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Posts Tagged ‘Fringe Benefits’

EdSpendingFraser2021

Some things in education return, year after year, like clockwork. So the dawn of 2021 produced the latest iteration of the Fraser Institute’s perennial report on “Education Spending in Public Schools in Canada. Everyone in Canadian K-12 education attuned to public policy, from coast-to-coast, knows what to expect as regular fare from one of our most conservative, cost-conscious think-tanks.

Public spending, so the narrative goes, is invariably excessive, wasteful, and spread around without much focus on meeting targeted needs. Spending more on public education does not produce better student results and, in the case of the Maritimes, spending rises while student enrolments have declined over the past five years. Those regular monitoring reports also come complete with supporting statistics –in the form of data, bar graphs, and tables.

Flipping through Fraser Institute reports, you can almost hear provincial education ministers, superintendents, and educators muttering something to themselves: “Lies, damned lies and statistics.” That’s a rather snide comment about the persuasive power of statistics, and particularly the kind used to mount or defend weak claims and arguments. While often attributed to former British prime minister Benjamin Disraeli, Earl of Beaconsfield (1804-1881), the phrase originated much earlier and only came into popular usage from the 1890s onward.

That was the phrase that first popped into my mind when reading the recent Atlantic Canadian spinoff from the Fraser Institute report for 2021. “Spending on public schools in Maritime Canada on the rise, despite largest declines in enrolment nationwide.” So read the Nova Scotia media release produced by Tegan Hill and Alex Whelan. What, one might wonder, is new about that pattern?

A year ago, the Fraser Institute 2020 report on Education Spending was mostly a yawn because it did beat the same old drum. Spending on public schools was up by 9.2 per cent per student from 2012-13 to 2016-17, a five-year period, and student numbers had dipped a little, by from 2 to 3 per cent in the Maritime provinces. Looking closer at the numbers, however, those increases averaged 1.8 per cent a year overall, and, at most 2.4 per cent a year in Nova Scotia. Throughout the period, it might be added, Nova Scotia consistently ranked 7th among the provinces in per-student spending, reported at $13,135 per student in the final year, 2016-17. Student enrolment in N.S., over the final year, actually began to edge upward to 118,566, province-wide.

The most recent Fraser Institute report actually did say something new and that may get lost in the whole debate, waged – for the most part—by ideologues holding fast to fixed positions. Something began to happen in 2017-18 that changed the trajectory of education spending in Nova Scotia and, to a lesser extent, in New Brunswick.

EdSpendingFraserNS2021

Total spending on Nova Scotia public schools, the 2021 Fraser Institute Report found, increased from 2013-14 to-2017-18 by 19.0 per cent to $1.7 billion, an increase of $279 million. Student enrolment did drop slightly over the five years by 1.7 per cent, but that was not the big story. Instead of ranking 7th among the provinces in education spending per student, it now ranked fourth at $14,726 per student. That’s well above the national average of $13,798 in 2017-18.

More was being spent on Nova Scotia public education and student performance, measured on international, national, and provincial tests, has plateaued or slightly declined, like many other provinces. It’s difficult to be definitive because, since 2015-16, provincial tests have routinely been reformatted, postponed or cancelled altogether, making it difficult to reliably track student results. That’s a recurring pattern and one that renders problematic the usual claims of declining standards.

What’s really new in Nova Scotia is the recent cost drivers for education spending. Two major program initiatives with infrastructure costs, Inclusive Education ($15-million per year since 2017-18), and Pre-Primary Program expansion/completion (2016-17 onward), are factors and produce recurring expenditures, mainly in the form of new education sector jobs. From 2017-18 onward, some 449 new positions have been added in K-12 education.

Few question the wisdom of moving forward with Inclusive Education for learning challenged students and universal Junior Primary for 4-year-olds, and those cost pale in significance when considering the real cost drivers in the extraordinarily high recent Nova Scotia education spending increases, all in the pension, benefits, and contract services domains.

Human resources costs represent the largest share of total education expenses, but under the public sector wage restraints, salaries and wages remained at or below the cost-of-living. Supply and services costs, including contracted work, reached $394 million in 2017-18, representing 22,9 per cent of all expenditures. Together, the employer share of pensions and fringe benefits totaled $324 million, up significantly over the previous five years.

Pension and benefits costs incurred by the K-12 system are running well ahead of all other expenditures, averaging more than 10 per cent increases per year. Carrying a monumental provincial liability, defined benefit education pensions cost $91 million to sustain in 2017-18 (representing 5.9 per cent of all spending) and addressing the problem continually gets deferred by the government and the education unions. Back in 2017-18, employee fringe benefits, including retirement allowances, were 13.5 per cent of all expenditures, double the national average, and up 31 per cent over five years.

Capital spending in K-12 education is hard to track because so much of the procurement and spending is financed over long-term financing arrangements. Some provinces simply report the annual costs paid in principal and interest on long-term contracts, disclosing only the annual carrying costs to the system. In the case of Nova Scotia, the provincial budget for 2020-21 will absorb $265.6 million in costs for capital projects. The deferred financing will cover the cost of renovating 16 schools and for the purchase of 16 Public-Private Partnership schools from developers at the conclusion of 30-year lease agreements.

Conservative business and public policy tanks are prone to “cry wolf” when wading into the regular waves of government spending, particularly in K-12 education. It would be tempting to dismiss the Fraser Institute’s 2021 Education Spending report on similar grounds. That would be a mistake, given the recent surge on Nova Scotia education spending, commencing before we were all hit with the pandemic.

Why are education policy reports from business-oriented think-tanks like the Fraser Institute routinely ignored or brushed aside in Canadian K-12 education? Why does so much education reporting and analysis focus almost exclusively on trumpeting new programs proposed to meet every conceivable need and boasting of dozens of new hires? Do human resource costs in K-12 education escape critical scrutiny? Who’s monitoring and overseeing rising human resource costs, particularly pensions and benefits? Should such dollars be focused more on meeting student needs in the classroom?

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