Private schools need tougher oversight
- Ombudsman’s criticism of high private school charges and the hands-off approach of the Education Bureau is right on the money, but fees may drop anyway as expatriate and rich mainland families stay away from troubled city
Hong Kong’s private schools, especially the elite international ones, are not for the faint of heart. They easily cost hundreds of thousands per pupil; and many have charges that add up to millions. They can bankrupt a middle-class family dissatisfied with public schools.
I don’t know why the ombudsman decided now to look into school charges and the priority admissions they sometimes confer. It’s been a long-standing issue but still, better late than never.
When it comes to levying charges, the Education Bureau has long taken a hands-off approach. Its officials seem to take the word “private” too seriously and ignore that most of these private and/or international schools receive indirect subsidies, such as land grants, token land rents and interest-free loans that last many years and can run up to hundreds of millions.
The ombudsman’s report cites one private school that asked parents for an annual capital levy of HK$60,000, a debenture of HK$600,000, or a corporate capital certificate of HK$5 million.
That’s standard practice. The school wasn’t being exceptionally greedy. Some elite international schools charge parents millions for a debenture. Granted, it could be a good investment, at least in the old days when its value tended to go up substantially by the time your child graduated. However, you usually have to share the profits with the school, which then resells the debenture to another family.
The ombudsman criticised the bureau for applying a “liberal approach” based on legal advice from 2002 that considered refundable charges by private schools a “private financial arrangement” and therefore did not require bureau approval.
That legal advice seems to me an excuse. If the government had wanted oversight, it could easily attach tough conditions to land grants and interest-free or low-interest loans.