Financing Vocational Training in Sub-Saharan Africa. Africa Region Human Development Series.

200 Pages·2012·2.43 MB·English

DOCUMENT RESUME
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AUTHOR
Ziderman, Adrian
Financing Vocational Training in Sub-Saharan Africa.
TITLE
Africa
Region Human Development Series.
INSTITUTION
World Bank, Washington, DC.
ISBN
ISBN-0-8213-5461-2
PUB DATE
2003-00-00
NOTE
l99p.;.Funded by the Norwegian Education Trust Fund
for
Africa.
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Research (143)
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DESCRIPTORS
Access to Education; Comparative Analysis; Definitions;
*Educational Finance; Educational Policy; *Finance Reform;
Financial Support; Foreign Countries; Government Role;
Government School Relationship; *Industrial Training;
Informal Education; *Policy Formation; Private Education;
Public Education; *Resource Allocation; Student Costs;
Training; Trend Analysis; *Vocational Education
IDENTIFIERS
Asia; Best Practices; Latin America; Work Based Learning
ABSTRACT
This document is part of the World Bank's comprehensive study
of post-basic educatioh and training in Sub-Sahara Africa and includes
findings from three short field studies conducted in South Africa, Tanzania,
and Zimbawe in early 2001. Chapter titles are as follows: Executive Summary;
Introduction; Conventional Patterns of Financing Training; Role of the State
in Financing; Finance Flows: Three Scenarios; Development of National
Training Funds; Training Levies; Finance Mechanisms: Augmenting Funding for
Training; Funding Distribution: Transfer to Training Institutions; Enhancing
Enterprise Training; Financing Informal Sector Training; Financing
Mechanisms, Contributing Conclusions: Major Policy Messages.
(The main
objective of training policy was defined as follows: facilitating the
development of effective, efficient, competitive, flexible, and responsive
[demand-driven] training systems to meet national economic and social needs
and the needs of individuals. The following were among the actions
recommended in order to achieve this objective:
(1) diversify sources of
financing;
(2) move toward increased cost sharing, with higher, more
realistic training fees;
(3) develop new funding diversification measures,
including levies on enterprises;
(4) decentralize control over public sector
providers and increase institutional autonomy;
(5) encourage private sector
provision of training; and (6) replace arbitrary, ad hoc funding arrangements
with objective formula funding related to inputs, outputs, and outcomes.)
Twenty-five tables/figures are included. The bibliography lists 59
references.
(MN)
Reproductions supplied by EDRS are the best that can be made
from the original document.
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Mies in the Africa Region Human Development Series
A Chance to Learn: Knowledge and Finance for Education
No. 1
in Sub-Saharan Africa (March 2001)
Une chance pour apprendre: Le savoir et le financement
No. 2
pour l'education en Afrique subsaharienne (March 2001)
Education and Health in Sub-Saharan Africa: A Review
No. 3
of Sector-Wide Approaches (March 2001)
Adult Literacy Programs in Uganda (April 2001)
No. 4
Dynamic Risk Management and the Poor: Developing
No. 5
a Social Protection Strategy for Africa (April 2001)
Financing Vocational Training
in Sub-Saharan Africa
Financing Vocational Training
in Sub-Saharan Africa
Adrian Ziderman
THE WORLD BANK
Washington, D.C.
© 2003 The International Bank for Reconstruction and Development / The
World Bank
1818 H Street, N.W.
Washington, D.C. 20433
Telephone [phone]
Internet www.worldbank.org
E-mail [email protected]
All rights reserved.
4 05 04 03
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1
The findings, interpretations, and conclusions expressed herein
are those of the
author(s) and do not necessarily reflect the views of the Board of Executive
Directors of the World Bank or the governments they
represent.
The World Bank does not guarantee the
accuracy of the data included in this
work. The boundaries, colors, denominations, and other information shown
on
any map in this work do not imply any judgment on the part of the World Bank
concerning the legal status of any territory
or the endorsement or acceptance of
such boundaries.
Rights and Permissions
The material in this work is copyrighted. Copying and/or transmitting portions
or all of this work without permission may be a violation of applicable law. The
World Bank encourages dissemination of its work and will normally
grant
permission promptly.
For permission to photocopy or reprint
any part of this work, please send a
request with complete information to the Copyright Clearance Center, Inc.,
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All other queries on rights and licenses, including subsidiary rights, should
be addressed to the Office of the Publisher, World Bank, 1818 H Street NW,
Washington, DC 20433, USA, fax [phone], e-mail [email protected].
Adrian Ziderman, formerly a senior economist
at the World Bank, is Professor
of Economics at Bar-Ilan University, Israel, and
a frequent adviser to international
organizations and governments on the evaluation and financing of education
and training.
Cover: Instructor Peter A. Makundi teaches diesel fuel injection
at the VETA
Regional Vocational Training and Service Center in Moshi, Tanzania. Photo-
graph by Richard K. Johanson, World Bank.
ISBN 0-8213-5461-2
Library of Congress Cataloging-in-Publication data has been applied for.
Contents
xi
Acknowledgments
xiii
Foreword
xv
Preface
xvii
Abbreviations
Executive Summary
1
23
Introduction
1
24
Training finance: consensus from the literature
26
Approach and methodology
29
Coverage
29
Training for whom?
Training by who&
30
Timing: preemployment, initial, and continuing training
31
Plan of the paper
31
Conventional Patterns of Financing Training
33
2
33
Typology of financing burdens
Shortcomings of conventional training financing
35
Changing roles for the state, enterprises, and individuals
38
39
The Role of the State in Financing
3
39
Training
40
Rationale for government intervention
40
External benefits
Contents
vi
Property rights
41
Market imperfections
42
Inadequate enterprise training
42
Weak private training provision
43
Parity
43
Disadvantaged groups
44
Designing appropriate policy interventions
44
4
Finance Flows: Three Scenarios
47
Conventional training markets
48
Training markets with state intervention
49
Integrated, demand-driven training markets
52
A broader role for sound financing mechanisms
55
The pace of reform
55
The Development of National Training Funds
5
59
Origins and objectives
59
Range of activities
60
Income sources
61
Country examples
62
Disbursement
63
Training provision and disbursement: uneasy bedfellows
66
Governance, control, and stakeholder representation
68
Central issues in governance and control
68
ZIMD EF
70
Stakeholder representation
71
Sectoral funds
72
Sectoral funding in South Africa
74
From training funds to national training authoriiies
75
National skills development coordination in South Africa
76
Training fund sustainability
77
Lessons for policy: identifying good practice
79
Desired objectives for training funds
79
Policy implementation
81
Training funds in selected SSA countries:
organization, funding source, and objectives
82
Contents
vii
89
Training Levies
6
89
Alternative training levy schemes
90
SSA sector levies
91
Payroll levies: revenue generation
92
Levy-grant schemes
92
Cost reimbursement
93
Cost redistribution
94
Levy exemption
95
Payroll levies in SSA
97
Rationale: the benefit principle
98
Coverage
99
Levy income generation
99
Alternative approaches to levy collection
100
Levy collection in SSA countries
105
Payroll levies: an oversheltered source of funding)
106
Lessons for policy
106
Training levies: strengths and limitations
106
Issues in levy scheme design
..
109
Finance Mechanisms: Augmenting Funding for Training
109
Funding augmentation versus funding distribution
110
Funding diversification: alternative approaches
111
Fund augmentation
111
Training levies
113
Provision of training services
113
Cost sharing
114
Matching funds
114
Cost recovery: user fees
116
Trainee loans
117
Income generation by providers
117
Income from production
118
Sale of services
118
Encouraging private provision
119
Measures for building up private training capacity
121
Role of government: four intervention modes
Responding to budgetary pressure: institutional
122
income in Tanzania
viii
Contents
Lessons for policy
123
Scope for funding diversification
124
Diversification mechanisms: strengths and
weaknesses
125
8
Funding Distribution: Transfers
to Training Institutions
129
.
Direct allocation mechanisms
129
Ad hoc funding
130
Input-based funding
131
Output-based funding
132
Composite formula funding
133
Competitive tendering: unifying training markets
134
Indirect allocation: trainee-based funding
136
Vouchers
136
Policy reform
138
9
Enhancing Enterprise Training
141
Direct training subsidies
141
Government grants
versus levy-grant schemes
141
Efficacy of direct training subsidies
142
Levy-grant schemes
143
Training off or on the job?
143
Systems approach versus piecemeal reimbursement
144
Indirect subsidies:
company tax concessions
146
SSA experience with tax concessions
146
Problems with tax-concession schemes
148
Other measures to
promote enterprise training
148
Apprenticeship training
148
Combining the carrot with "ear-stroking"
150
Lessons for policy
151
Mechanisms for encouraging enterprise
training:
strengths and limitations
151
10
Financing Informal Sector Training
153
The informal sector:
a vehicle for employment growth
153
Developing informal sector training markets
154
Departing from traditional training
154
Introducing external training
155
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