Addressing the Philippine education crisis
Even before the pandemic, there were worrying signs of an education crisis in the Philippines. The most widely disseminated news about the crisis came from a report of the Program for International Student Assessment (PISA) of the Organisation for Economic Co-operation and Development (OECD) in 2018 which showed Filipino students ranking the lowest among 79 countries in mathematics, science, and reading. In math and science Filipino 15-year-old students obtained 353 points and 357 points, respectively, against the 489 OECD average for both categories. The OECD 2018 PISA Country Note for the Philippines stated: “Fifteen-year-old students in the Philippines scored lower in reading, mathematics, and science than those in most of the countries and economies that participated in PISA 2018… No country scored lower than the Philippines and the Dominican Republic… Over 80% of students in the Philippines did not reach a minimum level of proficiency in reading, which is one of the largest shares of low performers amongst all PISA-participating countries and economies.” These tests started to be administered in 2000 and are repeated every three years. In the 2018 tests, the Philippines ranked second to the last (Dominican Republic) in math and science. In reading it ranked last.
In another international test, the 2019 report of the Trends in International Mathematics and Science Study (TIMMS), our Grade 4 students obtained the lowest scores in mathematics and science among the 58 countries involved in the study. There was a clear deterioration from 2013 to 2019. The Philippines scores decreased by 61 points (from 358 in 2003 to 297) and by 83 points (from 332 in 2003 to 249) in mathematics and science achievement, respectively. A third international test, the Southeast Asia Primary Learning Metrics (SEA-PLM) Program 2019 Main Regional Report revealed that only 10% of our Grade 5 students met the proficiency standards of reading, 2% writing, and 17% in mathematics. The same report showed that more than half of our Grade 5 students are taught by teachers who got training in the language of instruction from in-service trainings or none at all.
It is reasonable to expect that this poor performance of Filipino students will be exacerbated as a result of the public health emergency during the ongoing pandemic. Under the new normal, the many lockdowns have resulted in zero face-to-face interaction, and students have been forced to rely on learning materials to continue their education. This has resulted in a learning crisis in which poor content quality in modules and distance learning materials are prevalent. Because of widespread loss of employment and decreased incomes, especially among the C, D, and E households, some 2.7 million pupils have dropped out of school. Among those who have managed to continue schooling, a big number have no access to learning devices necessary for online instruction. To make matters worse, public expenditures on education and training have suffered budget cuts as these compete with health needs.
In a report to a joint committee of members of the Philippine Business for Education (PBEd) and some legislators, former Secretary of Education Armin Luistro painted a bleak picture of our pupils enrolled in basic education. Among learners, 52% are in poor health, 44% suffer from insufficient nutrition, and 37% lack sleep. In September 2020, during the height of the pandemic, 30.7% suffered from hunger. There are 1.9 million pupils who are wasted and 309,000 severely wasted. Among the learners, 65% are bullied, 26% are lonely, and 20% are unsafe. As regards the quality of teaching, 40% are absent teachers and 35 to 60% delay their classes. Because of paucity of learning materials, 20% of the pupils have to share textbooks.
These serious challenges to learning among our youth can be partly explained by the inadequacy of public expenditures on education. PISA estimates that government spending per learner in the Philippines is just 10% of the OECD average. In 2020, spending on education was 13.5% of the government budget, down from 17% in 2017. The ideal percentage is 20%. Among our peers, such as Thailand, Vietnam, and Malaysia, the equivalent percentage is over 20%. As regards spending on education as a percentage of GDP, the Philippines also lags behind our East Asian neighbors which spend five to 10% of GDP on public education, compared to our 3%. It is hoped that the increase in the incomes of the LGU units of some P225 billion in 2022 as a result of the Mandanas ruling will be substantially channeled to public education.
To be realistic, it will take herculean efforts for the Government to reach levels of expenditures on public education that approximate those of developed countries and even our East Asian peers. After all, quality education is just fourth in priority among the so-called Sustainable Development Goals (SDGs).
The first is No Poverty. The second is Zero Hunger. The third is Good Health and Well Being. Quality Education is fourth. It is understandable that more of the government’s limited budget will go to address the first three priorities. The most direct solution to poverty is investing more in agricultural and rural development, which also addresses the No Hunger goal if agricultural productivity is increased significantly through providing small farmers with more farm-to-market roads, irrigation systems, post-harvest facilities, and all the resources they need to get more productivity from their small holdings. Because of the experiences during the pandemic, it is reasonable to expect that expenditures on health will for the immediate future be given priority over education. It is, therefore, imperative that the Government mobilize the private sector to invest heavily in education.
What the Bureau of Internal Revenue (BIR) just did through RR 5021 is manifestly counterproductive. I fully agree with Senators Sonny Angara and Ralph Recto that the BIR made an erroneous interpretation of the CREATE bill by increasing the income tax rate on so-called propriety educational institutions that are run by stock corporations to 25% from the current 10%.
Private educational institutions, whether not-for-profit or for-profit, are providing what is known in economic parlance as a “public good.” When they educate an individual, they are not just benefiting the pupil or student but the whole of society. Education has significant external economies, that is, benefits to the entire society over and above the good done to the individual consumer of the service. In the language of the millennials today, we should consider an educational institution organized for profit as a “social enterprise.” Those who put up a for-profit educational institution are benefiting society in the same say that a non-profit school or university is doing. The only difference is that the former has a more practical way of sustaining its existence by generating some profit.
Those of us who put up notfor-profit schools have to be forever begging and soliciting donations, which eventually will cut down the taxes collected by the Government since most of these donations are tax deductible. There is also no guarantee that the not-for-profit institutions can sustain their operations by being completely dependent on the generosity of donors. The forprofit educational institutions make a significant contribution to society by delivering a public good in a sustainable way. They do this by generating some profits for the stockholders. In a society like the Philippines in which the Government is always short of funds to deliver public goods like public works, public health, and public education, the finance authorities should refrain from taxing schools organized for profit. In fact, I would even extend this reasoning to for-profit hospitals and other medical facilities, especially if they devote part of their facility to charity wards. These social enterprises are just taking the place of the Government that is unable to deliver all the public goods it has the obligation to provide to the general population.
To be continued.
BERNARDO M. VILLEGAS has a Ph.D. in Economics from Harvard, is Professor Emeritus at the University of Asia and the Pacific, and a Visiting Professor at the IESE Business School in Barcelona, Spain. He was a member of the 1986 Constitutional Commission.