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By Curtis Riep - University of Alberta, Canada

Corporate influence in public sector education is on the rise globally, and the Philippines is no exception where government is failing to fulfill its obligations to provide free quality education for all, and instead, is outsourcing private for-profit provision.

Shareholder earnings win the day

Corporate-led privatisations in Philippine education are taking shape in the form of a for-profit chain of low-cost private schools – known as APEC (Affordable Private Education Centers). APEC is a new corporate entity established through a joint venture between two major multinational corporations: Pearson Plc and the Ayala Group. APEC, and its corporate shareholders, intend to capitalise on an overburdened and under-resourced system by selling for-profit education services at nominally low-fees -more than $500 per year- on a massive scale. The vast number of ‘economically disadvantaged’ Filipino youth underserved by public and other private schools represents the target market for APEC.

Low-cost, low quality

Profits accumulated by APEC are the difference in price paid by consumers in the form of user fees and the cost to produce those services, or the cost to educate each student. In an effort to minimise production costs, while increasing profit margins, APEC has implemented a number of cost-cutting techniques. These include a low-cost rent model that involves short-term leases in unused commercial buildings that lack adequate space for libraries, gymnasiums, science and/or computer laboratories.

Although this low-cost rent scheme is drastically cheaper than purchasing land and constructing proper school facilities, quality learning environments are sacrificed. Teachers hired by APEC are also typically unlicensed and, therefore, paid severely low wages. These cost-cutting techniques are intended to minimise operational costs so the corporation can remain financially sustainable and profitable. Therefore, in the business of low-cost private schooling, as one APEC school manger remarked: “sometimes quality is compromised because of the companies’ concern for making a profit.”

Further problematic is the Department of Education’s complicity in this for-profit arrangement, since it has relaxed a number of regulations that govern the provision of basic education so that APEC can implement its low-cost, for-profit schooling experiment with limited governmental restriction.

Students: cogs in the corporate machine

APEC also represents a corporate strategy designed to manufacture cheap and flexible labour required by Ayala and other multinational companies through its provision of privatised basic education that aligns with the labour needs of industry. By reverse-engineering its curriculum, APEC intends to produce graduates of a particular disposition with specific skills, values, and knowledge that can be employed in the global labour market.

In particular, APEC aims to address the skill shortage in the business process outsourcing and call center industry in the Philippines by focusing on English communication skills. In turn, APEC schools involve two forms of privatisation: de facto privatisation, in the form of user fees paid for by students in exchange for basic education, and privatisation that exists because of the increasing private control and influence in the social relations of production. This is demonstrated by the joint venture between Ayala and Pearson that aims to produce a repository of labour with the skills, knowledge and values in demand by industry.

Education corporations increasingly participate in various aspects of educational governance and provision, including the sale and provision of for-profit education services, which undermines the right to free quality education, (re)produces social inequalities, undercuts the working conditions of teachers, and erodes democratic decision-making and public accountability in education.

The proliferation of private, for-profit basic education sold by education corporations, therefore, must be properly regulated by governments in order to safeguard education as a human right and a societal good. The case of APEC demonstrates that education corporations pursue profit-making ventures in countries such as the Philippines where the regulatory environment is weak, making it conducive to private enterprise, and where large numbers of students remain underserved by the existing system.

Moving forward, it is crucial that efforts to curtail the growth of transnational corporate activity and influence in education must address these two issues.

To access the report Corporatised education in the Philippines: Pearson, Ayala Corporation and the emergence of Affordable Private Education Centers (APEC) please go here.