Financing the modernisation of education 1990-2007

At the request of the House of Representatives, the Court of Audit has investigated the financing of three operations to modernise secondary education in the Netherlands. Our audit was part of a wider investigation into the modernisation of education carried out simultaneously by a parliamentary inquiry committee. As requested by the House, we considered only the budgeting of funds for the modernisation operations, their expenditure by the ministry and schools, and the average cost per pupil in secondary education. We also compared the average cost per secondary school pupil with the average cost abroad.

Conclusions

The government initially wanted all three modernisation operations to be budget neutral. It later changed its mind on all three counts following criticism chiefly from schools and the House of Representatives. We concluded from our audit that the financial planning of the modernisation left a lot to be desired. The amounts budgeted were determined chiefly by the available budget margin. This less than systematic approach also had consequences at the schools. Financing was ad hoc and incidental and even when funds were allocated over several years, decisions on a particular scheme were often taken on an annual basis. Furthermore, the schools had to account to the ministry only in broad lines about their expenditure of funds in general and not specifically about the modernisation funds.

Recommendations

We recommended that the ministry pay more attention in operations such as these to the financial underpinning of policy. More thought should be given to both the initial and the long-term costs at school level. The ministry should adopt a more systematic approach and provide greater assurances on financing in the medium term. Finally, schools should account separately for the specific-purpose funds allocated to them.

Response of the minister

The minister made one comment on our findings. He noted that the decisions taken on school financing meant that 100% assurance could no longer be given on the completeness and accuracy of the figures. He observed therefore that the amounts disclosed could be no more than a reasoned estimate and warned that far-reaching conclusions should not be drawn on the figures.

We rightly noted, according to the minister, that the modernisation operations were carried out partly during a period of budgetary constraint and it was therefore no more than logical that financial planning was determined largely by the available budget margin. He agreed with us, though, that this should not mean that there was no long-term underpinning of the cost of the modernisation operations. There certainly should be, and our recommendation on this point, according to the minister, was in line with current developments. The minister also agreed that a more systematic approach needed to be taken so that schools had greater assurances on additional financing in the medium term.

We appreciate the minister's prompt response to our draft report and we are pleased that he responded positively to most of our recommendations.