Session 7d- Education

The Education Service Contracting
(ESC) Program of the Philippines
Michael M. Alba
De La Salle University  Manila
The ESC program in a nutshell
• provides a fixed tuition subsidy
to graduates of public elementary schools
who opt to enroll
in participating private high schools.
• effectively, contracts private schools
to provide secondary education
to students who otherwise would have
attended public schools.
Program Features
• Beneficiaries
– graduates of public elementary schools
• who opt to enroll in participating private high schools
– Grantees pay school fees and expenses in excess of
the tuition subsidy.
• who are accepted by the participating private high
– A school committee processes applications and
screens grant applicants.
Program Features
• Benefits
– a fixed annual tuition subsidy through 4 years of
high school
• Value of the grant since SY 2008-2009: PhP10,000 per
year in NCR and PhP5,000 elsewhere in the country.
• Requirements
– Grantees must pass all academic requirements in
each year level.
– Grantees cannot take a leave from schooling
except due to force majeure or illness.
Program Features
• Service Providers
– Private high schools
• who apply to DepEd to participate in the program
• who pass an annual certification process for quality of
How the ESC Program came to be
• Education policy makers (in government and
the private sector) wanted to make use of
excess resources in private schools to address
congestion and poor quality in public schools
– Legal bases
• RA 6728 of 1989: Government Assistance to Students
and Teachers in Private Education (GASTPE)
• RA 8545 of 1998: Expanded GASTPE
Program Objectives
• Make quality secondary education more
accessible to poor Filipino students
• Enhance the complementary roles of public
and private education sectors
• Maximize the use of existing resources in the
private education sector
• Realize savings for the government
• Ease the need for constructing new
classrooms and hiring new teachers
What has been achieved? (1)
• National Coverage as of SY 2008-2009
– 476,776 grantees
• 9.3 percent of 5.1 million students in public high schools
• 35.8 percent of 1.3 million students in private high schools
– 2,033 participating private high schools
• 39.8 percent of 5,110 public high schools
– On average, 4 private high schools handle the enrollment
spillovers or congestion problems of 10 public high schools
• 46.3 percent of 4,392 private high schools
– 234.5 grantees per school, on average
• 58.6 grantees per year level per school, on average
What has been achieved? (2)
• The ESC program provides a lower cost
alternative to direct public provision of
– Cost of a public high school student: PhP9,048
– Cost of an ESC grantee: PhP5,344
What has been achieved? (3a)
• On average, a participating school receives
PhP1.18 million per year from DepEd due to
the ESC program
• But, in general, school fees exceed the ESC
– The average support value of the ESC program is
– sv = ESC grant ÷ school fees
ESC grants generate
4.43 schools
for= PESC
P4.43 billion in
2,040 , 46%
GRANT, 2,393 ,
ESC grantees shoulder P2.0 billion of the P4.43 billion.
What has been achieved? (3b)
• In effect, the ESC program generates resources
for participating schools, in excess of
government transfers, since grantees make
significant co-payments.
More resources are thus generated for basic
• Can the ESC program be expanded without
increasing costs and lowering the quality of
private school education?
– What is the cost structure of the program?
– What is the optimal mix of delivery? Will private
schools themselves become congested or suffer in
• Can the ESC program be better targeted to
improve the overall accessibility and quality of
secondary education?
– How can the ESC program be used to improve public
high schools?

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