Home Economics & Policy The impact of Lebanon’s economic woes on schools and parents

The impact of Lebanon’s economic woes on schools and parents

Putting a price tag on education

by Nabila Rahhal

Lebanon’s fee paying private schools—which cater to 52.6 percent of the student body in Lebanon or 564,446 students out of 1,073,141 as per the 2018-2019 statistical bulletin compiled by the Center for Educational Research and Development—are in grave danger of falling victim to the ongoing economic crisis plaguing the country. As Executive reported back in August 2019, administrations of private schools had been struggling to accommodate the 40 percent increase in each teacher’s salary—mandated by Law 46 (2017) for public sector employees and applied by private institutions—in an environment where parents were already struggling financially and could not bear a hefty increase in tuition fees.

Given that this was the case before the salary cuts, layoffs, banking restrictions, and increased price of consumer goods witnessed since the last quarter of 2019 to date, as a result of the economic and now coronavirus crises, the situation for parents today and therefore for private schools in Lebanon can only be worse.

Paying the bills

In the early 20th century, schools in Lebanon’s villages were largely free of charge and parents compensated teacher’s efforts in educating their children with home grown gifts such as basket of fresh eggs or a pail of laban (yoghurt), recounts Father Boutros Azar, secretary general of the General Secretariat of Catholic Schools and coordinator of the Association of Private Educational Institutions in Lebanon. The times are different nowadays, he says, as education in Lebanon is governed by laws that regulate private schools’ budgets, teachers’ salaries, and tuition payment terms.

Law 515 (1996) is one such law, which dictates that 65 percent of a private school’s budget should be spent on salaries and the remaining 35 percent on school development (including maintenance and operating costs). Tuition fees are then calculated based on this budget, Azar says, by dividing the total amount over the number of students. The tuition fees payment schedule also falls under this law and says that payment needs to be divided across the three calendar quarters in the academic year (from October to June). Because the school’s budget must be submitted to the Ministry of Education and Higher Education (MoEHE) by January 31 of every year, the first quarter tuition payment is set by Law 515 at 30 percent of the previous academic year’s tuition.

When the price is too high

No matter how they are calculated, the reality is that many parents have barely been able to afford their children’s tuition fees for several years now, as the economic situation in the country gradually declined. “For the past two years, we already had a problem with our financial situation because of low enrollment and because parents couldn’t afford the tuition so tuition collection was low,” says Murad Jurdak, president of the board of trustees of Marjoyoun National College (MNC) and professor of mathematics education at the American University of Beirut, explaining that the school had benefited, back then, from the high interest rates on its bank deposits that allowed the board to dip into emergency funds to close the deficit.

Azar says many schools have tried to keep tuition fees down by eating into the portion of the budget designated for school development. “I strongly believe that, in the past five years, only 10 percent of the schools were able to actually use the 35 percent for development,” he says. “The rest of the schools are reducing that percentage to 30, 25, or even 20 [percent]. Why? So they can maintain tuition fees without too much of an increase. The school sacrificed development needs to keep tuitions down.” Keeping tuition artificially low through eating into the development funds at schools will have likely had an impact of the quality of the education provided.

Despite the above, the academic year 2019-2020 (due to end June 13 as per the latest ministerial decision) may be the toughest year yet, financially speaking, for parents and schools in recent memory. The academic year started with disruptions in learning and school closures, brought on by the onset of the thawra (revolution), and with a tightening noose around parents’ necks as many lost their jobs or saw their salaries cut as the effects of the economic crisis began to accelerate (see Executive’s coverage on unemployment). It also ended with nationwide school closures courtesy of COVID-19 response measures and a shift to distance learning (see upcoming article on distance and online learning).

In this context, settlement of tuition dues further declined, especially in the last trimester when some schools did not have a viable distance learning program. “We did a quick survey of the schools in our network to see what percentage of parents were able to pay the tuition,” Azar says. “By the first quarter, only 36 percent had paid it, 19 percent of parents paid the second quarter [January through March], and corona happened in the third quarter so we don’t expect the outcome to be good. This is not the norm at all.”

The further away schools are from populous cities, the more likely are parents to struggle with tuition payment, says Azar, giving an illustrative example of schools in Zahle having less issues with tuition collection than schools in remote areas of the Bekaa Governorate. In line with Azar, Jurdak says that MNC, located close to the border in south Lebanon, had not been able to collect any tuition fees for the last quarter of the current academic year. 

Distance learning for the past three months did save schools some costs such as electricity and water, according to those interviewed for the article, but not enough to make a big dent in the budget and therefore in the tuition. “Going distance learning would decrease the cost of physical books, transportation, electricity etc, but ultimately the biggest expense of a school are the salaries, which are officially 65 percent of the budget but often go up to 72 percent when you include caisse [the retirement fund] and taxes,” says Shukri Husni, chairperson of the board and director general of the Learner’s World International Schools (LWIS), which operates four schools across Lebanon. “You also still have to pay rent for the school premises regardless of the frequency of usage.” In his interview with Executive in mid-May, Azar says there would be discussions with the parent committees of the schools in his network to see how much can be deducted from the tuition, based on what was saved during the last trimester of the school year, but that the amount is “very minor.”   

A vicious circle

Since tuition fees are the main source of revenue for schools, parents being unable to afford full tuition payments means schools struggle with securing their teacher salaries.

Jurdak recounts how, at first, MNC had just enough cash reserves to afford only 50 percent of their teachers’ and staffs’ salaries from April until the next academic year in September when hopefully parents would be able to pay tuitions again. But then, through fundraising efforts by the board and a donor, they were able to supplement this with an additional LL200 million. “We are very happy to have been able to secure 80 percent of the salaries of teachers and staff from April until September,” he says. “This is something noteworthy because many schools we know of are not able to pay the full salaries for their teachers.”

Indeed, similar to many institutions operating under the ongoing economic crisis, Azar says a portion of schools within their network, which employs a total of 22,000 teachers and staff across its 331 schools, can no longer afford to pay full salaries. “From October to mid-February, when the lockdown started and schools closed, 80 percent of our teachers got 100 percent of their salaries and the remaining 20 percent were getting paid from 40 to 80 percent of their salary depending on the school (some free private schools in our network in the north did not secure any payment, for example, and could not pay their salaries),” he says. “Today this has changed, parents are not paying the full tuition, and this is why we said that for March and April, we will pay an average of 50 percent of teachers’ salaries, again depending on the situation in each school.” Azar could not provide Executive with figures regarding what percentage of schools could afford full salaries.

Teachers’ salaries are not the only expense that schools have to contend with; school resources (text books, tablets, stationary supplies, etc) and running costs factor within the 35 percent of the budget designated for school development. As Husni explains, almost all of these expenses—save for fuel and electricity, which are subsidized—come from imported supplies that are paid for in dollars at the market exchange rate. This leaves schools wondering how they will secure revenue for these costs in the current economic climate. “I assume the financial situation will be worsening over the next five years,” he says. “Let us assume that teachers accept that their salaries will stay the same—which is a loss for them in terms of purchasing power—one would assume, in that case, that tuitions would not increase. But school books and supplies such as stationery items and tablets are imported and paid for in dollars. In this case, you have at least half of the 35 percent that has been multiplied by three. The repercussions of this would mean an additional 30 percent on the school fees. Solve this if you can.”

A big mess

With parents unable to afford an increase in tuition fees and teachers’ salaries rapidly becoming too little to deal with the increased cost of living, private schools are stuck between a rock and a hard place. “Increasing salaries will only deepen the problem and decreasing them is impossible given the fact that there is inflation in the country, so the 35 percent of the non-teaching costs will go up,” Husni says. “You cannot eliminate profit from the private schools because you would remove their raison d’etre. We are going toward a disaster.” 

Azar says the economic situation is affecting everyone. Within the Catholic schools’ network, four schools located in remote areas have announced they will close by the end of this academic year, while schools that cater to medium- to high-income communities such as Collège Notre-Dame de Jamhour have also announced they are struggling financially and might not last beyond this June.

Private school closures have implications not only on the teachers left jobless and the students left scrambling for an alternative, but also to the economy of a community, especially in rural areas. “What will happen to the people who are depending on good schools to stay in rural areas?” Azar asks. “Schools bring economic activity to a village, whether it’s the bookshop that sells school supplies or the furn (bakery) that children buy their manakish from.”

Going public

The financial situation has also led private school students whose parents can no longer afford tuition make the transition to the public school system. Both Azar and Husni separately tell Executive that around 100,000, roughly 14 percent, of students from private schools have moved to the public school system in the academic year 2019-2020 and that double this number are expected to do so the next academic year.

Fadi Yarak, director general of the Ministry of Education and Higher Education (MoEHE), says that no figures have been confirmed yet regarding an influx of new students to public schools and that registration for new students will open at the end of the current academic year in June. Based on the forthcoming numbers, Yarak tells Executive that the MoEHE “is developing contingency plans and will be ready to welcome all students to the public school system if they make the shift.” Examples of elements of this plan, according to Yarak, include a hotline to direct parents to the nearest public school in their area and a strategy to distribute teachers according to areas of the country with the highest student demand.

Some of the educators Executive spoke with believe the situation calls for a restructuring of the education system in Lebanon. “I don’t believe there is still room for adapting to these circumstances—it is time to wake up and smell the coffee,” Husni says. “Private schools will soon not exceed 10 percent of the total schools [in Lebanon]. In other countries, students go to public schools and only the elite go to private schools but here the quality of the public education is so low that most students prefer private schools.” Husni adds that he questions the ability of public schools to develop well-rounded students equipped with 21st century skills.

Azar says that it is high time for a collaboration between private schools and the MoEHE through what he calls a “student card,” which is currently a proposal painted in broad strokes where parents would have access to a predetermined funding amount under the MoEHE umbrella. The card, with a yet to be determined funding mechanism, would enable parents to direct a fixed entitlement to pay all or part of their child’s cost of attendance at either a public or private school of their choice. As the basic cost of education—which Azar estimates to be LL3 to 5 million per school year—will be provided via the card regardless of the school type, parents can use this amount toward paying tuition at a private school if the have the means to cover the school’s additional tuition charges out of their pocket. Private schools would still be free to set their own tuition but parents could use the card to supplement education in more expensive private schools, or find a school where the MoEHE covered amount is enough—Azar says that within his network in 175 of 330 schools the LL5 million per student would be sufficient. Yarak confirms that this idea has been proposed by the Association of Private Educational Institutes but says “it is not as simple as flipping on a light switch” and needs the passage of laws and the securement of a budget.

In the grip of these economic and coronavirus crises, it is difficult to make any solid plans for the future of anything, let alone the future of private education in Lebanon, which has been struggling financially for the past several years. Yet, if the situation continues as is without intervention, Lebanon would be in danger of losing one of its main assets and most successful exports: the brains of its well-educated citizens. The country would also be losing whatever chance it has left to rise out of the economic crisis and build a better nation for the next generation—without schools that teach students not only 21st century skills but also citizenship and tolerance, what hope is there for Lebanon?

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Nabila Rahhal

Nabila is Executive's hospitality, tourism and retail editor. She also covers other topics she's interested in such as education and mental health. Prior to joining Executive, she worked as a teacher for eight years in Beirut. Nabila holds a Masters in Educational Psychology from the American University of Beirut. Send mail

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