Government funding to private schools in British Columbia

Government funding to private high schools in British Columbia

Student name: First, middle, last

ECON109 Summer 2020

University of Alberta

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Government funding to private schools in British Columbia

Government funding to private high schools in British Columbia

Private schools generally outperform public schools at all levels which makes them attractive to

many parents, who see a better future for their children in private education. However, high

tuition fees in private schools is historically proved to be the most important hurdle faced by

these parents. To overcome this, private schools offered limited financial aid to low- and

middle-income families. With an extremely small number of these families getting the financial

aid, private school, nevertheless, remained unaffordable for non-wealthy families. To make

private schools more affordable, the government of British Columbia has been providing them

partial funding since 1977. This partial funding helped the government to save a large amount

of money, provided access for students from middle-income families to these schools, and

improved the quality of education in the province.

Considering the large amount of funding that the government is already providing to public

schools, some may believe that the partial funding to private school raised the government

spending on the province’s education and lowered government savings. However, paradoxically

the government is saving millions of dollars every year by providing partial funding to private

schools. Although the exact amount of saving is difficult to calculate, an approximate amount

can easily be calculated by examining the monetary effect of discontinuation of the government

funding. A school’s total expenses consist of operating expenses to teach students, and capital

expenses for school building and infrastructure. The provincial government funds private

schools in two tiers. It funds 35% of the operating expenses of elite schools (very expensive

preparatory schools catering to students from wealthy families) and 50% of the same cost of
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Government funding to private schools in British Columbia

non-elite schools (less expensive schools catering to students from middle- and some low-

income families) (Government of British Columbia, 2019). Capital expenses are entirely paid

by the school. The annual per student operating expense in 2018-19 was estimated at $9,351

(Government of British Columbia, 2019). Thus, elite schools received $3,273 per student, and

non-elite schools received $4,676. In 2018, approximately 83,644 students were going to private

schools (BCTF, 2019). With approximately 75% of these students going to non-elite private

schools and 25% going to elite private schools (Fraser Institute 2017), the government paid

approximately $361.8 million to all private schools. A discontinuation of government funding

would force most non-elite schools to close and cause their students to migrate to public

schools. To accommodate these students in public schools, the government would need an extra

$244.8million, —a difference between total operating expenses of approximately 63,000 non-

elite private school students migrating to public schools and the total current funding to all

private schools. Moreover, the relocation of an extremely large number of students to the public

education system will also force the government to spend additional hundreds of millions of

dollars to build hundreds of new schools.

The two-tier funding policy played a crucial role in making private schools affordable and

attracting more students from middle-income families. In the absence of financial aid, high

tuition of these schools, ranging up to $78,000 per year, would have restricted them to only

wealthy families. The chart below shows that families with children in private schools earn

14.2% higher income than those in public schools. Classifying the family-income levels into

two groups, depending on whether their children go to elite schools or non-elite schools,

provides a more realistic picture. Families with children in non-elite private schools earn only
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Government funding to private schools in British Columbia

1.9% higher income than those in public schools. Thus, categorization of families according to

their income levels, from low-income families in public schools to high-income in elite private

schools, shows that non-elite private schools cater to middle-income families. It, thus, supports

the claim that government partial funding helped thousands of students from middle-income

families in the province to get private education, even without the school’s financial aid

program.

Figure: Parental income, public versus private schools

Source: Research Bulletin (2017) Barbara Mitchell Centre for improvement in education, Fraser Institute. The

original graph uses the terms “government schools” and “independent schools” for public schools and private

schools, respectively.

In addition to making private schools more affordable to middle-income families, the

government of British Columbia took important measures to improve the education standard in

the province. Among them was the implementation of open enrolment policy to improve the

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Government funding to private schools in British Columbia

quality of education in public schools. According to this policy, students could enroll in any

public school, even if the school was located outside their catchment area. This policy, still in

effect, increased the quality of public schools. Interestingly, despite a rise in public schools’

quality of education, private schools outperformed even the best public schools in the province.

In 2018 ranking of British Columbia’s high schools by Fraser Institute, the top 19 schools were

private schools. Acknowledging that private schools perform better than public schools, our

analysis still maintains the question of how government funding to private schools improved the

quality of the province’s education system. As stated above, private schools provided better

quality of education than public schools despite the open enrolment policy. This implies that a

rise in private schools enrolment compared with public schools would enhance the overall

quality of education in the province. A policy focusing to improve the quality of education thus

must take measures to boost the private education. The two-tier funding policy in fact boosted

the private education by making non-elite private schools more affordable. Although

information about the student enrolment in non-elite schools is unavailable, a recent survey by

the Fraser Institute (2017) showed that the private school enrolment in British Columbia grew

by 35% from 2000 to 2014, whereas the public school enrolment fell by 12.1% during the same

period. This, on one hand, manifests the people’s preference for private schools and, on the

other hand, strengthens the claim that the government funding to private schools helped them

grow and improved the overall quality of education in the province.

As discussed above, the cost-effective government policy of funding the high-quality private

education system increased the enrolment of middle-income students in private schools, and

consequently improved the province’s quality of education and saved hundreds of millions of
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Government funding to private schools in British Columbia

dollars. The government can further improve the province’s education standard by reinvesting

these savings in private schools to attract students from lower-income families. With the student

enrolment rising in private schools and falling in public schools, the infrastructure needs would

rise in private schools and fall in public schools. The government can, thus, provide additional

funding to private schools for capital expenses either in monetary terms or by selling the closed

public school buildings to private schools at discount. Continuing this policy until the province

is left with only good-performing private and public schools would eventually bring the quality

of education to its peak.

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Government funding to private schools in British Columbia

References

BFTC (March, 2019). Independent schools in British Columbia. Education facts. updated

March 2019.

Cowley P., & Easton, S. T. (2019). Report card on British Columbia’s secondary schools 2018.

Studies in Education Policy. Fraser Institute.

Government of British Columbia (2018/19). Funding rates for independent schools. Resource

management division. Updated December 2018.