FCR(98-99)43

For discussion
on 13 November 1998

HEAD 173 - STUDENT FINANCIAL ASSISTANCE AGENCY
Subhead 153 Textbooks and stationery grants

Members are invited to approve an expansion of the ambit of the School Textbook Assistance Scheme to include eligible students in local private schools under the Direct Subsidy Scheme.

PROBLEM

The textbook and stationery grants administered by the Student Financial Assistance Agency (SFAA) are currently only available to eligible pupils in public sector schools. While there is at present an element in the subsidy for local private schools under the Direct Subsidy Scheme (DSS) to enable the schools to provide financial assistance to needy students for the purchase of school textbooks and stationery, such an arrangement is neither satisfactory nor effective in meeting the needs of the students.

PROPOSAL

2. We propose to expand the ambit of the School Textbook Assistance Scheme (STAS) administered by SFAA to include students in local DSS schools with effect from the 1998/99 school year. As a result, the element for textbook assistance included in the DSS subsidy will no longer be provided to schools from the same school year.

JUSTIFICATION

3. Government provides recurrent subsidy to DSS schools based on the school's actual enrolment. The subsidy is calculated on the basis of Government's average expenditure on an aided secondary school place, and includes an element for textbook assistance to help needy students in the purchase of essential textbooks and stationery. As the subsidy element for this purpose only represents an average figure and the provision of textbook assistance to needy students is at the discretion of individual DSS schools, the actual needs of students may not be adequately met through such a school-administered arrangement.

4. To address this problem, we propose to expand the ambit of the STAS to include eligible students of local DSS schools with effect from the 1998/99 school year. This means that needy students studying in these DSS schools may apply directly to SFAA and receive textbook assistance on the basis of their actual needs, as students in other public sector schools do. As local DSS schools no longer have to take care of the needs of their students in this respect, we will remove the element of textbook assistance in their subsidy¹. We do not propose to extend the STAS to students in international schools under DSS as these schools are being phased out from DSS since 1995, following a review of international school places.

FINANCIAL IMPLICATIONS

5. There are currently ten local private secondary schools under the DSS. Based on their actual enrolment as at September 1998, the past take-up rates under the STAS and the Senior Secondary Fee Remission Scheme², and the approved textbook and stationery grant levels³ for 1998/99, we estimate that the proposed arrangement would benefit about 3 700 students in these DSS schools at a full-year recurrent cost of $2.8 million in 1998-99. Since the element for textbook assistance will be excluded from the recurrent subsidy provided to DSS schools, the proposal should broadly be cost neutral.

6. Subject to Members' approval, additional expenditure to be incurred by SFAA in excess of the approved provision for 1998-99 for making textbook and stationery grants to eligible students in DSS schools will be offset by savings from Head 40 Education Department Subhead 325 Direct Subsidy Scheme. We will include sufficient provision in the 1999-2000 draft Estimates under Head 173 Student Financial Assistance Agency Subhead 153 Textbooks and stationery grants to meet the cost of the proposal.

BACKGROUND INFORMATION

7. STAS provides cash grants to eligible Primary 1 to Secondary 7 students in public sector schools (including bought places and caput schools) for purchasing essential textbooks and stationery. A successful applicant receives a full grant or half grant depending on the size and income of his family. We revise the grants annually having regard to the average cost of essential textbooks and stationery required by the students.

Education and Manpower Bureau
November 1998


1. The element of textbook assistance makes up about 1% of the existing recurrent subsidy for DSS schools. At the start of the 1998/99 school year, each DSS school receives, on average, a recurrent subsidy of about $28,000 per student per annum.

2. Past take-up rates of senior secondary students under the STAS are not available as the Scheme has only been extended to Secondary 4 to 7 students with effect from the 1998/99 school year. We have used the take-up rates under the Senior Secondary Fee Remission Scheme as reference for estimating the number of DSS students in Secondary 4 to 7 who might obtain assistance under the STAS as the two schemes adopt the same eligibility criteria.

3. The full grant levels for textbook and stationery assistance for the 1998/99 school year are : Primary 1 to 6 - $1,221; Secondary 1 to 3 - $1,766; Secondary 4 - $1,592; Secondary 5 - $978; Secondary 6 - $1,463; Secondary 7 - $416.