FINANCING FOR EQUITY
1. Overall Education Financing Mechanisms
2. Policies and Programmes to Provide Resources to Schools
3. Education Policies and Programmes to Provide Resources to Sudents and Families
4. Social Policies and Programmes to Provide Resources to Students and their Families
Preschool, primary and secondary education is compulsory and free in public schools. The State finances national education including human, material and technological resources, and services.
Educational responsibilities are shared by central, regional and local government. Budgets are divided among the different levels of government: 49 per cent is covered by the central government, 48 per cent by regional governments and the remainder by local governments. Resource allocation in education must be based on measurable results. Intergovernmental financing systems include fiscal equalization mechanisms to address regional disparities. The subnational level is responsible for distributing resources from the local education management unit to schools.
Figure 1 Financing sources and resource transfers in Peru
Fondo de Compensación Regional [Regional Compensation Fund – FONCOR]: A fund for regions where transfers are determined by the poverty level and availability of resources.
Fondo de Compensación Municipal [Municipal Compensation Fund – FONCOMUN]: A fund for municipalities with redistribution criteria that favour the most remote and deprived areas.Allocation is prioritized to rural and urban-marginal areas, taking into account criteria such as population, mortality rate, level of basic needs (Lima and Callao), the rurality rate (for the rest of the country) and statistical information from the National Institute of Statistics and Informatics.
Fondo Nacional de Desarrollo de la Educación Peruana [National Fund for the Development of Peruvian Education – FONDEP]: A fund attached to the Ministry of Education that supports investment and innovation projects and the educational development of schools in partnership with institutions, companies and international cooperation.
Most of the education budget is transferred from the Ministry of Education to regional governments based on historical criteria and annual negotiations. Resources for teaching staff are transferred according to benchmark class size and enrolment rates. Resources for school maintenance are allocated according to a set formula, and the Ministry of Education distributes teaching materials according to projected enrolment.
In 2018, education spending accounted for 3.72 per cent of gross domestic product (GDP) and 17.13 per cent of the national budget. In 2019, the education budget was USD 8.5 billion (PEN 30.6 billion) and the school-age population was 10 million.
Inclusion of students with disabilities in basic education
This programme is implemented by the Ministry of Education. It includes technical assistance to targeted schools that implement this educational model, training for principals, and subsidies to adapt school infrastructure and procure the necessary educational materials, such as textbooks in Braille. In 2017, the programme accounted for 1.36 per cent of the Ministry of Education’s budget and served 19,866 students (0.19 per cent of the school-age population).
The National Scholarships and Educational Credit Programme (PRONABEC in Spanish) includes different types of scholarships, including undergraduate scholarships, for example the Beca 18 [18 Scholarship]. These scholarships are aimed at academically gifted students from vulnerable populations in extreme poverty. In 2017, 39,221 students received undergraduate scholarships (0.38 per cent of the school-age population) and the programme executed USD 242 million (PEN 865 million), i.e. 11.8 per cent of the Ministry of Education’s budget.
This is a conditional transfer programme. Since 2012, it has been managed by the Ministry of Social Development and Inclusion, in coordination with other ministries for social affairs. The target population is families in extreme poverty with older adults and/or children up to the age of 19 years. It is national in scope, but operates mainly in rural areas. The selection instrument is the household targeting system, which is based on geographic and socioeconomic variables. The fortnightly transfer is USD 61.3 (PEN 200) per household, on the condition that children aged 6–14 years have 85 per cent school attendance.
In 2017, the programme spent USD 312 million, representing 0.15 per cent of GDP and benefiting 1.6 million recipients (5.1 per cent of the population) in 694,000 households.