The Impacts of Proposed Education Minimum Service Standards on a Sample of Districts in Indonesia Stephen Dunn January 13, 2005.

The Impacts of Proposed Education Minimum Service Standards on a Sample of Districts in Indonesia

Stephen Dunn

January 13, 2005

Overview

“Snapshot” of Indonesia and Districts

“Pre-History” of Decentralization in Indonesia

The Era of Decentralization

Motivation for Minimum Service Standards

Overview of Proposed Minimum Service Standards

Study and Results

Conclusions, Issues, Looking Forward

Snapshot of Indonesia

Population 214.5 million (WB, 2003)

14,000 islands

3,000 miles east-to-west

43% urban (WB, 2002)

Life expectancy at birth 66.7 Years, (WB, 2002)

GDP per capita $971 (WB, 2003)

Poverty Headcount Index 16% (WB, 2002)

Snapshot of Districts

420 Districts

District Populations from <25,000 to Over 4 Million

Environments from “Metro” to isolated, agricultural

Poverty Headcount Index from >90% to <2% (SUSENAS, 2002)

Annual Per Capita Own-Source Revenues from nearly Rp 1 million to below Rp 5,000 (WB, 2001)

Snapshot of District Education

Primary NER: 91% for lowest-income districts 91% for highest-income districts

Sen. Sec. NER: 18% for lowest-income districts 62% for highest-income districts

(WB, 2002)

Per-Student APBD Education Expenditure Range: minimum < Rp 50,000 maximum > Rp 300,000

(author’s data)

“Pre-History” of Decentralization in Indonesia

Prior to 1999 Laws, Highly Centralized Government

Low Control of Own-Resources

Deconcentrated Sectoral Offices in Districts

Limited District Autonomy

Little Scope for Local Choice in Service Delivery

The Era of DecentralizationOverview

Motivations for Decentralization

Decentralization to District Level

Laws 22, 25 of 1999 and “Big Bang” in 2001

Assets Transferred to Districts

Local Planning and Budgeting

New Revenue Streams: DAU and DAK

Share of Sub-National Spending Doubled

The Era of DecentralizationFinance and Management of Education

Education managed at district and school level

DAU is primary source of district funds

Education competes for district resources with other sectors

There are numerous other funding streams

Large amount of district autonomy, emerging school autonomy

Motivation forEducation Minimum Service Standards

Education is a national concern

Desire to increase equity across districts

Indonesia has low achievement relative to peers

Political-Economic Aspects

Overview of ProposedEducation Minimum Service Standards

SPM cover:

formal education (grades 1-12)

equivalent out-of-school education

pre-school

sports

“youth participation” / “social participation”

special education

teacher/school development and management

Overview of ProposedEducation Minimum Service Standards

Large number of SPM (297)

Some SPM are conflicting or internally inconsistent

“Education” SPM cover many non-education areas

Districts do not collect much of the data needed

PERFORM StudyOverview

Goal: understand expenditure implications of SPM

Team: PERFORM staff, MOF, RTI

SPM focus: formal education (grades 1-12)

* Districts: 15 districts from 10 provinces

* Model: policy options projection model

* Results: projections from 2002-2017, “lower bound”

PERFORM StudyDistricts

PERFORM Studypolicy options projection model

User can set policy/functional parameters (SPM) and examine impacts

A “what if?” model to examine policy impacts

Single district focus, output for 15 districts

District base data

Projections over 2002-2017

Results for many variables/indicators

ResultsOverview

Interpretation of Results

Total Expenditure

Expenditure by Level

Expenditure by Type

Enrollment Indicators, Teachers, Classrooms, Books, Teacher and Classroom Upgrading

ResultsExpenditure

Proposed SPM result in a 54% increase in district expenditure on education by the year 2007 (“lower bound” estimate of SPM impact)

Expenditure impact varies significantly across districts

Within districts, expenditure impact varies dramatically for different levels of education

ResultsExpenditure

District

Total Education Expenditure (base case):

2002

Total Education Expenditure (SPM-implied):

2007

%Difference

(2007-2002)

Kab. Probolinggo 122,752,000,000 151,102,565,528 23%

Kab. Batang 102,377,837,970 197,195,090,673 93%

Kab. Pati 149,207,000,000 224,659,939,789 51%

Kab. Banyuwangi 185,661,000,000 212,301,335,884 14%

Kab. Badung 101,122,289,895 144,902,914,201 43%

Kota Jayapura 74,440,544,100 133,860,163,672 80%

Kab. Kupang 74,936,298,168 116,248,371,089 55%

Kab. Solok 27,605,015,555 32,039,358,546 20%

Kab. Lombok Timur 181,724,956,236 348,186,081,662 92%

Kab. Maros 39,741,218,532 86,371,462,551 117%

Kab. Sleman 207,587,848,558 342,713,028,721 65%

Kota Pangkal Pinang 43,272,567,000 60,123,203,441 39%

Kota Banjarmasin 113,830,723,000 234,181,568,246 106%

Kab. Gowa 120,061,272,688 291,091,309,546 157%

TOTAL 1,610,753,101,209 2,475,614,366,237 54%

ResultsTotal Education Expenditure: Kab. Batang

Total Expenditure SD/MI through SMK (gds. 1-12) (Rp)

0

50,000,000,000

100,000,000,000

150,000,000,000

200,000,000,000

250,000,000,000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

tahun/year

Ru

pia

h

SD/MI through SMK (total SPM-impliedexpenditure, total)

SD/MI through SMK (base expenditure, total)

ResultsSD/MI Expenditure: Kab. Batang

Total SD/MI Expenditure (Rp)

0

10,000,000,000

20,000,000,000

30,000,000,000

40,000,000,000

50,000,000,000

60,000,000,000

70,000,000,000

80,000,000,000

90,000,000,000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

tahun/year

Ru

pia

h

SD/MI (total SPM-impliedexpenditure, total)

SD/MI (base expenditure, total)

ResultsSMA/MA Expenditure: Kab. Batang

Total SMA/MA Expenditure (Rp)

0

10,000,000,000

20,000,000,000

30,000,000,000

40,000,000,000

50,000,000,000

60,000,000,000

70,000,000,000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

tahun/year

Ru

pia

h

SMA/MA (total SPM-implied expenditure,total)

SMA (base expenditure, total)

ResultsSD/MI Enrollment: Kab. Batang

Total SD/MI Enrollment (students)

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

tahun/year

sis

wa/

stu

den

ts

SD/MI (SPM-implied enrollment, total)

SD/MI (base enrollment, total)

ResultsSMA/MA Enrollment: Kab. Batang

Total SMA/MA Enrollment (students)

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

tahun/year

sisw

a/st

ud

ents

SMA/MA (SPM-implied enrollment, total)

SMA/MA (base enrollment, total)

ResultsSD/MI and SMA/MA Teacher Demand: Kab. Batang

Teacher Demand SD/MI

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

5,000

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

tahun/year

gu

ru/t

each

ers

SD/MI (teacher demand, total SPM-implied)

SD/MI (teacher demand, total basescenario)

Teacher Demand SMA/MA

0

500

1,000

1,500

2,000

2,500

3,000

3,500

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

tahun/year

gu

ru/t

each

ers

SMA/MA (teacher demand, total)

SMA/MA (teacher demand, total basescenario)

Conclusions

If implemented, the proposed SPM would result in large expenditure increases for many districts

Achievement of SPM would require substantial level-specific actions/changes for each district

Time as well as money will be required

Issues/Questions

Are the proposed SPM Affordable?

Are the SPM really “minimum service standards”?

Should all districts be subject to the same SPM?

Should SPM apply to all of education or to particular aspects?

What about empowerment of schools, school committees, and district education boards?

Why are the enrollment SPM not met?

How to finance SPM?

How to hold districts accountable for meeting SPM?

Looking Forward

Before promulgation, more analysis: financial and educationist perspectives

Definition of obligatory functions within education

Tsunami Impacts? focus, spending priorities, timeframe