Decolonize education financing now! Reject IMF wage bill policies
By Dr. Limbani Eliya Nsapato
This week (May 29 to June 2, 2023) has been set aside by the international global campaigners led by Global Campaign for Education (GCE) as the Global Action Week for Education (GAWE). GAWE is being celebrated all over the world under the slogan, investing in a just world: Decolonize education financing now! In Africa, this slogan was echoed on 29th May by participants of the Africa Reginal Dialogue on Decolonizing Education Financing in Africa organized virtually by GCE and Africa Network Campaign on Education for All (ANCEFA).
The GAWE theme is a follow-up to the 2022 United Nations Transformative Education Summit Call to Action on Educational Investment which urges “all countries and all partners to take concrete action both nationally and internationally in order to invest more, to invest more equitably and to invest more efficiently in education”.
Globally, there is a huge funding gap to finance the sustainable development goal no 4 on quality education (SDG#4). GCE estimates that the annual education-financing gap in low and lower-middle-income countries is $148 billion. Additional costs due to COVID-19 related school closures risk increasing this financing gap by up to one-third, or between US$30-45 billion. UNESCO Institute for Statistics (UIS) estimates that the annual average financing gap between 2023 and 2030 is estimated to be USD 97 billion or 21% of the total cost of achieving the national SDG#4 targets. According to UIS report released in April the average gap is USD 26 billion (50% of the total cost) in low-income countries and USD 71 billion (17% of the total cost) in lower-middle income countries.
The pressure of this funding gap is hugely felt at country level. For instance, in Malawi, over the past three years government has been allocating less than 50% of the budget required to implement its 2020-2030 National Education Sector Investment Plan (NESIP). In 2020 government estimated a total funding gap of US$6.3 billion over the 10 year implementation period. Since 2020/2021 estimates show a three-year aggregate funding gap of K1.4 trillion (US$1.3 billion). The huge funding gap comes as the country needs to recruit additional 50,000 teachers to provide quality education in primary education where the qualified teacher: pupil ratio is 1:62, the third highest in the world.
The huge global funding gap could be reduced if countries allocated sufficient resources for education in the national budget. The 2015 Addis Ababa Action Agenda (AAAA) which outlined startegies for financing the 2030 SDG agenda encouraged countries to set nationally appropriate spending targets for education. While acknowledging that national contexts are diverse, the following international and regional benchmarks are crucial reference points in terms of government commitment to fianncing education: allocating at least 4% to 6% of gross domestic product (GDP) to education; and/or allocating at least 15% to 20% of public expenditure to education. The 2015 UNESCO Incheon Framework for Action urged least developed countries to reach or exceed the upper end of these benchmarks if they were to achieve the targets laid out in this framework. Unfortunately, most African countries are not complying with these financing benchmarks. Current World Bank figures show that at global level countries are only allocating an average of 4.3% of their GDP and 12.6% of the national budget to education.
In SubSaharan Africa, where most countries are least developed and need to allocate the upper ends of the financing benchmarks, government are allocating an average of 3.4% of the GDP and 14.3% of the national budget to education, being below target.
While SADC countries commit an average of 4.9% of the GDP and 15.9% of the national budget to education, being above those of Sub-Saharan Africa (3.4%, 14.3%) and World (4.3%, 12.6%), over 40% of the countries in the region are allocating below the agreed benchmarks. Analysis shows that 7 out of 16 SADC countries (44%) are allocating less than 4% of the GDP to education. These are Tanzania (3.3%), Madagascar(3,1%), Zambia(3.0%), Zimbabwe(2.9%), DRC(2.7%), Comoros(2.5%), and Angola(2.4%). Another 8 countries (50%) are allocating less than 15% of their national budgets to education. These are Tanzania (14.3%), Mauritius (14.3%), Zimbabwe (14.04%), Zambia (13.9%), Madagascar (13.9%), Comoros (13.4%), Seychelles (10.6%), and Angola (6.6%).
Consequently, in most countries there are high numbers of out- of- school children, illiterate adults (mostly women), acute shortages of teachers, and teaching and learning materials. There are also huge inequalities in access to quality education across gender, disability, and geographical locations, hurting more those from low socio-economic backgrounds.
While most countries in Africa are struggling to achieve the recommended minimum tax to GDP ratio of at least 20%, conditionalities imposed by donors (most of whom are from colonial nations) and multilateral institutions (IMF and Workd Bank) are restricting public spending to address huge challenges in education especially the shortage of teachers. ANCEFA in 2022 estimated that in Africa, there was shortage of at least 17 million teachers, yet IMF continues to impose wage bill policies which restrict recruitment of teachers. These wagebill policies are known to have negative impact on efforts to provide quality education, since adequate qualified teachers are needed to facilitate quality teaching and learning processes.
Studies by Action Aid, Educational International(EI), Public Services International(PSI), and GCE have shown that IMF wage bill policies have been introduced in many countries in Africa as part of asuterity measures to contain the budget – first by limiting wage increases and then by imposing a recruitment freeze, apart from macro-economic conditions of budget ceiling, single-digit inflation and budget deficit ceiling. One serious consequence of austerity policies is that they have led to cuts in the public sector workforce that have undermined the ability of governments to deliver quality public services.
A multi-country study released last year by EI and PSI across 15 countries including Zimbabwe, Brazil, Liberia and Ghana, the recommended IMF cuts added up to nearly US$ 10 billion – the equivalent of cutting over 3 million frontline public sector workers. In just those 15 countries, a one-point rise in the percentage of GDP spent on the public sector wage bill would allow for the recruitment of 8 million nurses, teachers and other public sector workers.
In Malawi, IMF policies have negatively affected the country’s efforts to recruit additional teachers and improve quality education. The country became a member of IMF on July 19, 1965, and has enjoyed at least 16 arrangements (loans) with the Fund, including an Outstanding Purchases and Loans (SDR) amounting to US$ 292.35 million as of June 30, 2021. On yearly basis IMF has been putting pressure on government to contain its wage bill as a way of ensuring macro-economic stability, and as pre-condition for continued support under the extended credit facility programme. A 2020 IMF review of Rapid Credit Facility (RCF) imposed projections on the size of the wage bill to be on declining trajectory from 7.7 % to 7.5% of the GDP over the period 2021/22 to 2024/25 (IMF, 2020), thereby limiting new recruitments or high salary increases.
In the education sector salaries and wages (personal emoluments) constitute 85% of education sector recurrent expenditure (MOE, 2020). The education wage bill constitutes around half of the total public wage bill. The wage bill constraints have forced Malawi to slow down on teacher recruitment, recruiting 50% of the annual target of 10,000.
The country needs to recruit an additional 52,459 teachers to reach the internationally recommended teacher pupil ratio of 1:40. But recruiting 52,459 teachers would increase the primary education wage bill by 63%, and as % of the GDP the education wage bill would need to move from 3.8% to at least 6%. This would in turn push the overall public wage bill by at least 2.2% from 7.7% of the GDP to at least 9.9% of the GDP, and by consequence, this would contravene the wage bill projection of 7.5% for the period 2021 to 2025 as indicated in the 2020 ECR report. Consequently, the government has resorted to recruiting auxiliary teachers who are recruited on a temporary basis and with demotivating low remuneration. Since 2021 the government has recruited 7,395 auxiliary teachers at primary level (3,270 auxiliary teachers, recruited in 2021 and 4,125 auxiliary teachers recruited in 2022).
Due to these wage bill constraints, there are at least 25,000 teachers who have been trained in teacher training colleges but can’t be recruited. Malawi’s teacher pupil ratio of 1:62, is third highest in the world, and far from the global average of 1:18 and Sub-Saharan Africa average of 1:36. In Malawi, one clearly notices that education is sacrificed at the altar of austerity policies. These policies must be reviewed, resisted, rejected, and even killed in pursuit of the human right to education. Restricting the right to education in the name of austerity is immoral and grossly unjust. This is because, as Pope Francis noted in 2018, “without the right to education, there is no real freedom, which allows every person to be the protagonist of their own destiny”.
The 2023 GAWE campaign is calling upon the IMF to remove existing austerity measures and ensure free spending on teachers. The global civil society movement through their national, regional and global offices have been writing to the IMF Authorities in various countries demanding that the IMF Board lives up to its 2007 decision to remove public sector wage bill constraints as a condition of loans.
While pursuing the end of the IMF austerity policies, it is also important that governments explore other actions to finance education. Critical actions are those agreed at the 2022 Transforming Education Summit. These are: (1) Action on Tax: increase tax-to-GDP ratios by five percentage points by 2030 through progressive tax reforms, enabling a doubling of spending on education and other sectors, (2) Action on debt: countries spending more in debt servicing than on education should be front of queue for debt cancellation / renegotiations and a new debt workout mechanism, (3) Action on paradigms: Ministries of Finance should see education as investment not consumption, and (4) Action on Special drawing rights: which calls for a new issuing of the IMF currency as was done during Covid + redistribution.
It is also important that there emerge strong advocacy movements to advocate against the retrogressive austerity policies by building their skills and coming up with strategies and alternatives to counter IMF wage bill and other austerity policies. GCE, teacher movements and collaborating partners should assess the advocacy capacity and come up with capacity strengthening measures to grow the resilience resistance against punitive and unjust austerity.
Finally, UNESCO, the United Nations body which coordinates and provides policy direction on education across countries, should intervene against unfavorable policies or conditions set by IMF, World Bank and other donors which perpetuate neocolonialism and provide restrictions for teacher recruitment and proper investment in education.
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#DecoloniseEducationFinancingNow #GAWE2023
