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B.C. Government Promotes Privatization and a Market Approach to Education

by Larry Kuehn

Submitted for publication in the Teacher newsmagazine, Nov./Dec. 2002 issue.

The B.C. Liberal government is reshaping public education through privatization and a market approach to education. Although the impact may now still be small, a number of policies put in place will have a profound impact on public education in the long term.

Welcome to School District No. ## Business Company!

Amendments to the School Act in Bill 34 in the spring of 2002 brought a new institution to the public schools in B.C.: the School District Business Company. Each school board now has the right to create a company to carry out business activities that would not be possible as a public body or that would expose the school district to financial liability.

The name is spelled out in the legislation: School District No. ## Business Company, with your district’s number in the place of ##. Two districts with a great deal of entrepreneurial experience—New Westminster and Vancouver—jumped almost immediately to establish their companies. When asked about why Vancouver had to rush into setting up its company without first studying the implications, board officials said it was to keep up with New Westminster, which had already created its company.

Boards may use their company to make profits to pay for educational programs. That could set up significant inequities as districts successful in marketing offer more programs than those that keep their focus on educating the students who live in their district. Selling educational programs to students overseas and providing consultants to other schools in Canada are two types of business likely to be undertaken.

Companies must have a board of at least three people, at least one of whom must be a board official or trustee. Boards are not supposed to transfer money to these businesses. If they transfer assets, such as teacher-developed learning resources to these companies, they must be for fair market value.

Offshore B.C. schools as profit centres

One school has been operating as a B.C. school in China, and now the province has chosen 20 more schools to offer the B.C. curriculum. The new schools will be in the People’s Republic of China, Taiwan, and Japan.

The offshore schools must employ teachers with B.C. certificates, meet the learning outcomes of the B.C. curriculum, and have the students write the required B.C. exams. The ministry will certify and inspect the schools and issue Dogwood diplomas to graduates. To meet requirements, the school can work with school district companies, other B.C. companies, independent schools, or consultants.

They are private schools with students whose families can afford to pay high tuitions. They are buying the Dogwood, which provides high status for the student and easier access to post-secondary education in B.C.

The (London) Times Education Supplement, August 2, 2002, ran an article pointing out the irony of B.C. public schools’ selling elite private education overseas to finance the public schools in B.C.

Open School is up for sale

Open School has been put on the market with a call for proposals for privatization. When Open School was created, it was given without cost all the materials developed for the ministry while it was a branch of the ministry. Last year, Open School earned a profit of $142,600 by selling course materials for distance-education students in B.C. and internationally.

International students as "cash cow"

Many districts have moved quickly to bring in international students, who pay high tuition and top up the district budget. In 2000–01, districts charged an average tuition of $10,000. On average, they spent $5,000 per student, leaving an average profit of $5,000. Lots of businesses would like to work on such a margin. The expenditures on those students are not for just a few extra teachers, but also for sending school administrators on expensive overseas recruiting trips.

Between 2000–01 and 2001–02, the number of international students jumped from 2,947 to 4,035. The revenue from international student tuitions totalled $40 million in 2001–02.

Some students as young as 9 or 10, speaking no English, are being put into classes, sometimes without ESL support. With the stripping of language from the collective agreement, the potential for even bigger profits is great. More students can be put into classes without contractual limits. That affects the learning conditions of not just the international students, but also the other students who have less of the attention of the teacher.

Distributed learning—competition for students... and their funding

For several years, the ministry allowed 18 school districts to run online distributed-learning programs for students being schooled at home rather than in classrooms. A cap of 2,200 students was placed on those programs, and the districts received funding of $3,500 for each of the students.

As of the 2002–03 school year, the lid is off those programs. Every school district is now free to run its own program. There is no cap on the number of students who can be enrolled in online programs. Each of the students brings to the school district the base funding of $5,308 each. Students can be enrolled in a district program no matter what district the student lives in.

This is creating a competition for students, with some districts offering incentives for students to sign up. The Gold Trail district, for example, is offering to pay parents $750 per student for learning resources and $250 for Internet connections. The Nechako E-bus has advertised that it provides a computer and Internet links to families who sign up with the program. Some of the Regional Distance Education Schools have reported that students in their programs have moved to other programs that offer more incentives to sign up.

Funding is determined by the number of students enrolled by September 30, so teachers in some of the programs have been told to focus on recruiting students so that there will be enough funding to pay for their positions. Since this is one of the few ways that a district can increase its funding, we can expect that the pressure to find new distributed learning students will increase. With student loads often 50 or more per distributed-learning teacher, some districts see making a "profit" on those students, even after giving a portion of the public funding to private individuals for learning resources, computers, and Internet links.

In the past, the distributed-learning programs primarily sought students who were being home schooled and not in the school system. Now, however, with deregulation, a district can recruit students from other distributed-education programs or from among students who would otherwise be attending regular classes in their own or other school districts.

With these new financial incentives, we could well see a rush by school districts to create new programs to keep from losing students and their funding. The situation could turn into another dot-com fiasco, where districts think they can whip together a program without first finding out if there is a real need or if distributed learning is really educationally sound for most students compared with participating in a classroom.

Who owns the teaching resources developed by teachers?

Ownership of teaching resources hasn’t been a big issue for teachers. We have shared things that work for us, borrowing from many sources and giving permission for use without formal agreements. Our work has, in effect, been part of a public commons.

With the commercialization of education that is taking place, questions of copyright and ownership are taking on a new importance. What has been a part of the commons has been privatized. When a teacher develops a resource for a distributed learning program, can the school board (or the "School District ## Business Company") sell that resource?

The answer is clear in a few cases—where the teacher was explicitly engaged to write something for the board to sell or where the teacher develops something on his/her own time for the specific purpose of selling it herself. But many real situations are somewhere in between; where the issues will have to be clarified over time.

Commodifying education moves it into the sphere of trade agreements

The General Agreement on Trade in Services (GATS) of the World Trade Organization covers education and all other services. The agreement as it exists has limited application to education, but negotiations to be completed by 2005 to expand the terms of the GATS.

What is considered trade in education? Four categories are defined by the WTO:

  1. Cross-border supply: service provided from one country into the territory of another country; e.g., providing education services through the Internet are a form of this type of trade.
  2. Consumption abroad: consumers such as students studying abroad, cross borders.
  3. Commercial presence: investment in service providers in another country, such as in a privatized Open School.
  4. Presence of natural persons. Individuals travel to another country to provide a service on a temporary basis, such as B.C. inspectors travelling to China, Japan, and Taiwan to inspect B.C. schools.

Clearly B.C. is already engaging in or is about to embark on a number of these forms of trade in education. The implication is that the entire public education system will come under the trade rules. When a province adopts legislation to allow public bodies—school boards—to create private companies for international trade, it can hardly claim that it should have an exclusion for "services supplied in the exercise of governmental authority."

So what is the problem with education as international trade?

International exchanges can open up attitudes and develop cross-cultural understanding. People in the rich countries like Canada have a social responsibility to share in the development of the educational possibilities for the millions of children who lack access to even the most rudimentary primary education. Communication technologies-satellite television and the Internet-are creating experiences with media that are common across national borders.

Internationalism is not the problem. Commodification and privatization is the problem.

Positive forms of international cross-fertilization can be carried out on a basis other than trade. Experiences can be based on solidarity and support, rather than on commerce and profits.

Two particularly negative effects flow from moving public education into the realm of international trade. The first is the exacerbation of inequalities. When the funding of the education of British Columbia children and youth depends on the sale of services, then the resources available will depend on the entrepreneurial success of the district rather than on an equitable distribution of public resources. Creating elite private schools outside Canada will increase inequalities in the countries where the schools are set up.

The second negative is the loss of democratic control of our own education system. Trade rules trump democratic decisions. If a school district wants to give preference to local suppliers or say that curriculum must be developed by people who have taught in the province, that action could be declared an inappropriate restraint on trade and on the right of corporations from elsewhere to profit by supplying those goods and services.

We have already seen a trade tribunal set up under NAFTA decide that a city in Mexico does not have the right to stop a dump of toxic wastes from a U.S.-based corporation on the borders of the city. In another case, a Canadian corporation is seeking damages for unrealized profits from a hazardous gasoline additive that California has banned. Such decisions are made by trade tribunals—which operate in secret—simply on the basis of trade rules, not on the basis of social justice or public health and environmental protection.

Commodifying education, making it a salable and tradable product, and privatizing its delivery lead us down that path. Maintaining education as a public good requires challenging provincial efforts to privatize. Further, it requires pressure on the federal government not to agree to provisions in the GATS negotiations that would broaden the coverage of education.

Public education is threatened when it faces cuts in resources that make the system less able to meet the needs of students and communities. But it is also threatened when ideological preference for market competition distracts it into profit-seeking rather than focussing on the needs of the students in its classrooms.

Larry Kuehn is director of the BCTF’s Research and Technology Division.

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