Peter and Miriam Cremers were required to subscribe to a refundable "personal nomination right" of HK$75,000 when their son Enzo was granted admission to the Chinese International School several years ago.
Besides paying the money, Enzo was selected on the basis of a half-day observation interview at the age of four.
"I don't have an objection in principle [on schools charging debentures]. I understand schools need to run and that costs money and investment. But in some schools there is a risk that a debenture gives you automatic access to a place and that is a problem," says Cremers.
Cremers raises a valid point, one that is becoming of increasing concern to parents who are reconciling themselves to meeting the exorbitant cost of educating their children.
Most international schools now require students to be covered by one of the several classes of debentures they issue, whose prices have risen significantly in recent years.
In the context of schools, debentures are a long-term debt instrument held by schools until maturity without any return on the capital invested. These instruments are also called capital notes, nomination rights and foundation certificates.
Parents of students can also contribute to the long-term funding of schools via an alternate method called a capital levy. This differs from a debenture in that it is paid yearly and may amount to the same or more than the debenture over the course of the child's schooling and is not refundable.
The primary benefit conferred by a debenture or the levy is the priority its holder gets in the allocation of a school place. Debentures bought by corporations have the highest value and priority because they are transferable to other employees.
Schools claim that all applicants are required to meet their admission criteria, generally written assessments and an interview. But do schools really adhere to the criteria in the face of debenture policies? Demand exceeds supply and some schools' debentures cost millions of dollars on top of exorbitant school fees that are generally set at a level which covers most if not all of the school's running costs.
Local parents who feel the public sector does not meet their children's educational needs and are reconciling themselves to the reality of footing hefty bills to give their children a competitive edge now find themselves facing new concerns.
Are international schools selecting on the basis of social mobility and do debenture policies disadvantage able and more deserving students? Are debenture policies making it possible for less able students from affluent families to secure admission and thus create a less challenging environment for their children? Conjecture will abound as getting answers to these sensitive questions will certainly prove difficult.
Interestingly, the recently published list of Outstanding Cambridge Learners for the IGCSE examination, held in June 2013, again revealed that several international schools with debentures that are among the lowest in Hong Kong had the best results. A German Swiss International School student secured the highest score in Hong Kong across eight IGCSE subjects, which was the distinction achieved by French International School in 2012, and has eight students securing the highest score in the world or in Hong Kong this year. Both Singapore International and Yew Chung International schools' students feature on this list each year. FIS also features on the list of schools with excellent IB results.
This raises the question of whether flamboyant campuses which are paid for by exorbitant debentures provide what parents are seeking for their children - a competitive school with good results and a holistic international education.
While the importance of learning environments is not discounted, to what extent are state-of-the-art facilities necessary in the context of good education for the child of a middle-class parent?
HR professional Shweta Kumar moved to this city from Dubai in 2011. His son was admitted into GSIS after he passed the admission test and Kumar paid a debenture.
Kumar believes the admission process was fair. But while this is encouraging, Kumar makes some astute observations. "I think raising money for education is a challenge everywhere and Hong Kong's process is better than private schools in Britain or the US, [where] parents make 'contributions' which have the same benefits as debentures but are more opaque and [have] no market valuation."
Kumar thinks the admission process in Hong Kong should be "more transparent and non-refundable debentures should be done away with". She adds: "While raising money for education is fair, debentures charged [by some schools] are not justifiable."
Anjali Hazari teaches biology at the French International School