FCR(98-99)34

For discussion
on 16 October 1998

HEAD 40 - EDUCATION DEPARTMENT
Subhead 300 Code of Aid for primary schools
Subhead 305 Code of Aid for secondary schools
Subhead 320 Code of Aid for special schools

Members are invited to approve -

1. the disbursement of a special recurrent Furniture and Equipment Grant ranging from $700 to $3,000 per class per annum to all aided schools from the 1998/99 school year; and
   
   
2. delegation of authority to the Director of Education to approve future annual revisions of the rates of the recurrent Furniture and Equipment Grant in accordance with the movement of the Consumer Price Index (A).
   
   

PROBLEM

The existing arrangements for meeting aided schools' requirement for furniture and equipment are unsatisfactory and are not conducive to effective school-based management.

PROPOSAL

2. The Director of Education (D of E), with the support of the Secretary for Education and Manpower, proposes to provide all aided schools with a special Furniture and Equipment (F&E) Grant on a recurrent basis from the 1998/99 school year at the following rates -

• $2,000 per class per annum for secondary schools, practical schools and skills opportunity schools;

• $1,000 per class per annum for whole-day primary schools;

• $700 per class per annum for bi-sessional primary schools; and

• $3,000 per class per annum for special schools.

3. To maintain the real value of the Grant, we propose that the D of E should adjust the rates annually in future in accordance with the movement of the Consumer Price Index (A).

JUSTIFICATION

4. At present, there are different arrangements for meeting the F&E requirement of aided schools. For the majority of schools which have yet to join the School Management Initiative (SMI) scheme, they are not given a dedicated subsidy for buying or replacing F&E. For the replacement of minor items of F&E (i.e. costing less than $3,000 per purchase in respect of primary schools and less than $8,000 per purchase in respect of secondary schools), these have to be met from their recurrent School and Class Grant, and only items on a standard list may be purchased. For major F&E items, schools have to apply for a non-recurrent subsidy from the Education Department (ED) on a competitive basis. In the case of the 30% of schools under the SMI, they receive a specific provision for F&E under their recurrent block grant and have the flexibility to use the provision to buy above standard or non-standard items. This amounts, on average, to $19,680 per primary school and $100,000 per secondary school per year and is considered insufficient to meet their needs, in particular if the schools are older ones. Like the non-SMI schools, they may also apply to ED for a non-recurrent subsidy for larger scale purchases of F&E.

5. The SMI experience suggests that the availability of a reasonable and certain level of recurrent F&E subsidy, coupled with other flexible measures in school management, would be a useful incentive and necessary facility to help schools achieve school-based goals and plan for its future needs. We therefore propose to improve the F&E provision of SMI schools by introducing a special F&E Grant on a per class per year basis. As the non-SMI schools will prepare for full implementation of school-based management in due course, we propose to similarly introduce a special F&E Grant for these schools; the amount of this grant will be the same as that for SMI schools. Both SMI and non-SMI schools may use the proposed recurrent grant flexibly to purchase F&E items to suit their needs. They may also accumulate the unspent balance for future F&E use.

6. Notwithstanding the introduction of the special recurrent F&E Grant, we will continue to allow aided schools to apply for non-recurrent F&E subsidy to meet larger-scale, one-off F&E purchases or other requirements under unforeseen circumstances. To improve its support to schools, the ED will explore ways to streamline and improve the present bidding and administration of the non-recurrent F&E subsidy.

7. To maintain the real value of the proposed recurrent F&E Grant, we propose that authority be delegated to D of E to revise the rates of the grant annually in accordance with the movement of the Consumer Price Index (A).

FINANCIAL IMPLICATIONS

8. Based on the existing number of operating classes of different types of schools, we estimate that the proposal will incur an annually recurrent cost of $30,977,000, made up as follows -

	Estimated number of operating classes	Proposed rate of grant per class per annum $	Estimated annually recurrent cost $
(a) Secondary, practical and skills opportunity schools	9 720	2,000	19,440,000
(b) Primary schools (whole-day)	2 460	1,000	2,460,000
(c) Primary schools (bi-sessional)	9 410	700	6,587,000
(d) Special schools	830	3,000	2,490,000
			____________
		Total	30,977,000
		Say	$ 31 million

9. The rate for secondary schools is higher than that for primary schools since F&E items for secondary schools are more expensive. In recognition of the specialised nature of F&E items for special schools which usually command a higher price, the rate for special schools is the highest among all types of schools.

BACKGROUND INFORMATION

10. The Education Commission (EC) recommended in its Report No. 7 that one of the means to achieve quality assurance in education was for all schools to practise school-based management. Schools should be given greater autonomy in the use of resources and be held more accountable for their performance. In line with this recommendation, we have included an F&E component in the block grant provided to SMI schools. EC envisages that eventually all schools should practise school-based management, and that an improved recurrent F&E Grant should be provided for all schools.

Education and Manpower Bureau
October 1998