Executive Summary The existence of low-cost private schools providing accessible education to low-income families in developing countries has generated a special interest in research that measures the existence of such schools in Indonesia. Their affordable tuition fees as well as satisfying quality is arguably the better alternative for marginalized families to access formal education since government initiatives on education have limited success in providing good-quality and accessible education. This paper presents an initial study of low-cost private schools in Indonesia and covers the location, cost, and quality of some of these schools. It argues in the end that the government should encourage the creation of more low-cost private schools so that they create a competitive pressure on government schools to increase their performance and their operational efficiency. In 2015, the proportion of private schools in Jakarta reached 57.08 per cent of all of the total of 5.659 schools from primary level to secondary level. Contrary to the popular belief, not all of those private schools are exclusively for the upper middle class. Some of them even play a crucial role in providing formal education to families in impoverished areas. The low-cost private schools are considered accessible by poor parents in terms of their fees, distance, and enrollment requirements. Most of the schools charge inexpensive monthly tuition fees ranging from only Rp.30,000 to Rp.130,000 per student. Besides, the schools are located nearer to the students’ residence sparing their parents from additional transport costs and from worrying about their childrens’ safety when going to school. Enrollment requirements, such as birth certificates and minimum graduation scores for secondary schools, are less strict than in public schools and are another reason why low-cost private schools are considered accessible by Indonesian parents. Meanwhile, the average monthly operational cost per student in low-cost private schools is 34 per cent lower than in public schools within the same districts and low-cost private schools also do not provide lesser quality. Students in schools that were covered in this study had significantly better national exam scores in mathematics and only slightly lower reading skills than public schools. 4 Low-Cost Private Schools in This Study Education is key to improve income and living standards, yet there is no consensus on who should be the primary provider of school education. Some hold the government entirely responsible for the task of providing school education nationwide. Others count on the initiative of individuals and communities. UNESCO statistics show that government expenditures on education as a percentage of GDP in several countries have increased in the last ten years1 but this has not resulted in universal school education in developing countries.2 Governments are trying to fill the gap but public schools are just one provider of school education. Many of the poor send their children to affordable private schools, which often just charge school fees of 1 USD per week. Many countries have experienced a significant increase in the number of these schools over recent years.3 Low-cost private schools are defined as schools that usually charge parents fees for at least part of their running and development costs and they maintain a degree of financial independence from the state.4 Since they serve communities with low-income households their fees need to be small and affordable. Individuals, communities or corporations usually found low-cost private schools for religious, philanthropic, humanitarian or for-profit reasons. Some schools are officially registered or accredited while others are unrecognized and operate unofficially. The recognized schools often receive government subsidies, which blurs the distinction between private and public schools. James Tooley has pioneered studies of low-cost private schools in some African countries, India and China.5 According to his research, parents send their children to these schools, not only for their low tuition fees and the schools’ proximity to their homes, but also because the schools provide better quality of education compared to public schools where teachers’ absenteeism is relatively high. The World Bank reported that, in Africa, teacher-absenteeism rates are 15-25%.6 In Indonesia, teacher absenteeism has significantly reduced over the years but remains around 10% in 2013.7 In 2015, the number of primary and secondary schools in the Indonesian capital Jakarta was recorded at 5.659 schools. These schools provided access to education for 1,783,652 school- age Jakartans. The 3,230 private schools outnumbered public schools and constituted 57.08 per cent of all schools. This number implies that the initiative of the private community has provided access to education for a large number of citizens. Many of the poor send their children to affordable private schools, which often just charge school fees of 1 USD per week. 5 Figure 1 Number of Schools and School-Age Citizens in DKI Jakarta Number of Schools Number of School- No Municipality/Regency Age Citizens Public Private 1 Kab. Kepulauan Seribu 25 1 521 2 Central Jakarta 300 313 163,227 3 South Jakarta 578 699 379,711 4 North Jakarta 307 567 305,841 5 West Jakarta 490 809 424,305 6 East Jakarta 729 841 510,047 Total 2,429 3,230 1,783,652 Source: Ministry of Education and Culture, 20158 An initial study by the Center for Indonesian Policy Studies focused on four districts in Jakarta, namely Tambora and Kalideres in West Jakarta as well as Cilincing and Penjaringan in North Jakarta. The four districts were chosen as they have higher percentages of citizens with incomes below the poverty line, namely 90,900 people in the disctricts in North Jakarta and 83,200 people in West Jakarta.9 Private schools play an important role in providing access to education in the Within these four districts. Out of a total number of 609 schools, there are 374 private schools communities (61.4%) while there are only 235 public schools (38.6%). In other words, private schools are key provider of school education for the majority of the poor. there are usually Most of the schools were initiated by local citizens in order to provide formal individuals education to the communities. Laksa Bhakti primary school, for example, who initiate the was established in 1968 by several private tutors who taught children in their neighborhood in Jalan Bakti in Tambora, West Jakarta. As attendance of their process and learning sessions grew, those teachers were inspired to initiate a school that could the existence of provide formal education to children who mostly come from low-income families. low-cost private Quite similarly, MI Tunas Karya10 was established in 1957 by a leading religious schools is closely figure in the poor and heavily populated area of Sawah Lio in Tambora, West Jakarta. This school went through a similar phase as Laksa Bhakti where the connected to the local community contributed immensely to the school’s main activities. Despite spirit brought its highs and lows, Tunas Karya has become one of the largest Islamic primary schools with 327 students in Tambora. about by these initiators. Indonesian private schools are generally in line with the National Education System Law that gives local communities a right to establish schools in order 6 to provide formal education for their children.11 Within these communities there are usually individuals who initiate the process and the existence of low-cost private schools is closely connected to the spirit brought about by these initiators. Interviews with 64 schools founders scattered in several regions which were considered as slums and remotes areas demonstrated that an important reason why they initiate the schools is because they want to provide accessible education for the children of impoverished households in their neighborhood. This study set out to analyze the role of low-cost private schools in providing access to education, the quality of education provided by these schools and their efficiency in utilizing financial resources. Findings in Jakarta were compared to the situation of 64 low-cost private schools in six different provinces of Indonesia in which the Center for Indonesian Policy Studies conducted a regional survey. Most schools charge monthly tuition fees ranging from Rp 5,200 to Rp 468,000 per student while some even provide their education services for free. Most of the low-cost private schools are registered and some of them are also accredited.12 Figure 2 Surveyed Low-Cost Private Schools in the Six Provinces Regions Number of Schools Aceh 12 Lampung 8 Jakarta 15 Central Java 7 North Sulawesi 12 East Nusa Tenggara 10 Source: Interviews with school principals and managers, 2015 Based on CIPS interview with the school principal of Catholic Elementary School of St. Philipus Tanajea, the school was initiated by a Dutch missionary in 1922, decades before Indonesia’s independence. He wanted to introduce the local people in the hinterland of Flores, East Nusa Tenggara, to formal education. Back in the days, the nearest schools could only be reached by a two-days walk and, even now, the next public school remains 7 kilometers away. Without St. Philipus Tanajea School many parents would have no choice but to ask their children to help them working in the field. Apparently, accessibility is not only a critical matter for the school in Flores but also for others, such as in Bintang Timur Elementary School in Lampung and Darut Taqwa Islamic Senior High School in Central Java. 7 Private Schools in Indonesia According to statistics provided by the Ministry of Education and Culture, there are more public schools than private schools, especially on elementary and junior secondary levels. However, the number of private schools exceeds that of public schools on senior secondary and vocational school levels (see Figure 3).