Financing for equity in primary and secondary education

1. Education resources to subnational governments

3. Education resources to students and families

4. Social policies and family support programmes

Introduction

Japan’s education financing system combines general intergovernmental transfers with education-specific grants to ensure equitable provision of compulsory schooling across prefectures and municipalities. The central government distributes national tax revenues to local governments through the Local Allocation Tax Grant (LATG), a general transfer that equalises fiscal capacity by adjusting for differences in revenue potential and standard expenditure needs, including those related to education. This mechanism enables less affluent local governments to provide comparable education services to those in wealthier regions.

The Ministry of Education, Culture, Sports, Science and Technology (MEXT) oversees the education system, working through prefectural and municipal education councils that manage schools and provide material support funded through both these general transfers and other tax sources. In public compulsory education, prefectural governments finance one-third of teachers’ salaries, while the national treasury covers between one-third and one-half of school facility and equipment improvement costs. Overall, local authorities contribute nearly half of total education expenditures, with the national government funding the remainder.

OECD Education GPS illustrated the flows of public funding for public primary and lower secondary educational institutions in Japan.

1. Education resources to subnational governments

Japan’s largest intergovernmental transfer is the Local Allocation Tax (LATG, jichi-zei futan zeikin), a general-purpose grant that redistributes national tax revenues from the central government to prefectures and municipalities to equalise fiscal capacity. The formula estimates each local government’s standard fiscal need and standard fiscal revenue, with education forming a major component of the expenditure needs. It adjusts for population size, enrolment, geographical remoteness, and regional cost differentials, ensuring that less affluent or sparsely populated areas can provide compulsory education at nationally required standards. The LATG thus serves as Japan’s main equalisation mechanism, indirectly addressing disadvantage through fiscal redistribution.

Complementing the LATG, the System of Specific Educational Grants (tokutei kyōiku shikin) channels earmarked funds from the national treasury to local education authorities to reduce regional disparities and support equal access to quality schooling. These grants finance part of teachers’ salaries in public elementary and lower-secondary schools, as well as free textbooks and school facilities, and together with the LATG form the backbone of equity in education finance.

MEXT co-finances the Assistance to School Attendance Programme (要保護者と準保護者への就学援助制度). Funds are transferred to municipalities which administer the programme for students from low-income households and for children with disabilities (see more in Section 3).

2. Education resources to schools

High School Attendance Support Fund System
Introduced in 2010, the system provides financial support to students from households that meet income criteria. It initially focused on eliminating tuition fees for public high schools while providing income-tested support for private high schools, has since been reformed to explicitly cover both public and private high schools under a unified national framework. Previously eligible families in 2013 had annual incomes below JPY 9.1 million (USD 61.7k), under the new framework, income limits have been removed, and support is provided up to a tuition cap of JPY 118,800 for public high schools and JPY 457,200 for private high schools. The central government allocates support to prefectures which then transfer it to the school on behalf of the eligible student. Since 2023, the scheme also supports households experiencing sudden financial changes. Payment amounts vary based on family income and school type, and are disbursed monthly over a 36-month period.

Special Education and the Inclusive School Management Model Project
The Ministry of Education, Culture, Sports, Science and Technology (MEXT) allocates funding to strengthen special education programmes across Japan. This includes direct support to special education schools as well as resources for sports, arts, and cultural activities.

In addition, MEXT introduced around 2013 the Inclusive School Management Model Project, designed to establish effective inclusive school management practices in both special needs schools and mainstream elementary, junior high, and high schools. The project focuses on creating school clusters where resources and expertise are shared, with designated coordinators facilitating collaboration between schools, welfare sectors, and disability professionals to ensure reasonable accommodations and support for students with special educational needs (SEN). This includes establishing incremental support systems and case meetings to tailor interventions for individual students, promoting smooth transitions between different levels of education and fostering inclusive environments across school types.

Support for Education in Remote and Isolated Areas
The 1954 Law for the Promotion of Education in Remote and Isolated Areas established a framework for state-led support to improve educational access in rural regions. Under this law, the government provides subsidies for school infrastructure, including teacher accommodations and multipurpose facilities, and ensures essential services such as transportation, technology, and provision of food and water. The legislation also mandates special allowances and incentives for teachers assigned to serve in these remote areas, promoting staffing stability and equitable educational opportunities.

GIGA School Programme
The GIGA School Programme, launched in 2019 and jointly funded by national and local governments, aims to achieve digital equity by providing one device per student in compulsory education and ensuring high-speed internet access in schools. During the COVID-19 pandemic, supplementary budgets were passed to equip schools with sanitation measures, digital learning tools, and resources to maintain educational continuity. Additionally, some municipalities and schools receive targeted support for Japanese-language education, with MEXT funding teacher training in Japanese as a second language, instructional materials, and bilingual education aides.

3. Education resources to students and families

Assistance to School Attendance Programme
Administered by the Ministry of Education, Culture, Sports, Science, and Technology (MEXT), this programme complements or supplements costs not covered by the Education Assistance Programme (See Section 4), including school trips and other additional expenses. Families cannot receive overlapping support from both programmes for the same school costs. Under the 1987 Guidelines for Grants for Assistance to Children and Students in Need of Protection, MEXT co-finances up to 50 percent of the costs to secure universal attendance. Families may use the support for school supplies, transport, or extracurricular activities, though this scheme represents only a minor share of total education spending compared with the broader equalisation system.

High School Supplemental Scholarship Fund
Established in 2014, the High School Supplemental Scholarship Fund provides targeted financial support to low-income households to cover non-tuition educational expenses. Eligibility is limited to families with an estimated annual income below JPY 2.7 million. The fund is designed to ensure equitable access to a full secondary education by subsidising essential costs such as textbooks, teaching materials, school supplies, extracurricular activities, student association and PTA fees, school trip expenses, and communication-related costs. By addressing these financial barriers, the programme supports both educational attainment and broader participation in school life, reinforcing national policy objectives of inclusive and equitable education.

JASSO Scholarships (Japan Student Services Organization)
The Japan Student Services Organization (JASSO) Scholarships primarily support post-secondary students but also provide assistance starting from the senior high school transition phase. These scholarships aim to ease the financial burden on students pursuing higher education in Japan, especially those from low-income and single-parent households. In addition to scholarships, JASSO offers both interest-free and interest-bearing loans to support students' living and educational expenses, promoting wider access to tertiary education and smoother transitions from secondary to higher education.

Municipal-Level Financial Aid for Primary and Junior High Schools
At the primary and junior high school levels, financial support for low-income families is primarily administered by municipal authorities under Article 19 of the School Education Law. This aid is intended to cover essential school-related expenses, ensuring that economic barriers do not impede access to compulsory education.

4. Social policies and family support programmes

Education Assistance
Students in compulsory education who meet the income eligibility criteria can access Education Assistance administered by the Ministry of Health, Labour, and Welfare. Since public schools do not charge tuition at this level, the programme is designed to cover other essential school-related costs, including school meals, commuting expenses, and school supplies. This policy ensures that low-income households can fully participate in compulsory education without financial barriers.

Child Allowance
The Japanese government provides a child allowance for all children from birth until the age of 18, with eligibility extending until 31 March following the child’s 18th birthday. Japan’s child allowance system was first established in 1972 under the Child Benefit Act and was subsequently expanded through several reforms, notably in 2006–2007, which broadened eligibility and increased benefit levels, and in 2010. The allowance is now universally available, as income limits were removed in October 2024; however, families exceeding certain high-income thresholds may receive a reduced amount or may not be eligible for the subsidy. Allowance amounts vary according to the child’s age and birth order. Children aged three to high school age receive ¥10,000 per month for the first and second child. For the third child and subsequent children, the allowance increases to ¥30,000 per month. Payments are disbursed six times annually, in even-numbered months.

Municipal-Level Support
Municipalities and cities also offer several programmes to support school-aged children, including Ichikawa city’s “Entrance Preparation Fund Loan System” and the “school preparation allowance.”

5. School meal programmes

School Lunch Promotion Project
Japan provides subsidised school lunches for all students in primary and lower secondary schools. Funding primarily comes from local authorities, while the national School Lunch Promotion Project supports the provision of local and organic produce. Subsidies are available to cover essential expenses, including the purchase of cooking equipment and coordination with food producers. Despite these supports, many schools continue to collect contributions from parents to cover remaining costs. School feeding programmes have been in operation since 1932 in the country.

Some municipalities have also introduced universal free school lunches to reduce stigma and improve access for all students.

This profile has been reviewed with support of national experts Suk Joon Son and Dr. Alaa Aladini