Are low-cost private schools educating the poor sustainable?”
Low-cost private schools for poor children are indeed sustainable. Hundred of thousands of these low-cost schools in Africa, Asia and Latin America are already up and running and are managed by entrepreneurs, typically teachers, who have bootstrapped their way to four or six classrooms. Many of these are followers of Jesus, and Edify exists to see far more sustainable Christ-centered schools serving the poor.
Although it is hard to imagine that schools charging $5-$15 per month can cover all costs and provide a livelihood to the proprietor, they do. For example, take a classroom with 35 students each paying $7.50 per month. The revenue from each classroom is $262. Given that a teacher is often paid about $80 per month, the remaining $182 represents funds available for the bookkeeper, the janitor, the proprietor and making payments on a loan. Edify typically funds schools which already have 4 to 6 classrooms that are owned free and clear. The proprietor has more than sufficient cash flow to service a loan that will build several more classrooms (the typical cost of a classroom in Africa is $2,500-$5,000), build a computer lab, or buy a used bus to transport more children to the school.
Can you create a sustainable school in a poor area?
Surprisingly, there are already tens of thousands of sustainable low-cost private schools in slums areas throughout sub-Saharan Africa alone. As far as creating new schools in such areas, Professor James Tooley, the world’s foremost authority on low-cost private schools, operates a chain of low-cost private schools in slum areas in Ghana and India. Professor Tooley seems to have come upon the Wal-Mart model for low-cost private schools in the developing world. Students are offered a high quality education (well apportioned classrooms, properly trained teachers, a computer lab, uniforms, textbooks, meals and bus transportation) all for the low cost of $14 US Dollars per month.
There is a huge demand for such schools. When Tooley first opened enrollment at one of the schools in Ghana, the 400 seats were filled within a week, and another 100 children were put on a waiting list. Impoverished parents want their children to receive a good education, and they are willing to pay for it. Demand exceeds supply.
Although it seems hard to believe, the poor can afford and will pay school fees. For example, a mother who earns only two dollars a day and works six days per week will, on average, earn $50 per month. Combine this with the $50 per month that the father earns and the family has a gross income of $100 per month. Research shows that they will spend $20-$30 per month to educate two children. Parents know the value of education, and they will make great sacrifices to provide a better education for their children.
It is worth noting that “free schools” are often not free. Public schools almost always charge for uniforms, lunch, bus, books, “desk fees” and/or exam fees. The incremental cost to attend a low-cost private school may only be a few dollars more per month. This explains why more children in many developing countries attend low-cost private schools rather than public schools.
Are the schools located in urban areas, villages or both?
Both. The schools are found in central slums, poor suburbs, and villages.
How does the loan get paid back?
Edify works through existing Christ-centered lending institutions located in the countries we have selected. We carefully research these institutions to ensure that they are committed to Christ-centered transformation. We monitor them on an ongoing basis to ensure the transformation is occurring. The lending institutions generally have experience making loans to sustainable Christ-centered schools which serve the poor.
Edify makes interest-free loans to the lending institutions in-country. Their local loan officers identify Christ-centered schools, analyze the cash flow of schools, make loans, and collect repayments. The local lending institution charges interest on the loans to cover their costs related to making and collecting the loan. The principle is returned to the lending institution’s account dedicated for Edify loans. The money is recycled through loans to other schools which use the funds to expand.
What is the quality of the education?
Professor Tooley, author of A Beautiful Tree, has recently concluded a seven-year study on low-cost schools. The quality of education in the low-cost private schools is substantially higher than in government schools where teachers are unionized, cannot be fired and are often absent. The evidence for this conclusion was that children from low-cost private schools consistently scored higher on national, standardized tests than children from government schools. This fact was confirmed by the academically rigorous studies performed by Professor Tooley. There is much room, however, to improve the education quality further, and school proprietors are eager to receive guidance to make such improvements.
Can you track discipleship?
We believe it is possible to measure discipleship and Christ-centered character development. We have engaged a research firm to do this on an objective, independent basis. The Metrix Group has done research for numerous ministries in the developing world. Although it seems reasonable to expect that children who have at least three hours per week of Christ-centered teaching for 8 to 12 years will have been discipled better than children without this education, we wish to verify this by research. We also hope schools will provide opportunities for students to put their faith in action through sharing their faith, tutoring other students, and serving the elderly and disabled.
What do you measure?
A highly-respected research firm is in the process of determining what will be measured. We wish to identify a good proxy to measure how Christ-centered character is being developed in students as well as how they are putting their faith into action in their community.
We are also interested in tracking how Edify can assist a school to help students perform better on national standardized tests and learn life skills such as entrepreneurship and computers. Most importantly, we wish for all students to develop a relationship with Jesus Christ so that they, in turn, will disciple others.
What are your critical issues?
Our critical success factors are:
- Assisting school proprietors to implement good Christ-centered curricula effectively.
- Advising school proprietors on how best to increase school capacity and academic excellence.
- Raising grants to scale up so that we can finance the Christ-centered education of 1 million children (4,000 schools) by 2017, and 4 million by 2021.
- Identifying good lending institutions, committed to Christ-centered transformation and making loans to low-cost private schools.
- Recruiting outstanding staff at Edify overseas and in the US in order to scale up.
One of our supporters made the following observation — “Edify is somewhat counter-intuitive as most people don’t think of private schools as being self sufficient especially among the poor or even educating the poor.” Indeed, when we hear of a private school being built in the developing world, it is often at a high cost, perhaps in the range of $250,000-$1 million. It then requires donations of several hundred thousand dollars per year to pay teachers, administrators and other expenses. These schools typically graduate 40 to 80 students per year who receive an outstanding education.
It appears that the Lord is moving in a new and additional way. Given the fact that so many, low-cost private schools already exist, there is a terrific opportunity to scale up sustainable Christ-centered education for millions of impoverished children in the developing world.
Studies have shown that the highest correlation with poverty in developing countries is corruption. If corruption continues, the poor are likely to be still mired in poverty in 20 years and in 50 years. However, if we can develop Christ-centered character in a significant percentage of the well-educated people in a developing country, the culture of corruption will change to a culture of integrity.
Public schools have failed the poor. So the poor are now solving their own problem by educating themselves in a sustainable manner. Edify believes that it is possible to assist the poor in doing a better job of what some are already doing–expanding low-cost private schools that develop Christ-centered character.
Data shows that schools have an excellent track record in repaying their small-business loans. Therefore, $100,000 sent to the field today will build approximately 12 classrooms. However, because the money is recycled, the original $100,000 will have built 24 classrooms in the fourth year, 36 by the seventh year and 48 classrooms by the 10th.
Do the schools you serve require students to become Christians?
We fund schools that serve children of all faiths or no faith. Although all students will hear the gospel of Jesus Christ, none are required to convert to following Jesus Christ.