Share of private investments in Kazakhstan's education sector increase

In January-September 2016, private business invested 59.6bln tenge in education that is 20% higher against the same period in 2015 and 87% higher than in January-September 2014.

The launch of the new Governmental Programme on Education and Science Development in March 2016 became a key event in the country's education system. The programme focuses on qualitative management of education and aims at increasing its competitiveness and human capital development. The programme offers some new approaches:

1) Introduction of transparent corporate management principles at all levels of education;
2) Academic freedom will be provided to the universities and colleges beginning from 2017 with the consideration of international accreditation;
3) Public contracts in education and science will be moved to competitive environment (Kindergartens have already shifted to this system; some schools are implementing per capita financing scheme. Full transition to per capita financing will be finished in 2019. Colleges and universities will start using this system beginning from 2017);

At the reboot stage, the government has significantly cut investment tranches in education: by 40% from the national budget and 15% from the local budget. As a result, total investment portfolio in education sector comprised 146.3bln tenge that is 14% lower than in January-September 2015. Meanwhile, private investments in the sector increased hugely.

It is expected that the share of private investments will keep increasing due to launch of partnership projects between akimats (local administratiions) and businessmen. As per the new programme, the responsibility of local executives for implementation of educational projects in PPP format will be enhanced.

Several institutional changes will ensure public sector's interest in investing in education:
1) Investors and institutional stakeholders will be awarded an official status and voting right (through the directors' councils, supervisory boards or boards of trustees);
2) Financial reporting and administrative transparency standards will be introduced by means of transformation of colleges and universities into non-commercial joint-stock corporations;
3) Transparent procedure of election of rectors and managerial staff will be introduced;
Some large companies of Kazakhstan have already joined the process of formation of mutually beneficial consortiums with the universities and colleges. For instance, Pavlodar-based Petrochemical Plant trains its specialists and participates in renovating the laboratories at the Pavlodar State University named after S.Toraigyrov.

The new governmental programme will let expand business opportunities of cooperation:
1) Investors and employers will get a direct competitive access to the formation of in-demand highly-qualified personnel pool by providing colleges and universities with academic freedom in elaboration of their academic programmes;
2) Education market of the country will get more opportunities in increasing the number of foreign students - independent assessment and international accreditation will fully replace governmental one which will considerably broaden the borders of recognition of diplomas and their rating;

Education market demand will be ensured also based on new conditions:
1) Since 2017, school leavers will be able to get blue-collar professions at vocational schools and colleges at the government's expense;
2) The amount of public contract in education will be based on per capita financing in pre-school, secondary, vocational and higher education institutions. It means that the more students are admitted, the more funding the education facilities will receive.