Costs and financing of education


Financing quality education for all is still far from guaranteed across the world. Maximizing the use of available resources is therefore crucial to reach the fourth Sustainable Development Goal (SDG 4). IIEP-UNESCO experts contribute to the development of tools and methodologies to strengthen analyses linked to the costs and financing of education, and support ministries responsible for education, training, and finance in their decision-making.

At the global level, the share of public expenditure dedicated to education is quite close to international objectives (see graphic). However, these figures conceal significant disparities, since one third of the countries for which information is available do not reach any of the minimum thresholds of commitment, as indicated in UNESCO’s Global Education Monitoring Report 2020.

The implementation of SDG 4 is dependent on the meticulous financial planning of educational policies. This expertise lies at the heart of IIEP’s technical support activities.


Costs and Financing of Education: our four mechanisms

IIEP supports UNESCO Member States in costing and planning their education development plans. Discover our tools and methodologies.

1. Education sector analysis: ‘costs and financing’ section

The sector analysis is the first step in educational planning, as it sets out an in-depth diagnosis of the state of a country’s educational system. It reports on progress made and identifies challenges. At the heart of this analysis, the section dedicated to costs and financing explores the sector’s different sources of financing, the share dedicated to education, and potential margins for progression. It also analyses the cost incurred by each pupil in school for each education level and examines possible efficiency gains.

With this aim in mind, IIEP has participated in the production of a methodological guide, which enables readers to familiarize themselves with the method of analysing costs and financing used in the context of the education sector analysis.

Download the methodological guide

IIEP works hand-in-hand with national teams to strengthen capacity and ensure the autonomy of UNESCO Member States in calculating and analysing the costs and financing of education. Our common objective is to optimize available resources to enable all pupils to enjoy quality education adapted to their needs, and in particular for the most disadvantaged.

Blandine Ledoux, Responsible for activities on education costs and financing at IIEP

2. National Education Accounts

A National Education Account (NEA) enables a complete mapping of financing and spending flows in terms of education in a given country. Through a structured methodology, a NEA can organize a large quantity of data of a very diverse nature, originating from public and private financing. The aim is not only to ensure greater transparency in estimating the volume of resources mobilized for the sector, but particularly to report on their use. It is then a matter of detecting potential levers of optimization and better identifying resources to reach the objectives of SDG 4.

IIEP and the UNESCO Institute for Statistics jointly developed a methodological guide in 2016, with funding from the Global Partnership for Education. Since then, nine countries have benefited from IIEP’s support in completely or partially setting up a National Education Account: Côte d’Ivoire, Guinea, Laos, Nepal, Uganda, Senegal, Togo, Viet Nam, and Zimbabwe.

3. Cost simulation model

A simulation model enables the calculation of costs linked to strategies envisaged in the context of the development or revision of an education sector plan. In concrete terms, it is a collection of interlinked calculation sheets.

This tool enables, among other things:

  • A synthesis of the organization and main interactions within an education system,
  • An estimate of the financial and logistical consequences of policy choices defined in the education sector plan. For example, building classrooms or recruiting teachers.

By comparing anticipated funding needs with the available resources, the simulation enables an assessment of the sustainability of the measures envisaged. This tool can also be used to document and feed into discussions within education ministries, or with other ministries and social, technical, and financial partners.

Our training on the development of simulation models

IIEP offers a specialized course on projection methods and techniques and simulation models. Objective: to offer participants the foundation needed to develop a simulation model autonomously. The priority target audience is staff of ministries responsible for education and training who wish to broaden their skills to strengthen the ‘costs and financing’ phase of the process of sectoral planning. Find out more

4. Link between education planning and budgeting

The dialogue between ministries responsible for education and training and those responsible for finance is sometimes difficult, particularly when there is a need to obtain additional resources to reach the objectives set out in the sectoral plans. Beyond financial negotiations and mediation, which affect all ministries, certain technical considerations can also complicate discussions. Planning and programming tools used on either side rarely interconnect very well, which prevents them from taking into account all the constraints and specificities of each ministry.

IIEP has launched a project that aims to document these difficulties in several countries in the West African Economic and Monetary Union (UEMOA). This study also analyses the implications linked to the transition from budgeting by post to budgeting by programme, which is currently ongoing in the region.

Who finances education?

According to UNESCO, governments account for 79% of global spending in terms of education. Households contribute 20% and donors 0.3% (12% in low income countries). Although household expenses are more difficult to monitor and vary significantly from country to country, they usually represent a much higher proportion of education spending in countries with weak public finance policies. This is a major obstacle to equal opportunities in education.