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Corporate Control of Public Education

There is a growing battle to convert Canadas public education system into enterprise opportunities, research labs, training grounds and captive markets for some of the worlds largest corporations. The stakes are high. Private interests are eyeing the multi-billion dollar markets for everything from school cleaning and bussing to building and operating schools, to writing curriculum and funding research. Public education is buckling under the pressure of shrinking funds. And the corporations stepping in to shore up the system are interested in maximizing their earning not students learning potential.

Nowhere is this broad agenda clearer than at the Canadian Education Industry Summit, an annual gathering of education buyers and sellers. On the summit agenda: topics including “The profitable perfect partnership” and “Compelling reasons to invest in the education-for-profit industry.” Literature from last years summit explains that “every 1 per cent shift of public funding to the private delivery sector represents a 12 per cent growth in market share.”

Meanwhile, the shares of gross domestic product and total government spending allocated to elementary and secondary education have shrunk, not grown, over the past two decades. And the average annual growth rate of public elementary and secondary spending has dropped from a rate of 11.2 per cent in 1975-76 to a low of 1 per cent in 1995-96.

Funding cuts from coast to coast have school boards looking for ways to trim their budgets. Twinned with the drive to cut costs by privatizing and contracting out is the loss of democratic control over schools. Elected boards of education are vanishing or being stripped of their powers, replaced by often-inexperienced parent councils or centralized decision-makers at the provincial level.

The Ontario governments funding formula centralizes control of education spending in the province while cutting millions, paving the way for the wholesale contracting out of non-instructional services. While the government claims they havent touched classroom spending, special education programs have been cut, teachers have less preparation time and schools are closing. Albertas school funding makes similar distinctions.

Despite attempts to draw an arbitrary line between classroom and non-classroom spending and activities, a healthy, safe and secure learning experience relies on a well-functioning network of services far beyond the classroom. Contracting out and privatization shred that network, as the experiences of Edmonton and Calgary school boards showed. Wide-ranging independent surveys of schools in both cities found contracted-out custodial services were costlier, left the schools dirtier, created health hazards and raised serious safety issues.

The survey of Edmonton schools, which compared five contracted-out schools with five in-house schools, found a much higher level of staff turnover in the contracted-out schools 500 per cent over 17 months. The turnover, attributed to low wages, benefits and morale, became a security concern for parents, students and teachers who didnt know whether the stranger walking through the corridor was a custodian or not. The contract cleaners left doors and windows unlocked, and didnt check strangers entering the building a regular part of in-house cleaners activities. Researchers reported that “hugely significant” immeasurable qualities such as attitude, pride and ownership made the in-house staff a far better investment.

Dirty drinking fountains and sinks were flagged as serious health hazards in the schools with contracted-out custodians. Principals spent more time supervising the contract cleaners, and teachers resorted to preparing daily lists of deficiencies they noted. And while the in-house custodians needed additional training in managing hazardous materials, the contracted-out custodians scored only 28 per cent in knowledge of WHMIS practises. The report concluded that in nearly every instance, keeping cleaning in house was cheaper, safer and more efficient.

Contracting-out cleaning can open the door to unsafe chemicals. The Edmonton study found contractors were free to choose which products were used in a school. ServiceMaster Canada, with cleaning contracts in schools, hospitals and nursing homes, brings in chemicals and equipment from a ServiceMaster warehouse in Chicago. In one Ontario example, this resulted in chemical containers lacking proper provincial safety labeling and electrical equipment such as floor cleaning equipment that wasnt approved by the Canadian Standards Association.

The drive to reap profits can also lead to safety-threatening corner-cutting when transportation is contracted out. This type of contracting out is happening across the country, including Edmonton. Of the 239 school buses Edmonton police inspected over a period of eight months, only 13 passed. Of the 226 that failed, the police deemed 211 immediate safety hazards due to problems with major systems such as brakes, steering, suspension, exhaust and frame. Fifty were so unsafe they had to be towed.

Transportation is a growing focus, with increasing contracting out in Ontario and Manitoba, and the contracting out of all school bus transportation in Nova Scotia. The key corporate player in this sector, Laidlaw, has consolidated its hold on school buses and is moving into the ambulance market.

Another dangerous trend is public-private partnerships to build schools. P3 schools, or lease-back schools, are most prevalent in Nova Scotia, but also exist in New Brunswick and Ontario. Pilot projects have failed in Prince Edward Island and British Columbia. In Nova Scotia, the governments three-year plan will see more than 30 schools built, owned and operated by private corporations. The government will pay to lease the schools over periods as long as 25 years, and may then buy the facilities. While there is an undeniable need to replace aging and overcrowded schools, P3 schools are politically expedient solutions with a hefty price tag.

The New Brunswick Auditor General recently concluded that the provinces first public-private partnership, a P3 school built in Moncton by the Greenarm Corporation of Fredericton, would have cost $775,000 less if the province had done the work. A substantial part of the higher price tag nearly $400,000 came from the higher rate at which Greenarm had to borrow. A private company cannot borrow as cheaply as government.

While lease-back schools may shift debt off the public books, costs over the long-term increase, leaving taxpayers to pay more than they would for a publicly-built and owned facility. The federal capital cost allowance allows firms to write off 100 per cent of the facility costs. Taxpayers then pay again, through government lease and buy-back payments. In Nova Scotia leases signed to date, the province still bears the responsibility for structural repairs, replacing furniture and equipment and other maintenance costs. These lengthy lease agreements are hard, if not impossible, to break.

Meanwhile, the crucial role of the school as a community hub is corrupted. As public space, schools are used for learning, childcare, community meetings, voting stations even emergency shelters. As a commercial facility, community access is restricted. School boards rent the building for defined hours. At other times, the building owner is likely to charge community groups additional fees. Over time, the school looks more and more like a shopping mall as the cafeteria is replaced with franchise fast food outlets, commercial ventures operate from the building and advertising clutters the corridors.

Ultimately, P3 schools lack accountability and limit communities democratic control over public education. Decisions about where to build schools will be based on the corporations best interests, not what suits students and parents. School boards, where they still exist, will see decision-making powers handed to corporate boards of directors. Good jobs will vanish from communities, replaced by minimum-wage contract workers. Local economies suffer, as in several Nova Scotia cases where corporations building P3 schools bypass local firms, buying construction materials and school equipment in the United States. And all indicators point to corner-cutting in maintenance and other support services, diminishing the quality of education.

Charter schools are another threat to public education. Promoted as an alternative to the public system, charter schools magnify existing inequalities, encouraging further fragmentation of communities and creating a two-tier education system. Public funds handed to the small groups running charter schools are better spent strengthening the public system, rather than providing a premium education to students who come most often from more affluent families.

Exempt from many regulations governing public schools, charter schools are often run by inexperienced, volunteer-run boards rather than school boards accountable to a broader community.

The Alberta charter school experiment has received low marks thus far. The provinces flagship school, Calgarys Global Learning Academy, was closed by the province last May under a cloud of scandal following the suspension of the school principal and a forensic audit. A second charter school in a rural community outside Edmonton also closed its doors after running up a $45,000 debt the government refused to pay unless the school closed and its students moved to the public school system.

In many ways, the post-secondary level mirrors changes at the primary and secondary level. Government retreat from funding and regulation. Contracting out and privatization of services and programs. Shifts in decision-making, with a growing corporate presence on governing boards. A massive increase in user fees. And corporations staking their claims in the ensuing rush to the gold mine.

Between 1993 and 2000 federal transfers for post secondary education and training will shrink by $7 billion. Over the last 10 years tuition fees user fees for public education have risen by an average of more than 150 per cent. The average undergraduate student debt load has ballooned to $25,000. Student financial assistance was privatized in 1995, with the federal government handing administration of the Canada Student Loans program to the banks. With ownership and control of this program in the hands of private institutions, students face interest rates well above prime, more aggressive collection methods and fewer options when repayment is not feasible. The banks also have power to decide who receives loans. Yet with all this power, banks are not required to release statistics on student debt and repayment.

Spiraling tuition fees have reached a national average of $3,200, but many degrees have even higher price tags, as a result of government deregulation. A one-year science and technology MBA at Queens University costs more than $20,000. A 12-week international MBA at McGill costs $78,000. And a Dalhousie University MBA program slated to start in 1999 will cost $38,000 and will be offered in partnership with the private Information Technology Institute. Through the deal, ITI gains credibility, access to taxpayer-funded resources and a $23,000 share of the tuition fees. Medical, law and dentistry degrees are other professional programs with deregulated fees far above the national average. These dramatic increases in user fees further the retreat of public funds from post-secondary education.

Declining federal funding has hurt some of the most vulnerable students. While full-time university enrolment is relatively stable, part-time undergraduate enrolment has plummeted by 24 per cent between 1992-93 and 1997-98. The sharpest drop occurred among students aged 25 to 44. Enrolment for women in this age group fell 31 per cent. Analyzing these figures, Statistics Canada cites research suggesting university funding cuts have led administrators to focus attention and resources on full-time students. In an era where colleges and universities increasingly dance to the tune of corporate pipers seeking well-trained employees, part-time courses are no longer top priority. Part-time students are often among the most in need and least able to afford to attend school full-time, including single parents, working students and mature students looking to re-train and re-enter the workforce after a layoff.

Rising tuition fees also force a growing number of Canadians deep into debt. This is of particular concern to women, Aboriginal people and people of colour, who experience difficulty finding well-paid work. For these and other people, loan repayment can stretch for a lifetime.

A key attraction for corporate involvement is access to publicly-subsidized research labs. Basic research is increasingly taking a back seat to applied research as corporations fund research that will develop a new product or other intellectual property that the funder can own, at bargain-basement prices. These research contracts often sign away dangerous levels of control to the corporate funders, at the expense of academic freedom and the public interest. A recent example is the case of Dr. Nancy Olivieri of Torontos Sick Childrens Hospital who claims that a pharmaceutical company has tried to block her research findings questioning the safety of a new drug.

Corporate interests are also moving onto campus in areas such as cleaning, food services and technical support. The consequences are similar to those at the primary and secondary level: safety is compromised, quality suffers. When Simon Fraser University contracted out security services to save money, it was then required to mount an expensive investigation, hiring a private investigator to look into the theft of computer and athletic equipment. Three contract guards were charged by police with theft.

Private, for-profit training institutes are another threat to universal, accessible post-secondary education. As colleges and universities streamline their programs, private institutes are poised to recruit students eager for a quick fix. These private institutions are also positioning themselves to take over Adult Education programs being cut from public secondary schools. The institutes focus on marketable job skills and career training. Yet their unregulated nature and drive to make a profit make them a bad risk. The recent collapse of the Newfoundland-based Career Academy left students who had paid more than $40,000 in tuition empty-handed and prompted a review of the provinces act governing private institutions. The U.S.-based DeVry Institute, which has degree granting status in Alberta, was recently forced to repay $3.7 million in Ontario student loan funds, and was suspended from both the provincial and federal loan programs. And allegations are flying about another recently-closed private Newfoundland college, with the college owner claiming he bribed government officials to obtain a licence.

Public, free and accessible education is one of the building blocks of Canadian society. Its vital to democratic decision-making and new ideas, a healthy economy, caring communities. Public education must remain in the control of the communities it serves not in the hands of corporations.