In wake of the ongoing tax-for-fee reform, ways of funding rural education have changed and investment in rural education has witnessed a huge shortfall.

The reasons leading for this shrinkage are as follows: The allocation of government funds could not make up for the funding gap left by the cancellation of the former educational fees. And schools' extra-budgetary revenues have decreased due to the cancellation of most extra educational charges after the tax-for-fee reform. Furthermore, appropriations from the higher administrative level could not be put in place in time and in full.

Currently educational funds are made up of six parts: Appropriation for the payment of teachers' wages; transfer payments from upper-level governments after the tax-for-fee reform; operational funds comprising miscellaneous fees collected by schools; funds for the renovation of dilapidated school buildings; higher school fees in urban areas; and local educational funds.

Among the six items, teachers' wages and funds for the renovation of dilapidated building could basically be guaranteed. But other funds are used for other purposes or fall short, and are therefore unable to meet demand.

Therefore, a new mechanism that ensures an input into rural education and matches the country's fiscal and rural tax-for-fee reforms should be established.

First of all, the responsibilities of governments at all levels should be defined.

In line with their respective fiscal conditions of governments at different levels, the proportion of educational input should be fixed. And in some underdeveloped areas, a shared responsibility system on educational input is needed. The government should not dodge their responsibility and shift it to the lower levels, which used to be the practice.

Meanwhile, the central and provincial governments should increase their overall input in education.

The management of compulsory education in rural areas should be improved.

Responsibility, rights and interests of governments at the county and township level should be defined. After initiating the tax-for-fee reform, governments at these two levels should make efforts to meet the fiscal demands of local education. Educational funds should be managed in a unified way to prevent it from being diverted to other uses.

County governments should play the major role of ensuring payment of teachers' wages.

Funds for teachers' wages should come from the county governments' budget. And every month the money should enter teachers' bank accounts in time and in full.

A mechanism to assure schools' operational funds for public use should be set up. Standards of operational funds for different types of schools should be examined and fixed. County governments should manage and allocate the operational funds strictly according to standards set by provincial governments.

Apart from fees collected from students, operational funds should be appropriated from the government budget. And operational funds must not be used for other purposes, such as payment of teachers' wages or welfare.

Funds for the renovation of dilapidated school buildings should be guaranteed. Crumbling buildings should be checked out and renovated promptly. Debts from schools' renovation of dilapidated buildings and infrastructure constructions should be paid by county and township governments.

Helping poverty-stricken students should also be stressed. Various channels should be explored to ease the burden of needy students.

Finally, a system of multi-channel funding for education should be set up.

On the one hand, standard charges on students could be raised to a certain extent; on the other hand, poverty-stricken students should be given access to various financial aid and bank loans.

Donations for education from different sources should be encouraged. Various social forces should be encouraged to run private schools. And schools should be allowed to run businesses to raise funds.

(China Daily HK Edition August 28, 2003)