ADDIS ABABA UNIVERSITY

COLLEGE OF EDUCATION AND BEHAVIORAL SCIENCE

{ DEPARTMENT OF
EDUCATIONAL PLANNING AND MANAGEMENT
 
MODULE TITLE: The Economics and Financing of Education  
MODULE CODE: EDPM – 614

 
 Group Assignment II

Name of Group Participants

1. {
Dereje Tadesse ------------ID.No. GSR/5959/11
2. Girma Aboye------------ID.No.GSR/2023/11
3. Fekadu Likisa -------- ID.No.GSR/0628/11
1. Read the Education and Training Policy of Ethiopia (TGE,
1994) and
A. Describe the major problems with the indicators identified by the
document
 Our country's education in general is entangled with
complex problems of relevance, quality, accessibility and
equity.
 The objectives of education do not take cognizance of the

society's needs and do not adequately indicate future

direction.
 The absence of interrelated contents and mode of
presentation that can develop student's knowledge, cognitive
abilities and behavioral change by level, to adequately enrich
problem-solving ability and attitude, are some of the major
problems of our education system.
 Inadequate facilities, insufficient training of teachers,
overcrowded classes, shortage of books and other teaching
materials, all indicate the low quality of education provided.
 The gross participation rate of primary education is below

22% of the relevant age cohort. Of these a large number

discontinues and relapse to illiteracy. The disparity among
regions is high. illiteracy is an overall problem of the society.
Opportunities for high school education and technical and
vocational training are limited to big towns. Higher
education institutions are found only in very few regions.
they are overcrowded and their research capacity is very low.
 The necessary infrastructure to provide relevant quality

education to the rural population, which is over eighty-five

percent of the population of the country, is at an insignificant
level of development.
 B. What is the implication of these problems when
examined from the perspectives of economics of
education?
The implication of these problems are:
 The problem of equal distribution of economy

among competing individuals and groups.

 Difficulty to get the required Human capital/

educated man power to bring the desired economic

growth and economic development.
 It brings the problem of migration.

 Difficulty to cope up with the new information and

technology.
2. Read ESDP I, II, III and IV.
A.Describe their thematic focus and explain their implications for the education
sector development. Do not forget explaining their link with poverty reduction
strategy’ PASDEPs and other economic development programs plus the
national and international policy direction?
ESDP I
 Realizing the fact that education plays a significant role in reducing

poverty and enhancing the development of society, the

Government of Ethiopia gives high priority to the education sector.
However, low enrolment, high gender and regional disparities and
low quality of education have been the major the major issues to be
solved in the Ethiopian Education System for a long period of time.
In order to redress those underserved situations, the Government
of Ethiopia has adopted, along with its Education Sector Strategy
drawn up in 1994, a new Education and Training Policy (ETP)
which outlined the mission and goals for the education system of
Ethiopia. The ETP focuses on Universal Primary Education by the
year 2015 by increasing access to education opportunities and
improving quality, quantity and efficiency of education.
 To achieve the long-term goal of Universal Primary Education by the
year 2015, the Government of Ethiopia implemented a 5-year
Education Sector Development Program (ESDP 1997/98-2001/02) to
improve the following issues in collaboration with the donor
organizations.
i. Improvement of low enrollment ratio (to raise primary school
enrollment ratio to 50% by 2000)
ii. Enhancement of educational services in remote areas and for girls (to
raise the enrollment ratio of girls to 45%)
iii. Provision of high-quality education (to distribute textbooks to
individual students, upgrade school facilities, enhance teacher’s
training)
iv. Rationalization of the inefficient educational system (to optimize the
school operations by reviewing educational program, and to decrease
dropouts and repeaters)
v. Securing of adequate fund
vi. Enhancement of the planning/management capabilities in each
region
ESDP II
 Produce good citizens who understand, respect and defend the
constitution; students who respect democratic values and human
rights; develop attitude for research and work and capacity to solve
problems, develop skill in various professions and with a sense of
citizenship to participate in and contribute to the development of
community and the nation.
 Realize the goal of achieving universal primary education through

expanding access and coverage of primary education with equity

and improved quality.
 Meet the quantitative and qualitative demand for trained manpower

at all levels in order to respond to the socio-economic development

needs, bearing in mind the needs of poverty reduction, the strategy
of agricultural- development- led- industrialization of the country
through vertical integration of the secondary, technical- vocational,
and higher education programs.
 Build the capacity within the education system for sustainable development of
the system through organizational capacity building for program
implementation, continuous innovation, and quality leadership at various
levels.
 EFA goals are treated within ESDP II in an integrated manner, through a sector
wide approach.
 ESDP II pays special attention to the question of equity.
 Attention is also paid to improving access to education for the children of
highly marginalized and pastoralist communities, to narrowing the urban rural
gap in access to education, and to reducing the regional disparities.
 Adult and non-formal education is also treated in ESDP II, as an integral part
of the strategies for achieving the goals of universal primary education and
education for all.
 Non-formal education modes are proposed within the program as an alternative
to school based primary education for out of school children and for very
sparsely populated and remote communities, of course, with options for
graduates of these programs to join the regular schools. Adult and non-formal
education programs are also seen as vehicles for improving the occupational
and life skills of the general adult population as part of the poverty alleviation
strategy.
ESDP lll
 General Education

 Produce responsible and competent citizens

 Increase access to educational opportunities at primary level, to achieve UPE by the

year 2015.
 Improve the quality of education,

 Enhance efficiency and use resources wisely.

 Address equity issues by narrowing the gap between male and female, among regions

and rural and urban areas,

 Provide increased access to Adult and Non-Formal Education in order to combat the

problem of adult illiteracy.

 Increase access to quality secondary education based on the demand of the economy for

trained human power at middle and higher level and the intake capacity at the tertiary
level.
 Technical Vocational Education and Training

 Provide relevant and demand-driven education and training that corresponds to the

needs of economic and social sectors for employment and self-employment through
labor market assessments and by re-orienting and re-focusing the existing TVET
system.
 Assure the quality of TVET training programs.

 Develop demand-oriented curricula based on Occupational Standard and Occupational

 Training Standard for non-formal and formal education and training by involving

experts from the world of work.

 Tertiary Education
 Develop responsible and competent citizens who meet the quantitative and
qualitative demand for a high-level trained labor force based on the socio-
economic development needs of the country.
 Ensure democratic management and governance in Higher Education system.
 Set up a cost effective, efficient and results-oriented system in order to develop
an appropriate range of modern and effective human resources management
procedures and practices.
 Develop the volume, quality and relevance of research and consultancy
services which are necessarily directed to the needs of the country.
 Producing qualified human power in sufficient numbers in order to meet the
needs of the economy at all levels will require the maintenance of greater
vertical integration among programs ranging from secondary to technical and
vocational education and training (TVET) to all levels of higher education.
 There is a need to prove that education is a powerful force in combating the
spread of HIV/AIDS by making concerted efforts for the realization of the
education sector response to HIV/AIDS strategy outlined in the February 2004
national seminar.
ESDP IV
 A strong improvement in student achievement through a consistent

focus on the enhancement of the teaching/learning process and the

transformation of the school into a motivational and child‐friendly
learning environment;
 The development of programs which help attract the unreached and the

disadvantaged into school and ensure that they complete basic

education. Without a significant decrease in the drop‐out rates in the
early grades (which also demands the promotion of Early Childhood
Education), universal primary enrolment will never be achieved.
 A renewal of adult education with a specific focus on Functional Adult

Literacy. The number of illiterates has remained high and, for reasons of
justice as well as economic and social development, efforts need to be
strengthened to build partnerships against illiteracy.
 The strengthening of the capacity for knowledge creation, in particular

in the domain of science and technology, through an expansion of access

to TVET and to higher education without sacrificing quality.
 Further improvement of the effectiveness of the educational

administration at all levels, through capacity development and the

creation of motivational work environments.
 ESDP IV also foresees a major program in adult education, the objective
of which is to allow all adult illiterates to participate in a two year
Functional Adult Literacy (FAL) course. A Master Plan for Adult Education
has been drafted and it is expected to guide efforts in this sub‐sector
during ESDP IV implementation.
 Special support programs will be developed for the emerging regions
and to allow for a steep and swift decrease in pupil drop‐out rates.
 Student repetition and drop‐out rates decreased through higher quality
of teaching and learning
 Learning outcomes improved at primary and secondary schools
through the reinforcement and better coordination of key quality inputs
and processes.
 Equitable access to quality primary and secondary education expanded
amongst the four emerging regions in which the gap between the
emerging regions and other regions reduced, by giving special support
to the education of emerging regions’ children (both female and male)
 Capacity of educational management bodies at various levels
strengthened
 All adult illiterates will participate in a two‐year FAL program.
 Quality of TVET (formal and non‐formal) improved at all levels and
made responsive to the needs of the labor market
 comprehensive, integrated, outcome based and decentralized TVET
system for Ethiopia established
 Number of rich/advanced Medium and small enterprises created
through the transferred technologies.
 A balanced distribution of higher education opportunities throughout
the country through the widening of access to higher education, in
particular to science and technology
 Increased student learning, personal growth and improved
employability through high quality higher education and relevant
professional mix
 Eight crosscutting issues aim to focus attention on the situation of
specific groups and on issues of particular importance: Capacity
development for improved management; Gender and education;
Special needs education; HIV/AIDS and education; Environmental
education and protection; Education in emergencies; School health and
nutrition and Drug and substances abuse prevention in education.
ESDP V
 ESDP V will involve a concentrated focus on a few select

important policy priorities (for example, improving teacher

quality, developing core foundation skills, reducing high
drop-out and repetition rates and ensuring relevance of
middle- and higher-level training) rather than on trying to
spread limited resources across too many priorities.
 Makes clear the expected changes in the structure of the

economy over the next five years and the implications for
education and training, as a main source of supply of human
capital to the emerging economic and productive sectors.
 The priorities of ESDP V are also consistent with those of

regional and international agreements, such as Education for

All, the Sustainable Development Goals and the Convention
on the Rights of the Child.
 Strong leadership and direction, and effective cooperation
and communication across all education levels and amongst
ministries in multi-sectoral efforts, will be essential.
 In order to bring about the improved outcomes that we

expect within the education sector over the next five years,
we need to identify and expand those approaches that have
been successful. Focus is essential if every child is to achieve
at least the core foundation skills needed to contribute to
achieving a lower middle income economy for Ethiopia.
 Capacity development for improved management

 General education: quality

 General education: access, equity and internal efficiency

 Adult and non-formal education

 Technical and Vocational Education and Training (TVET)

 Higher education
 B. Identify how finance related issues were handled (ESDP I, II, III, IV) and to be
handled (ESDP V).
 Financial planning and implementation has been improved from time to time.
As a result better financial utilization capacity was developed as we go from
ESDP I – ESDP V. But still efforts need to be exerted to further improve
capacity in timely closing regional accounts.
 For example :
 In ESDPII the total financial requirement of ESDP-II was Birr15.1 billion.
During the preparation of this document disaggregated data were not
available to analyze the financial resources allocated to education from
different sources and their utilizations.
 However, from the total Government budget figures, it was learned that the
total budget allocation to education during ESDP-II (2002/03 –2004/05) was
Birr12.5 billion, which is 83% of the total requirement of the program. Since
the community contribution in expanding education was significant (though
there is no proper documentation), the total amount of funds that were
made available to ESDP-II is much higher than what is indicated in the
budget.
 At the Woreda level the education sector is receiving the largest amount of
the block grant varying from 33 – 60% of which the largest part is for teachers’
salaries, whereas the non-salary budget per student is small.
 In ESDP III the total financing requirements were estimated at around 53
billion birr. These finance were estimated to cover 85% of program costs.
 The model generated a financing gap of around 2.4 billion birr in 1998 but this
fell to zero in 2009/10. The gap was expected to be covered by bilateral and
multilateral partners. It was anticipated that expenditure on salaries would fall
to around 60% of recurrent spending.
 The draft Public Expenditure Review (March 26, 2010) shows the overall
resource envelope for education rose to 9.6 billion birr in 2000 (around two
billion less than the ESDP III cost projection). This represented around 4% of
GDP in 2000 (down from 4.7%). Of that around 46% was spent on primary, and
9.4% on secondary, 3.7% on TVET and over 40% on higher education.
 The university expansion program has driven up higher education spending.
Primary spending held up, while both secondary and TVET have been receiving
less funds than indicated in ESDP III.
 There has also been a continued squeeze on non‐salary recurrent costs which
continue to be only around 5% of recurrent expenditure for primary schools.
 Contributions from donors however appear to have exceeded the expectations
set in the ESDP III planning period.
 In ESDP IV the cost of the further expansion and improvement of the Ethiopian
education system under depends strongly on the norms and standards related to
the use and the cost of human and material resources.
3. Describe and explain the supply and demand factors in education. Do not forget to
relate your answer/s with the context of Ethiopian schools.
 The demand for education

 Refers to how much (quantity) of product or service is desired by buyers.

 The quantity demanded is the amount of a product people are willing to buy at a

certain price.
 The law of demand states that if all other factors remain equal, the higher the price of

a good, less people demand that good. The higher the price the lower the quantity
demanded. The amount of a good that buyer purchase at a higher price is less because
as a price of a good increases, so does the opportunity cost of buying that good.
 The demand for place in primary school will depend on a number of factors

 The price schools charge all other things being equal, the higher the price of schools

charge in the country X, the lower the demand for primary school place.
 The price of other goods and services that are complements to private primary school

education. The higher the price of complements, the lower the demand for primary
school places. Example of complements to primary education may be uniform, meals
and transportation.
 The price of other goods and services that are substitutes for private primary school

education. The higher the price of substitutes in country x, the lower the demand for
primary school places in that country. Examples of substitutes for secondary school
education might be apprenticeships, if craftsmen in the country charge families a
particular fee for providing apprenticeships to older primary school students.
 The opportunity cost of children’s time (oc) that is the value of the
child’s time if the child were to work instead of going to school. The
higher the opportunity cost of children’s time, the lower the demand
for primary school places.
 The number of families in the country (pop). Assuming that all families
have one child of primary school age, then the greater the number of
families in a country, the higher the demand for primary school places.
 The distribution of income among the families in the country. The
higher the average income of the families, the higher the demand for
primary school place.
 The supply of education
 Supply represents how much the market can offer.
 The quantity supplied refers to the amount of a certain good producers
are willing to supply when receiving a certain price. The law of supply
demonstrates the quantities that will be sold at a certain price. The
supply relationship is shows an upward slope. Producers supply more
at a higher price because selling a higher quantity at higher price
increase revenue.
Factors that determine the available places in the schools.
 The price that paid by families for a year of school education. The higher

the price, the higher the supply of the school places.

 The price the school owners must pay for inputs including teachers,

books, teaching materials, building rent, and so on (the price of inputs).

The higher inputs, the lower the supply of school places. In general,
there are three important determinants of the supply of education
services. These are:
 Time precedence

 Unity of supply

 Complementarily of the components.

Time precedence
 This pertains to providing in advance accommodation for the various

types of schools, and training teachers in sufficient number and quality

to meet the requirements. This is applied when there is a serious
shortage of resources. Time precedence in the supply of education
service implies also the preparation, on the base of demand projection,
of adequate accommodation, equipment, non-teaching staff, all of which
go to make up an education service.
Unity of supply
 The second factor affecting the supply of education service is its unity. When it

opens up the doors of elementary education to everyone and makes every efforts
to increase the school rate, the government has a duty to expand secondary school
and higher education. It does not lend itself a differential development of separate
levels. Too rapid expansion at one level tend to provoke, on one hand,
deterioration in the quality of services offered at that level. Means less qualified
teachers may have to be used, classroom will be cramped and equipment scarce,
and less gifted students.
Complementarily of the components of supply
 The supply of educational services is the complementarities of such components

as premises, teaching staffs, equipment, and non-teaching staff. All these

components have to be present in fixed proportions or at least in the proportion
which can vary only within narrow limits.
Interaction between supply and demand
 Supply and demand analysis examines the effect of a single change, holding

constant the other factors that affect the demand and supply (the ceteris paribus
assumption) in a given market. When supply and demand are equal the economy
is said to be at equilibrium. At this point the allocation of good is as it is most
efficient because the amount of goods being supplied is exactly the same as the
amount of goods being demanded. Thus, every individuals, firms or countries is
satisfied with the current economic condition.
4. Fiscal decentralization.
A. Explain the nature of educational financing in Ethiopia?
 Following fiscal decentralization in Ethiopia, regional and
local governments undertake planning and resource
mobilization for the education sector. As a result, over the
last decade, more than half of the national education
spending was administered by regional and local
governments (Figure 9). This demonstrates the government’s
effort in promoting universal access to primary education at
the grassroots level, and the implementation of targeted
interventions to close the existing regional, gender and
urban-rural enrolment differentials to achieve universal
primary education across the board. Improvements in access
to primary schools with innovations such as mobile schools
are helping to reach disadvantaged groups and children
living in remote rural areas.
 B. Who finances education in Ethiopia? Why?
 The national education system is financed through domestic funds
from the state budget, external funds received from bilateral and
multilateral donors, private sector investments and household
contributions.
 A portion of external financing to the education sector is directed
through off-budget channels, the amounts of which are
challenging to track. Hence this budget brief is limited to
analysing on-budget finances, and leaves out significant financial
resources channelled to the education sector through off-budget
donor resources, private sector investments and households’
contributions.
 Information on the sources of on-budget education sector
financing has been made available only for federal capital
expenditures. Regarding on-budget financing, domestic resources
cover the majority of the federal education capital expenditure,
while donor contributions (on-budget) to the federal Government
capital education expenditure have been rising from time to time.
 C. Describe and explain the essence free of fee education in
the context of Ethiopia
 The framework of the educational policy takes into account

the poverty of the country and the complex problems that

face the society. Thus, it aims to produce democratic-minded
and productive citizens who are capable of solving problems,
and are generally resourceful and creative.
 Primary school education contributes to the society at large

by empowering students with knowledge and skills to

improve their standard of living and to solve problems. Thus,
it should be given priority, encouraged, and expanded. Basic
education is useful both to the society at large and to the
individual, for it has economic, social, and political benefits.
It has a critical role in providing a productive labor force that
is essential for development.
 Basic and universal primary education abolishes earlier inequities and
enables citizens to participate in the democratic process. Further, it
contributes to agricultural development, to family life, health care,
nutrition, birth control, and the proper nurture of children.
 The education finance strategy has taken all the above into account.
Up to the present, the government treasury is still the primary
financial source for education. Given the social utility of basic
education and its contribution to the improvement of the society's
living conditions, it is proper that it is provided free of charge.
 The costs for tuition, educational materials, books purchase,
administration and infrastructure are so high that it is unrealistic to
expect the student to cover them. The most important consideration
has to be the allocation of government finance on the most important
and timely needs of the society.
 The priority for government financial support will be up to the
completion of general secondary education and related training
(grade 10) with increased cost sharing at higher levels of education
and training.
 D. Describe and explain the major problems educational financing in
Ethiopia?
According to the findings of the current studies the major problems of
educational financing in Ethiopia were:
 shortage of budget is a common problem faced by the O-class program

which in deed requires the immediate attention of the Government.

 Over reliance on development partners for funding;

 lack of transparency in the allocation of budget;

 lack of accountable system in the utilization of the budget;

 inadequacy of the budget allocated to schools;

 highly centralized system of government financing;

 limited participation of the community in funding schools.

 Even if for secondary and preparatory school the budget accounted for

roughly 20% of total government spent, the required budget to the

sector needed additional financial and in-kind contributions from
international partners, NGOs and community contributions ,and Yet, a
high quality education demands more resources than that.
5. What determine the share of education budget from the GDP of a
nation (relate to Ethiopia)? How about the share of education budget
from the public expenditure? What share of the education budget of the
regional state is covered by the Federal government?
 Out of the internationally agreed targets set out by the Education

for All (EFA) coalition, Ethiopia meets the target on education

expenditure accounting for 20 per cent of total government
expenditure, whereas it is yet to meet the international target for 6 per
cent of GDP being allocated to education
 For example, in 2015/16, the aggregate expenditure in the education

sector was Ethiopian Birr (ETB) 67.9 billion in nominal value and
ETB 16.8 billion in real terms, at 2006/07 prices (Figure 4)9.
Compared to the spending levels in 2007/08, expenditure in nominal
and real terms grew at an average rate of 27 per cent and 8.3 per cent
respectively
 In terms of types of expenditure, spending in the education sector
remained predominantly recurrent in nature. Over the last decade,
nearly 62.6 per cent was on average allocated to finance recurrent
education expenditure (Figure 8). Salaries and non-salary recurrent
spending, including textbooks and teacher training, account for the
bulk of education recurrent expenditure. The remaining 37.4 per cent
was on average absorbed by capital education expenditure. In the
presence of competing investment requirements in other sectors such as
transport and energy infrastructure, the GoE has remained committed
to maintaining its large capital education expenditure that has more
recently been driven by the construction and expansion of universities.
 At the regional level however the composition is different. The bulk of
regional governments’ education expenditure is allocated to finance
recurrent education expenditure (Figure 11). Salaries, textbooks and
teachers’ training account for a substantial part of regional recurrent
education spending, while capital spending at the regional level has
stagnated, reflecting the policy to mobilize communities’ contribution
for primary school construction and expansion.
6. Read the MoE guideline of educational organization, finance and
community participation. Analyze issues that are related financing and
describe its economic implications in details
 Communities and PTAs are playing important roles in all aspects of

education from generating resources to managing schools. Resources

are mobilized for purchasing basic equipment and materials, hiring
contract teachers, and building classrooms and schools.
 PTAs are active in raising the awareness of the general community on

the benefits of education and in encouraging parents to send their

children to school so as to increase access and reduce dropout. PTAs
are involved in school management, preparing annual plans and
follow-up disciplinary cases.
 Hence, communities are funding new school buildings, building

teachers’ houses, running non-formal education initiatives, and

encouraging girls to go to school and be retained in school until they
complete a given level of education. However, PTAs and communities
still need further capacity enhancement in order to enable them to
carry out the quality of support that schools need to help them
function as desired.
 The 2002 guideline, which is under implementation, clearly defines
the duties and responsibilities of each stakeholder in the education
sector. It also highlights each stake holder’s accountability at each
level. As a result, the last two years have shown an unprecedented
community turn-out, not only in raising funds and constructing
classrooms, but also in owning and managing the development of
education in their respective communities.
 Education and training boards and PTA’s have become instrumental
in lowering dropout and repetition rates and restoring good discipline
in schools. community involvement will go beyond financial, material
and labour contributions; communities will be expected to exercise
leadership, participate in school management in such a manner that it
reflects their ownership of the school.
 In this context, the communities will continue to contribute to
financing education, in particular through support to low-cost
classroom construction through provision of local materials and
labour.
 The community may also, based on its ability and development level,
help out with non-salary recurrent expenditure.
7. Read GTP I and II documents and try to single out the focus to
education. Do not forget to relate to the essence of economics of
education and its implication to the sector
GTP I
 Enhancing expansion and quality of social development

 Expanding human capital and improving human development

outcomes is still a central pillar strategy of Growth and

Transformation Plan. The Government has been taking measures to
improve the human resource development as healthy, productive,
and trained human resource is essential for the implementation of
government policies, strategies and programs. The main ingredients
of this pillar are higher education and adult education, better primary
health care, better and closer access to safe water and sanitation
facilities, halting the spread of HIV/AIDS and other infectious
diseases, better food security and nutrition, and housing conditions.
 Education and Training:
 In order to build on the progressive achievements in this regard, the
Government will increase its efforts in human resource development
through improving access and quality of education in the next five
years. In terms of improving access to education, efforts will be made
to gradually address issues that limit children in particular girls and
women enrollment.
 As for improving quality of education measures will be taken to
address the shortcomings through increasing the number of teachers
and schools. The Government will enhance the implementation of
General Education Quality Improvement Program.
 The TVET System will continue to serve as a potential instrument for
technology transfer, through the development of occupational
standards, accreditation of competencies, occupational assessment
and accreditation, establishment and the strengthening of the
curriculum development system. TVET institutions will serve as the
centers of technology accumulation for MSEs.
 A cost effective and participatory early childhood care and education
will be expanded in both formal and non formal delivery mechanisms.
The education strategy for children with special needs will be fully
implemented to meet the needs of this group. Further, functional adult
literacy will be expanded across the country.
 General education
 The initiatives, already in place to expand basic educational services to
all and achieve the MDG goals, will be strengthened. A cost effective
and participatory early childhood care and education (ECCE) will be
expanded in both formal and non-formal delivery mechanisms.
 The role of the government will be to facilitate policy based services,
such as, supervision of quality, support of materials, development and
provision of curriculum, standards, guidelines, provision of ECCE
classrooms, and space within formal primary schools for community
driven programs, etc.
 Ensure equitable access to quality primary education (EFA) will be
continued and strengthened. The gender disparity will be eliminated
by the end of the plan period. The education strategy for children with
special needs will be fully implemented to meet the needs of this group.
 Improving and ensuring the quality and efficiency of education at all
levels. To realize this priority, the General Education Quality
Improvement Package/GEQIP will be fully implemented. Its
subsequent impact in improving student achievement (in terms of
knowledge, skill and attitude) will be verified through regular
monitoring and evaluation schemes; and through the National
Assessments of Student Achievement conducted every three years.
The findings of which shall serve as inputs to further enrich GEQIP
and achieve excellence access to quality education for all.
 Functional adult literacy (FAL) will be expanded to all regions. Youths
and adults within the 15-60 age range would participate in the
program as per the FAL strategy.
 Technical and Vocational Education and Training/TVET
 A quality and efficient TVET system will be established through full
implementation of the TVET strategy. As a result, Government
investment will be strengthened and cooperative training will be fully
implemented in order to ensure provision of middle level human
power that will satisfy the national labor market.
 The TVET System will continue to serve as a potential instrument for
technology transfer, through the development of occupational standards,
accreditation of competencies, occupational assessment and accreditation,
establishment and the strengthening of the curriculum development system.
TVET institutions will serve as the centers of technology accumulation for
MSEs. Rigorous and regular monitoring and evaluation will be carried out
amongst TVET institutions; both government and private monitoring will
enable them to ensure the minimum levels of competency.
 Higher Education
 The key priority for higher education during the forthcoming five years will
be ensuring quality and relevance. To this end, the management and
administration system of universities will be improved and strengthened,
and efforts will be made to enable the Higher Education Strategic Center and
the Higher Education Quality Assurance Agency to achieve their missions.
 The performance and implementation capacity of technology institutes will
also be built upon. Adequate supply of university teachers will be ensured
through the implementation of a full fledged teacher development program.
The revised curricula will be implemented in line with critical issues, such as,
instructional process, assessment and examinations and student
achievement.
 The education provided at higher education institution level will be
made compatible with the quantity, type and quality of the human
power demanded by the economy and /or national labour market.
Accordingly, the increase in enrolment in graduate and post graduate
programs will be in line with the 70/30 Program. There will be a
system introduced which will enable universities to raise their own
internal incomes, which in turn, will help them promote quality and
relevance of education.
 There will be a technology transfer-centered research system for
higher education institutions (HEIs). Capacity building will be
undertaken to improve performance, especially of Science and
Technology Institutes and departments in order to make them
support the economic development through technology transfer. In
general, the research system in HEIs will be guided by the role it
plays in the economic growth and development of the country.
 Through continuous support and monitoring, higher education
institutions will be made effective/efficient and have student friendly
environment especially for girls and students with special needs.
 
GTP ll
 The goal of the educational sector plan was to raise the quality of

education and consolidate the expansion of the education service

coverage.
 Hence, to enhance the coverage of general secondary education,

additional secondary schools need to be constructed, while also making

concerted efforts to improve the completion rate of primary education
and thereby also of the student population promoted to join secondary
education. Significant progress has been achieved in the preparatory
secondary education (grade 11-12) during the period under review.
 To improve the quality of education, a host of activities have been

carried out on teacher`s development program, curriculum

improvement, school improvement and expansion and improvement of
information and communication technology.
 There has been a critical problem in reducing repetition and dropout

rates. Therefore, factors behind these generally high student dropout

and repetition rates have to be investigated and addressed during the
second growth and transformation plan period.
 Quality and relevance of the TVET system are still crucial issues that
call for concerted efforts to bring basic improvement during the GTP
II period. In addition, efforts should be made to resolve the flawed
perception towards TVET and address the rent-seeking problems in
the sub-sector.
 To enhance the relevance of higher education to the needs of the
country, 70 percent of undergraduate students were enrolled in
Science and Technology program and 30 percent of them were
enrolled in engineering and technology program. This is well in line
with the policy objective of the government. However, to improve
quality of education farther, the on-going higher education quality
improvement program needs to be fully implemented. In addition, to
link the higher education and training systems with development
activities to keep up with technology development, the momentum to
strengthen existing linkage of university with industries need to be
continued.
8. Describe and explain the focus of ESDP V by focusing on the elements introduced by
describing their financial implications
 The cost of the implementation of ESDP V depends on several factors, which can be

grouped as follows:
 Policy objectives, as translated into targets for admission and internal efficiency

 Assumptions about the use of resources (such as pupil/section ratios or pupil/textbook

ratios)
 Assumptions about the cost of specific items and their evolution over the five year

period (such as salaries)

 The description of the priority programmes has mentioned the various targets. Taking

these targets as a basis, a full cost estimate has been made for ESDP V, by sub-sector
and by category of spending. Subsequently, an estimate is made of available
financing. This estimate is also based on a number of assumptions. This allows for an
estimate of the financing gap to be filled. Much of the financing for general education
is a regional responsibility so it is dependent on the commitment of regions and
wored as to the sub-sector.
 One indicator of future financing is how education financing has progressed over the

life of ESDP IV. The forthcoming Education Public Expenditure Review (2015)
provides some indications of recent financing trends in education. These are:
 a result of the expansion of the system, with school enrolment (up to Grade 12) rising

from 10 million to 19 million .

 Recurrent spending, largely composed of teacher salaries, doubled during this period.
 There was a massive increase in capital spending as construction of the third
generation of universities got under way.
 Despite special attention to education at all levels of government, the sector is likely
to face financial constraints in the coming period due to the visibly rising households
demand for education and increasing unit cost of service provision including
teaching materials and supplies and need to keep teachers in the education system
with good incentives in the face of widening economic opportunities elsewhere.
 The cost of ESDP V depends firstly on its major policy objectives which are translated
into specific targets for admission and internal efficiency.
 Within the government’s overall vision to become a lower-middle-income country by
2025, several key objectives for ESDP V have been defined:
 the achievement of universal primary education by the end of the ESDP V period;
 expansion of secondary education, with a view to achieving universal secondary
education by 2025;
 and the expansion of TVET and undergraduate options to train middle- and higher-
level skilled manpower for a middle-income economy, are among the key objectives.
 The enrolment patterns in upper primary, secondary, TVET and higher education
depend to a large extent on the evolution of enrolment in the early grades.
 They also depend on policy choices made with regard to these higher levels, such as
the transition rate between Grades 8 and 9 and the distribution of students between
TVET and preparatory education after Grade 10.
 Reference
 FEDERAL DEMOCRATIC REPUBLIC GOVERNMENT OF ETHIOPIA EDUCATION
AND TRAINING POLICY Addis Ababa April, 1994
 EDUCATION SECTOR DEVELOPMENT PROGRAM ESDP I (2007-2010) August 2006
TA Number 4754 (NEP) : Preparing the Education Sector Development Program I
 ESDP II of MoE
 MoE. (2005). Education Sector Development Program III (Action Plan). FDRE. Addis Ababa.
 ESDP IV of MoE
 Education Sector Development Programme V (ESDP V) 2008 - 2012 E.C. 2015/16 - 2019/20
G.C.Federal Ministry of Education 2015 Addis Ababa
 MoE guideline of educational organization, finance and community participation , 2002
Addis Ababa.
 The Education and Training Policy and its Implementation Ministry of Education February
2002 Addis Ababa
 Economic Focus Education and Development in Ethiopia Seyoum Teffera* Translated by
Yonas Admassu
 The Economics and Financing of Education (EdPM 614) ; Jeilu Oumer (PhD) , AAU, 2008
Addis Ababa.
 Financing and Efficiency in Education Reference for Administration and Policymaking
MANUEL ZYMELMAN HARVARD UNIVERSITY
 Ethiopian Education Development Roadmap (2018-30)
 Second Growth and Transformation Plan (GTP II: 2016-2020)
 First Growth and Transiformation Plan (GDP I)
 Different Sample Education Materials related to the questions from the web site.
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