im­prove fe­male la­bor-force par­tic­i­pa­tion in Turkey, which is around 30% on aver­age, but 72% for those with a univer­sity di­ploma.

Given Turkey’s ge­o­graphic size (twice that of Ger­many but with a sim­i­lar-size pop­u­la­tion), it has been a chal­lenge to en­sure that all pupils, re­gard­less of their lo­ca­tion or so­cioe­co­nomic back­ground, re­ceive a good ed­u­ca­tion. But one of Turkey’s most re­mark­able suc­cesses since 2003 has been to break the in­tol­er­a­ble link be­tween a child’s house­hold cir­cum­stances and his or her chances to suc­ceed in school.

Con­sider that in 2003, the test scores of 28% of Turk­ish stu­dents could be ex­plained by their so­cioe­co­nomic stand­ing – in other words, the poorer the pupil, the lower his or her PISA scores.

This was in line with the OECD aver­age. But the OECD’s 2012 re­port found that only 15% of lower test scores among Turk­ish stu­dents could be ex­plained by their so­cioe­co­nomic stand­ing, a bet­ter out­come than the OECD aver­age.

Turkey is also nar­row­ing the gap with OECD coun­tries in terms of ed­u­ca­tional qual­ity. In 2006, Turkey scored 76 points lower than the OECD aver­age in sci­ence ex­ams and 74 points lower in math. By 2012, the gap had fallen to 38 points in sci­ences and 46 points in math.

Given these achieve­ments, it may be no co­in­ci­dence that Turkey’s youth un­em­ploy­ment rate has also de­clined, from 25.3% in 2009 to 17.3% in Jan­uary 2014, be­low the EU aver­age of 22.8%. What is clear is that im­prov­ing ed­u­ca­tion and bol­ster­ing eco­nomic growth go hand in hand.

Of course, more needs to be done to re­alise Turkey’s hu­man-de­vel­op­ment po­ten­tial; but the past decade of ed­u­ca­tional re­forms and their ben­e­fi­cial eco­nomic ef­fects demon­strate that the foun­da­tions are be­ing laid for rapid, sus­tain­able, and in­clu­sive growth.

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