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An In-Depth analysis of School funding voucher system in Portugal

Once in a while, in Portuguese media, arises the discussion of implementing the school voucher system to fund schools. But what really is a voucher system?
What this system does is to give a state-issued certificate of funding that allows parents to enrol their children in a private school, rather than in a public one.

One of the arguments presented in favour of this is that it not only allows for more options to parents, which is good since with more options it seems that they will never be worse-off, but it seems as well that it is more fair, since parents that have their children in private schools not only pay higher tuitions, but pay taxes as well, which are allocated to public schools. So they fund both private and public schools.

I want to start off by saying this is not the case in Portugal, and it is a big issue regarding equality between schools. This argument is based on the assumption that private schools are only funded by tuitions, donations and other non-public transfers, which is not the case in Portugal. In 2011, for each classroom with at least 22 students, every private school with “Contrato de Associação” received around 85 000€. The only reason for private schools to be state-funded is that if there is no public alternative, which is not the case in the vast majority of the publicly-funded private schools (or schools with “Contrato de Associação”). If people do not want their children to go to public school, they should pay the premium of this choice, and not be funded by public money.

Another argument for this system is that, since everyone can chose any school now, this will create some sort of competition between schools, that may enhance the performance of schools in general. I strongly disagree with this view because it does create some perverse incentives for private schools: Why would a company set up a school in a region of the country that has students with more difficulties (like neighbourhoods with a high percentage of low-income, social-beneficiaries households), if all students get the same amount of funding? Schools of this kind will need the use of more resources (more teachers, psychologists, special language staff, and so on), so the private school would be having more costs than in a region without these problems. This could be partly solutioned by giving vouchers only in the presence of some characteristics regarding the social-economic background of the student, to avoid a very high level of stratification/discrimination between schools.

Other problem can be that really the voucher can lead schools to select students, if you do not promote a first-come, first-served basis. By selecting students, you can create an environment of students with more complicated backgrounds, being relegated to worst schools not only creating a vicious cycle for these students, but creating conditions to undermine public schooling, if this self selection leads to good students moving to private schools. Moreover, it is not easy to find a link between the introduction of school vouchers and better overall results in the educational system, (also suggested by Lass, 2006). Another problem is that there is a high chance that rich families will benefit more (some argue that only rich households benefit) with this measure. The idea is that these parents have more information available, more resources, and thus can make better choices in what concerns the education of their children. For example, Greg Palast (2006) argues that around 76% school voucher benefits in Arizona, were students already attending private schools, prior to the introduction of such a system.

The voucher system is far from being a consensus. It seems to work in the opposite direction of social mobility and equality, which should be, in my opinion, the major role of Public Policy in general, and of Education in specific.

Sérgio Rocheteau #620

Ladd, Helen F. “School vouchers: a critical view.” The Journal of Economic Perspectives 16, no. 4 (2002): 3-24.

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Author: studentnovasbe

Master student in Nova Sbe

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