This report examines trends in public spending and privatization of education in ASEAN countries post-COVID-19, with a focus on the impact of fiscal strategies on education. Publicly funded education is a critical element in achieving fiscal justice and providing equal opportunities for citizens. This study aims to explore the management and allocation of education spending, privatization trends, and progress in education equity in the ASEAN region.
The analysis shows that education spending as a percentage of GDP has declined in 8 out of 10 ASEAN countries, even before the pandemic. Despite a slight recovery between 2020 and 2022, education spending has not returned to pre-2013 levels. Only Malaysia meets the UNESCO threshold of 4% of GDP for education spending. The bulk of spending is directed towards recurrent expenditure, with teacher salaries being a major component.
The COVID-19 pandemic has caused many governments to reduce education budgets to focus on other pressing needs. However, Malaysia and Indonesia show different trends, with Malaysia increasing education spending, while Indonesia has decreased. In addition to the decline in public funding, there has been an increase in the privatization of education, which has the potential to worsen the inequality of access to quality education.
All ASEAN countries are in the lowest group on the Commitment to Reduce Inequality Index (CRII), with Myanmar, Cambodia and Laos being the lowest globally. Despite progress in some countries, fiscal challenges remain, including low tax progressivity and unequal distribution of resources. Key recommendations include a budget focus on education and the need for uniform education data reporting standards to improve education budget allocation and monitoring across ASEAN.
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