Report | Budget, Taxes, and Public Investment

Public education funding in the U.S. needs an overhaul : How a larger federal role would boost equity and shield children from disinvestment during downturns

Report • By Sylvia Allegretto , Emma García , and Elaine Weiss • July 12, 2022

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Summary 

Education funding in the United States relies primarily on state and local resources, with just a tiny share of total revenues allotted by the federal government. Most analyses of the primary school finance metrics—equity, adequacy, effort, and sufficiency—raise serious questions about whether the existing system is living up to the ideal of providing a sound education equitably to all children at all times. Districts in high-poverty areas, which serve larger shares of students of color, get less funding per student than districts in low-poverty areas, which predominantly serve white students, highlighting the system’s inequity. School districts in general—but especially those in high-poverty areas—are not spending enough to achieve national average test scores, which is an established benchmark for assessing adequacy. Efforts states make to invest in education vary significantly. And the system is ill-prepared to adapt to unexpected emergencies.

These challenges are magnified during and after recessions. Following the Great Recession that began in December 2007, per-student education revenues plummeted and did not return to pre-recession levels for about eight years. The recovery in per-student revenues was even slower in high-poverty districts. This report combines new data on funding for states and for districts by school district poverty level, and over time, with evidence documenting the positive impacts of increasing investment in education to make a case for overhauling the school finance system. It calls for reforms that would ensure a larger role for the federal government to establish a robust, stable, and consistent school funding plan that channels sufficient additional resources to less affluent students in good times and bad. Furthermore, spending on public education should be retooled as an economic stabilizer, with increases automatically kicking in during recessions. Such a program would greatly mitigate cuts to public education as budgets are depleted, and also spur aggregate demand to give the economy a needed boost.

Following are key findings from the report:

Our current system for funding public schools shortchanges students, particularly low-income students. Education funding generally is inadequate and inequitable; It relies too heavily on state and local resources (particularly property tax revenues); the federal government plays a small and an insufficient role; funding levels vary widely across states; and high-poverty districts get less funding per student than low-poverty districts.

Those problems are magnified during and after recessions. Funding inadequacies and inequities tend to be aggravated when there is an economic downturn, which typically translates into problems that persist well after recovery is underway. After the 2007 onset of the Great Recession, for example, funding fell, and it took until 2015–2016, on average, to return to their pre-recession per-student revenue and spending levels. For high-poverty school districts, it took even longer—until 2016–2017—to rebound to their pre-recession revenue levels. And even after catching up with pre-recession levels, revenue levels in high-poverty districts lag behind the per-student funding in low-poverty districts. The general, long-standing funding inadequacies and inequities combined with the worsening of these problems during and in the aftermath of recessions have both short- and long-term repercussions that are costly for the students as well as for the country.

Increased federal spending on education after recessions helps mitigate funding shortfalls and inequities. Without increased federal education spending after recessions, school districts would suffer from an even greater decline in funding and even wider gaps between funding flowing to low-poverty and high-poverty districts.

Increased spending on education could help boost economic recovery. While Congress has enacted one-time education spending increases in difficult economic times, spending on public education should be considered one of the automatic stabilizers in our economic policy toolkit, designed to automatically increase and thus spur aggregate demand when private spending falls. Deployed this way, education spending becomes part of a set of large, broadly distributed programs that are countercyclical, i.e., designed to kick in when the economy overall is contracting and thus stave off or lessen the severity of a downturn. Along with other automatic stabilizers such as unemployment insurance, education spending thus would provide a stimulus to boost economic recovery.

We need an overhaul of the school finance system, with reforms ensuring a larger role for the federal government. In light of the concerns outlined in this report, policymakers must think differently both about school funding overall and about school funding during recessions. Public education is a public good, and as noted in this report, one that helps to stabilize the entire economy at critical points. Therefore, public spending on education should be treated as the public investment it is. While we leave it to policymakers to design specific reforms, we recommend an increased role for the federal government grounded in substantial, well targeted, consistent investment in the children who are our future, the professionals who help these children attain that future, and the environments in which they work. To establish a robust, stable, and consistent school funding plan that supports all children, investments need to be proportional to the size of the problems and to the societal and economic importance of the sector.

Introduction

The hope for the public education system in the United States is to provide a sound education equitably to all children regardless of where they live or into which families they are born. However, the COVID-19 pandemic exposed four interrelated, long-standing realities of U.S. public education funding that have long made that excellent, equitable education system impossible to achieve. First, inadequate levels of funding leave too many students unable to reach established performance benchmarks. Second, school funding is inequitable, with low-income students often and communities of color consistently lacking resources they need to meet their needs. Third, the level of funding reflects an overall underinvestment in education—that is, the U.S. is not spending as much as it could afford to spend in normal times. Fourth, given that educational investments are not sufficient across many districts even during normal times, schools are unable to make preparations to cope with emergencies or other unexpected circumstances. An added, less known feature is that economic downturns make all four of these problems worse. Downturns exacerbate funding inadequacies, inequities, underinvestment, and unpreparedness, causing cumulative harm to students, communities, and the public education system, and clawing back any prior progress. The severity of these problems varies widely across states and districts, as do the strength of states’ and localities’ economic and social protection systems, which may either compensate for or compound the problems.

The pandemic-led recession made these four major financial barriers to an excellent, equitable education system more visible, leading to serious questions about the U.S. education-funding model, which relies heavily on local and state revenues and draws only a small share of funding from the federal government. While public education is one of our greatest ideals and achievements—a free, quality education for every child regardless of means and background—the U.S. educational system is in need of significant improvements.

As the report will show, the core barriers to delivering universally excellent U.S. public education for all children—funding inadequacies and inequities that are exacerbated during tough economic times—were present in the system from the very start. They are the outcomes of a funding system that is shaped by many layers of policies and legal decisions at the local, state, and federal levels, creating widespread disparities in school finance realities across the thousands of districts across the country in all 50 states and the District of Columbia. This complex funding puzzle speaks to the need for a funding overhaul to attain meaningful and widely shared improvements.

In this report, we first provide an overview of the characteristics of the U.S. education funding system. We present data analyses on school finance indicators, such as equity, adequacy, and effort, that expose the shortcomings of funding policies and decisions across the country. We also discuss factors behind some of these shortcomings, such as the heavy reliance on local and state sources of funding.

Second, we illustrate that recessions exacerbate the funding challenges schools face. We parse a multitude of data to present trends in school finance indicators both during and after the Great Recession, demonstrating that the immediate effects of federally targeted funds helped schools navigate recession-induced budget cuts. We also look at the shortfalls and inequitable nature of those investments. We explore how increased federal investments—in good economic times and bad—could help address these long-standing problems. We argue that public education funding is not only an investment in our societal present and future, but also is a ready-made mechanism for countering economic downturns. Economic theory and evidence both demonstrate that large, broadly distributed programs providing public support serve as cushions during economic downturns: they spur overall spending and thus aggregate demand when private spending falls. As we note, there are strong arguments for placing public education spending within the broader category of effective fiscal responses to recessions that are countercyclical—designed to increase spending when spending in the economy overall is contracting and thus stave off or lessen the severity of a downturn. Increases in public education spending during downturns work as automatic stabilizers for schools and provide stimulus to boost economic recovery. We review existing research on the consequences of funding in general and of funding changes—evidence that supports a larger role for the federal government.

Third, we discuss the benefits of rethinking public education funding, along with the societal and economic advantages of a robust, stable, and consistent U.S. school funding plan, both generally and as a countercyclical policy. We show that federal investment that sustains school funding throughout recessions and recoveries would provide three major advantages: It would help boost educational instruction and standards, it would provide continued high-quality instruction for students and employment to the public education workforce, and it would stimulate economic recovery. Education funding, in particular, would blanket the country while also targeting areas with the most need, making the recovery more equitable.

We conclude the report with final thoughts and next steps.

This paper uses several terms to refer to investments in education and to define the U.S. school finance system. Below, we explain how these terms are used in the report:

Revenue indicates the dollar amounts that have been raised through various sources (at the local, state, and federal levels) to support elementary and secondary education. We distinguish between federal, state, and local revenue. Local revenue, in some of our charts, is further divided into local revenue from property taxes and from other sources.

Spending or expenditures indicates the dollar amount devoted to elementary and secondary education. Expenditures are typically divided by function and object (instruction, support services , and noninstructional education activities). We rely on data on current expenditures (instead of total expenditures; see footnotes 2 and 30).

Funding generically refers in this report to the educational investments or educational resources. Mostly, when we use funding we refer to revenue, i.e., to resources available or raised, but funding is also used to refer to the school finance system more broadly, and in that case it could be either referring to revenue or expenditures, depending on the context.

For more information on the list of components under each term, see the glossary in the  Documentation for the NCES Common Core of Data School District Finance Survey (F-33), School Year 2017–18 (Fiscal Year 2018) (NCES CCD 2020).

A funding primer

The American education system relies heavily on state and local resources to fund public schools. In the U.S. education has long been a local- and state-level responsibility, with states typically concerned with administration and standards, and local districts charged with raising the bulk of the funds to carry those duties and standards out.

The Education Law Center notes that “states, under their respective constitutions, have the legal obligation to support and maintain systems of free public schools for all resident children. This means that the state is the unit of government in the U.S. legally responsible for operating our nation’s public school systems, which includes providing the funding to support and maintain those systems” (Farrie and Sciarra 2021). Bradbury (2021) explains that state constitutions assign responsibility for “adequate” (“sound,” “basic”) and/or “equitable” public education to the state government. Most state governments delegate responsibility for managing and (partially) funding public pre-K–12 education to local governments, but courts mandate that states remain responsible.

States meet this responsibility by funding their schools “through a statewide method or formula enacted by the state legislature. These school funding formulas or school finance systems determine the amount of revenue school districts are permitted to raise from local property and other taxes and the amount of funding or aid the state is expected to contribute from state taxes. In annual or biannual state budgets, legislatures also determine the actual amount of funding districts will receive to operate their schools” (Farrie and Sciarra 2020).

A quick note on data sources

Some of our analyses rely on district-level data, i.e., the revenues and expenditures use the district as the unit of analysis. We rely on metrics of per-student revenue or per-student spending, i.e., taking into consideration the number of students in the districts. Other analyses use data either by state or for the country, which are typically readily available from the Digest of Education Statistics online. Sometimes the variables of interest are total revenue or expenditures, whereas on other occasions we rely on per-student values. All data sources are explained under each figure and table, and some are also briefly explained in the Methodology.

The federal government seeks to use its limited but targeted funding to promote student achievement, foster educational excellence, and ensure equal access. The major federal agency channeling funding to school districts (sometimes through the states) is the U.S. Department of Education. 1

Figure A shows the percentage distribution of total revenue for U.S. public elementary and secondary schools for the 2017–2018 school year, on average. As illustrated, revenues collected from state and local sources are roughly equal (46.8% and 45.3%, respectively). Two other factors also stand out. First, revenue from property taxes accounts for more than one-third of total revenue (36.6 %). Second, federal funding plays a minimal role, providing less than 8% of total revenue (7.8%). As discussed later in the report, this heavy reliance on local funding is a major driver in the funding challenges districts face.

More than 90% of school funding comes from state and local sources : Revenues for public elementary and secondary schools by source of funds, 2017–2018

  2017–2018 
Federal 7.8%
State 46.8%
Local property taxes 36.6%
Local other public revenue  7.1%
Local private revenue 1.6%

The data below can be saved or copied directly into Excel.

The data underlying the figure.

Source: National Center for Education Statistics’ Digest of Education Statistics (NCES 2020a).

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Key metrics reveal the four major financial barriers to an excellent, equitable education system 

Fully comprehending how school funding works and how it contributes to systemic problems requires drawing on key metrics and characteristics that define the education investments or education funding. Understanding these metrics is the first step toward designing a comprehensive solution.

The adequacy metric tells us that funding is inadequate

Adequacy, one of the most widely used school finance indicators, measures whether the amount raised and spent per student is sufficient to achieve a certain level of output (typically a benchmark of student performance or an educational outcome).

We use the adequacy data provided by Baker, Di Carlo, and Weber (2020). These authors, who use the School Finance Indicators Database, compare current education spending by poverty quintile with spending levels required for students to achieve national average test scores—typically accepted as an educationally meaningful benchmark. The authors’ estimates account for factors that could affect the cost of providing education, including student characteristics, labor-market costs (differences in costs given the regional cost of living), and district characteristics (larger districts for example may enjoy economics of scale).

Figure B reveals that spending is not nearly enough, on average, to provide students with an adequate education. As this figure illustrates, relative to the wealthiest districts, the highest-poverty districts need more than twice as much spending per student to provide an adequate education. As the figure also shows, the gaps between what is spent on each student and what would be required for those students to achieve at the national level widen as the level of poverty increases. Medium- and high-poverty districts are spending, respectively, $700 and $3,078 per student less than what would be required. For the highest-poverty districts, that gap is $5,135, meaning districts there are spending about 30% less than what would be required to deliver an adequate level of education to their students. (Conversely, the two low-poverty quintiles are spending more than they need to reach that benchmark, another indication that funds are being poorly allocated.)

U.S. education spending is inadequate : Per-pupil spending compared with estimated spending required to achieve national average test scores, by poverty quintile of school district, 2017

Required spending Actual spending
Highest-poverty (poorest) $18,231 $13,096
High-poverty $13,928 $10,850
Medium-poverty $11,199 $10,499
Low-poverty $9,917 $10,532
Lowest-poverty (affluent) $8,313 $10,239

Notes: District poverty is measured as the percentage of children (ages 5–17) living in the school district with family incomes below the federal poverty line, using data from the U.S. Census Bureau. The figure shows how much is spent in each of the five types of districts and how much they would need to spend for students to achieve national average test scores.

Source: Adapted from The Adequacy and Fairness of State School Finance Systems , Second Edition (Baker, Di Carlo, and Weber 2020).

The equity metric tells us that funding is inequitable 

An equitable funding system ensures that, all else being equal, schools serving students with greater needs—whether for extra academic, socioemotional, health, or other supports—receive more resources and spend more to meet those needs than schools with a lower concentration of disadvantaged students. Across districts, states, and the country as a whole, this means allocating relatively more funding to districts serving larger shares of high-poverty communities than to wealthier ones. While our funding system does allocate additional funds based on need (e.g., to students officially designated as eligible for “special education” services under the federal Individuals with Disabilities Education Act and to children from low-income families through the federal Title I program), in practice, more funding overall goes to lower-needs districts than to those with high levels of student needs.

Figure C compares districts’ per-student revenues and expenditures by poverty level, and shows gaps relative to low-poverty districts. The figure is based on data from what was, when this research was conducted, the most recent version of the Local Education Agency Finance Survey (known as the F-33) (NCES-LEAFS, various years). As shown in the figure, on average, per-student revenue and spending in school districts serving wealthier households exceed revenue and spending in all other districts. In low-poverty districts (i.e., districts with a poverty rate in the bottom fourth of the poverty distribution), per-student revenues averaged $19,280 in the 2017–2018 school year, and per-student expenditures averaged $15,910. In the high-poverty districts (i.e., in the top fourth of the poverty distribution), per-student revenues were just $16,570, and per-student expenditures were $14,030. High-poverty districts raise $2,710 less in per-student revenue than the lowest–poverty school districts, reflecting a 14.1% revenue gap—meaning high-poverty districts receive 14.1% less in revenue. Per-student spending in high-poverty districts is $1,880 less than in low-poverty districts, an 11.8% gap. 2 In other words, rather than funding districts to address student needs, we are channeling fewer resources—about 14% less, per student—into districts with greater needs based on their student population.

Districts serving poorer students have less to spend on education than those serving wealthier students

: total per-student revenues by district poverty level, and revenue gaps relative to low-poverty districts, 2017–2018.

Total revenue Revenue gap
Low-poverty districts $19,280
Medium-low poverty districts $17,470 $1,810  
Medium-high poverty districts $16,660 $2,620  
High-poverty districts $16,570 $2,710  

: Total per-student expenditures by district poverty level, and spending gaps relative to low-poverty districts, 2017–2018

Total expenditures Expenditures gap
Low-poverty districts $15,910
Medium-low poverty districts $14,410 $1,500  
Medium-high poverty districts $13,940 $1,970  
High-poverty districts $14,030 $1,880  

Notes: Amounts are in 2019–2020 dollars and rounded to the closest $10 and adjusted for each state’s cost of living. Low-poverty districts are districts whose poverty rate (for children ages 5 through 17) is in the bottom fourth of the poverty distribution; high-poverty districts are districts whose poverty rate is in the top fourth of the poverty distribution.

Extended notes: Sample includes districts serving elementary schools only, secondary schools only, or both; districts with nonmissing and nonzero numbers of students; and districts with nonmissing charter information. Amounts are in 2019–2020 dollars using the consumer price index from the Bureau of Labor Statistics (BLS CPI 2021) and rounded to the closest $10. Amounts are adjusted for each state’s cost of living using the historical Regional Price Parities (RPPs) from the Bureau of Economic Analysis (BEA 2021). Low-poverty districts are districts whose poverty rate (for children ages 5 through 17) is in the bottom fourth of the poverty distribution; medium-low-poverty districts are districts whose poverty rate (for children ages 5 through 17) is in the second fourth of the poverty distribution; medium-high-poverty districts are districts whose poverty rate (for children ages 5 through 17) is in the third fourth of the poverty distribution; high-poverty districts are districts whose poverty rate is in the top fourth of the poverty distribution. Amounts are unweighted across districts.

Sources: Authors’ analysis of 2017–2018 Local Education Agency Finance Survey (F-33) microdata from the National Center for Education Statistics (NCES-LEAFS 2021) and Small Area Income and Poverty Estimates (SAIPE) data from the U.S. Census Bureau (Urban Institute 2021a).

Adequacy and equity are closely intertwined

In recent decades, researchers have explored challenges to both adequacy and equity in U.S. public education. For example, Baker and Corcoran (2012) analyzed the various policies that drive inequitable funding. Likewise, lawsuits that have challenged state funding systems have tended to focus on either the inadequacy or inequity of those schemes. 3

But in reality, especially given extensive variation across states and districts, the two are closely linked and interact with one another. At the state level, for example, apparently adequate levels of funding can mask disparities across districts that innately mean inadequate funding for many, or even most, districts within that state (Farrie and Schiarra 2021). 4

In addition, disparate levels of public investments in education are often made in a context that correlates positively with disparate levels of parents’ private investments in their children’s education and related support (Caucutt et al. 2020; Duncan and Murnane 2016; Kornrich 2016; Schneider, Hastings, and LaBriola 2018). Substantial research on income-based gaps in achievement demonstrates that large and growing wealth inequality plays a role. Parents at the top of the income or wealth ladders, who can and do pour extensive resources into their children’s human capital, constantly set a baseline of performance that can be hard for children and schools without such investment to attain (Reardon 2011; García and Weiss 2017). 5

The “effort” metric tells us that many states are underinvesting in education relative to their capacity

 “Effort” describes how generously each state funds its schools relative to its capacity to do so. Researchers measuring effort determine capacity to spend based on state gross domestic product (GDP), which can vary widely (just as wealthier neighborhoods can raise more revenues even with lower tax rates, states with higher GDP and thus greater revenue-raising capacity can attain higher revenue with a lower effort, i.e., generate more resources at a lower cost). The map ( Figure D ), reproduced from Farrie and Sciarra 2021, shows state funding effort from the 2017–2018 school year.

School funding ‘effort’ varies widely across states : Pre-K through 12th grade education revenues as a percentage of state GDP, 2017–2018

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State PK-12 education revenues as a percentage of state GDP (2018)
Vermont 5.99%
New Jersey 4.86%
Wyoming 4.36%
Maine 4.29%
New York 4.20%
Illinois 4.10%
Connecticut 4.06%
Pennsylvania 4.04%
West Virginia 3.99%
South Carolina 3.95%
Alaska 3.89%
Arkansas 3.89%
Rhode Island 3.85%
Kansas 3.81%
New Hampshire 3.70%
Michigan 3.68%
Maryland 3.64%
Kentucky 3.63%
Iowa 3.62%
Mississippi 3.59%
Ohio 3.52%
Nebraska 3.48%
Wisconsin 3.43%
Montana 3.37%
Minnesota 3.33%
Missouri 3.33%
Indiana 3.32%
Oregon 3.30%
Georgia 3.30%
New Mexico 3.27%
Alabama 3.26%
Hawaii 3.20%
Massachusetts 3.16%
Texas 3.10%
Virginia 3.04%
North Dakota 3.01%
Idaho 2.98%
Louisiana 2.90%
California 2.89%
Washington 2.84%
Utah 2.82%
Delaware 2.81%
Oklahoma 2.81%
Colorado 2.79%
South Dakota 2.74%
Nevada 2.65%
Tennessee 2.59%
Florida 2.58%
North Carolina 2.28%
Arizona 2.23%
District of Columbia 0.98%
US 3.39%

Note: “Effort is measured as total state and local [education] revenue (including [revenue for] capital outlay and debt service, excluding all federal funds) divided by the state’s gross domestic product. GDP is the value of all goods and services produced by each state’s economy and is used here to represent the state’s economic capacity to raise funds for schools” (Farrie and Sciarra 2020).

Source: Adapted from Making the Grade 2020: How Fair is School Funding in Your State? (Farrie and Sciarra 2020).

As Farrie and Sciarra (2021) note, states fall naturally into four groups:

  • High-effort, high-capacity: States such as Alaska, Connecticut, New York, and Wyoming are high- capacity states with high per-capita GDP, and they are also high-effort states: They use a larger-than-average share of their overall GDP to support pre-K–12 education, which generates high funding levels.
  • High-effort, low-capacity : States such as Arkansas, South Carolina, and West Virginia have lower-than-average capacity, with low GDP per-capita, but they are high-effort states. Even with above- average efforts, they yield only average or below-average funding levels.
  • Low-effort, high-capacity : States such as California, Delaware, and Washington are high-capacity states that exert low effort toward funding schools. If these states increased their effort even to the national average, they could significantly increase funding levels.
  • Low-effort, low-capacity : States such as Arizona, Florida, and Idaho are low-capacity states that also make lower-than-average efforts to fund schools, generating very low funding levels.

Evidence shows that districts and schools lack the resources to cope with emergencies

As the COVID-19 pandemic has made clear, our subpar level of preparation to cope with emergencies or other unexpected needs reflects another aspect of underinvestment. As García and Weiss (2020) not about the COVID-19 pandemic, “Our public education system was not built, nor prepared, to cope with a situation like this—we lack the structures to sustain effective teaching and learning during the shutdown and to provide the safety net supports that many children receive in school.”

Whether due to lack of resources, planning, or other factors, districts, schools, and educators struggled to adapt to the pandemic’s requirements for teaching. Schools were unprepared not only to support learning but also to deliver the supports and services they were accustomed to providing, which go far beyond instruction (García and Weiss 2020). This lack of preparation was the result of both a lack of contingency planning as well as a failure to build up resources to be ready “to adequately address emergency needs and to compensate for the resources drained during the emergencies, as well as to afford the provision of flexible learning approaches to continue education” (García and Weiss 2021).

A lack of established contingency plans to ensure the provision of education in emergency and post-emergency situations, whether caused by pandemics, other natural disasters, or conflicts and wars (as examined by the education-in-emergencies research), prevents countries from being able to mitigate the negative consequences of these emergencies on children’s development and learning. The lack of contingency plans also leaves systems unprepared to help children handle the trauma and stress that come from the most serious events. This body of literature has also shown that access to education and services—and an equitable and compensatory allocation of them—helps reduce the damage that students experience during the crisis and beyond, since such emergencies carry long-term consequences (Anderson 2020; Özek 2020).

Public education’s over-reliance on local funding is a key factor behind the troubling funding metrics

The heavy reliance on local funding described above is at the core of the school finance problems. Extensive research has exposed the challenges associated with this unique American system for funding public schools. 6 The myriad factors that drive school funding—politics and political affiliation, state legislative and judicial decisions, property values, tax rates, and effort, among others—vary substantially from one community to another. Thus, it is not surprising that this system has contributed to institutionalizing inequities, especially in the absence of a strong federal effort to counter them.

It is well understood that the local sources of revenues on which school districts heavily rely are often distributed in a highly inequitable way. Revenues from property taxes, which make up a hefty share of local education revenues, innately favor wealthier communities, as these areas have a much larger capacity to raise funds based on higher property values despite their lower tax rates. 7 These higher property-tax revenues in wealthier areas lead to greater revenues for their districts’ schools, since property-tax revenues account for such a significant share of the total.

State and federal funding are insufficient to compensate for these locally driven inequities

State funding of public education is the largest budget line item for most states. 8 Along with federal funding, state funding is expected to make up for local funding disparities and gaps. 9 Federal funding, in particular through Title I of the Elementary and Secondary Education Act (ESEA), is specifically designed to compensate low-income schools and districts for their lack of sufficient revenues to meet their students’ needs. 10 Similarly, state funding is intended to offset some of the disparities caused by the dependence on local revenues. However, in reality, state and federal sources do not provide enough to less-wealthy school districts to make up for the gap in funding at the local level, as shown in Figure E .

As the figure   shows, the U.S. systematically funds schools in wealthier areas at higher levels than those with higher rates of poverty, even after accounting for funding meant to remedy these gaps. On average, local property-tax funding per student is $5,260 lower in the poorest districts than in the wealthiest districts.

Federal and state revenues fail to offset the funding disparities caused by relying on local property tax revenues : How much more or less school districts of different poverty levels receive in revenues than low-poverty school districts receive, all and by revenue source, 2017–2018

High-poverty districts Medium-high poverty districts Medium-low poverty districts
-$2,710 -$2,620 -$1,810
Federal $1,550 $660 $350
State $2,080 $1,540 $1,180
Property taxes, local -$5,260 -$3,850 -$2,820
Other local -$1,070 -$960 -$510

Notes: Amounts are in 2019–2020 dollars, rounded to the closest $10, and adjusted for each state's cost of living. Low-poverty districts are districts whose poverty rate for school-age children (children ages 5 through 17) is in the bottom fourth of the poverty distribution; high-poverty districts are districts whose poverty rate is in the top fourth of the poverty distribution.

Extended notes: Sample includes districts serving elementary schools only, secondary schools only, or both; districts with nonmissing and nonzero numbers of students; and districts with nonmissing charter information. Amounts are in 2019–2020 dollars using the consumer price index from the Bureau of Labor Statistics (BLS-CPI 2021) and rounded to the closest $10. Amounts are adjusted for each state’s cost-of living using the historical regional Price Parities (RPPs) from the Bureau of Economic Analysis (BEA 2021). Low-poverty districts are districts whose poverty rate for school-age children (children ages 5 through 17) is in the bottom fourth of the poverty distribution for that group; medium-low-poverty districts are districts whose school-age children’s poverty rate is in the second fourth (25th–50th percentile); medium-high-poverty districts are districts whose school-age children’s poverty rate is in the third fourth (50th–75th percentile); in high-poverty districts, the rate is in the top fourth. Amounts are unweighted across districts.

Sources: 2017–2018 Local Education Agency Finance Survey (F-33) microdata from the National Center for Education Statistics (NCES-LEAFS 2021) and Small Area Income and Poverty Estimates (SAIPE) data from the U.S. Census Bureau (Urban Institute 2021a).

While state revenues are a significant portion of funding, they only modestly counter the large locally based inequities. And while federal funding, by far the smallest source of revenue, is being deployed as intended (to reduce inequities), it inevitably falls short of compensating for a system grounded in highly inequitable local revenues as its principal source of funding. As such, although states provide their highest-poverty districts with $1,550 more per student than to their lowest-poverty districts, and federal sources provide their highest-poverty districts with $2,080 more per student than to their lowest-poverty districts, states and the federal government jointly compensate for only about half of the revenue gap for high-poverty districts (which receive a per-student average of $6,330 less in property tax and other local revenues). That large gap in local funding leaves the highest-poverty districts still $2,710 short per student relative to the lowest-poverty districts, reflecting the 14.1% revenue gap shown in Figure C. Even though high-poverty districts get more in federal and state dollars, they get so much less in property taxes that it still puts them in the negative category overall.

Disparities shortchange states’ (and districts’) ability to access and allocate the resources needed for effective education

Given the heavy reliance on highly varied local funding, it is no surprise that there is similarly significant variation across states with respect to almost every aspect of funding discussed here. Table 1 reports federal, state, and local funding for each state and for the District of Columbia, with local funding broken down into three categories.

Revenues for public elementary and secondary schools, by source of funds and by state : Share of each source in total revenue, 2017–2018 

State or jurisdiction Federal State Local Local property taxes  Local private revenues Local other revenues
United States  7.8 46.8 45.3 36.6 1.6 7.1
Alabama  11.1 55.3 33.6 15.5 4.1 13.9
Alaska  62.4 21.7 12.6 0.7 8.4
Arizona  12.4 47.1 40.4 30.9 2.4 7.1
Arkansas  10.8 51.9 37.3 32.5 2.7 2.0
California  8.4 56.5 35.1 28.1 0.4 6.6
Colorado  6.3 41.7 52.0 42.6 3.7 5.7
Connecticut  4.3 39.8 55.9 54.8 0.7 0.4
Delaware  8.2 60.5 31.3 30.3 0.7 0.3
District of Columbia  8.2 –  91.8 30.7 0.4 60.7
Florida  11.4 39.2 49.4 40.0 3.0 6.4
Georgia  8.8 46.8 44.4 29.1 2.2 13.1
Hawaii  8.3 89.9 1.9 –  0.9 1.0
Idaho  9.6 66.7 23.7 19.7 1.4 2.6
Illinois  6.2 40.2 53.6 47.1 1.3 5.2
Indiana  7.7 62.5 29.9 23.5 2.6 3.8
Iowa  7.2 53.2 39.5 32.3 2.1 5.2
Kansas  7.8 64.7 27.5 17.3 2.2 8.0
Kentucky  10.9 56.3 32.9 24.7 1.0 7.3
Louisiana  12.6 43.1 44.2 18.9 0.5 24.8
Maine  6.6 39.4 54.0 51.6 1.2 1.2
Maryland  5.3 42.3 52.4 25.2 0.7 26.5
Massachusetts  4.9 38.7 56.4 52.2 1.6 2.6
Michigan  8.4 60.3 31.3 26.7 1.3 3.3
Minnesota  5.5 66.6 28.0 18.3 2.6 7.0
Mississippi  13.8 50.4 35.8 30.2 2.3 3.3
Missouri 8.0 32.3 59.7 46.7 3.0 10.1
Montana  12.7 43.4 43.9 29.2 3.2 11.5
Nebraska  7.4 32.4 60.2 53.4 3.6 3.2
Nevada  8.5 35.6 55.9 24.4 0.7 30.7
New Hampshire  5.3 61.0 1.5 1.0
New Jersey  43.3 52.6 49.6 1.9 1.2
New Mexico  13.4 68.4 14.8 1.4 2.1
New York  4.3 39.6 56.1 50.1 0.4 5.6
North Carolina  10.9 62.1 27.0 22.8 1.1 3.1
North Dakota  9.5 56.2 34.3 25.2 4.0 5.1
Ohio  7.2 42.1 50.7 41.6 2.6 6.5
Oklahoma  10.8 46.9 42.3 32.4 4.2 5.7
Oregon  6.8 52.8 40.4 32.3 1.7 6.3
Pennsylvania  6.9 38.1 54.9 43.5 1.2 10.2
Rhode Island  7.1 43.0 49.9 48.2 1.0 0.7
South Carolina  8.7 49.0 42.3 32.0 2.4 7.9
South Dakota  13.8 34.5 51.7 43.8 2.7 5.1
Tennessee  11.0 46.8 42.2 19.3 4.3 18.6
Texas  10.5 37.4 52.1 46.8 1.6 3.7
Utah  7.5 56.0 36.5 27.6 3.2 5.7
Vermont  6.4 0.0 1.3 2.4
Virginia  6.5 39.9 53.7 32.5 1.4 19.8
Washington  6.2 64.2 29.6 25.1 1.8 2.7
West Virginia  10.9 55.3 33.8 31.5 0.5 1.9
Wisconsin  7.0 46.8 46.2 41.9 1.9 2.4
Wyoming  6.4 56.8 36.8 27.1 0.9 8.7

Source: National Center for Education Statistics' Digest of Education Statistics (NCES 2020b). 

Nationally, in 2017–2018, local and state sources accounted for 45.3% and 46.8% of total revenue, respectively; just 7.8% comes from the federal government. However, these averages mask substantial variation in the shares of revenue apportioned by each source across states. Local revenue, for example, ranges from just 3.7% of total public-school revenue in Vermont and 18.2% in New Mexico, on the lower end, to a high of 63.4% in New Hampshire. The same is true with respect to state revenue. The state that contributes the smallest share to its education budget is New Hampshire at 31.3%, with Vermont contributing the largest share (89.9%). There is also quite a bit of variation in the share represented by federal funds—from just 4.1% in New Jersey to 15.9% in Alaska. (The cited values are highlighted in the table. We omit the District of Columbia and Hawaii from these rankings because of the unusual composition of their funding streams, but we provide their values in the table.)

As shown earlier in the discussion of the map in Figure E, there are also large disparities in funding effort—how generously each state funds its schools relative to its capacity to do so, based on state GDP. High-effort, high-capacity s tates such as Alaska, Connecticut, New York, and Wyoming use a larger-than-average share of their overall GDP to support pre-K–12 education and they generate high funding levels.

As a result of funding and effort variability across states, the levels of inequity and inadequacy across states also vary substantially (Baker, Di Carlo, and Weber 2020; Farrie and Sciarra 2021). Notably, funding variability translates into significant disparities in overall per-student revenue and per-student spending levels, as shown in Figures F and G . In Wyoming, for example, where effort is relatively high (4.36%; see Figure E) and there is a higher-than-average contribution of state funds to total revenue and a lower-than-average contribution of local funds to total revenue (56.8% and 36.8%, respectively, versus 46.8% and 45.3% averages across the U.S.), per-student revenue is among the highest of any state, nearly $21,000. In contrast, Arizona and North Carolina—which are among the lowest in effort in the country (2.23% and 2.28%, respectively), but where state funds account for 47.1% and 62.1% of the state’s total public education revenues, respectively, and local funds account for 40.4% and only 27.0%, respectively—collect about half of what Wyoming collects per student. (Data accounts for differences in states’ cost of living; see the appendix for more details on our methodology.)

Public education revenues vary widely across states : Per-student revenues for public elementary and secondary schools, by state, 2017–2018

Jurisdiction Total revenue
United States $15050
Alabama 12830
Alaska 18690
Arizona 10320
Arkansas 13820
California 13250
Colorado 12570
Connecticut 20700
Delaware 16720
District of Columbia 25940
Florida 11050
Georgia 13600
Hawaii 15890
Idaho 10070
Illinois 19370
Indiana 14390
Iowa 15910
Kansas 15550
Kentucky 14570
Louisiana 14610
Maine 16880
Maryland 16860
Massachusetts 18230
Michigan 15230
Minnesota 16400
Mississippi 12000
Missouri 15020
Montana 14210
Nebraska 16460
Nevada 11290
New Hampshire 17400
New Jersey 20350
New Mexico 13320
New York 24410
North Carolina 11010
North Dakota 18460
Ohio 17310
Oklahoma 10980
Oregon 15280
Pennsylvania 19780
Rhode Island 19100
South Carolina 15430
South Dakota 14200
Tennessee 12140
Texas 12580
Utah 9730
Vermont 20660
Virginia 13320
Washington 15210
West Virginia 15240
Wisconsin 15360
Wyoming 20930

Note: Amounts are in 2019–2020 dollars using the consumer price index from the Bureau of Labor Statistics (BLS-CPI 2021) and rounded to the closest $10. Amounts are adjusted for each state’s cost-of living using the historical regional Price Parities (RPPs) from the Bureau of Economic Analysis (BEA 2021).

Source: National Center for Education Statistics’ Digest of Education Statistics (NCES 2020b).

Public education expenditures vary widely across states : Per-student expenditures for public elementary and secondary schools, by state, 2017–2018

Jurisdiction Total spending
United States $13120
Alabama 11660
Alaska 17530
Arizona 8990
Arkansas 12360
California 11380
Colorado 10420
Connecticut 19690
Delaware 16040
District of Columbia 20680
Florida 9960
Georgia 11990
Hawaii 13380
Idaho 8790
Illinois 16820
Indiana 11650
Iowa 13630
Kansas 12780
Kentucky 13080
Louisiana 13540
Maine 15620
Maryland 14490
Massachusetts 17320
Michigan 13110
Minnesota 13730
Mississippi 10740
Missouri 12880
Montana 12790
Nebraska 14840
Nevada 9610
New Hampshire 16220
New Jersey 18280
New Mexico 11340
New York 21100
North Carolina 10480
North Dakota 15770
Ohio 15120
Oklahoma 9590
Oregon 12210
Pennsylvania 17410
Rhode Island 17700
South Carolina 12180
South Dakota 12100
Tennessee 11070
Texas 10360
Utah 8130
Vermont 20280
Virginia 12420
Washington 12490
West Virginia 13660
Wisconsin 14040
Wyoming 18040

Note: Amounts are in 2019–2020 dollars using the consumer price index from the Bureau of Labor Statistics (BLS-CPI 2021) and rounded to the closest $10. Amounts are adjusted for each state’s cost-of living using the historical Regional Price Parities (RPPs) from the Bureau of Economic Analysis (BEA 2021).

Source: National Center for Education Statistics’ Digest of Education Statistics (NCES 2020c).

These substantial disparities in all the school finance indicators, and in per-pupil spending and revenue across states, are mirrored in capacity and investment patterns across districts and, within them, individual schools.

As such, these systemic and persistent inequities play a decisive role in shaping children’s real school experiences. As Raikes and Darling-Hammond (2019) note, “As a country, we inadvertently instituted a school finance system similar to red-lining in its negative impact. Grow up in a rich neighborhood with a large property tax base? You get well-funded public schools. Grow up in a poor neighborhood? The opposite is true. The highest-spending districts in the United States spend nearly 10 times as much as the lowest-spending, with large differentials both across and within states (Raikes and Darling-Hammond 2019). In most states, children who live in low-income neighborhoods attend the most under-resourced schools” (see also Turner et al. 2016 for the underlying data). 11

These gaps in spending capacity touch every aspect of school functioning, including the capacity of teachers and staff to deliver effective instruction, and pose a huge barrier to the excellent school experience that each student should receive. In Pennsylvania, for example, where districts tend to rely heavily on local revenues to finance schools, per-pupil spending ranges dramatically. Indeed, in 2015, the U.S. Department of Education flagged the state as having the biggest school-spending gap of any state in the country (Behrman 2019). One illustrative example is in Allegheny County, on the western side of the state, where the suburban Wilkinsburg school district outside of Pittsburgh spent over $27,000 per student in the 2017–2018 school year, while the more rural South Allegheny school district spent just over $15,000, roughly 45% less.

With salaries being the largest line item in school budgets, these disparities substantially affect schools’ ability to hire the educators and other school personnel needed to provide effective instruction, the school leaders to guide instructional staff, and the staff needed to support administrative needs and to offer other services and extracurricular activities. As a result, these resources vary tremendously not only among states, but within them from one district, and even school, to another. 12 Overwhelming research exposes large disparities in access to counselors, librarians, and nurses, and in access to up-to-date technology and facilities. Facilities are literally crumbling in lower-resourced states and districts, painting a clear picture of the dire straits many schools face. (See, for example, Filardo, Vincent, and Sullivan 2019 regarding added consequences for low-income students and their teachers in schools that are too cold, full of dust or lead paint, and have broken windows or crumbling ceilings.)

Baker, Farrie, and Sciarra (2016) note that “increasing investments in schools is associated with greater access to resources as measured by staffing ratios, class sizes, and the competitiveness of teacher wages.” The findings presented here are backed by the extensive body of literature on the positive relationship between substantive and sustained state school finance reforms and improved student outcomes. Together, they make a strong case that state and federal policymakers can help boost outcomes and close achievement gaps by improving state finance systems to ensure equitable funding and improved access to resources for children from low-income families.

Economic downturns exacerbate the problems with our school finance system and, over time, cause cumulative damage to students and to the system

Recessions lead to depleted state and local budgets and, in turn, to cuts in education funding. Trends since the Great Recession demonstrate that it can take a long time to restore education budgets and that our practice of balancing budgets on the backs of schoolchildren is an unwise and, ultimately, costly one in terms of educational and societal outcomes. As we show in Figure H , reductions in revenue for public education often outlast the official length of the recession, lasting much longer than the point when state and local budgets have returned to pre-recession trajectories in other areas of spending. In addition, a poor allocation of resources across high- and low-poverty districts disproportionately harms students in the highest-poverty districts relative to their peers in better-off districts, compounding the existing challenges described above and impeding their recovery.

It took the United States nearly a decade to restore the national per-student revenue to its pre-recession (2007–2008) school-year levels. Figure H shows national trends in revenue per student, by source (federal, state, and local), from the onset of the Great Recession through 2017–2018. 13

Education revenues fell sharply after 2008 (and did not return to pre-recession levels for about eight years) : Change in per-student revenue relative to 2007–2008, by source (inflation adjusted)

Total (state, local, and federal) Federal State Local Local property taxes
2007/2008 $0 0 0 0 0
2008/2009 -10 200 -250 30 160
2009/2010 -90 650 -750 10 220
2010/2011 -220 600 -700 -120 130
2011/2012 -780 210 -830 -160 80
2012/2013 -940 70 -870 -140 110
2013/2014 -780 10 -660 -140 120
2014/2015 -430 10 -460 20 250
2015/2016 90 20 -170 230 450
2016/2017 360 20 -20 360 570
2017/2018 620 0 70 550 660

Note: The chart shows change in revenue per student for public elementary and secondary schools compared with 2007–2008. Amounts are in 2019–2020 dollars and rounded to the closest $10 using the consumer price index from the Bureau of Labor Statistics (BLS-CPI 2021). The Local line is all local sources, including property tax revenues.

Per-student state revenue fell precipitously between 2007–2008 and 2012–2013—it was down nearly $900 at the low point. While revenue from property taxes did not decrease, on average, other local revenues fell by $160 by 2011–20121, only recovering to 2007–2008 levels in 2014–2015. Federal funding for schools, together with the additional recovery funds targeted to education through the 2009 American Recovery and Reinvestment Act (ARRA), provided an initial and critical counterbalance to these reductions; in 2009–2010 and 2010–2011, districts were receiving slightly over $600 more per student from the federal government than they were before the recession.

The peak in federal revenue is also visible in Figure I , which depicts the distribution of funding by sources by year . Total federal funds accounted for 12.7% of total revenue in 2009–2010, compared with just 8.2% in 2007–2008, an increase of over 50%. (Note that this increase was made larger by the reduced total amounts of revenues, i.e., it constituted a greater share of a smaller whole).

Importance of federal funding for education increased in the aftermath of the Great Recession : Share of total education revenue by source, 2007–2008 to 2017–2018

Federal State Local property taxes Local other public revenue Local private revenue
2007–2008  8.2 48.3 33.6 7.8 2.1
2008–2009  9.6 46.7 34.7 7.0 2.1
2009–2010  12.7 43.4 35.4 6.5 2.0
2010–2011  12.5 44.2 35.0 6.4 1.9
2011–2012  10.2 45.0 36.1 6.7 2.0
2012–2013  9.3 45.3 36.8 6.8 1.9
2013–2014  8.7 46.3 36.4 6.7 1.9
2014–2015  8.5 46.6 36.4 6.8 1.7
2015–2016  8.3 46.9   36.5 6.7 1.7
2016–2017  8.1 47.0 36.6 6.6 1.7
2017–2018  7.8 46.8 36.6 7.1 1.6

Source: National Center for Education Statistics' Digest of Education Statistics (NCES 2020a).

While these federal investments provided a critical boost by temporarily upholding education funding, our analyses suggest an opportunity to shorten the slow recovery to pre-recession levels was lost. Just as they effectively operated during the recession, it is likely that larger and more sustained federal investments would have better assisted the students, schools, and communities that suffered major setbacks due to the Great Recession. We come back to this idea in sections below.

In keeping with the discussion on broad funding disparities by state, the road to recovery from the Great Recession also varies across states and districts, with some still lagging from the Great Recession as they struggled with the COVID-19 crisis.

Research demonstrates that well after the end of the Great Recession, a significant number of states were still funding their public schools at lower levels than before the recession. As late as 2016, for example, per-student funding in 24 states—including half of the states with over a million enrolled students—was still below pre-recession levels (Leachman and Figueroa 2019). For some of these states, the failure to return to prior funding levels was driven by the lack of recovery of the per-student state revenue (for example, Alabama, Alaska, Arizona, Florida, Mississippi, Montana, New Mexico, and Oklahoma). In some of the “deepest-cutting states — including Arizona, North Carolina, and Oklahoma,” note Leachman and Figueroa, the state governments made significant cuts to income tax rates, “making it much more difficult for their school funding to recover from cuts they imposed after the last recession hit.” In other states, lack of local revenue was the culprit (as in Hawaii, Indiana, Kansas, and Vermont, for example). Finally, in some of these states, this shortfall fell on top of a rapidly growing student population (i.e., even had their total revenues recovered to pre-recession levels, they would still fall far behind on a per-student basis). Exploring the various drivers of these trends and their variation across states is beyond the scope of this report but would undoubtedly be fruitful. 14

Putting aside state trends and underlying causes, a focus on school districts reveals a strong correlation between poverty rates and education funding recovery. The following figures show the trends over time in total per-student revenue and spending by school district poverty levels. As we see, high-poverty districts and their students experienced both the biggest shortfalls and the most sluggish recoveries.

Figure J shows that, as discussed above, districts with relatively small shares of low-income students (low-poverty districts) never saw revenues per student fall below pre–Great Recession levels, adjusted for inflation and state cost of living. By contrast, the one-fourth of districts with the largest share of students from poor families (high-poverty districts) stayed below their pre–Great Recession level of per-student revenues long after recovery was in full swing, through 2015–2016. In keeping with that spectrum, the medium-high poverty districts did recover to their pre-recession per-student revenue levels, but not until 2014–2015.

The drop in education revenues after 2007–2008 was greater in high-poverty districts : Change in total per-student revenue compared with 2007–2008, by district poverty level (adjusted for inflation and state cost of living)

Year Low-poverty districts  Medium-low-poverty districts Medium-high-poverty districts High-poverty districts
2007/2008 $0 0 0 0
2008/2009 120 260 190 10
2009/2010 20 440 30 -180
2010/2011 710 510 -60 -390
2011/2012 40 90 -360 -910
2012/2013 350 0 -690 -1,170
2013/2014 450 370 -360 -730
2014/2015 900 1,070 -50 -420
2015/2016 1,090 1,290 450 -140
2016/2017 1,640 1,240 590 210
2017/2018 1,940 1,560 1,020 680

Sources: 2007–2008 to 2017–2018 Local Education Agency Finance Survey (F-33) microdata from the National Center for Education Statistics (NCES-LEAFS 2021) and Small Area Income and Poverty Estimates (SAIPE) data from the U.S. Census Bureau (Urban Institute 2021a).

Figure K tells a similar story regarding trends in per-student expenditure across school districts. As such, it took until 2017–2018, a decade after the Great Recession had first hit, for high-poverty school districts to surpass their pre-recession levels, though they still lagged far behind their wealthier counterpart districts. Moreover, though not shown in this graph, for high-poverty districts, getting back to pre-recession status means catching up to revenue and spending levels that were lower than in the wealthier districts to begin with. (Figure C earlier in the report illustrates the gaps between high- and low-poverty districts in 2017–2018.)

The drop in education expenditures after 2007–2008 was greater in high-poverty districts : Change in total per-student expenditures compared with 2007–2008, by district poverty (adjusted for inflation and state cost-of living)

Low-poverty districts Medium-low-poverty districts Medium-high-poverty districts High-poverty districts
2007/2008  $0 0 0 0
2008/2009  80 240 140 40
2009/2010  240 440 250 10
2010/2011  690 480 10 -340
2011/2012  210 110 -90 -740
2012/2013  480 180 -290 -980
2013/2014  550 300 -90 -600
2014/2015  900 840 30 -420
2015/2016  1,070 1,120 380 -260
2016/2017  1,570 1,170 620 130
2017/2018  1,840 1,370 910 380

Notes:  Amounts are in 2019–2020 dollars, rounded to the closest $10, and adjusted for each state's cost of living. Low-poverty districts are districts whose poverty rates (for children ages 5 through 17) are in the bottom fourth of the poverty distribution; high-poverty districts are districts whose poverty rates are in the top fourth of the poverty distribution.

Balancing budgets on the backs of children during a recession has serious consequences

Inadequate, inequitable funding relegates poor children to attend under-resourced schools even in good economic times, and to suffer disproportionately during and in the aftermath of economic downturns. We have for far too long been balancing recession-depleted budgets on the backs of schoolchildren, in particular low-income children and children of color. This not only hurts these children immediately, but severely limits their prospects as adults. As such, this practice has broader implications for the future of the country, both economically and regarding the strength of our societal fabric, given that the students of today are the workers and the citizens of tomorrow.

Indeed, these negative patterns are just the first indications of a cascade of consequences that result from funding cuts. This section describes those consequences and their flip side, which is more frequently the focus of education researchers—the positive effects of increased investment. First, we review the literature demonstrating the impacts of various levels of funding on student outcomes. Next, we point to analyses that have shown some other associated school problems (education employment, class size, and student performance, among others) that were contemporaneous with the declines in spending and revenue. Thought it is difficult to quantify the exact and independent impact of the funding cuts on these factors, the strong correlations suggest that they are related.

Substantial evidence points to the positive effects of higher spending on both short- and long- term student outcomes, as well as on schools overall and on adult outcomes (Jackson and Mackevicius 2021; Jackson, Johnson, and Persico 2016; Gibbons, McNally, and Viarengo 2018; Hyman 2017; Lafortune, Rothstein, and Schanzenbach 2018; Jackson 2018; Jackson, Wigger, and Xiong 2020; Baker 2018). This body of research also provides evidence that the impact of school spending differs by students’ family income (Lafortune, Rothstein, and Schanzenbach 2018; Jackson, Johnson, and Persico 2016). And, though less has been studied in this specific area, the evidence also shows that a misallocation of resources and/or a decrease in spending has a negative influence on student outcomes, as well as on some teacher outcomes (Jackson, Wigger, and Xiong 2020; Greaves and Sibieta 2019). 15

A recent summary of the literature provides compelling evidence of the effects of school spending on test scores and educational attainment. Based on 31 studies that provide reliable causal estimates, Jackson and Mackevicius (2021) find that, on average, a $1,000 increase in per-pupil public school spending for four years increases test scores by 0.044 percentage points, high school graduation by 2.1 percentage points, and college-going by 3.9 percentage points. Interestingly, the authors explain that “when benchmarked against other interventions, test score impacts are much smaller than those on educational attainment—suggesting that test-score impacts understate the value of school spending.” Consistent with a cumulative effect, the educational attainment impacts are larger after more years of exposure to the spending increase, and average impacts are similar across a wide range of baseline spending levels, indicating little evidence of diminishing marginal returns at current spending levels.

Other research suggests that the effect of spending is greater on disadvantaged students. Bradbury (2021) investigates “how specific state and local funding sources and allocation methods (redistributive extent, formula types) relate to students’ test scores and, especially, to test-score gaps across races and between students who are not economically disadvantaged and those who are.” Her findings suggest that statewide per-student school aid has no relationship with test-score gaps in school districts, but that the progressivity of the state’s school-aid distribution is associated with smaller test-score gaps in high-poverty districts. 16

Other studies further affirm the implications of equity-specific funding decisions. Jackson, Johnson, and Persico’s (2016) study assesses the impacts on a range of student and adult outcomes of a series of court-mandated school finance reforms that took place in the 1970s and 1980s. Linking information on the reforms to administrative data about the children who attended the schools, the authors found that the increase in school funding was associated with slight increases in years of educational attainment, and with higher adult wages and reduced odds of adult poverty, as well as with improvements to schools themselves—increased teacher salaries, reduced student-to-teacher ratios, higher school quality, and even longer school years (Jackson, Johnson, and Persico 2016). Specifically, a 10% increase in per-pupil spending each year for all 12 years of public schooling leads to 0.27 more completed years of education, 7.25% higher wages, and a 3.67 percentage-point reduction in the annual incidence of adult poverty. As with the other studies, the benefits from increased funding are much greater for children from low-income families: 0.44 years of educational attainment and wages that are 9.5% higher.

In another study drawing on data from post-1990 school finance reforms that increased public-school funding in some states, Lafortune, Rothstein, and Schanzenbach (2018) estimate the impact of both absolute and relative spending on achievement in low-income school districts, as measured by National Assessment of Educational Progress (NAEP) data. 17 They find that the reforms increase the achievement of students in these districts, phasing in gradually over the years following the increase in spending/adequacy. While the measures employed to estimate the impact tend to be technical, the authors emphasize that this “implied effect of school resources on educational achievement is large.” 18 Similar adequacy-related reforms that resulted from court mandates, rather than state legislative decisions, prompted significant increases in graduation rates (Candelaria and Shores 2019).

Conversely, research shows that both the reallocation of resources and/or a decrease in spending have a negative influence on both teacher and student outcomes. Jackson, Wigger, and Xiong (2020) find that the cuts to per-pupil spending that occurred during the Great Recession reduced test scores and college enrollment, particularly for children in poor neighborhoods. Shores and Steinberg (2017) reaffirm these findings, noting that the Great Recession negatively affected math and English language arts (ELA) achievement of all students in grades 3–8, but that this “recessionary effect” was concentrated among school districts serving both more economically disadvantaged students and students of color. Greaves and Sibieta (2019) find that changes that required districts to pay teachers following higher salary scales, but that provided no additional funding to implement the requirements, did lead to increased pay for teachers as intended, but at the expense of cuts to other noninstructional spending of about 4%, with no net effects on student attainment. That is, reallocating resources across functions, without increasing the overall levels, did not improve outcomes.

Other studies explore disappointing trends across multiple education parameters during the decade preceding the COVID-19 pandemic, including teacher employment, class size, aggregate student performance, and performance gaps by socioeconomic status and/or racial/ethnic background. Several analyses show that recession-led school funding cuts were contemporaneous with significant reductions of teacher employment. The number of teachers in the United States public-school system reached its highest point in 2008, and then dropped significantly between 2008 and 2010 because of the recession (Gould 2017; Gould 2019; Berry and Shields 2017). Evans, Schwab, and Wagner (2019) estimated a decrease in total employment in public schools of 294,700 from the start of the recession until January 2013. Gould (2019) estimated that, in the fall of 2019, there were still 60,000 fewer public education jobs than there had been before the recession began in 2007 and that, if the number of teachers had kept up proportionately with growing student enrollment over that period, the shortfall in public education jobs would be greater than 300,000.

Related to these challenges, in the aftermath of the Great Recession through the 2015–2016 school year, schools’ struggles to staff themselves increased sharply. García and Weiss (2019) showed that the share of schools that were trying to fill a vacancy but could not do so tripled from the 2011–2012 to the 2015–2016 school year (increasing from 3.1% to 9.4% of schools in that situation), and the share of schools that reported finding it very difficult to fill a vacancy nearly doubled (from 19.7% to 36.2%). 19

Although class size, and the closely related metric of student-to-teacher ratios, have declined over the long term, they are higher, on average, in 2020 than they were in 2005 (the closest data point prior to the Great Recession) in 29 out of the 50 states plus the District of Columbia (NCES 2020d; Hussar and Bailey 2020). (See Mishel and Rothstein 2003 and Schanzenbach 2020 for a recent review of the influence of class size on achievement.)

Understanding overall trends in student performance over this period helps to put the impacts of trends in these other metrics in context. We have cited research that links school finance trends and educational outcomes in the aftermath of the Great Recession, but it is worth describing what the trends in student performance looked like across the country. It should not be surprising that scores from the National Assessment of Educational Progress (NAEP), the most reliable indicator over time of how much students are learning, show stagnant performance in math and reading for both fourth- and eighth-graders between 2009 and 2019 (NAGB 2019). As Sandy Kress, who served as President George W. Bush’s education advisor, commented, “The nation has gone nowhere in the last ten years. It’s truly been a lost decade [and] [t]he only group to experience more than marginal gains in recent years has been students in the top 10th percentile” (Chingos et al. 2019).

Gains (both absolute and relative) vary by students’ background, with multiple trends visible. Carnoy and García’s 2017 research on achievement gaps between racial/ethnic groups shows that Black–white and Hispanic–white student achievement gaps have continued to narrow over the last two decades, and also that Asian students were widening the gap ahead of white students in both math and reading achievement. At the same time, Hispanic and Asian students who are English language learners (ELLs) are falling further behind white students in mathematics and reading achievement, and gaps between higher- and lower-income students persist, with some changes that vary by subject and grade. During the decade of stagnation, however, in keeping with trends in per-pupil investments over this period, these trends widened existing inequities. As National Center for Education Statistics (NCES) Associate Commissioner Peggy Carr soberly notes, “Compared to a decade ago, we see that lower-achieving students made score declines in all of the assessments, while higher-performing students made score gains” (Danilova 2018).

Finally, we have also seen marked changes in the student body composition that have implications for these trends going forward. The proportion of low-income students in U.S. schools has increased rapidly in recent decades, as has the share of students of color (NCES 2020e; Carnoy and García 2017). A student’s race/ethnicity and socioeconomic status also affects the student’s odds of ending up in a high-poverty school or a school with a high share of students of color. For example, Black and Hispanic students who are not poor are much more likely than white or Asian students who are low income to be enrolled in high-poverty schools (Carnoy and García 2017).

All of these changes point to the need for increased resources across the board, and especially in schools serving the highest-needs students. As we revisit education funding in the aftermath of the pandemic-induced recession, the new structure must make greater investments to ensure the equitable provision of education and associated supports not only in stable times but also in the context of substantial disruptions and crises (García and Weiss 2021). As the analysis above makes clear, neither equity not adequacy—and, thus, excellence in public education—will ever be possible as long as local revenues play such a central role, and as long as states are the primary vehicle to address those disparities. While we leave it to policymakers to design the specifics of this public-good investment, we emphasize that the benchmarks we should reach to determine that those investments are stable, sufficient, and equitable should reflect meaningful, consistent advances for the highest-poverty schools and schools serving students of color. In other words, when the impacts of recessions no longer fall on the backs of our most vulnerable children, we will know that we are moving in the right direction.

Public education funding could also be deployed quickly to boost the economy and serve as an automatic stabilizer

The practice of cutting school funding during recessions is not only bad for students and teachers but also hurts the economy overall. The education sector has the potential to help stabilize the economy during downturns, but historically, our policy responses have failed to provide the necessary investment, as discussed in this report.

Up to this point, we have shown the characteristics, dynamics, and consequences of the existing education funding system. We have emphasized that fixing the system’s problems and achieving an excellent, equitable, robust, and stable public education system requires more funding —not just a reshuffling of existing funding. We have presented evidence indicating the need for a significantly larger contribution to the system from the federal government on a permanent basis. We have also demonstrated that targeting additional funds to schools during the Great Recession—via ARRA funds in particular— helped offset the large cuts schools experienced due to state and local shortfalls. As stated by Evans, Schwab, and Wagner (2019), “[…] the federal government’s efforts to shield education from some of the worst effects of the recession achieved their major goal.” Based on the observed trends, we considered whether even more sustained federal investments would have better assisted the students, schools, and communities that suffered major setbacks due to the Great Recession.

There is another reason for both larger investments and a more robust federal role when state and local budgets experience shortfalls due to economic downturns: School funding can be part of the countercyclical public-spending programs that help the economy recover. While policymakers and economists have long recognized the need for, and the effectiveness of, such automatic stabilizers (programs that pump public spending into the economy just when overall spending is declining), they have not traditionally placed public education spending in this category—yet it belongs there. 20 Federal funding directed toward schools during and in the aftermath of economic downturns can further boost the economy, thereby jump-starting economic recoveries.

Stable, sufficient, and equitable education funding would give schools and districts the resources and flexibility to adapt to challenges that they need but have not had during the COVID-19 pandemic. Moreover, automatic stabilization of public education protects students and school systems against depleted school budgets during recessions and volatile business cycles (Evans, Schwab, and Wagner 2019; Allegretto, García, and Weiss 2021). In addition to averting the harms to students and teachers described above, countercyclical investments would keep the public education workforce employed. The teachers, nurses, counselors, librarians, bus drivers, cafeteria workers, and others who work in public schools made up 53.2% of all state and local public-sector workers in 2019—accounting for nearly 7.0% of total U.S. employment. 21 School staff are also family and community members whose spending ripples through their local economies (known as the multiplier effect). Cuts to education revenues and employment thus also affect local communities more broadly, and retrenchment of spending acts as a type of reverse multiplier, resulting in a vicious downward cycle.

Federally provided countercyclical fiscal spending on public education set up to kick in based on defined triggers—akin to an expansion of unemployment benefits that kicks in when certain unemployment targets are reached—would have significant “bang-for-your-buck” multiplier effects. Such automatic spending constitutes smart investment that upholds public education while giving the overall economy a significant boost. Analyzing then President-elect Biden’s American Rescue Plan, which included public education spending, Zandi and Yaros (2021) reported a 1.34 fiscal multiplier for state and local government spending (the American Rescue Plan Act of 2021 was signed into law in March 2021).

Because the federal government already provides substantial support to state and local governments in such times, bolstering and further targeting that support in a defined and concerted manner would entail a relatively light lift. Despite some challenges, several programs of this nature have been shown to meet their goals in their given policy areas. For example, the federal unemployment insurance (UI) and food stamps (SNAP) 22 programs are often cited as having demonstrably positive outcomes when the federal government increases their funding. Both have been heavily criticized for their structural flaws and lack of sufficient resource (Bivens et al. 2021). However, through prior recessions and the pandemic, data illustrate that UI and SNAP nonetheless prevented millions of people from falling into, or deeper into, poverty, as well as averted hunger and evictions. The CARES Act’s first allotment of the Economic Impact Payments and expanded UI benefits during the COVID-19 pandemic kept 13.2 million people out of poverty (Zipperer 2020). 23 The Bureau of Economic Analysis broke out the effects of selected pandemic response programs on personal income, illustrating just how heavily Americans leaned on these benefits through the pandemic. In June 2020, UI payments accounted for 15.6% of all wages and salaries in the U.S (BEA 2020). By contrast, just prior to the pandemic UI benefits were negligible in comparison—just 0.27% of wages and salaries overall in February 2020.

We propose that policymakers create a program for funding education during downturns that is of adequate magnitude and provides immediate, sufficiently large, and sustained relief as needed.

In order to provide an immediate response, the system must have the capacity to adapt to emergencies; a key way to ensure that is to specify ahead of time the automatic triggers that prompt launching the contingency plans. 24 To clarify, we are not suggesting that public education spending be treated exactly like food stamps or unemployment insurance benefits—i.e., that states amass reserves for a “rainy day” or that reserves be built up during nonrecessionary periods. Rather, we are pointing to the economic benefits of an education system that is robustly, stably, and consistently funded throughout economic ups and downs, ensuring that it also has the resources to withstand the downturns and the flexibility to adapt. And we are recommending that Congress establish a program that kicks in when needed, rather than waiting until a crisis and coming together to pass a large, responsive bill, which requires political negotiation and can thus take a lot of time.

Sufficiently large investments imply that the spending numbers are adequate to the size of the problem. As we have seen during the COVID-19 pandemic, the various public programs—even with all their flaws—have been critical to preventing a much worse disaster than the one we have experienced. 25

Finally, regarding sustained assistance, it was clear that relief and recovery spending fell far short in response to the Great Recession and was cut off too soon; it took 6.2 years to recoup the jobs lost and nearly eight years for the unemployment rate to get back to its pre-recession rate of 5%. And unemployment rates for Black and Hispanic workers took much longer to return to pre-recession levels (Allegretto 2016). In education, as shown before, it was not until the 2014–2015 school year that districts’ per-student revenue, on average, recovered to 2007–2008 levels nationally—and recovery took even longer for high-poverty districts.

In sum, while the purpose of this study is not to offer guidance on how to best design a public education automatic-stabilization program, we do argue that such a program would help public education during downturns, and provide a boost to the overall economy. At later stages, proof-of-concept designs such as Medicaid and transportation grants, and some of the existing large-scale public programs already mentioned, could be a useful place to continue the discussion. Identifying best practices—in program design, financing, and implementation in the United States and elsewhere—would help to conceive a strategy.

Conclusions and next steps

For too long in this country, we have normalized the practice of underinvesting in education while expecting that schools would still function well (or at least moderately well). We have also accepted the disproportionate burden that economic recessions place on public schools and students. These norms are very costly—to individuals and to society—and they shortchange our country’s potential.

As the data and research show, this approach is backward. If we are to have a chance of providing all students in the United States with an excellent education we must  build a strong foundation—one with sufficient, adequate, and equitable funding of public schools in practice, not just in theory. Ensuring broad adequacy and equity will require increased federal investment (to more fully complement a system that relies heavily on nonfederal sources). Moreover, federal provisions that provide for automatic boosts to education spending during downturns is critical. Our education system can and should include a countercyclical designed to help stabilize the economy when it is contracting—benefiting schools and communities.

Were we to truly acknowledge the benefits, it would be hard to argue politically against making these investments a reality. Here again the data are edifying: Extensive research indicates that a stable and consistent funding system with a much higher level of investment would generate large economic and social returns. 26

An increased federal investment to ensure sufficient, adequate, and equitable funding of public schools has an additional benefit: It could serve as another tool in our toolbox for faster, broader, and more equitable recoveries from recessions. Boosting school funding during downturns could boost the wider economy—and disproportionately benefit the low-income communities that tend to be hit hardest in hard economic times.

This proposal requires jettisoning the tendency to pit public policy areas against one another for resources, and to glamorize the purportedly efficient notion of “doing more with less.” The latter, often used to justify education budget cuts, actually entails a misguided denial of the need for resources and of the inevitable damage that ensues when those resources fall short—or fail to exist at all.

We are not arguing that increased access to federal resources alone will address all the issues outlined above. Simply throwing money at the goal of providing an excellent education equitably to all children won’t achieve it; we need to make the right investments. 27

In addition, it is also important to distinguish funding from decision-making. While the federal government is best positioned to ensure broadly adequate and equitable education funding nationwide, it is not necessarily well suited to make decisions about policy, practice, and implementation. Evidence should guide how decision-making is allocated across the federal, state, and local levels. 28

Advancing this proposal also requires that we dislodge the conversation from where it has been stuck for at least the past half-century—namely on whether the resources exist. They do. What we need to ask now is how to make those resources available, and how to deploy them to ensure that all students have the opportunities to learn, develop, and achieve their full potential—and that these opportunities are available during both ordinary and recessionary times.

About the authors

Sylvia Allegretto is a research associate with the Economic Policy Institute. She worked for 15 years at the Institute for Research on Labor and Employment at the University of California, Berkeley, where she co-founded the Center on Wage and Employment Dynamics (CWED). She received her Ph.D. in economics from the University of Colorado, Boulder.

Emma García is an economist specializing in the economics of education and education policy. She developed this study while she was at the Economic Policy Institute (2013-2021). She is now a senior researcher at the Learning Policy Institute. García received her Ph.D. in economics and education from Columbia University’s Teachers College.

Elaine Weiss is the Policy Director at the National Academy of Social Insurance, and former National Coordinator of the Broader, Bolder Approach to Education at the Economic Policy Institute (2011-2018). She received her B.A. in Political Science from the University of Maryland, J.D. from Harvard Law School, and Ph.D. in public policy from the George Washington University.

Acknowledgments

The authors are grateful to EPI Publications Director Lora Engdahl for having edited this report and for her help shepherding it to its release. The authors benefited from Ajay Srikanth’s guidance on school finance data sources at the beginning of the project. The authors appreciate EPI’s support of this project, EPI Research Assistant Daniel Perez for his assistance with the tables and figures, EPI Editor Krista Faries for her usual thoughtful insights, and EPI’s communications staff for their assistance with the production and dissemination of this study.

Appendix: Notes on the data sources and the analyses

We construct our own district-level longitudinal data set using information from three different sources:

  • the National Center for Education Statistics’s School District Finance Survey (F-33, Local Education Agency Finance Survey microdata from NCES 2007–2008 to 2017–2018 (NCES-LEAFS 2021)
  • the United States’ Census Bureau’s Small Area Income and Poverty Estimates (SAIPE) Program (for districts 2007–2018, from the Urban Institute’s Education Data Portal (Urban Institute 2021a) 29
  • Stanford Education Data Archive (SEDA) Version 4.0 covariates file (Reardon et al. 2021).

The School District Finance Survey (F-33) is the source for revenues and expenditures for public elementary and secondary school districts in the country. The F-33 is a component of the Common Core of Data (CCD) and consists of local education agencies (LEA)-level finance data submitted annually to the U.S. Census Bureau by state education agencies (SEAs) in the 50 states and the District of Columbia. The entire universe of LEAs in each school year and in each state plus D.C. are included. The F-33 report includes the following types of school district finance data: revenue, current expenditure, and capital outlay expenditure totals; revenues by source; current expenditures by function and object; and revenues and current expenditures per pupil.

We use the annual data from 12 school years from 2006–2007 until 2017–2018 (the most recent available data at the time of development of this research was the data for 2017-2018, last accessed in March 2021 (NCES-LEAFS 2021) , see https://nces.ed.gov/ccd/files.asp#Fiscal:1,LevelId:5,Page:1 for updates).

We use the following variables from NCES CCD 2020:

  • Total Revenue (TOTALREV)
  • Total Federal Revenue (TFEDREV)
  • Total State Revenue (TSTREV)
  • Local Rev – Property Taxes (T06)
  • Fall Membership (V33 and MEMBERSCH if V33 is missing)
  • Total Current Expenditures for Elementary/Secondary Education (TCURELSC) 30

We calculate revenues (total and by source) and current expenditures in per-student terms.

For findings expressed “in constant 2019 – 2020 dollars,” all spending and revenue data are expressed in dollars corresponding with the 2019–2020 school year (average July–June as explained by NCES 2019), using the consumer price index from the Bureau of Labor Statistics (BLS-CPI 2021).

For findings involving states’ cost-of-living-adjusted (RPPs), we account for differences in the cost-of-living across states by using the Bureau of Economic Analysis’s (BEA’s) Regional Price Parities (BEA 2021). 31

For analyzing metrics and outcomes by school poverty level, we link the school finance information with the poverty information.

Our preferred poverty data source is the United States Census Bureau’s Small Area Income and Poverty Estimates (SAIPE) Program for districts for school years spanning 2007–2018, which we collect from the Urban Institute’s Education Data Portal (Urban Institute 2021a). Census SAIPE district poverty data are available for the period 2007–2008 through 2017–2018 (U.S. Census Bureau 2021). The variable of interest is the poverty rate for children ages 5–17 in the district (ratio between poor children and total children in that age group). They are originally available as yearly data. To proxy for the school year (July–June) data, for a given school year, we take the average between the fall year-1 and the spring year.

We also use two other poverty data sources, which are linked to the F-33 data in sequential steps, for the following two purposes: (a) to offer sensitivity analyses of the results using alternative sources of data; and (b) to use the maximum number of observations possible, in cases in which some information is missing in one source but available in others.

Our second-preferred poverty data are SEDA’s shares of free and reduced price lunch eligible students in grades 3–8 in the districts (Reardon et al. 2021). This information is available in the covariates’ file, and it is available starting in school year 2008–2009 (which is least preferred because it is after the beginning of the Great Recession). 32

As an additional source checked in our sensitivity analyses, we use the county-level information from the Census, available (by year) at: https://www.census.gov/programs-surveys/saipe/data/datasets.html (U.S. Census Bureau 2021). The information is equivalent to the district-level information, but at the county level. For this study, we use the data in the same manner (turning the year estimates into school-year equivalent estimates, etc.).

We perform the analyses using the different sources independently, plus one more in which we combine the three sources, when one is missing but the other is not (i.e., we define a poverty-all variable that “combines” sources: If Census’s SAIPE’s district poverty data are missing, SEDA’s district poverty data are used; for districts missing on both, Census’s SAIPE’s county poverty data are used).

In each case, we calculate the poverty quartiles each year by dividing the poverty variable(s) into four quartiles. 33 Low-poverty districts are districts with a poverty rate for children ages 5–17 in the first quartile of the poverty distribution. Medium-low-poverty districts are districts with a poverty rate for children ages 5–17 in the second quartile of the poverty distribution. Medium-high-poverty districts are districts with a poverty rate for children ages 5–17 in the third quartile of the poverty distribution. High-poverty districts are districts with a poverty rate for children ages 5–17 in the fourth (top) quartile of the poverty distribution.

A note about analytic samples and weights: As the school finance variables of interest are in per-student terms, districts with nonmissing and nonzero numbers of students are kept in our sample. In our preferred sample, we also restrict the analyses to observations from districts serving elementary schools only, secondary schools only, or both, 34 and to districts with charter information nonmissing. Results using the full number of observations (unrestricted sample) are available upon request.

A note about the final sensitivity analysis: Following the nature of F33 and the weights available in the surveys, our unit of analysis is the district, and we present unweighted averages across districts. Sensitivity analyses are also available using the student population in the district to compute weighted averages across the districts, upon request.

A note about methods: The analyses presented in this report are descriptive in nature. We are interested in providing a description of the trends in revenues and expenditures over time, by state, and by district poverty level. We produce updated estimates for the main school finance indicators and we look at trends in the main variables (per-student revenue and spending) during recessions to see the potential of a solid response from the system to respond, counter, and recover from economic recessions.

We conducted multiple sensitivity analyses in our attempt to verify that the data that we provide are not sensitive to data sources or data procedures, as well as to understand possible ways to further expand this research. Each data source offers significant advantages, but there is no source that can be used for all the purposes intended. Additionally, the evidence improves if we use multiple sources. We are confident the main findings hold and are not driven by extraneous factors. We do not use regression analyses in this version of the report.

1. In addition to the Department of Education, the Department of Health and Human Services, which funds the Head Start program for young children, and the Department of Agriculture, which funds the School Lunch (meals) Program are also part of the agencies that support programs or functions in education.

2. We use current expenditures instead of total expenditures when comparing education spending between states or across districts, as suggested by the agency that provides the data, the National Center for Education Statistics (NCES). This approach recognizes that current expenditures exclude expenditures for capital outlay, “which tend to have dramatic increases and decreases from year to year.” Also, “the current expenditures commonly reported are for public elementary and secondary education only. Many school districts also support community services, adult education, private education, and other programs, which are included in total expenditures. These programs and the extent to which they are funded by school districts vary greatly both across and within states and school districts.” See NCES 2008.

3. See the New Yorkers for Students’ Educational Rights backgrounder (NYSER n.d.) on Campaign for Fiscal Equity, Inc. (CFE) v. State of New York , 8 N.Y.3d 14 (2006) and Srikanth et al. 2020. Michael A. Rebell, one of the most prominent school funding litigators in the country, was co-counsel for the plaintiffs in CFE v. New Yor k , a school funding “adequacy” lawsuit that claimed that the State of New York violated the constitutional rights of New York City students by failing to adequately fund the city’s public schools (NYSER n.d.). See also Sciarra and Dingerson 2021.

4. Since 2010, the Education Law Center (ELC), housed at Rutgers University, produces report cards that ask Is School Funding Fair? (using the data collected annually, some of which we use in our analyses below). To paraphrase their response, “Generally, no.” As the authors emphasize, “The hallmark of a fair school funding system is that it delivers more funding to educate students in high-poverty districts [since] states providing equal or less funding to high-poverty districts are shortchanging the students most in need and at risk of academic failure” (Farrie and Schiarra 2021).

5. Moreover, these wealth-based disparities are mirrored in and compounded by race/ethnicity-based gaps. The Education Trust uses data to report on disparities by both income/poverty level and race/ethnicity. As the Education Trust’s report on funding gaps in 2018 reveals, “School districts serving the largest populations of Black, Latino, or American Indian students receive roughly $1,800, or 13 percent, less per student in state and local funding than those serving the fewest students of color. This may seem like an insignificant amount, but it adds up. For a school district with 5,000 students, a gap of $1,800 per student means a shortage of $9 million per year ” (Morgan and Amerikaner 2018, emphasis added).

6. Our peer Western nations view public schools as more of a national responsibility and provide resources accordingly. For example, Germany has a heavily state-based school system, France has a hybrid local–federal system in which the central government pays teachers’ salaries, and Finland’s national government takes virtually full responsibility for public education.

7. As a large study by Berry (2021) reveals, higher-income areas are taxed, on average, at just half the rate of their lower-income counterparts. Not only does this lead to structurally inequitable funding for schools, it exacts a harder toll on the residents who are least able to afford it—who pay double the taxes of their wealthier peers on much lower incomes. And, as Srikanth (2021) notes, “The study reveals structural racism at work.”

8. Funding for K–12 (21.5%) and higher education (9.4%) combined make up the largest segment of most state budgets. Spending on K–12 education alone is barely second in public budgets to public welfare spending (22.4%) (Urban Institute 2021b).

9. Bradbury (2021) explains that “the largest portion of state aid to local school districts is typically provided on a per-student basis through a ‘foundation,’ ‘power-equalizing,’ ‘flat grant,’ or ‘tiered’ program.…In addition, some states include cost adjustments in their formulas. Key attributes on which states base such cost adjustments are student poverty, English language facility, and special education or disability status.”

10. As part of his War on Poverty, which recognized the impacts of poverty on children’s well-being and the nation’s future, President Lyndon Johnson advanced the Elementary and Secondary Education Act (ESEA) in 1965. This flagship federal legislation, which has since been reauthorized multiple times and whose current iteration is the Every Student Succeeds Act, is designed principally to channel resources to schools serving low-income students. However, Title I, the largest section of ESEA, was never enough to make up for the inequities created by the local–state funding system (see Gamson, McDermott, and Reed 2015).

11. This pattern isn’t at all “inadvertent,” but is a built-in feature that is part of a pattern of systemic racism and related classism that merits attention in itself. See, for example Sosina and Weathers 2019.

12. For example, in 2018–2019, average teacher salaries ranged from less than $46,000 in Mississippi to roughly $86,000 in New York (NEA 2020). However, within New York (according to 2017 data), they ranged from as low as $55,976 in the low-income Finger Lakes region in the northern part of the state to nearly twice as high, $110,000, in the wealthiest Long Island districts (Malatras and Simons 2019).

13. We note that the Great Recession started as the 2007–2008 school year was underway, so we are using the term “pre-recession level” flexibly and assuming school budgets do not immediately respond to the economic recession.

14. See Leachman, Masterson, and Figueroa 2017; Leachman and Figueroa 2019; Baker 2018; and Allegretto 2020 for some more examples.

15. Note that we are not distinguishing here between the source of increased or decreased funding but focusing on total revenues and expenditures. Roy (2011) examined a redistributive school finance reform initiated by the state legislature in Michigan in the mid-’90s, called Proposal A. This reform, which eliminated local discretion over school spending by increasing state aid to the lowest-spending districts and limiting it in the highest-spending districts, reduced spending disparities between districts, and increased student performance (state test scores) in the lowest-spending districts, though it also had a negative effect on student performance in the highest-spending districts. For an analysis of state school finance reforms affecting Kansas (“block grant funding” that froze district revenue regardless of enrollment and reduced funding in districts where enrollment increased), see Rauscher 2020. See Biasi 2019 for an examination of the effect of equalizing revenues across public school districts on students’ intergenerational mobility; Biasi finds that equalization has a large effect on mobility of low-income students, with no significant changes for high-income students.

16. Note that these analyses are based on cross-sectional data.

17. This post-1990 period, often referred to as the “adequacy era,” represented a time in which state-court decisions in multiple states resulted in increased public-school funding, offering an opportunity for researchers to study the overall impacts of these substantial increases and to compare them to student outcomes in states that did not experience them.

18. Their preferred estimates, based on the gradient of student achievement with respect to district income, indicate that a school funding reform raises achievement in a district with log average income one point below the state mean, relative to a district at the mean, by 0.1 standard deviations after 10 years.

19. High-poverty schools found it more difficult to fill vacancies than did low-poverty schools and schools overall, and high-poverty schools experienced higher turnover and attrition rates than did low-poverty schools (García and Weiss 2019).

20. Note that in this report, our main goal is to document the need and concept for such a program, not to discuss how best to design a public education automatic-stabilization program. These considerations, including specifically raising federal supports to education, have been discussed before (Boushey, Nunn, and Shambaugh 2019; Partelow, Yin and Sargrad 2020; Ogletree et al. 2017; Sahm 2019; Schott Foundation 2022; U.S. Department of Education 2013; Washington Center for Equitable Growth 2021; etc.).

21. Author Sylvia Allegretto’s analysis based on Bureau of Labor Statistics Current Employment Statistics data for 2019 (BLS-CES 2021). Education is one of the largest single components of government spending, amassing 7.3% of GDP across federal, state, and local expenditures (OECD 2013).

22. SNAP is the abbreviation for the Supplemental Nutrition Assistance Program, also known as “food stamps.”

23. Data Household Pulse Survey (HHPS) from the U.S. Census Bureau found that 29.3% of respondents with children were food insecure in the week of April 23–July 21, 2020 (Schanzenbach and Tomeh 2020). Bauer (2020) estimates that there were almost 14 million children living in a household characterized by child food insecurity during the week of June 19–23, 2020, “5.6 times as many as in all of 2018 (2.5 million) and 2.7 times as many as during [the] peak of the Great Recession in 2008 (5.1 million).” Typically, these programs disproportionately benefit low-income communities, which are often hit the hardest, thus preventing even more damage and the exacerbation of the large existing inequities.

24. The term “contingency plans” comes from the education-in-emergencies field and is mostly applicable to international contexts, but it has also been used in the U.S. to give broader responses to crises such as Hurricane Katrina (The White House 2006). See García and Weiss 2020, 2021 for more details. The term “automatic trigger” is used to indicate what activates benefits or programs. See Mitchell and Husak 2021 and Boushey, Nunn, and Shambaugh 2019.

25. For flaws around one of those programs—unemployment insurance—see Bivens et al. 2021. Bitler, Hoynes, and Schanzenbach 2020 provide evidence for three reasons why the policy response left needs unmet: “(1) timing—relief came with a substantial delay (due to overwhelmed UI systems/need to implement new programs); (2) magnitude—payments outside UI are modest; and (3) coverage gaps—access is lower for some groups and other groups are statutorily excluded.”

26. See section summarizing the literature on the impacts of spending on education above.

27. We have discussed this point extensively in our other research on early childhood education, socio-emotional learning, and integrated student support, among others. See García 2015; García and Weiss 2017; García and Weiss 2016; Weiss and Reville 2019, among others, for guidance on smart education investments. See also Bryk et al. 2010 for a discussion on the role of context and how even after receiving funding, schools did not improve, and offering suggestions for school reform efforts.

28. California, which revamped the state’s education funding and accountability systems in the wake of the 2015 passage of the Every Student Succeeds Act, offers a valuable model. See Furger, Hernández, and Darling-Hammond 2019 and Johnson and Tanner 2018.

29. For counties 2007–2019, see U.S. Census Bureau 2021.

30. As explained earlier in the report, we use current expenditures instead of total expenditures when comparing education spending between states or across districts, as suggested by the agency that provides the data, the National Center for Education Statistics (NCES). This approach recognizes that current expenditures exclude expenditures for capital outlay, “which tend to have dramatic increases and decreases from year to year.” Also, “the current expenditures commonly reported are for public elementary and secondary education only. Many school districts also support community services, adult education, private education, and other programs, which are included in total expenditures. These programs and the extent to which they are funded by school districts vary greatly both across and within states and school districts.” See NCES 2008.

31. For 2018: https://www.bea.gov/news/2020/real-personal-income-state-and-metropolitan-area-2018 , and For Time Series: https://apps.bea.gov/regional/histdata/releases/0920rpi/SARPP.zip

32. Note that we obtain the minority concentration from this source. Not used in this report.

33. Variables with the poverty quartiles are called POV_CDIST (our preferred Census SAIPE district) and povall (the one combining all sources).

34. Excluded are districts of vocational or special education system; nonoperating school system that exists for administrative purposes only and does not operate its own schools; LEAs that closed shortly before the start of the fiscal year or are scheduled to open in a future fiscal year but still reported revenue or expenditure information for the current fiscal year; and education service agency (ESA) (variable labeled schlev).

Allegretto, Sylvia A. 2016. California’s Labor Market: Eight Years Post-Great-Recession . Center on Wage and Employment Dynamics of the Institute for Research on Labor and Employment, University of California, Berkeley. May 2016.

Allegretto, Sylvia A. 2020. “The Critical Issues of Teacher Pay and Employment.” In Strike for the Common Good: Fighting for the Future of Public Education , edited by Rebecca Kolins Givan(1975– and Amy Schrager Lang. Ann Arbor: University of Michigan Press.

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Budget execution in the education sector and why it matters

Aliya kadirov, srinivas gurazada, thomas poulsen.

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According to a recent report , public financial management (PFM) systems often struggle where it matters most for efficient service delivery: budget execution. More than two-thirds of governments struggle to maintain the planned composition of their expenditure throughout the fiscal year.   This affects most sectors, especially sectors focusing on service delivery like education.

Understanding budget execution is important as underspending and overspending, of allocated education budgets can indicate broader challenges in efficiently delivering education services and pertinent challenges in the PFM system. Fund release delays; complex financial management requirements between the various levels (school, district, province, central levels); timely reallocation of funds between budget lines if needed; ineffective teacher deployment; and ineffective procurement processes, to name a few, can all inhibit the timely availability of resources such as books, teaching and learning materials, and human resources, at school level. These challenges ultimately impact student learning outcomes.

Research on the link between PFM and service delivery is limited

Globally, there is still limited research on the mechanisms through which PFM affects service delivery, and the impact of improved PFM on student learning outcomes. From the evidence available, improved PFM performance, how governments manage resource allocation, and the benefits of increased budget predictability have a limited but positive impact on education service delivery outcomes.

The extent to which the budget execution rate facilitates or stalls improvements in service delivery requires in-depth analysis. A few sources readily available for analysis are: 1) public expenditure reviews (PER) in the World Bank’s Education PER database; 2) finance trends in the Education Finance Watch 2022 ; and 3) data from Public Expenditure and Financial Accountability (PEFA) assessments .

What do we know about budget execution in education?

The share of education spending for most lower-middle- and middle-income countries has been either stagnant or on a slow upward trend (low-income countries) for the last 10 years, but during and following the COVID-19 pandemic, education spending declined in many countries. The pandemic affected execution rates, but not equally in all countries or in all cost categories. Declining execution rates were most prominent in goods and services spending (a 10 percent decline compared to pre-COVID data), while wages in the sampled countries did not see a similar decline. Wages, often accounting for 80 to 90% of education spending, are by far occupying the largest share of the (executed) budget. But relevant data on execution rates are often limited. A recent review of education PERs between 2015 and 2021 found that only 66% reported actual execution rates over time.

Table 1. Budget execution rates before and during COVID, overall, by type of expenditure and by country income group

Budget execution rates before and during COVID

In addition to PERs, we analyzed PEFA assessments conducted between 2016 and 2022 in 70 countries . Among other indicators, we estimated the difference between planned and actual budget expenditure, also known as “aggregate expenditure outturn.” The budget reliability indicators assess whether the government budget is implemented as intended and compares actual revenue and expenditures with the original approved budget. On average, low-income countries tend to have weaker budget reliability and operate with larger differences between planned and executed budgets.   Interestingly, on average, the performance on budget execution in lower-middle-income countries is slightly higher than in upper-middle-income countries.

Figure 1. PEFA Indicator P1, Aggregate expenditure outturn

Figure 1. PEFA Indicator P1, Aggregate expenditure outturn

On average, low-income countries tend to have lower scores in the assessment, but there is a wide variation within this group. Differences in political-economy factors can drive these variations, but evidence suggests that these variables can explain only 40% of those differences. Within country, deviations often look different than the national average . Understanding country institutional arrangements and frameworks can shed light on why some countries might have stronger budget execution processes and lead to a better understanding of service delivery bottlenecks.

The implications for education and beyond?

The size of education budgets is important, but the ability of Ministries of Education to spend well, and execute appropriately, must not be overlooked.  More money to a sector that spends ineffectively or not as expected is cause for concern and could exacerbate financial inefficiencies. Exploring the reasons behind the executed share of the allocated budget opens a window to understand whether systems are set up to implement budgets effectively and to pinpoint whether bottlenecks are present in the execution stage or elsewhere in the budget cycle. If there is low predictability in the release of funds, coordination of input purchases, distribution of textbooks, or expanding school infrastructure becomes challenging. Strengthening budget oversight is key for budget process credibility.

Data on budget execution is not consistently reported or is unavailable in many countries . A recent Open Budget Survey (2021 ) noted a decrease in the legislative oversight of budget execution, with more than half of the 115 countries surveyed not overseeing the progress of budget implementation. Budget oversight can assist with the effective use of resources. Transparency, citizen engagement, and accountability in the budgeting process result in less corruption, more revenue, and better and more efficient public service delivery. 

More scrutiny of budget execution is a commitment to the global effort on transform education financing. While examining the deviations and discrepancies between planned and implemented budget is imperative to understand and tackle PFM bottlenecks, we should keep in mind that a narrow focus on execution rates can distract us from “discovering” challenges elsewhere in the budget cycle. Attention to all stages of the budget cycle, through the key drivers of learning “lens,” and identifying bottlenecks in the PFM system, is critical to ensuring efficient service delivery in the education sector and achieving learning outcomes at the national level.

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Education Consultant with the Education Global Practice of the World Bank

Srinivas Gurazada

Global Lead, Public Financial Management

Senior Economist, World Bank

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Education Spending

How is education financed how much do we spend on it what are the returns.

In most countries basic education is nowadays perceived not only as a right, but also as a duty – governments are typically expected to ensure access to basic education, while citizens are often required by law to attain education up to a certain basic level. 1

This was not always the case: the advancement of these ideas began in the mid-19th century, when most of today’s industrialized countries started expanding primary education, mainly through public finances and government intervention. Data from this early period shows that government funds to finance the expansion of education came from a number of different sources, but taxes at the local level played a crucial role. The historical role of local funding for public schools is important to help us understand changes – or persistence – in regional inequalities.

The second half of the 20th century marked the beginning of education expansion as a global phenomenon. Available data shows that by 1990 government spending on education as a share of national income in many developing countries was already close to the average observed in developed countries. 2

This global education expansion in the 20th century resulted in a historical reduction in education inequality across the globe: in the period 1960-2010 education inequality went down every year, for all age groups and in all world regions. Recent estimates of education inequality across age groups suggest that further reductions in schooling inequality are still to be expected within developing countries. 3

Recent cross-country data from UNESCO tells us that the world is expanding government funding for education today, and these additional public funds for education are not necessarily at the expense of other government sectors. Yet behind these broad global trends, there is substantial cross-country – and cross-regional – heterogeneity. In high-income countries, for instance, households shoulder a larger share of education expenditures at higher education levels than at lower levels – but in low-income countries, this is not the case.

Following the agreement of the Millennium Development Goals, the first decade of the 21st century saw an important increase in international financial flows under the umbrella of development assistance. Recent estimates show that development assistance for education has stopped growing since 2010, with notable aggregate reductions in flows going to primary education. These changes in the prioritization of development assistance for education across levels and regions can have potentially large distributional effects, particularly within low-income countries that depend substantially on this source of funding for basic education. 4

When analyzing correlates, determinants and consequences of education consumption, the macro data indicates that national expenditure on education does not explain well cross-country differences in learning outcomes. This suggests that for any given level of expenditure, the output achieved depends crucially on the mix of many inputs.

Available evidence specifically on the importance of school inputs to produce education, suggests that learning outcomes may be more sensitive to improvements in the quality of teachers, than to improvements in class sizes. Regarding household inputs, the recent experimental evidence suggests that interventions that increase the benefits of attending school (e.g. conditional cash transfers) are particularly likely to increase student time in school; and that those that incentivize academic effort (e.g. scholarships) are likely to improve learning outcomes.

Policy experiments have also shown that preschool investment in demand-side inputs leads to large positive impacts on education – and other important outcomes later in life. The environment that children are exposed to early in life, plays a crucial role in shaping their abilities, behavior, and talents.

Historical perspective on financing education

When did the provision of education first become a public policy priority.

Governments around the world are nowadays widely perceived to be responsible for ensuring the provision of accessible quality education. This is a recent social achievement. The advancement of the idea to provide education for more and more children only began in the mid-19th century, when most of today’s industrialized countries started expanding primary education.

The following visualization, plotting public expenditure on education as a share of Gross Domestic Product (GDP) for a number of early-industrialized countries, shows that this expansion took place mainly through public funding. Our topic page on global education provides details regarding how this expansion in funding materialized in better education outcomes for these countries.

How did the US finance the expansion of public education?

Public schools in the US educate more than 90% of all children enrolled in elementary and secondary schools. 5

This is the result of a process of education expansion that relied heavily on public funding, particularly from local governments. The visualization shows the sources of revenues for public schools in the US over the last 120 years.

As can be seen, states and localities are – and have always been – the main sources of funding for public primary education in the US. In fact, we observe three broad periods in this graph: there is first a period of stable revenues until 1920, then a period of sharp growth and decline during the interwar years, and then a period of substantial growth since the Second World War, slowing down in the 1970s. In all these periods, federal funding was always very small.

Disaggregated data from the last couple of decades gives further insights into the specific sources of local revenues for schools in the US: the largest part comes from property taxes (about 80% of local revenues came from property taxes in 2013), while only a very small part comes from fees and donations (private funding for public schools, which is considered a local revenue, amounted to less than 2% of total public school revenues in 2013). This heavily decentralized system relying on property taxes has the potential to create large inequalities in education since public schools in affluent urban areas are able to raise more funding from local revenues. Indeed, a significant part of the debate on education inequalities in the US today focuses on the importance of increasing progressive federal spending to reduce inequalities in public school funding. 6

How did France finance the expansion of public education?

The case of the US above shows that funding for public schools has been historically a responsibility of local governments. In other countries, such as France, the expansion of public education also took place initially with resources from local governments, but relatively quickly the fiscal burden was shifted to the national level. In France, this transition was associated with a sharp jump towards universal access and a concomitant reduction in regional inequalities.

The following visualization from Lindert (2004) 7 provides evidence of the French experience. As we can see there are three distinct periods: education spending was initially low and mainly private, then in 1833 funding began growing with local resources after the introduction of a law liberating communes to raise more local taxes for schools, and finally in 1881 the national government took over most of the financial responsibility after the introduction of a new law that abolished all fees and tuition charges in public elementary schools. In the source book, Lindert (2004) provides further evidence of how this transition towards centrally funded public education reduced north-south inequalities in France.

Lindert (2004) France_EarlyEducation_Breakdown

In the US growth in education expenditure was characterized by growth specifically in the public sector

A comparison of expenditure between public and private education institutions is helpful to contextualize the role the public sector played in the process of education expansion in industrialized countries. The following graph does this using data from the National Center for Education Statistics in the US.

It shows that during the years 1950-1970 – a period of substantial growth in education expenditure in the US – expenditure grew specifically in the public sector. 9

When did the expansion of basic education become a global phenomenon?

The second half of the 20th century marked the beginning of education expansion as a global phenomenon. The visualization shows government expenditure on education as a share of national income for a selection of low and middle-income countries, together with the corresponding average for high-income countries, for more than the last half-century. As can be seen, spending on education in many developing countries has become similar to the average observed in developed countries in recent decades.

It is important to point out that the remark above makes reference to convergence in expenditure relative to income . To the extent that low-income countries remain poorer than high-income countries, gaps in levels of expenditure per pupil are persistently large. Indeed, cross-country heterogeneity in education expenditure per pupil is currently much higher than heterogeneity in expenditure as a share of GDP. 10 One factor contributing to the slower convergence of expenditure per pupil in real terms is the fact that teachers' salaries – the main component of education expenditure, as discussed below – are much higher in high-income countries because labor has a higher opportunity cost in these countries. In general, the opportunity cost of labor is a key variable that governments in developing countries should factor in when deciding whether to expand education now, rather than later.

Education inequality is falling around the world

An important consequence of the global education expansion is a reduction in education inequality across the globe. The following visualization shows this through a series of graphs plotting changes in the Gini coefficient of the distribution of years of schooling across different world regions. The Gini coefficient is a measure of inequality and higher values indicate higher inequality – you can read about the definition and estimation of Gini coefficients in our related article . The time-series chart shows inequality by age group.

It can be seen that as inequality is falling over time, the level of inequality is higher for older generations than it is for younger generations. We can also see that in the reference period education inequality went down every year, for all age groups and in all world regions.

Have gains from historical education expansion fully materialized? The breakdown by age gives us a view into the future: as inequality is lower among today's younger generations, we can expect the decline of inequality to continue in the future. Thus, further reductions in education inequality are still to be expected within developing countries; and if the expansion of global education can be continued, we can speed up this important process of global convergence.

Cuaresma etal(2013) edu_gini_1960_2010

Education inequality can decline rapidly across all levels of education – South Korea is an example

The experience of South Korea shows that it is possible to reduce education inequality rapidly across all levels of education.

The following visualization shows two graphs comparing the concentration of years of education in South Korea between the years 1970 and 2010. To be precise, each of these graphs shows an education Lorenz curve: a plot showing the cumulative percentage of the schooling years across all levels of education on the vertical axis, and the cumulative percentage of the population on the horizontal axis.

As can be seen, in 2010 education was much less concentrated than in 1970, not only because there was a smaller share of individuals without schooling (shown at the bottom of the chart), but also because there was a smaller share of individuals concentrating large proportions of school-years at higher levels of education. Indeed, in only 40 years South Korea was able to double the mean years of schooling (from 6 to 12 years) and at the same time get remarkably close to the 45-degree line marking the hypothetical scenario of perfect equality of schooling.

inequality-of-education-south-korea-lorenz-curves

Financing of education across the world

Is funding for education expanding.

The last two decades have not a clear trend in the share of income that countries devote to education.

The following chart plots trends in public expenditure on education as a share of GDP. We can see an upward trend in some countries, but a downward trend in others.

However, as incomes – measured by GDP per capita – are generally increasing around the world, this means that the total amount of global resources spent on education is increasing in absolute terms.

Is additional funding for education taking resources from other sectors?

The following visualization shows government expenditure on education as a share of total government expenditure. The available data also does not suggest a discernible global pattern here.

The data does suggest, however, that there is large and persistent cross-country heterogeneity in the relative importance of education vis-a-vis other sectors, even within developing countries.

European countries tend to assign a lower share of public budgets to education, relative to the amount of their income that is devoted to education

Generally speaking, countries that spend a large share of their income on education also tend to prioritize education highly within their budgets.

The following visualization presents a snapshot of government spending on education around the world. Specifically, this graph plots government expenditure on education as a share of GDP on the horizontal axis, and government expenditure on education as a share of total government expenditure on the vertical axis.

As we can see, there is a positive correlation, but regional differences are stark: for almost every level of spending as a share of GDP along the horizontal axis, countries in Europe spend a smaller budget share on education.

In European countries the weight of primary education within total education spending is lower than in other countries

In comparison to countries where education started expanding later, European countries tend to assign relatively more of their government education budgets to the secondary and tertiary levels, while at the same time devoting relatively less of their general government budgets to education as a whole.

This can be appreciated in the following visualization, where the prioritization of primary education (i.e. the share of primary education within the education budget) is plotted against the overall prioritization of education (i.e. the share of education within the entire government budget).

It can be seen that European countries are mostly located in the upper left. There is a weak positive correlation between the variables, both across all countries and across European countries.

In high-income countries, households shoulder a larger share of education expenditures at higher education levels than at lower levels – but in low-income countries, this is not the case

The following visualization shows the percentage of total education expenditures contributed directly by households in 15 high-income countries and 15 low or middle-income countries.

The top chart in this figure, corresponding to high-income countries, shows a very clear pattern: households contribute the largest share of expenses in tertiary education, and the smallest share in primary education. Roughly speaking, this pattern tends to be progressive, since students from wealthier households are more likely to attend tertiary education, and those individuals who attend tertiary education are likely to perceive large private benefits. 13

In contrast, the bottom chart shows a very different picture: in several low-income countries households contribute proportionally more to primary education than to higher levels. Such distribution of private household contributions to education is regressive.

UNICEF Private Education Expenditure Levels

Recent funding structures in OECD countries

Primary education continues to be publicly funded in industrialized countries.

We have already mentioned that those countries that pioneered the expansion of primary education in the 19th century – all of which are current OECD member states – relied heavily on public funding to do so. Today, public resources still dominate funding for the primary, secondary, and post-secondary non-tertiary education levels in these countries.

The visualization presents OECD-average expenditure on education institutions by source of funds. 14

Publicly funded pre-primary education is more strongly developed in the European countries of the OECD

High-income countries tend to have better-developed pre-primary education systems than lower-income countries. However, within high-income countries, there is substantial heterogeneity in the extent to which pre-primary education is publicly financed.

The visualization presents expenditure on pre-primary educational institutions as a share of GDP across the OECD.

As can be seen, publicly funded pre-primary education tends to be more strongly developed in Europe than in the non-European countries of the OECD.

OECD_Expenditure_Pre-primary

Where does funding for education go to?

The largest part of funding devoted to education in OECD countries goes to finance current expenditures, mainly compensation of staff – specifically, teachers. The following two charts, taken from the OECD's report Education at a Glance (2015) , highlight the labor-intensive nature of education. In the lower levels of education (i.e. primary, secondary, and post-secondary non-tertiary) the share of current expenditure is very large and exhibits little cross-country variation – between 90 and 97 percent of total expenditure corresponds to current expenditure across all of the OECD countries. In higher levels of education (i.e. tertiary) there is more cross-country variation, but current expenditure still dominates by a large margin across all countries.

OECD_Expenditure_Education_Resources

What drives current expenditure on education?

In the figures above we noted the importance of current expenditure in the production of education. The following table provides further details regarding the type of expenditures that comprise current spending. Specifically, this chart shows a breakdown of expenditure for tertiary-level institutions in the US (public and private), during the period 1980-1997. It shows that instruction accounts for almost half of expenditure; and while there are some small differences across sectors, there is a fair amount of stability in expenditures across time. This serves as a benchmark for lower education levels, where instruction takes an even larger share of expenditure. 15

US_CurrentExpenditure_Types

International financing flows

Education financing in developing countries has been bolstered by development assistance.

Following the agreement of the Millennium Development Goals, the first decade of the 21st century saw an important increase in international financial flows under the umbrella of development assistance (often also called development aid, or simply 'aid').

The following chart shows total OECD development assistance flows for education by level, in constant 2013 US dollars, for the period 2002-2013. As it can be seen, there are two distinct periods: in 2003-2010 flows for education increased substantially, more than doubling in real terms across all levels of education; and in the years 2010-2013 funding for basic education decreased , while funding for secondary and post-secondary education remained relatively constant. For many low-income countries, where development assistance contributes a substantial share of funding for education, this marked change in trends is important. As a reference, in 2012 development assistance accounted for more than 20 percent of all domestic spending on basic education in recipient low-income countries. 17

EducationAidWatch_ODA_Education

The share of development assistance for education going to Sub-saharan Africa has decreased

The reductions in development assistance funds for primary education have been coupled with important changes in regional priorities. Specifically, the share of development assistance for primary education going to sub-Saharan Africa has been decreasing sharply since the agreement of the Millennium Development Goals.

The following chart shows this: sub-Saharan Africa’s share in total aid to primary education declined from 52 percent in 2002 to 30 percent in 2013, while the continent’s share in the total number of out-of-school children rose from 46 percent to 57 percent.

Brookings_ODA_EduAfrica

This pattern is something specific to the education sector within the broader development assistance landscape: in the healthcare sector, the overall slowdown of flows started a couple of years later, was less abrupt, and affected proportionally less the sub-Saharan countries. 18

Indeed, recent studies further highlight that development assistance for education is significantly different from assistance for healthcare in other ways: the education sector attracts less earmarked funding through multilaterals, and includes a smaller proportion of resources that developing governments can directly control for programming. 19

You can read more about development assistance for healthcare in our article on healthcare spending .

Development assistance priorities have the ability to increase or reduce expenditure inequalities

We mentioned above that public spending on education has translated, in the long run, into lower inequality in education outcomes across most of the world. But for any given country, with a given income distribution and demographic structure, the extent to which public spending on education contributes to reducing inequality depends crucially on the way in which spending is focused across education levels.

The recent UNICEF report The Investment Case for Education and Equity shows that in low-income countries, on average 46 percent of public resources are allocated to the 10 percent of students who are most educated – while this figure goes down to 26 and 13 percent in lower-middle and upper-middle income countries respectively.

The following visualization shows further details on the concentration of public spending across different countries. The vertical axis shows the percentage of public education resources going to the 10% most educated or 10% least educated students – as we can see expenditure is heavily concentrated at the top in many low-income countries.

The earlier remarks about trends in international education financing flows (namely that aid is very important in low-income countries, and that a relatively low and shrinking share of aid is going to primary levels), suggest that inequality in public spending may worsen in low-income countries. Yet development assistance priorities have the ability to change this. 20

UNICEF Education Expenditure Concentration

What determines educational finance?

The big picture, why do governments finance education.

One of the reasons to justify government intervention in the market for education, is that education generates positive externalities. 21 This essentially means that investing in education yields both private and social returns. Private returns to education include higher wages and better employment prospects. Social returns include pro-social behavior (e.g. volunteering, political participation) and interpersonal trust .

The following chart uses OECD results from the Survey of Adult Skills to show how self-reported trust in others correlates with educational attainment. More precisely, this chart plots the percentage-point difference in the likelihood of reporting to trust others, by education level of respondents. Those individuals with upper secondary or post-secondary non-tertiary education are taken as the reference group, so the percentage point difference is expressed in relation to this group.

As we can see, in all countries those individuals with tertiary education were by far the group most likely to report trusting others. And in almost every country, those with post-secondary non-tertiary education were more likely to trust others than those with primary or lower secondary education. The OECD's report Education at a Glance (2015) provides similar descriptive evidence for other social outcomes.

The conclusion is that adults with higher qualifications are more likely to report desirable social outcomes, including good or excellent health, participation in volunteer activities, interpersonal trust, and political efficacy. These results hold after controlling for literacy, gender, age, and monthly earnings.

OECD_Education_Trust

Do countries that spend more public resources on education tend to have better education outcomes?

Education outcomes are typically measured via 'quantity' output (e.g. years of schooling) and 'quality' output (e.g. learning outcomes, such as test scores from the Programme for International Student Assessment – PISA).

The following visualization presents three scatter plots using 2010 data to show the cross-country correlation between (i) education expenditure (as a share of GDP), (ii) mean years of schooling, and (iii) mean PISA test scores.

At a cross-sectional level, expenditure on education correlates positively with both quantity and quality measures; and not surprisingly, the quality and quantity measures also correlate positively with each other.

But obviously correlation does not imply causation: there are many factors that simultaneously affect education spending and outcomes. Indeed, these scatterplots show that despite the broad positive correlation, there is substantial dispersion away from the trend line – in other words, there is substantial variation in outcomes that does not seem to be captured by differences in expenditure.

Edu_OutcomesVsExpenditure

Does cross-country variation in government education expenditure explain cross-country differences in education outcomes?

The following visualization presents the relationship between PISA reading outcomes and average education spending per student, splitting the sample of countries by income levels.

It shows that income is an important factor that affects both expenditure on education and education outcomes: we can see that above a certain national income level, the relationship between PISA scores and education expenditure per pupil becomes virtually nonexistent.

Average reading performance in PISA and average spending per student

Several studies with more sophisticated econometric models corroborate the fact that expenditure on education does not explain well cross-country differences in learning outcomes. 25

School inputs

Each education system is different, but improving teacher quality is often more effective in improving learning outcomes than increasing the number of teachers per pupil.

A vast number of studies have tried to estimate the impact of classroom resources on learning outcomes.

The following table summarizes results from the systematic review in Hanushek (2006). 26 In this table, the left-hand side summarizes results from econometric studies focusing on developing countries, while the right-hand side presents evidence from the US (where studies have concentrated extensively).

We can see that for all listed inputs and across all countries, the share of studies that have found a positive effect is small – in fact, the majority of studies find either no effect or a negative effect. This clearly does not mean that these classroom resources are not important, but rather that it is very difficult to know with confidence when and where they are a binding constraint to improve learning outcomes.

A first conclusion, therefore, seems to be that context and input mix are fundamental to improving outcomes – even in developing countries where the expected returns to additional resources is large across the board.

Taking the ratio of positive to negative effects detected in the literature as a proxy for what tends to work best, we can derive a second conclusion from the table: spending more resources on better teachers (i.e. improving teacher experience and teacher education) tends to work better to improve learning outcomes than simply increasing the number of teachers per pupil. This seems to be true both in developed and developing countries.

This last conclusion is consistent with the main message from the OECD's report Does money buy strong performance in PISA? , which points out that countries that prioritized the quality of teachers over class sizes performed better in PISA tests. 27

This is is also consistent with a recent high-quality study on the impact of teacher quality on test scores using data from the US, which suggests that improvements in teacher quality can causally raise students’ test scores. 28

Hanushek_Supply_Interventions

Remedial teaching can yield substantial improvements in learning outcomes

Education in low-income countries is particularly difficult because there is substantial heterogeneity in the degree of preparation that children have when they enter school – much more so than in high-income countries.

Evidence from policy 'experiments' in developing countries suggests remedial teaching, in the form of assistants teaching targeted lessons to the bottom of the class, can yield substantial improvements in learning outcomes.

The following visualization summarizes the effects of four different policy treatments within the so-called Teacher Community Assistant Initiative (TCAI) in Ghana – this is an initiative that evaluated four different such remedial teaching interventions. 30

The units in this figure are standard deviations of test results. The first two sets of estimates correspond to the test-score impacts of enabling community assistants to provide remedial instruction specifically to low-performing children, either during school or after school. The third set of estimates corresponds to test-score impacts of providing a community assistant and reducing class size, without targeting instruction to low-performing pupils. The last set of results corresponds to testing the effect of training teachers to provide small-group instruction targeted at pupils’ actual learning levels.

As we can see, while all interventions had a positive effect, the lowest impacts – across all tests – come from the non-targeted 'normal curriculum' intervention that reduced class sizes, and from the intervention that provided training to teachers on how to engage in targeted remedial teaching themselves. This suggests that the improvements in outcomes were caused by the combination of targeted instruction and TCAs who, unlike teachers, were specifically dedicated to this purpose. These results are consistent with findings from across Africa, suggesting that teaching at the right level causes better learning outcomes in a cost-effective way. 31

TCAI_RemedialTeaching_JPAL

Are pay-for-performance teacher contracts an effective instrument to improve learning outcomes?

We have already made the point that the bulk of education expenditure goes specifically towards financing teachers. We have also pointed out that improving teacher quality may be a particularly good instrument to improve teaching outcomes. This leads to a natural question: are pay-for-performance teacher contracts an effective instrument to improve learning outcomes? A growing body of literature in the economics of education has started using randomized control trials (i.e. policy 'experiments') to answer this question. Glewwe and Muralidharan (2016) provide the following account of the available evidence:

"Results suggest that even modest changes to compensation structures to reward teachers on the basis of objective measures of performance (such as attendance or increases in student test scores) can generate substantial improvements in learning outcomes at a fraction of the cost of a "business as usual" expansion in education spending. However, not all performance pay programs are likely to be effective, so it is quite important to design the bonus formulae well and to make sure that these designs reflect insights from economic theory." 33

The conclusion is that well-designed pay-for-performance contracts are a cost-effective instrument to boost test scores; but this does not mean that they are necessarily effective at achieving other – perhaps equally important – objectives of time spent in school. In simple words, it is possible that pay-for-performance yields 'teaching to the test'.

Other incentive mechanisms, such as community-based monitoring of teachers, have been proposed as an alternative. Glewwe and Muralidharan (2016) also provide a review of the – somewhat limited – available evidence on such alternative incentive mechanisms. 34

Household inputs

School attendance and student effort are responsive to incentives.

Demand-side inputs are as important as supply-side inputs to produce education. Attending school and exerting effort are perhaps the most obvious examples: without these inputs, even the best-endowed schools will fail to deliver good outcomes.

The table summarizes information on different demand-side investments that have been shown to successfully improve quality and quantity outcomes. More precisely, this table gathers evidence from randomized control trials in developing countries, as per the review in Glewwe and Muralidharan (2016). The reported figures correspond to positive/negative significant/insignificant estimates across a set of available experimental studies (bear in mind some studies estimate more than one effect – e.g. by measuring outcomes at several points in time).

As we can see, the evidence suggests interventions that increase the benefits of attending school – such as conditional cash transfers – are likely to increase student time in school. And those that increase the benefits of higher effort and better academic performance – such as merit scholarships – are likely to improve learning outcomes. 35 .

Glewwe2016_DemandInterventions_RCTs

Targeting health problems can be a particularly cost-effective way of increasing school attendance

In many low-income countries, health problems are an important factor preventing children from attending school.

The following visualization presents a comparison of the impact that a number of different health interventions have achieved in different countries – together with some non-health-related interventions that serve as references. The height of each bar in this graph reflects the additional school years achieved per hundred dollars spent on the corresponding intervention; so these estimates can be interpreted as a measure of how cost-effective the different interventions are. 37

We see that treating children for intestinal worms (labeled 'deworming' in the chart) led to an additional 13.9 years of education for every $100 spent in Kenya; while a program targeting anemia (labeled 'iron fortification') led to 2.7 additional years per $100 in India. These interventions seem to be much more cost-effective in improving test scores than conditional cash transfers, free school uniforms, or merit scholarships. 38

Of course, ranking these interventions is not trivial since most programs achieve multiple outcomes – indeed, we have already discussed that remedial teaching is generally effective to increase test-scores, although here we see a particular instance where it had no impact on school attendance.

Nevertheless, health interventions seem to be particularly interesting, since they lead to substantial achievements in both education and health outcomes. 39

CEA_SchoolParticipationRCTs_JPAL

How important are pre-school investments?

The environment that children are exposed to early in life plays a crucial role in shaping their abilities, behavior, and talents. To a great extent, this is what drives large and remarkably persistent gaps in education achievement between individuals in the same country, but in different socioeconomic environments. Cunha et al. (2006) provide a detailed account of the theory and evidence behind this claim and discuss its implications for the design of education policies.

In the chart, we see the impacts of the Perry Preschool Program – a flagship experimental intervention study, designed to test the impact of preschool education on subsequent education outcomes. 41

The chart shows disadvantaged children participating in the preschool program (the 'treatment group') had higher grades and were more likely to graduate from high school than the reference control group. Moreover, they spent substantially less time in special education. Other programs have similarly shown evidence of very large and persistent returns to early education interventions.

Cunha2006_Preschool_Impact

Interactive Charts on Education Spending

See the Wikipedia entry on compulsory education for a table of the ages of compulsory schooling around the world.

As per estimates from Adam Szirmai, (2015) The Dynamics of Socio-Economic Development .

As per estimates of Gini coefficients for the distribution of school years in Crespo Cuaresma, J., KC, S., & Sauer, P. (2013). Age-specific education inequality, education mobility and income growth (No. 6). WWWforEurope.

As per estimates reported in Steer L. and K. Smith (2015), Financing education: Opportunities for global action . Center for Universal Education.

As per 2015 enrolment estimates from the NCES.

An article from the Huffington Post highlights this point, including interesting visualizations documenting the important role that federal funding plays in reducing expenditure inequalities.

Lindert, Peter H. Growing public: Volume 1, the story: Social spending and economic growth since the eighteenth century . Vol. 1. Cambridge University Press, 2004.

Lindert, Peter H. Growing Public: Volume 1, the story: Social spending and economic growth since the eighteenth century . Vol. 1. Cambridge University Press, 2004.

Bear in mind that the estimates from the National Center for Education Statistics are not broken down by source of funds. Rather, they show expenditure by type of institution – which is not equivalent, since public institutions may spend private resources, and vice versa.

In 2010, high-income countries spent 6721 US PPP dollars per primary school pupil. Low-income countries, in contrast, spent 115 US PPP dollars per pupil (UNESCO EFA Global Monitoring Report 2014).

Jesus Crespo Cuaresma, Samir K.C., and Petra Sauer (2013) – Age-Specific Education Inequality, Education Mobility and Income Growth . WWWforEurope working paper; Working Paper no 6.

Data from Petra Sauer (2016) – The Role of Age and Gender in Education Expansion . Working Paper.

Strictly speaking, for this spending pattern to be truly progressive there must be subsidies or income-contingent loans to guarantee that low-income students can also access tertiary education and reap the private benefits from this type of investment.

The OECD provides country-specific figures. However, there is relatively little variation across OECD countries in this respect. This is explained by near-universal enrolment rates at these levels of education and the demographic structure of the population.

This is a stylized fact of OECD education spending. In all the OECD countries, the share of spending devoted to the compensation of teachers is by far the largest component of current expenditure. Moreover, expenditure on teachers' compensation is larger at the combined primary, secondary, and post-secondary non-tertiary levels of education than at the tertiary level. See Table B6.2 in Education at a Glance (2015) for details on the breakdown of current expenditure across all OECD countries by education level.

Welch, F., & Hanushek, E. A. (2006). Handbook of the Economics of Education, Two Volumes. North Holland.

Steer L. and K. Smith (2015), Financing education: Opportunities for global action . Center for Universal Education. Available Online from the Brookings Institution

The share of development assistance going to sub-Saharan Africa has decreased as a whole – from 55 percent in 2002 to 40 percent in 2013 –, but as we note the drop specifically for primary education has been steeper.

Steer L. and K. Smith (2015), Financing education: Opportunities for global action . Center for Universal Education.

The conclusion from these figures is that, while public spending does reduce education inequality in low-income countries, remaining inequalities could be further reduced by shifting resources towards lower levels of education. This evidently does not mean that resources should be shifted – low-income countries and aid donors may have other objectives apart from reducing inequality. But the case for reducing inequality at the bottom is very strong, and some studies suggest that returns to education at the primary level might be higher than at post-primary levels in low-income countries (for a discussion of the vast literature on returns to education, and the ongoing debate on the validity of estimates, see Heckman, J. J., Lochner, L. J., & Todd, P. E. (2006). Earnings functions, rates of return and treatment effects: The Mincer equation and beyond. Handbook of the Economics of Education, 1, 307-458. ).

That positive externalities justify government intervention in the provision of education is essentially an efficiency argument. The logic is that individuals may not spend enough on education because they fail to internalize the positive effect that their education has on other people. But there are, of course, also equity arguments to justify government intervention in the provision of education – for instance, reducing inequality in education may be of intrinsic value, or may be instrumental in reducing inequalities in other outcomes.

As per the source notes: "Percentage-point difference reflects the relative change of reporting to trust others compared to the reference category. For example, in Norway, the percentage of individuals with tertiary education reporting to trust others increases by 20 percentage points compared to someone who has upper secondary or post-secondary non-tertiary education. Similarly, after accounting for literacy proficiency, the percentage of individuals with tertiary education increases by 16 percentage points compared to someone who has upper secondary or post-secondary non-tertiary education."

Data on expenditure corresponds to 2010 total government education expenditure across all levels, as a share of GDP (source: World Bank Education Statistics). Data on PISA scores corresponds to 2010 mean average test scores across categories – mathematics, reading, and science (source: OECD PISA). Data on years of schooling corresponds to 2010 mean years of schooling for the population aged 15 and over (source: Barro Lee Education dataset)

Does money buy strong performance in PISA? - OECD. Available online here .

For a discussion of the evidence supporting this claim, see Hanushek, E. A., (2006). School Resources. Handbook of the Economics of Education, 2.

Hanushek, E. A., (2006). School Resources. Handbook of the Economics of Education, Volume 2. Elsevier.

This claim is clearly only descriptive since there are many underlying variables that simultaneously drive teacher characteristics and student outcomes in any particular country. Indeed, most of the available evidence on whether teacher quality and quantity matters is difficult to interpret causally, as it is hard to find instances where teacher quality/quantity varies exogenously. A recent study concludes on the topic: "teachers vary in many ways, but we found no high-quality studies that have examined the impact of teacher characteristics on student learning or time in school" (source: page 696, Glewwe, P. and Muralidharan, K. (2016) Improving Education Outcomes in Developing Countries: Evidence, Knowledge Gaps, and Policy Implications . Handbook of the Economics of Education, Volume 5. )

Chetty, Raj, John N. Friedman, and Jonah E. Rockoff. 2014. “Measuring the Impacts of Teachers I: Evaluating Bias in Teacher Value-Added Estimates.” American Economic Review, 104(9): 2593-26

Hanushek, E. A., (2006). School Resources. Handbook of the Economics of Education, 2.

Further details in Innovations for Poverty Action, 2014. I mplementation Lessons: The Teacher Community Assistant Initiative (TCAI) .

For further details, see: Glewwe, P. and Muralidharan, K. (2016) Improving Education Outcomes in Developing Countries: Evidence, Knowledge Gaps, and Policy Implications . Handbook of the Economics of Education, Volume 5. Elsevier. (Link to working paper)

Innovations for Poverty Action (2014). Implementation Lessons: The Teacher Community Assistant Initiative (TCAI) .

Glewwe, P. and Muralidharan, K. (2016) Improving Education Outcomes in Developing Countries: Evidence, Knowledge Gaps, and Policy Implications . Handbook of the Economics of Education, Volume 5. Elsevier.

They conclude that "evidence on the impact of monitoring on time in school is scarce and not encouraging...[while] the evidence of the impact of monitoring on student learning is only somewhat more encouraging"

See Glewwe and Muralidharan 2016 for further details on the underlying policy interventions, plus further evidence and discussion of results

Glewwe, P. and Muralidharan, K. (2016) Improving Education Outcomes in Developing Countries: Evidence, Knowledge Gaps, and Policy Implications . Handbook of the Economics of Education, Volume 5. Elsevier. (Link only to working paper)

Bear in mind that the reported gains in school years are a measure of the total impact of the program across the treated population, rather than impact per treated student. Further information on cost-effectiveness analysis is available from the source of the graph.

Further details on all interventions available in: Dhaliwal, I., Duflo, E., Glennerster, R., & Tulloch, C. (2013). Comparative cost-effectiveness analysis to inform policy in developing countries: a general framework with applications for education . Education Policy in Developing Countries, 285-338.

For an analysis of the literature on the impacts of mass deworming see: Croke, Kevin, Joan Hamory Hicks, Eric Hsu, Michel Kremer, and Edward Miguel. 2016. “ Does Mass Deworming Affect Child Nutrition? Meta-analysis, Cost-effectiveness, and Statistical Power .” Working Paper.

Dhaliwal, I., Duflo, E., Glennerster, R., & Tulloch, C. (2013). Comparative cost-effectiveness analysis to inform policy in developing countries: a general framework with applications for education . Education Policy in Developing Countries, 285-338.

More specifically, the Perry preschool 'experiment' consisted of enrolling 65 randomly selected black children in a pre-school program, and comparing their outcomes later in life against those achieved by a control group of roughly the same size. The treatment consisted of a daily 2.5-hour classroom session on weekday mornings and a weekly 90-minute home visit by the teacher on weekday afternoons to involve the mother in the child's educational process. More information and details on the intervention are available in Cunha et al. (2006).

Cunha, F., Heckman, J. J., Lochner, L., & Masterov, D. V. (2006). Interpreting the evidence on life cycle skill formation . Handbook of the Economics of Education, 1, 697-812.

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A big education fight stands in the way of a Pa. budget deal

The Pennsylvania Capitol building in Harrisburg.

Spotlight PA is an independent, nonpartisan, and nonprofit newsroom producing investigative and public-service journalism that holds power to account and drives positive change in Pennsylvania. Sign up for our free newsletters .

How much money to spend on Pennsylvania’s public education system has become a key barrier to a budget deal as lawmakers launch a barrage of talks ahead of the June 30 deadline.

Leaders in the split legislature say there are potential compromises on other key topics, including overhauling the state’s permitting process, making college cheaper, and creating new tax breaks.

But deciding how much money to spend on K-12 education remains an obstacle to closing a deal. Democrats who want to increase spending point to decades of funding inequality between rich and poor public school districts, while Republicans who want to curb costs warn of financial calamity if spending increases too quickly.

Lawmakers have to overhaul Pennsylvania’s funding system for basic education, following a judge last year ruling that the status quo is unconstitutionally inequitable. The commonwealth is also flush with cash, with $14 billion in reserves that have continued to grow this year.

Budget negotiations kicked off in February when Gov. Josh Shapiro, a Democrat, made his annual pitch to the legislature. In it, he called for $48.5 billion in spending, an 8% increase from last year, and proposed that much of the new money should flow to the state’s K-12 education system. That spending would be covered using $3 billion of the state’s $14 billion in cash reserves, Shapiro proposed.

In a state that has historically run deficits , the idea raised alarm bells among legislative Republicans. Heading into the final stretch, state Senate Republicans’ main goal is keeping spending under control, Majority Leader Joe Pittman (R., Indiana) told reporters last week.

“We don’t have a fixed number in mind,” Pittman said last week. “What our focus is on [is] maintaining expectations, maintaining a reasonable growth of spending that allows us to be able to make sure that the taxpayers are protected.”

While some education issues, like adding more dollars for school construction, have bipartisan backing, Pittman said his goal is making sure the state doesn’t use up its reserves within the next three years.

That puts the state Senate at loggerheads with House Democrats, who called for new education funding for years when they were in the minority and are now determined to use their narrow majority to notch a victory on the issue. The 2023 state court ruling that found Pennsylvania underfunds public education in poorer districts has given their push extra weight.

Democratic lawmakers and the Shapiro administration authored a report earlier this year that proposes setting a baseline amount of per-student spending that increases based on factors like poverty and level of English proficiency within a district.

The report estimated it would cost $5.4 billion over the next seven years just to bring each district up to the new standard, alongside billions in additional dollars for property tax relief, school construction, teacher training, and school mental health resources — among other programs.

A bill that would implement that plan, and that includes changes to the way districts reimburse cyber charter schools that could save districts millions of dollars, passed the state House with bipartisan support earlier this month.

Sustaining such spending would quickly drain Pennsylvania’s cash reserves. But a University of Pennsylvania report released last week found that the benefits of increased education spending would outweigh the cost to taxpayers by boosting graduation rates and leading to “improved individual earnings, health, economic productivity, and reduced crime and government dependency.”

“We’ve been making the point that Pennsylvania pays a huge price, and has been paying it for literally decades, by failing to adequately fund public education,” state House Majority Leader Matt Bradford (D., Montgomery) told Spotlight PA of the study.

Closed-door negotiations are ongoing, but insiders say that if lawmakers can agree on an education spending number, the rest of the trades that will make up the deal should fall into place.

Lawmakers say there is room for compromise on reducing the cost of higher education, updating the state’s business permitting process, and reducing taxes.

State Senate Republicans have advanced a package of bills that would offer scholarships to those who choose certain in-demand career paths, like computer science and nursing . Bradford added that he hopes to add elements of Shapiro’s higher education plan to find a deal.

“I think there is common ground about the need to make college more affordable, but also retain Pennsylvania students,” Bradford said.

Republicans’ longtime push to rewrite how state regulators issue permits may also bear fruit this year.

The state Senate passed a bill last year that would require agencies to set internal timelines for each permit request. Under the measure, the permit would be automatically approved if a requester didn’t get a response by those deadlines.

Democrats and environmental groups have traditionally opposed such efforts, arguing the practice could lead to more pollution and potentially threaten funding tied to enforcing federal environmental laws. But Shapiro has tried to speed up the permitting process within his administration, and Bradford said last week that he’s been “hearing out” the state Senate on its bills amid talks.

“We believe a government that is efficient is in everyone’s best interests,” Bradford said.

Finally, tax policy appears to be a potential bargaining chip. Responding to Shapiro’s spending plan, state Senate Republicans passed a $3 billion tax cut plan in May with Democratic support, arguing that Pennsylvania’s good financial position should be a sign to reduce taxes rather than increase spending.

Their bill would slightly lower the state’s flat income tax. The benefits of the plan would be small and would skew toward higher earners, the liberal Pennsylvania Policy Center said in a brief. According to the group’s data, the wealthiest 1% of taxpayers would save an average of $5,400 a year while the bottom 20% would get back just about $20.

Last week, Pittman said the state Senate’s proposal was an attempt “to do something within the world of taxation to be dynamic in encouraging growth and investment,” and that he welcomed House Democrats’ counterproposal.

Bradford told Spotlight PA he is willing to look at tax cuts as part of a budget deal. He also argued that the best way to get money into working people’s pockets would be a state version of the earned income tax credit , a federal program that gives a tax break to people under certain income levels .

A bill that would create such a program passed the state House last year but has lingered in the Senate.

The deadline for a deal is Sunday. Both chambers have scheduled voting session days through the weekend, which will likely be filled with closed-door negotiations, boisterous public rallies, and late-night votes.

The stakes of missing the deadline are low at first. While an on-time budget holds symbolic value for lawmakers in the middle of a key election year, a delay of a few days or even a week isn’t a big deal for government operations.

The state is bound by statute to pay its workers, cover debt payments, and continue many other critical government functions even without a budget. However, last year’s delayed budget — which wasn’t approved until December — showed that within weeks , the lack of funding can constrict the operations of county governments, libraries, and other core services supported by public money .

Pittman and Bradford have insisted that a ticking clock won’t make them change their approach.

“The test by which we judge the product is what is in it,” Bradford said.

Chicago promises that laid-off teachers and staff will get paid through next school year

Facing budget deficit, Chicago vows to guarantee pay for laid-off workers

Michigan lawmakers pass state school budget with more money for mental health support

After reports of a tentative plan to slash funding for mental health alarmed educators earlier this week, legislators finalized a budget with more funding for such programs.

Randi Weingarten says teachers are ‘frustrated’ with NYC’s reading curriculum mandate

“It became much more about the performative aspects of saying the curriculum is being implemented as opposed to the real support that teachers need,” Weingarten said.

Here are the 25 Philadelphia public schools piloting year-round school this fall

Mayor Cherelle Parker stressed the pilot won’t significantly change the academic calendar, won’t be mandatory, and won’t disrupt collective bargaining agreements.

Schools can’t wish away the need for DEI officers

School districts are eliminating diversity and equity roles. We’re not ready for the fallout.

Michigan school leaders shocked by tentative state school budget agreement that could lead to big cuts

A potential state school budget plan floated by lawmakers Wednesday could mean massive cuts to mental health funding, layoffs, and other cuts.

budgetary allocation to education

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Budget allocation and financial incentives

International benchmarks recommend that governments spend at least 15% of public expenditure and 4% of their gross domestic product (GDP) on education (GPE, 2019). Many education systems in developing countries fall short of these thresholds, and the outlook is not encouraging considering the growing youth populations and the COVID-19 crisis which has resulted in declining available revenues, aid, and household contributions (Al-Samarrai and Benveniste, 2021). Not spending on education per child remains too low in low-income countries, but recent increases in public education spending have had little impact on educational outcomes (Al-Samarrai and Benveniste, 2021). There is, therefore, an urgent need to mobilize more resources for education and, perhaps more importantly, to finance education more equitably and efficiently in order to improve the quality of learning.

Promising policy options

Mobilize additional resources for education through domestic sources

Increasing funds for education is indispensable if quality and access to education goals are to be met. It is estimated that low-income countries would need to double their total share of national income devoted to education to achieve goals similar to SDGs by 2030 (Al-Samarrai and Benveniste, 2021). Given the decreasing levels of aid to education and the need for sustainability, governments will need to mobilize domestic sources to generate additional funds for education. Many of them have the potential to increase their share of the budget allocated to education, for instance, by redirecting public funds from other sectors if they are used in a way that disproportionately benefits the rich and produces distortions in the economy (e.g., subsidies in energy) (Al-Samarrai and Benveniste, 2021). However, the weight of education in the national budget is ultimately the result of a decision-making process reflecting the priorities of the government; therefore, ministries of education will have to advocate for education among other national priorities knowing that it can benefit other policies for socioeconomic development (UNESCO and IIEP-UNESCO, 2012).

Increasing national revenues for education can also be achieved by widening the tax base, in particular by eliminating harmful taxes, fighting against tax evasion, and raising tax compliance (Al-Samarrai and Benveniste, 2021; GCE, Education International, and ActionAid, 2016). Another range of options concerns the diversification of sources, notably from the private sector. For example, allowing the private sector to finance tertiary education in SSA (e.g., through co-financing and co-management with the industry of vocational/technical training; provision of loan and scholarship programs) would enable to shift the limited public funds to priority areas (UIS, IIEP-UNESCO, and UNESCO-BREDA, 2011).However, greater private sector involvement needs to be carefully regulated with particular attention to preserving transparency and equity (UIS, IIEP-UNESCO, and UNESCO-BREDA, 2011).

Integrate policy, planning, and budgeting

Often, budgetary decisions diverge from the planning cycle because their respective preparation may involve different people, and the budget is often oriented towards a short-term perspective covering a one-year period as opposed to longer-term planning (UIS, IIEP-UNESCO, and UNESCO-BREDA, 2011; UNESCO and IIEP-UNESCO, 2012). Yet, the divergence between policy, budget, and planning is among the most important contributors to poor budgeting outcomes in developing countries (UNESCO and IIEP-UNESCO, 2012). In contrast, “integrated  policy,  planning,  and  budgeting  is  fundamentally  about  having  expenditure programmes that are driven by policy priorities and disciplined by budget realities” (UNESCO and IIEP-UNESCO, 2012: 115).

To establish the link between policy, planning, and budgeting, more and more countries have resorted to medium-term expenditure frameworks (MTEFs) to increase the predictability of funds and the criteria of funding decisions (UNESCO and IIEP-UNESCO, 2012). These frameworks “allow for a more efficient resource allocation aligned with the government’s goals, and they link the annual budget to multi-year policies”, besides serving as a tool for dialogue and consensus between the stakeholders involved (e.g., ministry of education, ministry of finance) (Buonomo Zapaleta, 2018; OECD and Asian Development Bank, 2019: 66).

MTEFs often come along with program-based budgeting, further reinforcing the link between planning and budgeting. Unlike traditional line-item budgeting, program-based budgeting allows testing the feasibility of different policy options and estimating the funds necessary for the selected policies. With this approach, policymakers can develop financial models that integrate all education sub-sectors to ensure coherence across them as well as cohesion across the different ministries involved (UIS, IIEP-UNESCO, and UNESCO-BREDA, 2011).

Please consult this booklet for a guide on the costing and financing of safety, resilience, and social cohesion initiatives.

Ensure efficient budget allocation

Beyond the availability of financial resources, perhaps a more important question is how they are used . Constraints on raising additional funds for education render the efficient use of the limited available funds even more critical. Due to differences in spending efficiency, two countries may reach different outcomes for a similar amount of spending per child. Two main factors account for inefficiencies: (i) the use of funds is not aligned with learning objectives and equity; (ii) funds are not allocated as intended or do not reach schools (Al-Samarrai and Benveniste, 2021).

Improving the efficiency of the use of funds requires that, in the first place, realistic educational goals are identified, trade-offs are made, and strategies are selected based on their financial feasibility and sustainability, considering the aims of the education sector and the needs of each educational level (Buonomo Zapaleta, 2018; Jourde, 2016). Secondly, as discussed above, the alignment between planning and budgeting should allow better consideration of learning in the budgeting process; this could be achieved by, for instance, using learning-related indicators for budgeting as done in education plans (Al-Samarrai and Benveniste, 2021). As the evidence base on policy and decision-making is growing, policymakers can draw on evaluations conducted on interventions aimed at improving learning to identify the strategies that will make the best use of funds (Al-Samarrai and Benveniste, 2021). Finally, to determine whether funds are used as intended and reach schools, Public Expenditure Tracking Surveys (PETs) , which are audits of financial flows, are one of the tools that can be used to measure the efficiency of public expenditure and identify potential leakages (Poisson, 2016).

Ensure equitable budget allocation

Spending inefficiencies resulting from redirecting education funds to purposes other than the intended ones disproportionately affect disadvantaged children and households (Al-Samarrai and Benveniste, 2021). Efficiency and equity can go hand in hand and improving the efficiency of budget allocation can generate more equitable outcomes (Al-Samarrai and Benveniste, 2021). One straightforward way for budget allocation to play a redistributive role would be to allocate more funds to those facing disadvantages (GCE, Education International, and ActionAid, 2016).

In OECD countries, there are two approaches to do so: (i) providing additional funding through the main allocation mechanism, for instance, by including certain parameters (e.g., special needs, refugee/immigrant status, socioeconomic background) in the funding formula; (ii) providing targeting funding through other ways external to the main allocation mechanism (OECD, 2017). The experience of OECD countries suggests that, although the latter option allows better steering and monitoring of the funds, the multiplication of such targeted programs can become excessively complex and costly to handle. On the other hand, including equity-related parameters in the main allocation mechanism is comparatively simpler but requires adequate accountability to ensure the funds benefit the target groups as intended (OECD, 2017).

The Brazilian Fund for the Development of Primary Education and Appreciation of Teachers (FUNDEB) is an example of a successful program which redistributes tax revenues raised at the state, federal and municipality levels to guarantee a minimum level of spending per student in all municipalities. The program not only narrowed the spending gap across municipalities but also resulted in improved enrolment and learning achievement and narrowed achievement gaps in poorer municipalities (Al-Samarrai and Benveniste, 2021).

Determine appropriate modalities for allocation

The level at which funds are allocated has different implications. On the one hand, a high degree of decentralization of funding allocation means that the particular needs of schools may be better taken into account, but risks of inequities may arise across schools. On the other hand, a high degree of centralization is more likely to guarantee equal treatment of schools but makes considerations for equity more difficult (OECD, 2017). In the context of growing school autonomy, many countries have implemented school grants. These funds transferred from the central level directly to schools aim to reduce the bureaucratic burden, limit leakages, allow schools to use funds for self-improvement as needed, and more effectively reach disadvantaged schools, among other benefits (IIEP-UNESCO, 2014). The features of an effective school grant policy include, among other things, precise and realistic goals, a formula and amount aligned with these goals, consideration of disparities, a participative decision-making process, and provisions for control and monitoring (IIEP-UNESCO, 2018).

A number of decisions also need to be made regarding the modalities through which funds are allocated, and these are important to ensure resources are distributed where they can make the most difference. The allocation of funds to schools commonly follows a funding formula, an indicators-based rule that determines the amount to allocate. The simplest formula would consist of allocating the same amount per capita, but funding formulae have grown in complexity. For instance, a needs-based approach relies on an analysis of individual schools’ needs to attain a specified level of quality of education (Levačić and Ross, 1999). Although a more complex formula may better address the diversity of beneficiaries than a simpler per-capita approach, it requires a larger set of reliable data and capacities for monitoring and may be less transparent and understandable to the public (LE Wales, 2009; OECD, 2017). While there is no single best funding formula, it is important that certain principles are followed:

  • “Aligning formulas with school system priorities and establishing evaluation criteria accordingly;
  • Adequately reflecting different per student costs of providing education;
  • Promoting budgetary discipline; and
  • Ensuring the periodical review of formulas to assess the need for adjustments.” (OECD, 2017: 25)

It must be noted that the way funds reach schools introduces incentives for their behavior (Hanushek, 2007). For example, schools have no incentive to reduce expenditure and use the funds efficiently when the formula is rigid (e.g. on a historical basis), when an authority covers most of the school expenditure directly, or when schools cannot redirect funds between different expenditure items or carry over unused funds from one year to another (Glover and Levačić, 2020; OECD, 2017). By contrast, a per capita lump sum can be an incentive for greater efficiency (Levačić and Ross, 1999).

Promote accountability and transparency

Budget transparency is fundamental to any mechanism of accountability and participation in budget allocation. At a country level, access to information on government budgets and allocations is often limited; yet public oversight helps evaluate whether resources have been used efficiently and equitably and fight against corruption. Open budgeting offers this possibility: it refers to “public access to budgetary information and processes related to education, with the opportunity for citizens to participate in the budgetary cycle” (Poisson, 2021: 1). Measures that facilitate transparency and accountability include the full disclosure of budget information on time to allow stakeholders to influence debates (GCE, Education International, and ActionAid, 2016), the definition of clear lines of responsibilities and the creation of independent audit mechanisms (UNESCO, 2017). At the school level, structures such as management committees and parent associations must be operational and have defined roles and capacities to oversee the use of funds ( How can we oversee the use of school grants? , 2017; OECD, 2017).

Build strong information systems and capacities

Budget allocation must rely on strong information systems that link policy with outcomes rather than solely focus on inputs (Al-Samarrai and Benveniste, 2021; UNESCO and IIEP-UNESCO, 2012). Such systems should allow assessing the cost-effectiveness of the possible strategies to achieve education goals, monitoring the use of funds, and measuring the impact of education investments (Al-Samarrai and Benveniste, 2021; Buonomo Zapaleta, 2016; UNESCO and IIEP-UNESCO, 2012). This requires collecting, processing, and utilizing comprehensive and credible data on education finance at all levels (including household expenditure and private provision of education services), student achievement, as well as research findings (UIS, IIEP-UNESCO, and UNESCO-BREDA, 2011). This, in turn, requires developing adequate capacities in budgeting, financial management, and performance reporting (Buonomo Zapaleta, 2016).

Other policy options

Consider the introduction of financial incentives with caution

Incentives are a special case of resource allocation (Plecki et al., 2006). Financial incentives encompass a wide set of measures aiming at influencing behaviors and preferences, often with the objective of improving the efficiency and equity of the education system. For instance, these can be used to address challenges such as teacher absenteeism or lack of qualifications or promote student attendance.

Performance indicators have been increasingly used in budget allocations as a means to establish a direct link between the budget and the outcomes, motivate recipients to pursue their objectives, and instill a culture of monitoring and evaluation throughout the system (UNESCO, 2017). Such an approach attributing rewards (or sanctions) to the delivery of desired outcomes has been implemented at different levels of both the supply side (government, service providers, teachers) and the demand side (parents, students) (UNESCO, 2017). This includes, among a variety of interventions, conditional cash transfers or programs granting teacher bonuses based on student results (Crehan, 2016; Masino and Niño-Zarazúa, 2015). However, evidence of their success is mixed.

While performance-based allocation mechanisms or “payment by results” have the potential to foster efficiency, accountability, and educational improvement, they also entail many potential unintended effects. Some of these effects include narrowing complex issues to imperfect indicators, exacerbating existing disparities, producing risk-avoiding behaviors (e.g., teaching to the test), and augmenting the unpredictability of fund flows (OECD, 2017; UNESCO, 2017).

Financial incentives should be introduced cautiously, considering the other factors at play. Evidence suggests that incentives need complementary policies to be successful (Masino and Niño-Zarazúa, 2015). For instance, cash transfers may be effective in relieving low-income families of the opportunity cost of education, but they are of little value if children do not have any education opportunities. Similarly, incentives can be used to foster teachers’ motivation, but the expected actions and results must be within their capacity (World Bank, 2018). Additionally, incentives do not need to be monetary or high-stakes to be effective. In Mexico, Punjab, and Pakistan, providing parents with information on the school’s relative performance has improved learning outcomes (World Bank, 2018).

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Why U.S. Schools Are Facing Their Biggest Budget Crunch in Years

Federal pandemic aid helped keep school districts afloat, but that money is coming to an end.

An empty school hall, lined with lockers.

By Sarah Mervosh and Madeleine Ngo

After several cash-flush pandemic years, school districts across the country are facing budget shortfalls, with pressure closing in on multiple fronts.

A flow of federal dollars — $122 billion meant to help schools recover from the pandemic — is running dry in September, leaving schools with less money for tutors, summer school and other supports that have funded pandemic recovery efforts over the last three years.

At the same time, declining student enrollment — a consequence of lower birthrates and a growing school choice movement — is catching up to some districts.

The result: Districts across the country must make tough decisions about cuts that will affect millions of families as soon as the next school year. The cuts, which many districts put off during the pandemic, could interrupt the recovery of U.S. students, who by and large have not made up their pandemic losses .

“I’m concerned that too many state and district leaders had their heads in the sand about the coming fiscal cliff, and now they are being confronted with really painful decisions,” said Thomas S. Dee, a Stanford University professor who has studied student enrollment trends.

The cutbacks span districts rich and poor. In the Edmonds, Wash., school district, an upper-middle income area north of Seattle, music classes were a target of district slashes , mobilizing a local foundation to raise more than $200,000 to try to save them. In Montgomery County, Md., an upscale suburb, the district is slightly increasing class sizes to save money.

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Department of Budget and Management

DBM: Education gets P924.7 billion in proposed 2024 national budget; Focused expenditure on subsidies, skills development, facilities enhancement

DEPED Budget 2024

Department of Budget and Management (DBM) Secretary Amenah F. Pangandaman applauded the progress of the country's economy, expressing confidence that the continuous decrease of the inflation rate will be sustained. Department of Budget and Management (DBM) Secretary Amenah F. Pangandaman reaffirmed the government's commitment to uplift the country's learning infrastructure and resources as she  highlights that the 2024 National Expenditure Program (NEP) earmarks an unprecedented P924.7 billion for the education sector. Secretary Pangandaman said that higher provisions for subsidies, facilities, learning materials, and skills training programs comprise the bulk of the 3.3 percent increase in the budget allocation for the education sector in the FY 2024 NEP, which the DBM recently transmitted to the House of Representatives for deliberations, following its approval by President Ferdinand R. Marcos Jr. "As mandated by the Constitution, education will remain our top priority with a total budget of P924.7 billion, equivalent to 16.0 percent of the FY 2024 NEP," the DBM Secretary assured. The President recognized the amount as a crucial expenditure that will benefit students as they resume full face-to-face classes after lifting the pandemic-induced state of public health emergency in the country. In his Budget Message, the President Marcos noted, "With 99.5 percent of our public schools now implementing 5-day in-person classes, this amount will fund significant investments in the education of over 28 million learners nationwide." The DBM Secretary said that of the total amount, P758.6 billion was allotted for the Department of Education (DepEd), while P31.0 billion for the Commission on Higher Education (CHED). She further revealed that P15.2 billion had been provided for the Technical Education and Skills Development Authority (TESDA) and P105.6 billion for the 116 State Universities and Colleges (SUCs), among others.   “Echoing the pronouncement of our President, alongside the strengthening of our economy, we will also invest heavily in human capital development through education, health, and social protection,” the Secretary stressed. *Subsidies for students* The subsidies consist of P51.1 billion for the UAQTE Program and an additional P41.0 billion for Education Assistance — of which P39.3 billion goes to DepEd’s Education Service Contracting, Junior High School and Senior High School (SHS) Voucher Program, and Joint Delivery Voucher Program for SHS Technical Vocational Livelihood Specialization. Meanwhile, P1.5 billion has been allotted for CHED’s Student Financial Assistance Program and P200 million for TESDA’s Private Education Student Financial Assistance Program. The Alternative Learning System will receive P632 million to support education, employment, and entrepreneurship programs for out-of-school youth above 15 years old who lack access to formal education. *Upgrading classrooms, facilities* The learning environment for students, including those in remote areas, will be upgraded via the Basic Education Facilities (BEF) Program, which has a P33.8 billion allocation for the construction of 7,879 new classrooms and technical vocational laboratories; repair and rehabilitation of 10,050 classrooms; procurement of 21,557 sets of school desks, furniture, and fixtures; electrification of 432 classrooms; and construction of 333 priority school health facilities, 3 medium-rise school buildings, 72 library hubs, 16 Inclusive Learning Resource Centers (ILRCs), and 4 Community Learning Centers (CLCs). Various infrastructure projects of State Universities and Colleges (SUCs) will receive P3.4 billion. *Learning tools and equipment* As for learning materials, P12.0 billion is allotted for textbooks and instructional kits aligned with the new curriculum for Kinder and Grades 1, 4, and 7. An additional P3.9 billion will fund the procurement of learning tools and equipment, including science and mathematics equipment and technical vocational and livelihood equipment. Further, the DepEd Computerization Program will also receive P8.9 billion to procure eLearning cart packages, laptops for teachers and non-teaching personnel, and various ICT equipment for the establishment of the MATATAG Center in 2024. "The education budget will support DepEd’s MATATAG Agenda for Basic Education through the provision of higher allocations for textbooks and other instructional materials amounting to Php 12.04 billion," the Budget Secretary said. *Focus on students’ nutrition* The DBM Secretary added that to improve children's learning reception and capacity, there is a need to address nutrition. "Furthering the cause of better nutrition for improved learning, we have also allocated Php 11.71 billion for the School- Based Feeding Program, among others," Sec Pangandaman underscored. *Special programs for the employment of students* To equip the Filipino youth with the necessary experience for employment and offer them access to skills training in accredited institutions, the Government Internship Program will receive a budget of P808 million. In addition, the Special Program for Employment of Students will get P829 million, and the JobStart Philippines Program, P205 million. Further, TESDA’s Supporting Innovation in the Philippine Technical and Vocational Education Training System, will be allotted P1.8 billion to modernize the country's technical and vocational education and training system. The TESDA’s Training for Work Scholarship Program will receive Php 3.2 billion, while the Special Training for Employment Program and Tulong Trabaho Scholarship Program will get Php 1.3 billion and Php 1.0 billion, respectively. Meanwhile, to tap the Bangsamore people's potential for productive employment and skills development, the Bangsamoro Autonomous Region in Muslim Mindanao (BARMM) will also be supported through the establishment of a Professional Regulation Commission’s (PRC) field office in the region with an allotted budget of P5 million. This will help address the needs of BARMM professionals, such as applications for initial registration of PRC licenses, PRC ID renewals, registration for professional examinations, requests for certification and authentication, and the holding of examinations.

budgetary allocation to education

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budgetary allocation to education

Nigeria Education Spending 1960-2024

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  • Immigration
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  • Military Size
  • Suicide Rate
  • Education Spending
  • Surface Area
  • Arable Land
  • Nigeria education spending for 2022 was 0.00% , a 0% increase from 2021.
  • Nigeria education spending for 2021 was 0.00% , a 0% increase from 2020.
  • Nigeria education spending for 2020 was 0.00% , a 0% increase from 2019.
  • Nigeria education spending for 2019 was 0.00% , a 0% increase from 2018.
Similar Country Ranking
Country Name Education Spending (% of GDP)
23.87%
21.85%
19.65%
18.90%
18.48%
17.09%
16.63%
16.62%
15.70%
15.45%
13.50%
13.18%
12.77%
12.39%
11.73%
10.79%
10.45%
9.40%
9.07%
6.64%
5.35%
5.04%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
0.00%
Nigeria Education Spending - Historical Data
Year Education Spending (% of GDP) Annual Change
2022 0.00% 0.00%
2021 0.00% 0.00%
2020 0.00% 0.00%
2019 0.00% 0.00%
2018 0.00% 0.00%
2017 0.00% 0.00%
2016 0.00% 0.00%
2015 0.00% 0.00%
2014 0.00% 0.00%
2013 0.00% 0.00%
2012 0.00% 0.00%
2011 0.00% 0.00%
2010 0.00% 0.00%
2009 0.00% 0.00%
2008 0.00% 0.00%
2007 0.00% 0.00%
2006 0.00% 0.00%
2005 0.00% 0.00%
2004 0.00% 0.00%
2003 0.00% 0.00%
2002 0.00% 0.00%
2001 0.00% 0.00%
2000 0.00% 0.00%
1999 0.00% 0.00%
1998 0.00% 0.00%
1997 0.00% 0.00%
1996 0.00% 0.00%
1995 0.00% 0.00%
1994 0.00% 0.00%
1993 0.00% 0.00%
1992 0.00% 0.00%
1991 0.00% 0.00%
1990 0.00% 0.00%
1989 0.00% 0.00%
1988 0.00% 0.00%
1987 0.00% 0.00%
1986 0.00% 0.00%
1985 0.00% 0.00%
1984 0.00% 0.00%
1983 0.00% 0.00%
1982 0.00% 0.00%
1981 0.00% 0.00%
1980 0.00% 0.00%
1979 0.00% 0.00%
1978 0.00% 0.00%
1977 0.00% 0.00%
1976 0.00% 0.00%
1975 0.00% 0.00%
1974 0.00% 0.00%
1973 0.00% 0.00%
1972 0.00% 0.00%
1971 0.00% 0.00%
1970 0.00% 0.00%
1969 0.00% 0.00%
1968 0.00% 0.00%
1967 0.00% 0.00%
1966 0.00% 0.00%
1965 0.00% 0.00%
1964 0.00% 0.00%
1963 0.00% 0.00%
1962 0.00% 0.00%
1961 0.00% 0.00%
1960 0.00% 0.00%

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Budget 2024: Modi government's allocations to education in five years

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Ahead of the 2024 Lok Sabha elections, Finance Minister Nirmala Sitharaman presented India's 15th interim budget .

In her 2024 budget speech, Sitharaman reflected upon the transformational reforms brought by the New Education Policy (NEP), increased enrollment of women in higher education and STEM courses in the last 10 years, and the infrastructural development of educational institutions.

"A large number of new institutions of higher learning, namely 7 IITs, 16 IIITs, 7 IIMs, 15 AIIMS and 390 universities have been set up", she said.

Additionally, the Finance Minister asserted that more medical colleges will be set up across India.

Sitharaman further said that there has been a growth in the education sector and the government plans to encourage and facilitate development in the sector.

Here we take a look at the Modi government's plans and budget allocation for the education sector of past five years

In the 2020 Budget, Rs 99,300 crore was allocated to the education sector and Rs 3,000 crore for skill development.

The government aimed at enabling External Commercial Borrowings and FDI for the education sector.

The government also announced the implementation of the NEP. The National Police University and National Forensic Science University were proposed for policing science, forensic science, and cyber-forensics.

The Ind-SAT programme was also proposed for Asian and African countries as part of the 'Study in India' programme.

In the 2021 Budget, Rs 93,223 crore was allocated for the education sector. The government announced the implementation of NEP in schools. It aimed to strengthen 15,000 schools through NEP implementation.

For higher education, legislation to set up the Higher Education Commission of India as an umbrella body with 4 separate vehicles for standard-setting, accreditation, regulation, and funding, was introduced.

In an effort to encourage higher education in Ladakh, the government had said that a Central University would come up in Leh.

In the 2022 Budget, Rs 54,874 crore was allocated for the sector. The government focused on the promotion of virtual education.

Virtual labs and skilling e-labs were set up to promote critical thinking skills and simulated learning environment.

High-quality e-content was developed for delivery through Digital Teachers.

Additionally, plans to set up a Digital University for world-class quality universal education with personalised learning experience was put forth.

In the 2023 budget, Rs 1,12,899 crore was allocated for this sector, making it the highest ever allocation for education.

The government set up a national digital library to make available quality books across different subjects, aiming to overcome learning losses suffered during the Covid-19 pandemic.

Additionally, district institutes of education and training were developed as vibrant institutes of excellence for teachers’ training.

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Analyzing the Education Budget of 2024-2025: Key Takeaways

The 2024-25 fiscal year promises to be a landmark period for education in India, with the Interim Budget, unveiled by Finance Minister Nirmala Sitharaman, demonstrating the government’s commitment to nurturing the nation’s educational foundations. A significant increase in budget allocations for the Department of School Education and Literacy (DoSEL) and the Higher Education Department underscores a strategic push towards improving the quality and accessibility of education across the country.

The Department of School Education and Literacy (DoSEL) has been granted an impressive allocation of ₹73,008.10 crore for the 2024-25 fiscal year, marking a robust increase of ₹4,203.25 crore over the previous year’s budget. This upward revision signals the government’s intent to strengthen the school education infrastructure and enhance learning outcomes for millions of students across the nation.

Equally noteworthy is the increment in the budget for the Higher Education Department, set at ₹47,619.77 crore for the coming fiscal year. This allocation represents a substantial rise from the ₹44,094.62 crore earmarked for the current financial year, highlighting the government’s focus on elevating the standards of higher education and fostering an environment conducive to research and innovation.

The cumulative budget for the Education Ministry now stands at ₹1,20,627.87 crore, indicating a significant increase from the previous year’s allocation of ₹1,12,898.97 crore. This growth in funding is poised to catalyze the transformation of the educational sector, making it more dynamic and responsive to the needs of the 21st-century learner.

Delving deeper into the specifics, the PM Schools for Rising India (PM SHRI) initiative has been a notable beneficiary, receiving ₹6,050 crore for the 2024-25 fiscal year. This increase from the previous year’s allocation underscores the government’s ambition to redefine the contours of school education in India, with PM SHRI schools set to become the exemplars of excellence in teaching and learning.

The budgetary enhancements extend to the Kendriya Vidyalaya Sangathan (KVS) and Navodaya Vidyalaya Samiti (NVS), with allocations of ₹9,302.67 crore and ₹5,800 crore, respectively. These institutions are crucial to the government’s vision of providing high-quality education to children from all sections of society, regardless of their geographical or economic backgrounds.

However, the National Council of Educational Research and Training (NCERT) saw a slight reduction in its budget, receiving ₹510 crore compared to ₹518.50 crore in the previous fiscal year. Despite this, the NCERT continues to play a pivotal role in shaping the educational curriculum and ensuring the dissemination of standardized learning materials across the country.

The Samagra Shiksha scheme, the cornerstone of the country’s school education system, has been allocated ₹37,500 crore, maintaining its critical role in providing holistic education to students from the primary to the secondary levels.

This year’s budget also shines a light on the Pradhan Mantri Poshan Shakti Nirman (PM POSHAN) scheme, which has seen its budget increase to ₹12,467.39 crore. This initiative is vital for ensuring that students receive the nutrition they need to stay healthy and focused on their studies, reinforcing the government’s commitment to nurturing both the minds and bodies of India’s future generations.

Also Read:  Early Childhood Education

In conclusion, the Education Budget of 2024-25 is a testament to the government’s unwavering dedication to elevating the educational landscape of India. By channeling resources into both school and higher education, the budget lays a solid foundation for a brighter, more educated future, ensuring that every student has the opportunity to thrive and contribute to the nation’s progress.

The percentage of the budget allocated to education can vary significantly by country and region. It typically depends on government priorities and economic conditions. In some countries, education may receive a substantial portion of the budget, while in others, it may be a smaller percentage.

Whether there will be a budget in 2024 depends on the specific country and its fiscal calendar. Most countries prepare annual budgets, so there will likely be a budget for the fiscal year 2024.

The allocation of financial resources to education refers to the amount of funding dedicated to educational programs, infrastructure, and initiatives within a given budget. This allocation varies from country to country and may change each fiscal year.

The specific budget allocation for education varies widely and depends on the country’s overall budget size, government priorities, and educational needs. Each year, governments determine the budget allocated to education based on these factors.

The budget share allocated to education is the portion of the overall budget dedicated to educational expenses. This share can fluctuate and is influenced by factors such as government policies, economic conditions, and the educational needs of the population.

Also Check: Best preschools in India

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House Republicans Propose Budget Cuts for Education Department

By  Katherine Knott

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House Republicans want to keep funding flat for the Pell Grant program and the Education Department’s Office for Civil Rights in fiscal year 2025 while slashing the budget for the Office of Federal Student Aid. Those are among other cuts rolled out in a spending plan released Wednesday.

The Labor–Health and Human Services appropriations subcommittee will meet this morning to review the legislation, which also includes the budgets for the Departments of Labor and Health and Human Services.

The spending plan is the opening salvo in what will likely be another contentious fight over how to allocate limited federal dollars. Lawmakers overseeing appropriations are technically bound by a deal reached in spring 2023 to avert a default on the federal government’s debt, which set spending levels for fiscal years 2024 and 2025. Under the deal, federal spending on nondefense programs can only increase by up to 1 percent. Democrats say that cap “will mean pain,” while Republicans argue that it’s needed to reduce federal spending.

While President Biden requested $3.3 billion more for the Education Department’s overall budget, the House Republican plan would give the agency $11 billion less than what it received in the current fiscal year.

Alabama representative Robert Aderholt, the Republican chair of the subcommittee, said in a statement that the bill “provides needed resources to agencies for administering vital programs, while also reining in reckless and wasteful spending,” and it “lays a strong foundation for the path to transparency and fiscal responsibility.”

The draft bill text is light on specifics about how exactly Republicans would dole out $72 billion in discretionary funds for the Education Department—and doesn’t go into detail on programmatic cuts they’ll call for. A budget summary says the legislation eliminates 17 programs, maintains 2024 funding levels for the Pell Grant—which Democrats hope to raise—and boosts funding for Gallaudet University, the nation’s oldest institution for Deaf and hard-of-hearing students.

According to the bill text, the Office of Federal Student Aid would get about $1.5 billion—some $529 million less than its current funding. The Biden administration had requested $625 million more for the cash-strapped agency that’s grappling with a number of projects , including next year’s Free Application for Federal Student Aid.

A summary from House Democrats on the appropriations committee says the Republican plan would cut funding for federal work-study programs in half. The GOP plan also guts a program that provides ​​subsidized childcare for low-income parents enrolled in a postsecondary program, as well as the research and infrastructure grant program for historically Black colleges and universities and other minority-serving institutions.

“Republicans are in the midst of a full-scale attempt to eliminate public education that makes the American Dream possible,” said Connecticut representative Rosa DeLauro, the top Democrat on the committee, in a statement. “This bill is dangerous and threatens programs and services that Americans depend on at every stage of their life.”

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Budget 2024: Experts push for higher allocation for education, reduction in GST for digital services

Union Budget 2024: A total outlay of school and higher education for the financial year 2024-25 is Rs 1,20,627.87 crore, a 6.84% increase compared to last year’s education budget.

Education sector continues to eye for 6% of GDP on education. (Image: Wikimedia Commons)

Anu Parthiban | June 26, 2024 | 05:53 PM IST

NEW DELHI: The Union finance minister Nirmala Sitharaman is expected to present her seventh consecutive Budget in the third week of July. With the ongoing controversy related to NEET, UGC NET exam 2024 paper leak and other irregularities, academics continue to expect 6% of Gross Domestic Product (GDP) allocation to the public education system.

This year, an interim-budget 2024 was presented in February due to the Lok Sabha elections. The finance minister highlighted that 43% female enrolment in STEM courses is one of the highest in the world. She also proposed plans to establish more medical colleges by utilizing existing hospital infrastructure.

A total outlay of school and higher education for the financial year 2024-25 is Rs 1,20,627.87 crore, a 6.84% increase compared to previous year’s education budget. The budget allocation of higher education and for department of school education and literacy have also been increased compared to last financial year.

6% of GDP on education

Kanak Gupta, group director of Seth MR Jaipuria Schools, said: “I’ve always maintained it that it would take a very brave initiator to plan and spend the allocated 6% of GDP on education as per the previous years’ budgets. The Union budget should be a roadmap that propels education towards endless possibilities of socio-economic progress. The last few years, the spend on education has been oscillating between 2.5% - 3% and it would be encouraging to see allocation towards education be upped to the more optimal 6% and beyond.”

On 6% of GDP on education, he said: “That essentially means that we as a country must be prepared to spend upwards of the previously allocated ~INR 132,000 crore on education by encouraging the setting up of new institutions, especially K-12 Schools.”

He also highlighted the need to encourage collaboration between academia, industry, and research institutions that can foster an ecosystem that supports cutting-edge research.

Also read Budget 2024: Why we still talk about education needing 6% of GDP

PwD students, teacher training

As of 2023, approximately 29% of children with disabilities in India were not enrolled in schools; research also indicates one in 68 students in India having certain learning challenges. I am expecting focus on the same as well.

“I am expecting massive impetus on comprehensive teacher training programs, continuous professional development, and innovative teaching methodologies

towards unlocking the potential of our educators. The budget should be a catalyst, allocating funds for research grants, fellowships, and the establishment of research centres,” he said.

Also read Budget 2024: Fund cuts, scholarships; a recap of budget 2023, impact on universities

Reduction of GST on digital services

Sumit Singhal, subject matter expert, SN Dhawan and CO LLP said: “The government should focus on increasing the education budget beyond 13% as it would provide continuous support for educational initiatives and further strengthen the educational framework. Such an increase would allow for more robust funding of critical programs, infrastructure development, and technological integration in schools and higher education institutions.

Singhal also urged the government to focus on “reduction in Goods and Services Tax (GST) rates on digital educational content and services. Lowering these rates would significantly enhance the affordability of online learning, which has become increasingly vital in today’s digital age. This measure would be advantageous for students by making high-quality educational resources more accessible and for edtech companies by fostering a more conducive environment for innovation and growth”.

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  • Telegram link to NEET, UGC NET paper leaks unsurprising: Experts

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IMAGES

  1. Federal Government Budgetary Allocation to Education (%) from 1994 and

    budgetary allocation to education

  2. Budgetary allocation to education sector

    budgetary allocation to education

  3. Annual Budgetary Allocation to Education of 20 Countries Sampled by the

    budgetary allocation to education

  4. Budgetary allocation to education sector

    budgetary allocation to education

  5. Budgetary allocation to education sector

    budgetary allocation to education

  6. Budgetary allocation to education sector

    budgetary allocation to education

COMMENTS

  1. PDF Fiscal Year 2023 Budget Summary

    To advance the goal of providing a highquality education to every student, the Budget includes - $36.5 billion for Title I, including $20.5 billion in discretionary funding and $16 billion in mandatory funding, which more than doubl es the program's funding compared to the 2021 enacted level. Title I helps

  2. Fiscal Years 2023-2025 State Tables for the U.S. Department of Education

    State tables are available for fiscal years 2023, 2024, and 2025. Funds included in the State tables are for Department of Education (Department) programs that allocate funds to States or local educational agencies using statutory formulas. The totals do not reflect all Department funds that a State receives.

  3. FY 2025 Budget for the entire U.S. Government

    President's FY 2025 Budget Request for the U.S. Department of Education. Today, the Administration released the fiscal year 2025 budget request for the U.S. Department of Education. "President Biden's budget raises the bar in education by investing in evidence-based strategies and partnerships that will improve outcomes from cradle to career.

  4. Public education funding in the U.S. needs an overhaul

    A funding primer. The American education system relies heavily on state and local resources to fund public schools. In the U.S. education has long been a local- and state-level responsibility, with states typically concerned with administration and standards, and local districts charged with raising the bulk of the funds to carry those duties and standards out.

  5. Fiscal Year 2024 Budget Resources

    2024 Education Budget Resources Raise the Bar: Lead the World Strategy. Using the Department's Raise the Bar: Lead the World initiative as a framework, this summary serves as an overview of the proposed allocations for President Biden's fiscal year 2024 budget requests for education. Raise the Bar framework (one-pager [PDF, 332KB].

  6. Budget execution in the education sector and why it matters

    Budget oversight can assist with the effective use of resources. Transparency, citizen engagement, and accountability in the budgeting process result in less corruption, more revenue, and better and more efficient public service delivery. More scrutiny of budget execution is a commitment to the global effort on transform education financing.

  7. Education Spending

    The second half of the 20th century marked the beginning of education expansion as a global phenomenon. Available data shows that by 1990 government spending on education as a share of national income in many developing countries was already close to the average observed in developed countries.2.

  8. Education spending has become a budget deal barrier in Pennsylvania

    Budget negotiations kicked off in February when Gov. Josh Shapiro, a Democrat, made his annual pitch to the legislature. In it, he called for $48.5 billion in spending, an 8% increase from last ...

  9. PDF STRATEGIC BUDGETING AT COLLEGES AND UNIVERSITIES May 2020 James A ...

    CBOs at public associate degree colleges or private baccalaureate colleges are most likely to indicate their college uses a zero-based budgeting model. One-third of CBOs use a responsibility-centered budget model, a decentralized approach in which individual units on campus receive and manage their own revenues.

  10. Government expenditure on education, total (% of GDP)

    Current education expenditure, primary (% of total expenditure in primary public institutions) Government expenditure per student, tertiary (% of GDP per capita) Current education expenditure, secondary (% of total expenditure in secondary public institutions) Download. CSV XML EXCEL. DataBank.

  11. Budget allocation and financial incentives

    Budget allocation must rely on strong information systems that link policy with outcomes rather than solely focus on inputs (Al-Samarrai and Benveniste, 2021; UNESCO and IIEP-UNESCO, 2012). Such systems should allow assessing the cost-effectiveness of the possible strategies to achieve education goals, monitoring the use of funds, and measuring ...

  12. Trend Analysis of the Nigerian Budgetary Allocation to the Education

    This paper presents a holistic trend of budgetary activities in Nigeria with a particular focus on the allocation to the Education sector using times series approach from 2009-2018.

  13. PDF The Future of Education in Nigeria: Budgetary Allocation as an Albatross

    The table above shows the trend of Federal budgetary allocation to education for the period 1999 to 2019. It is evident from above that the year 2011 had the lowest allocation of 1.69% of the total budget while the highest allocation was in 2008 with 13.00%. of the twenty years under review, only five years (1999, 2004, 2006, 2008 and 2012) had ...

  14. Why U.S. Schools Are Facing Their Biggest Budget Crunch in Years

    Sarah Mervosh covers education for The Times, focusing on K-12 schools. More about Sarah Mervosh Madeleine Ngo covers U.S. economic policy and how it affects people across the country.

  15. U.S. Department of Education Budget Office

    Welcome to the Budget homepage of the United States Department of Education (ED). Here you'll find a wealth of information about the President's FY 2025 Budget Request for ED, including a program-by-program description of the request. In Budget News, we track Congressional action on the Department's budget and keep you updated on other ...

  16. Department of Education Budget Tables

    This table provides a summary of discretionary funding for Department of Education programs by education level (elementary and secondary, postsecondary, and other programs) for fiscal years 2017, 2018 Annualized CR and the FY 2019 President's Budget. Summary of ED Mandatory Funds (last updated 10/03/2023) in PDF [23KB].

  17. PDF Preliminary Statement on the 2024 Education Budget

    10. Of the total allocation to education, GHC 2.7 billion, representing about 8% of the total education budget is allocated to the free SHS/TVET programme, compared to 11.7% in the 2023 main budget. The allocation of GHC 2.7 billion constitutes a 10% decline from the 2023 allocation of GHC 2.9 billion. In real

  18. DBM: Education gets P924.7 billion in proposed 2024 national budget

    Secretary Pangandaman said that higher provisions for subsidies, facilities, learning materials, and skills training programs comprise the bulk of the 3.3 percent increase in the budget allocation for the education sector in the FY 2024 NEP, which the DBM recently transmitted to the House of Representatives for deliberations, following its ...

  19. Michigan lawmakers approve $82.5-billion state budget for 2025 ...

    The budget's freezing of the K-12 per-pupil grant for 2025 at this year's level of $9,608 created a split with sectors of the public school education community that has been one of Whitmer's ...

  20. PDF Floor Report of The 2024-25 Budget

    prior budget allocations linked to now-vacant positions, are slated to cut nearly $400 million on an annual basis from the CDCR budget. The budget bill, as amended, states the intent of the ... Major Budget Act PreK-12 Education Actions For the 2024-25 Budget Year, projects TK-12 spending to be $135.7 Billion from all

  21. Nigeria Education Spending 1960-2024

    Nigeria education spending for 2019 was 0.00%, a 0% increase from 2018. General government expenditure on education (current, capital, and transfers) is expressed as a percentage of total general government expenditure on all sectors (including health, education, social services, etc.). It includes expenditure funded by transfers from ...

  22. Budget 2024: Modi government's allocations to education in five years

    Here we take a look at the Modi government's plans and budget allocation for the education sector of past five years. 2020-21. In the 2020 Budget, Rs 99,300 crore was allocated to the education ...

  23. PDF On Nigeria's Budgetary Allocations to The Education Sector (1960-2023

    budgetary allocations to the Education Sectors of some selected African countries (namely, Nigeria, Ghana, South Africa, Senegal, Kenya and Morocco) by their respective Federal Governments, from 1999 to 2021. A few descriptive analyses shall be employed in this study, especially the use of graphical representations to show the trends in the ...

  24. Analyzing the Education Budget of 2024-2025: Key Takeaways

    The cumulative budget for the Education Ministry now stands at ₹1,20,627.87 crore, indicating a significant increase from the previous year's allocation of ₹1,12,898.97 crore. This growth in funding is poised to catalyze the transformation of the educational sector, making it more dynamic and responsive to the needs of the 21st-century ...

  25. FACT CHECK: Did UNESCO ever recommend 26 per cent budgetary allocation

    Notwithstanding the revelation, the appeals by the participants during the last education retreat to the president to allocate up to 15 per cent of the 2018 budgetary allocation to education is ...

  26. House Republicans Propose Budget Cuts for Education Department

    While President Biden requested $3.3 billion more for the Education Department's overall budget, the House Republican plan would give the agency $11 billion less than what it received in the current fiscal year.. Alabama representative Robert Aderholt, the Republican chair of the subcommittee, said in a statement that the bill "provides needed resources to agencies for administering vital ...

  27. CSAC Statement on 2024-25 State Budget

    This agreement reflects the challenging budget landscape facing California. No one can deny that improving California's financial aid system is one of the state's best opportunities to remove barriers to higher education, train the skilled workers it needs, and drive long -term economic growth. It is financial aid that helps protect

  28. Budget 2024: Experts push for higher allocation for education

    A total outlay of school and higher education for the financial year 2024-25 is Rs 1,20,627.87 crore, a 6.84% increase compared to previous year's education budget. The budget allocation of higher education and for department of school education and literacy have also been increased compared to last financial year.

  29. U.S. Department of Education Budget News

    FY 2019 Congressional Action— On September 28, 2018 the President signed the Department of Defense and Labor, Health and Human Services, and Education Appropriations Act, 2019 (Public Law 115-245), which provides funding for the Department of Education through September 30, 2019.PDF [167KB] and MS Excel [2.05MB].. FY 2019 President's Budget Request —On February 12, 2018 President Trump ...

  30. PDF U.S. Department of Education

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